H1 ’24: UBA declares N2 interim dividend as earnings hit N1.37 trillion

United Bank for Africa Plc will pay an interim dividend of N2 per share for the first half of 2024 (H1 2024), as the bank’s gross earnings grew by 40 per cent year-on-year to hit N1.37 trillion during the half-year.

The bank recorded a pre-tax profit of N401.6 billion, a marginal 1% decline from the N403.6 billion posted in H1 2023. The bank posted a profit after tax of N316.4 billion for H1 2024 representing a 16 per cent year-on-year decline from the N378.2 billion posted in the corresponding period in 2023.

However, the banks’ shareholders funds increased by 47 per cent from N2.03 trillion in December 2023, to N2.99 trillion.

During the period under review, UBA enjoyed a bumper surge in interest income, as it recorded an interest income of N1 trillion, which marks a whopping 134% year-on-year growth from N428.3 billion posted in H1 2023. However, there was a 77% year-on-year decline in the group’s net trading and FX gains to N98.2 billion, from N418.3 billion as of H1 2023.

The group posted a net interest income of N674.6 billion, marking a 143% year-on-year growth from the N278.1 billion posted in H1 2023. There was also an 85 per cent growth in the net fee and commission income to N145.1 billion, from N78.3 billion as of the corresponding period in 2023.

In line with income growth, there was a corresponding growth in expenses, as the group’s employee benefits expenses jumped by 93 per cent year-on-year from N69.4 billion as of H1 2023 to N133.9 billion as of H1 2024. UBA spent N126.6 billion on the payment of wages and salaries during the six months, in contrast with N65.9 billion spent in H1 2023.

There was also a 122 per cent growth in the bank’s operating expenses to N312.4 billion, from N140.9 billion as of H1 2023. The bank spent N47.9 billion on fuels, repair, and maintenance, which was 219 per cent higher than the N15 billion spent in the first six months of 2024.

Commenting on the group’s result, Oliver Alawuba, the Managing Director of UBA Plc noted, “The Group’s performance has been buoyed by consistent strong growth in all core and sustainable banking income lines.”

He also noted that in their bid to acquire more customers, the bank has invested heavily in technology, data analytics, and product innovation to improve their services and customer experience.

During the half-year, UBA’s total assets grew from N20.7 trillion to N28.3 trillion. Loans and advances to customers grew by 30 per cent to N6.8 trillion during the six months, from N5.2 trillion at the start of the year, while its investment securities grew by 48% to N4.6 trillion from N3.1 trillion. UBA’s customer deposits grew by 35% to N20.1 trillion, from N14.9 trillion at the start of the year.

Ugo Nwaghodoh, the Executive Director of Finance & Risk at the bank expressed delight at the milestone achieved by the bank in driving operational efficiency, as reflected in cost-to-income ratio normalizing around the 50% range.

“Our cost optimization provides scope for further moderation, as we explore options towards a drastic reduction of our foreign currency denominated cost components, robotizing and automation of processes and application of artificial intelligence to our operations.”

“The Group has made significant progress and is on course to shore up its share capital to support its medium to long term aspirations, whilst aligning with the recent regulatory requirement in Nigeria and other jurisdictions. that we operate in,”

Details from the bank’s cash flow statement show that the bank received N361.8 billion as proceeds from its borrowings, however, it spent N601.5 billion on the repayment of principal and interests during the six months.

In line with the bank’s culture of paying both interim and final cash dividends, the Board of Directors of UBA Plc has declared an interim dividend of N2.00 per share for every ordinary share of N0.50 each held by its shareholders, representing a 300% increase compared to the N0.50 declared in the similar period of 2023.

United Bank for Africa Plc is a leading Pan-African financial institution, offering banking services to more than thirty-five million customers, across 1,000 business offices and customer touch points in 20 African countries.

With presence in New York, London, Paris and Dubai, 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.