Union Bank of Nigeria’s profit before tax in the first half of 2024 increased by 20 percent to N79.8 billion, up from N66.5 billion reported in the same period of last year.
This was driven by the bank’s gross earnings, rising by 58 percent to N333 billion during the half year ended June 30, 2024, from N210.5 billion reported in the corresponding period of 2023.
Yetunde B. Oni, managing director and chief executive officer of the Bank, said in a statement: “I am pleased that Union Bank of Nigeria has delivered a progressive financial performance in the first half of the year, with a significant boost in Net Interest Income, Net Operating Income, and Net Trading Income.
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“At the beginning of the year, our top priority was to keep the momentum going with a strong focus on stability following the intervention of the Central Bank of Nigeria. We also continued with the planned strategic priorities, which are centred around scaling our digital play, driving hypergrowth in target sectors, optimising our wholesale bank structure, aggressively ensuring recoveries of past-due obligations, and orchestrating a robust ecosystem play through existing and new partnerships,” Oni said.
The bank reported that its net operating income after Impairments increased by 32 percent to N143.6 billion from N108.5 billion in H1 2023, attributed to enhanced interest income, fees, commissions, and margin expansion.
Oni highlighted the bank’s strategic priorities, which included maintaining stability following the Central Bank of Nigeria’s intervention, scaling digital initiatives, driving growth in key sectors, and optimizing the wholesale bank structure. One key achievement was the successful launch of UnionKash, the bank’s digital lending platform, which has enabled over 14,000 customers to access loans quickly and easily via a USSD code.
Despite these successes, the bank was not entirely shielded from the broader economic challenges. Non-interest income dipped slightly by 3 percent, falling to N108.3 billion due to foreign exchange revaluation losses. Operating expenses also rose significantly by 52 percent to N63.8 billion, driven by inflation, higher power costs, and increased regulatory fees. Nonetheless, Union Bank’s Cost to Income Ratio remained below 50 percent, standing at 44 percent, reflecting effective cost management strategies.
Oluwagbenga Adeoye, acting chief financial officer described the bank’s H1 2024 performance as a testament to its resilience in the face of economic pressures. He noted that the bank continued to grow its loan portfolio cautiously, with gross loans increasing by 24 percent to N1.93 trillion, while customer deposits grew marginally by 1 percent to N2.36 trillion.
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The statement further disclosed that as Union Bank looks ahead to the second half of 2024, the focus will be on improving efficiency and boosting non-interest income.
Oni emphasised the importance of the bank’s ongoing recapitalization efforts, aligning with the CBN’s Banking Sector Recapitalisation Program.
“This initiative aims to strengthen the bank’s capital base and position it to capitalise on emerging opportunities in the market,” the bank’s CEO said.
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