United Bank for Africa (UBA) Plc has achieved N76.2 billion Profit Before Tax (PBT) in its audited financial results for the half year ended June 30, 2021.
The performance showed PBT rose by 33.4 per cent compared with N57.1 billion it achieved in the same period of last year.
The bank also showed strength across all major income lines, growing its annualised Return on Average Equity to 17.5 per cent as against 14.4 per cent a year earlier.
The group’s total assets crossed the N8 trillion mark as it soared to N8.3 trillion up from N7.7 trillion at the end of the 2020 financial year.
The results filed with the Nigerian Exchange, showed that the group’s profit after tax stood at N60.6 billion representing a significant rise by 36.3 per cent compared to N44.4 billion recorded in the half year of 2020.
The bank’s gross earnings rose to by five per cent to N316 billion from N300.6 billion as at June 2020.
Customer deposits also crossed the N6 trillion mark growing by 7.4 per cent to N6.1 trillion in the period under consideration, compared to N5.7 trillion as at December 2020.
The Group’s Shareholders’ Funds remained robust at N752.5 billion up from N724.1 billion in December 2020, reflecting its strong capacity for internal capital generation.
The Board of Directors of UBA Plc equally declared an interim dividend of 20 kobo per share for every ordinary share of 50 kobo each, held by its shareholders. The dividend payout is in line with its culture of paying both interim and final cash dividend.
The bank’s soaring performance came despite challenging business and economic environment triggered by global lockdown due to the Covid-19 pandemic.
UBA’s Group Managing Director/Chief Executive Officer, Kennedy Uzoka, was delighted by the bank’s performance.
He said: “This has been a strong first half for us, as global economic recovery exceeded expectations, creating a positive rub-off on consumer and corporate confidence, savings and investment activities. We saw this positively impact our business, as we continued to leverage our key strategic levers – People, Process and Technology, and our Customer 1st Philosophy, to revolutionise customer experience at UBA.”
According to him, the bank’s investment in the Rest of Africa (Excluding Nigeria) continues to yield good results for the group.
“The benefits of pan-African business diversification accruing to the Group is once again evident, with gross earnings and interest income growth of 5.1 per cent and 8.3 per cent respectively, despite the low yield environment in our largest market, Nigeria. We are making remarkable progress on our strategy that is progressively positioning UBA as the bank of choice on the continent, driven by our emphasis on tech-led innovation and best customer experience.”
Continuing, the Uzoka pointed out that the bank recognises the far-reaching effects of the pandemic on businesses globally, and remains focused on its promise to always provide our customers with the best banking experiences possible.
“Our half year 2021 performance reflects our progressive efforts in building on the strong momentum that we started the year with. As a purpose-driven organisation, we remain resolute in our drive for sustained growth in customer acquisition, transaction volumes and balance sheet, as we consolidate our ‘Africa’s Global Bank’ market position in the years ahead, uplifting livelihoods across the continent,” Uzoka explained.
UBA’s Group Chief Financial Officer, Ugo Nwaghodoh, on his part, noted that the bank’s goal is to achieve marked improvement in earnings quality whilst maintaining positive operating leverage as well as top-notch asset quality.
“The Group recorded an Return on Average Equity (RoAE) of 17.5 per cent (from 15.1 per cent in 2020 half year) and a Net Income Margin of 5.8 per cent (from 5.4 per cent in first half of 2020) as we played the volatile yield environment diligently for best return on our interest earning assets. Capital position remained strong, with the capital adequacy and liquidity ratios of 24.9 per cent (22.4 per cent in half year 2020 ) and 58.3 per cent (58.2 per cent in half year 2020) respectively. This is robust enough to support our growth ambitions,” he said.
The GCFO pointed out that even while the operating environment remains largely uncertain and volatile, despite marked improvement from Covid-19 induced macroeconomic stress, UBA will continue to build resilience through its geographically diversified business model to support headline earnings growth for the Group.
“We remain committed to our 18 per cent and 15 per cent respective RoAE and deposit growth guidance for financial year 2021, as we continue to invest in growth opportunities across our geographies of operation, whilst managing capital and balance sheet prudently,” Nwaghodoh stated.
United Bank for Africa Plc is a leading Pan-African financial institution, offering banking services to more than twenty five million customers, across over 1,000 business offices and customer touch points, in 20 African countries. With presence in the United States of America, the United Kingdom and France, UBA is connecting people and businesses across Africa through retail; commercial and corporate banking; innovative cross-border payments and remittances; trade finance and ancillary banking services.
CBN to inject more dollars in banks to increase FX supply
According to ThisDay, senior CBN officials said the apex bank can meet all legitimate transactions channelled through the banks.
The officials explained that the black (parallel) market represented less than one percent of FX transactions and should never be used to determine Nigeria’s dollar exchange rate.
The report stated that the apex bank had met ministries, agencies and departments (MDAs), including airline operators, to stop collecting payment in foreign currencies.
The officials also disclosed that those who collect rent in dollars would be prosecuted, adding that if anyone needed dollars for foreign transactions, they should go to their banks.
“There is no reason for anyone, who needs dollars to go to the black market as long as the person needs dollars for legitimate purposes,” CBN officials told ThisDay.
“Anyone patronising the black market to buy dollars at such rates must be engaged in illegal business because he can get the same dollars from the banks, the CBN, investors and exporters’ window at much lesser rates.
“So, what is the reason they’re going to the black market? Let those going to black market illegally desist from doing so.
“Their banks will sell them dollars through any of the approved channels. If anyone is refused, he/she should come out openly to report the bank. We will deal with the bank.
“For instance, agencies like the Nigeria Ports Authority and others that request some customers to pay dollars have been asked to stop such forthwith.
“Also, agencies such as the Federal Airport Authority of Nigeria (FAAN) or airline operators involved in charters and international airlines tickets must all be done in naira, as long as they are in Nigeria.
“Traders who go to the black market will lose their capital as their replacement cost can never be matched in the black market because their import will always be too expensive so they had better look inward and begin local production.
“Manufacturers too should reduce their overdependence on imported raw materials in production as we build an economy, where most raw materials would be sourced locally.”
In July, CBN stopped the sale of FX to Bureau De Change (BDCs) operators in the country. It then directed deposit money banks (DMBs) to set up teller points to meet legitimate forex demands.
The Economic and Financial Crimes Commission (EFCC), on Wednesday, warned banks against selling foreign currencies to customers with no intention of travelling outside the country.