UBA records 44% profit growth in the third quarter of 2015 as earnings hit N247.2 billion during the period
Smarting from the consistently favourable performance recorded in the capital market since the year, United Bank for Africa (UBA) Plc, yesterday, released an impressive result of its performance for the third quarter.
The bank’s stock has been investors’ toast in the daily trading activities on Nigerian bourse for three quarters running. The Pan-African financial services group, in its 9 months unaudited financial results for 2015 published yesterday maintained a strong showing as it recorded 44% rise in profit after tax (PAT) to N48.6 billion and a 17% rise in gross earnings to N247.2 billion.
Analysts had predicted that UBA would publish an impressive result in the third and fourth quarters given the active trend in its equities in the stock market since the beginning of the year, and the robust standing it maintained in the first half-year result.
Aside impressive PAT and earnings results, the third quarter also shows a strong Net Operating Income (NOI) growth of 21% to N167.4 billion. The bank explained, with satisfaction, that the cost to income ratio remained within management’s guidance of 65%, compared to 68.7% in the corresponding period of 2014. This was achieved on the background of the bank’s determination to focus on improving operational efficiencies, with the aim of delivering superior return to its shareholders.
In other indices, UBA closed the third quarter with total assets of N2.87 trillion, loan book of N1.01 trillion and a deposit base of N2.18 trillion.
Commenting on the result, the UBA Plc Group Managing Director/CEO, Phillips Oduoza, said the bank had sustained its financial performance in 2015 as it significantly leveraged the unique pan-African platform enjoyed by the lender among other opportunities.
“We have continued to sustain our financial performance in 2015, leveraging our unique pan-African platform and the strength of our committed work force in gaining competitive edge in the market place”, Oduoza said.
The Group MD/CEO also attributed the impressive performance of the Bank to enhanced balance sheet efficiency and improving extraction of value from the Bank’s channels. “We have also maintained our discipline on how, where and with whom we do business and I am happy with the results, as reflected in our earnings and asset quality” the bank’s chief executive added.
Further analysis of the result shows that UBA, under the review period, maintained a Non-Performing Loan ratio of 2.1% and 0.6% cost of risk, which are amongst the lowest in the banking industry.
Highlighting some of the significant achievements in the third quarter, Oduoza further disclosed that UBA led a consortium of local banks to facilitate a USD1.2 billion syndicated facility for the National Oil Company in Nigeria, NNPC. Further reflecting the strength of the Bank, Global Credit Rating (GCR) affirmed UBA’s AA- (LCY) and BB- (FCY) credit ratings.
Also speaking on the results, the Group CFO, Ugo Nwaghodoh noted that the Bank’s entrepreneurial persistence continues to yield results as the Group increasingly extracts synergy opportunities across its African network.
“Our business in Africa, excluding Nigeria, contributed a quarter of our profit after tax in the period; a resounding benefit of our geographic diversification” said Nwaghodoh.
He assured that the Bank is encouraged by the improving performance metrics, assuring “we will not relent on our commitment to achieving desired scale, size and profitability in all our chosen markets.”
He explained that the Group’s balance sheet remains strong, with a 20% capital adequacy ratio and 49% liquidity ratio, noting that UBA will continue to balance the quest for earnings and growth, with the best sustainability principles.
Commenting on the report, CEO, Sofonix Investment & Communication, Sola Oni, said it shows a positive signal that would mitigate the anxiety created by the lull in the economy. “UBA impressive third quarter report shows a positive signal despite the lull in the economy. However, the year-end accounts would show the actual performance of the bank,” one said in an sms to The UNION yesterday.
Sir Sunny Nwosu, National Co-ordinator, Independent Shareholders Association of Nigeria (ISAN) described the result as encouraging and said it signals hope that the trend would continue through the last quarter.
“The result shows that UBA is on course; meaning that the shareholders look forward to enhanced dividend at the end of the financial year,” said Boniface Okezie, President, Progressive Shareholders Association of Nigeria(PSAN).
– Sam Diala