United Bank for Africa (UBA) plc has released its audited 2016 full-year results, showing significant growth in gross earnings and profits, an attestation to its resilience, enhanced productivity and geographic diversification, evident in the contribution from its African subsidiaries.
The Group recorded a 22 percent growth in gross earnings to N384 billion, as of December 2016, from N315 billion at the end of the 2015 financial year, illustrating its ability to grow profitability despite difficult macro-economic environment.
In addition to the rising adoption of electronic banking channels in many of the African markets, where it operates, the bank leveraged its franchise and geographical footprint.
As reflected in the results released on March 24, at the Nigerian Stock Exchange (NSE), covering the period January to December 2016, the Group saw a significant 32 percent growth in profit before tax to N91 billion, compared with N68 billion profit recorded over the same period of 2015.
UBA’s profit after tax grew by 22 percent to N72 billion, from N60 billion recorded the previous year. The performance was buoyed by considerable growth in interest and non-interest income as well as increasing efficiency gains from cost management initiatives.
Its subsidiaries outside of Nigeria are increasingly gaining market share, reinforcing the strong and impressive subsidiary contribution to the Group, estimated at one-third of profit in 2016, from a quarter in 2015 financial year.
Following the performance, the Board of Directors proposed a final dividend of 55kobo, subject to the approval of the shareholders at the forthcoming annual general meeting in Lagos.
Commenting on the results, Kennedy Uzoka, group managing director/CEO, UBA, expressed satisfaction at the resilience of the bank, despite the macro-economic challenges in a number of countries where UBA operates.
“Given the operating environment in 2016, I am very pleased with our profitability – an impressive 32% growth in profit before tax to N91 billion – while we have also focused keenly on operational efficiencies, illustrated by the reduction in our Cost-to-Income Ratio,” Uzoka said.
Ugo Nwaghodoh, chief financial officer, UBA Group, said the bank extracted efficiency gains across its operations to boost profitability, confirming that the bank had seen significant improvement across major performance metrics, including an improvement in the net interest margin.
“Our performance in 2016 reflects the strong potential and resilience of our business. We grew top and bottom lines by 22% and 32% respectively, despite the stagflation in Nigeria, our core market. Reflecting improved balance sheet management and better value extraction, our net interest margin (NIM) improved 40bps YoY to 6.7%,” the CFO said.
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