Caption: Oliver Alawuba, Group Managing Director/Chief Executive of United Bank for Africa (second left) displaying his plaque as Independent Banker of the Year 2024 bestowed on him by Independent Newspapers Limited after the receiving the award in his office on Monday. He is flanked by the Chukwuma Nweke, Deputy Managing Director/Group Chief Operating Officer (left); Steve Omanufeme, Managing Director/Editor-in-Chief, Independent Newspapers Limited (middle); Muyiwa Akinyemi, Deputy Managing Director of UBA Plc (send right) and Mrs. Alero Tolu-Ladipo, the Group Head, Marketing & Corporate Communications at UBA Plc.
The United Bank for Africa Plc, on Monday became the first among its peers to file its audited financials for the year ended December 31, 2024, highlights of which included the 53.6% jump in gross earnings, with the African business contributing 51.7%, just as Profit After Tax rose 26.14% up, despite what the group said was the highly challenging global economic and business environment.
Gross earnings rose significantly from N2.08tr to N3.19tr in the period under consideration of which interest income contributed N2.370 trillion, compared to the previous year’s N1.075tr. A breakdown of the figure showed that interest income was significantly driven by N678.44bn from investment securities (Treasury Bills), up from N242.236bn; while bonds contributed N449.098bn, as against N258.845bn. Interest on term loans to corporate grew from N569.142bn from N269.217bn; while loans on overdrafts contributed N138.808bn, up from N89.827bn.
Interest expense amounted to N839.25bn, up from N367.807bn; resulting in net interest income of N1.53tr, up from N707.54tr, boosted by interest on deposits from customers amounting to N456.609bn, against the previous N246.488bn; deposits from banks, N196.634bn from N52.051bn; while borrowings rose from N66.909bn to N180.558bn.
Impairment charge for credit losses on loans rose from N144.049bn from N216.967bn, which was mitigated by the N54.641bn recoveries in allowance for credit loss, which grew significantly from the previous N15.891bn; net impairment charge for credit losses on other financial assets dropped from N62.583bn to N17.553bn; just as modification loss on purchased or originated credit impairment stood at N19.045bn. These left net interest income after impairment on financial instruments at N1.277tr, compared to the previous year’s N500.908bn.
Fee and commission income for the year amounted to N589.001bn from N307.313bn, lifted by N236.309bn from electronic banking, up from N125.579bn, followed by N94.765bn from credit-related fees and commission, up from N34.218bn. Fee and commission expense stood at N233.998bn from N118.254bn, driven by the N8.998bn electronic banking expense, which rose from N101.847bn; resulting in net fee and commission income of N355.003bn, up from N189.059bn.
Net trading and foreign exchange gain fell from N659.257bn to N181.762bn; other operating income rose to N46.08bn from N33.469bn, after being impacted by the net fair value loss on derivatives which dropped to N342.205bn from N457.188bn. This was not helped by the foreign currency revaluation gain of N293.085bn, up from N26.582bn; among others. Net monetary loss on hyperinflation dropped to N10.163bn from N32.804bn. Employee benefit expenses increased to N314.66bn from N182.812bn; depreciation and amortisation rose to N48.608bn from N36.596bn; just as other operating expenses increased to N682.91bn from N372.801bn. Profit before income tax N803.726bn, compared to N757.68bn; income tax expense dropped to N37.158bn from N149.984bn; leaving net profit N766.568bn, up from N607.696bn in the 2023 full-year; translating to N21.73 Earnings Per Share, up from N17.49 each.
A breakdown of the figures showed that of the total revenue and net profit, the Nigerian business contributed N1.658tr and N415.886bn; followed by the rest of Africa’s N1.517bn and N426.939bn; while the rest of the world added N258.504bn and N171.565bn respectively. At the end of 2023, UBA Group’s Nigeria recorded N1.354tr and N519.195bn in revenue and net profit respectively; with the rest of Africa accounting for N767.482bn and N152.5bn; while the rest of garnered N161.197bn and N99.175bn respectively.
Reporting the 2024 audited numbers according to strategic business units showed that Retail & commercial segment yielded N1.363tr and N307.629bn to the group’s revenue and net profit; ahead of the corporate segment’s N1.078tr and N394.512bn respectively; while the treasury and financial markets accounted for N1.086tr and N416.794bn.
At the end of 2023, UBA Group’s retail and commercial business pooled N625.381bn turnover and N7.73bn loss; while corporate banking business recorded N494.629bn in turnover and N160.714bn net profit; while treasury and financial markets contributed N496.188bn and N139.47bn turnover and profit respectively.
According to the result filed with the Nigerian Exchange Limited (NGX), Total Assets rose by 46.8% from N20.65tr in 2023 to N30.4tr; signifying a milestone leap for the bank with the largest spread across the continent. A breakdown showed customer loans and advances of N6.954tr from N5.228tr; just as cash and bank balances closed at N8.163tr from N6.069tr. Total liabilities rose to N26.904tr from N18.623tr with customer deposits soaring from N14.891tr to N21.894tr.
Shareholders’ Funds rose from N2.03tr in December 2023 to N3.419tr, representing an impressive growth of 68.39 percent.
Following from the impressive performance and in fulfilment of the promise made by the Group’s Chairman, Tony Elumelu, to shareholders at the last Annual General Meeting, the UBA Plc proposed a final dividend of N3.00 kobo for every ordinary share, which brings total payout for the year to N5.00 for ratification by the shareholders during its upcoming Annual General Meeting (AGM).
When approved at the AGM slated for April 25, 2025, the dividend will be paid electronically to those shareholders whose names are on the company’s register at the close of business on Friday, April 11, 2025.
Commenting on the resulting, the Group Managing Director/Chief Executive Officer, Oliver Alawuba, while expressing excitement, said the scorecard demonstrates a continued focus on driving earnings growth, preserving asset quality, expanding business operations and deepening market share.
“Our continued investment in our highly diversified global network allows UBA to deliver high quality, consistent earnings. Our businesses have been able to grow product and service income and expand our deposit base, allowing the Group to increase earnings, while maintaining strong spreads and margins,” he said.
Continuing, he noted that “the just released results reflect broad-based growth across all core businesses and were achieved despite prevailing macroeconomic challenges, geopolitical uncertainties, and exchange rate volatilities.”
The GMD expressed excitement at the marked improvement recorded in the bank’s core earnings profile, as he explained that the profit is derived from high-quality income streams from funding intermediation, fees and commissions, thus reflecting strong long-term, sustainable revenues generation capacity.
“Our ex-Nigeria (Rest of Africa & International) operations have expanded significantly over the past five years, now contributing 51.7% of Group revenue, up from 31% in 2019, delivering diversification benefits and further boosting long-term shareholder value. This will continue to grow, as we further explore strategic markets that align with our overall vision. We are currently upgrading our business scope and authorization in France, and considering other viable markets in the short to medium term,” Alawuba noted.
He pointed out the bank’s resolve to invest continuously in technology, data analytics, product innovation, staff training and development, which, according to him, will collectively enhance our customers’ experience.
On his part, UBA’s Executive Director, Finance & Risk Management, Ugo Nwaghodoh, said the bank recorded triple digit growth in net interest income, resulting in remarkable improvement in net interest margin from 6.83 percent in 2023 to 9.02 percent, while also recording strong double-digit growth in fee and commission income lines of 91.66 percent.
“UBA Group continues to demonstrate strong capital levels, with shareholders’ funds growth of 68.4% to N3.42 trillion and a solid capital adequacy ratio of 31.0%., and as we defensibly position the portfolio to navigate prevailing global and regional macroeconomic upheavals, asset quality improved, with NPL ratio moderating to 5.58%, with strong provision coverage at 81%,” Nwaghodoh noted.
He explained that as the bank navigates evolving risks, its management remains focused on responsible growth, delivering customer-focused value propositions, whilst ensuring compliance with regulatory requirements in all jurisdictions.
