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Unity Bank outlines plans to reverse 9M’23 negative positions

Unity Bank reports N47.91bn loss in Q3

Unity Bank Plc has outlined plans to reverse the record negatives in its recently released financials for the nine months (9M) period ended September 30, 2023.

The bank’s financial results released at the Nigerian Exchange Limited (NGX) show loss after tax (LAT) of N47.917billion, down by 2,461percent from profit after tax (PAT) of N2.029billion in same nine months period of 2022.

While responding to BusinessDay questions on the nine months financials, Unity Bank said they are embarking on recapitalisation of the institution, aggressively driving asset creation, introducing more innovative retail products to compete favourably in new markets, and relentlessly driving pursuit of digital banking innovation in order to shake off and completely reverse negative positions.

The bank also noted that it is enhancing the retail franchise through fintech partnerships, consumer banking and other innovative retail loans, as well as diversification of portfolio investment.

“First, though the Bank has taken a revaluation loss, it will not all materialise at a go. In other words, the liability spans over four years and within the 4 years, an appreciation of the naira against the dollar will reduce the gap.

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“Our foreign exchange earnings on our offshore investments will have a knock-on effect on the FX liability. Our investment is in positive and in favour of the Bank. Consequently, it will be revalued and have a positive impact,” Unity Bank further said.

“Aggressive income generation on treasury assets following the liberalisation of the interbank market will also have a positive impact that will materially reduce the gap. The creation of quality risk assets many of which are already being executed will ameliorate the gap,” Unity Bank said, adding that it is focusing on its efforts to recapitalisation of the institution.

“The Bank is fast tracking its retail strategy with particular emphasis on the SME space and the ever-important youth segment to accelerate the Bank’s deposit growth and retail assets such as Naira credit cards as well as incredibly successful Unity pay Loan scheme. The Bank is relentlessly pursuing investment in digital Banking to drive innovation, enhance volume, value and fee income. The Bank is enhancing its retail franchise by leveraging its expansive Agency Banking network to drive increased revenue,” it noted.

The bank’s earnings per share (basic) is in negative of 546.56kobo as at 9M’23 as against 23.15kobo earnings per share reported in 9M’22.

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The share price has surprisingly risen by 74.5percent year-to-date (YtD) to 96kobo, even outperforming the NGX All Share Index (ASI) which closed same Friday November 3 at with year-to-date (YtD) return at 36.97percent.

Unity Bank reported Foreign Exchange (FX) revaluation loss of N38.162billion, an increase by 70,565percent from N54.005million Foreign Exchange (FX) revaluation loss it recorded in nine months to September 2022.

Unity Bank provides banking and other financial services to corporate and individual customers. Such services include but not limited to granting of loans and advances, corporate banking, retail banking, consumer and trade finance, international banking, cash management, electronic banking services and money market activities.

United Bank’s gross income of N38.183billion in 9 months to September 30, 2023 represents a decrease by 10percent, from N42.292billion gross income in 9M’2022.

Its net interest income (NII) of N9.470billion in 9M’23 as against N14.527billion in 9M’22 represents a decline by 35percent.

Loss Before Tax (LBT) printed higher at N47.726billion in 9M’23 as against N2.206billion profit before tax (PBT) in 9M’22, down by 2,263percent.