Union Bank Plc, one of Nigeria’s longest-standing and most respected financial institutions, has released its unaudited financial statements for the first quarter (Q1) ended March 31, 2020.
The bank’s financial highlights show a profit before tax went up by 19 per cent to N6.2billion (N5.2billion in Q1 2019). Gross earnings grew 18percent to N42.6billion (N36.1billion in Q1 2019); driven by an increase in earning assets.
Interest income was also up 18percent to N29.7billion (N25.2billion in Q1 2019). Net interest income before impairment rose by 38percent to N14.8billion (N10.8billion in Q1 2019), driven by the growth in treasury assets.
Non-interest income increased by 18percent to N12.9billion (N10.9billion in Q1 2019), driven by robust trading income, growth in e-business and revaluation gains.
Net operating income increased by 7percent to N24.2billion (N22.7billion in Q1 2019). Operating expenses were slightly up 3percent to N18billion (N17.1billion in Q1 2019). Gross loans rose by 3percent to N611.1billion (N595.3billion Dec 2019). Customer deposits increased by 1percent to N897.6bn (N886.3billion December 2019).
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Commenting on the results, Emeka Emuwa, CEO Union Bank said: “Coming off a strong 2019, we maintained a focus on executing our strategic priorities in Q1 2020, delivering double-digit growth across all our major income lines.
Profit Before Tax (PBT) grew by 19percent to N6.2billion from N5.2billion in Q1 2019. Our Gross Earnings are also up by 18percent to N42.6billion from N36.1billion in Q1 2019. Our platforms and channels continue to drive our performance as Non-Interest Income increased by 18percent from N10.9billion in Q1 2019 to N12.9billion for the period with e-business fees contributing N2.1billion, a 71percent growth compared to Q1 2019″.
“The current COVID-19 pandemic presents daunting challenges for the global economy and consequently Nigeria and our business. Our focus in the short-term is on ensuring business continuity through our strong operational risk framework; ensuring the health and well-being of our employees by adopting stringent health and safety protocols at our operating branches and offices; and supporting our customers through the crisis.
“We have reinforced our digital platforms to continue delivering value and convenience to our customers while aligning our focus areas to where opportunities emerge during and post COVID-19.
“We will continue to support the government, private entities, and our communities in the fight against COVID-19,” the CEO added.
Also speaking on the Q1 2020 numbers, Chief Financial Officer Union Bank, Joe Mbulu said: “Headline numbers delivered 19% growth in Profit Before Tax to N6.2billion compared to N5.2billion in Q1 2019.
The 18percent YoY growth in Non-Interest Income was driven by the stronger trading income of N5billion compared to N2.2billion in Q1 2019, e-business income of N2.1billion compared to N1.2billion in Q1 2019 and revaluation gains of N2.7billion compared to N0.1billion in the same period last year.
Our operational efficiency also improved with Cost-Income Ratio declining YoY to 74.3percent from 76.9percent in Q1 2019 as our cost optimisation programme continues to yield results. We have also kept NPL ratios flat currently at 5.9percent compared to 5.8percent as of December 2019.
“While the current COVID-19 pandemic has dimmed the global economic outlook for the year, we will leverage our strong capital position with Capital Adequacy Ratio (CAR) at 19.9percent and our solid risk management framework towards the delivery of our 2020 objectives.”
