UBA Group grows profits by 41% In Q1 2017

United Bank for Africa Group (UBA)’s unaudited first quarter (Q10 2017 results, showing significant growth across major income lines.

The company’s result for the period showed that Its African subsidiaries performed stronger in the period under review, contributing 35 per cent of earnings
The result delivered by the Nigerian Stock Exchange (NSE) on Thursday showed that the Pan African financial institution group, recorded another impressive 41per cent percent year-on-year growth in profit-before-tax in the first three months of 2017.

Leveraging on strong growth in both interest and non-interest income as well as increased efficiency, UBA recorded N25.5 billion in profit before tax in the first quarter, ending March 31st 2017, compared to N18.1 billion achieved in the first quarter of 2016. The

According to the UBA,s Q1 2017 result, the group posted a profit after tax of N22.4 billion in the first quarter, an impressive 32 percent year-on-year growth compared to N17.0 billion achieved in the corresponding period of 2016. The group sustained its strong profitability recording an annualized 19.4% Return on Average equity (RoAE).

Driven by an unprecedented 43% year-on-year growth in interest income, UBA Group recorded a 38% percent year-on-year growth in gross earnings to close at N101.2 billion for the three months period ending March 2017, compared to N73.7 billion recorded in the first three months of the year 2016.

Mr. Kennedy Uzoka, the Group Managing Director/CEO of the United Bank for Africa Group (UBA), expressed fulfilment with the Bank’s impressive performance in the first quarter of 2017, despite intensifying competition and a very challenging business environment.
He said “Our performance in the first quarter of the year strengthens our optimism on economic and business recovery in Nigeria and many of our markets across Africa. More importantly, this result is evidence of efficiency gains in our pricing, balance sheet management and operations,”

“Driven by our balance sheet liquidity, we grew interest income by 43% to an unprecedented quarterly run-rate of N77 billion. Buoyed by improving foreign currency supply in Nigeria, remittance and trade services fees almost doubled and foreign currency trading income grew by 148% year-on-year, as we leveraged our Customer First initiatives to gain market share in these offerings. More so, it is my pleasure to report that we made further progress in our consistent retail penetration, as reflected in the 12% year-to-date growth in retail savings and current account deposits.

Notwithstanding the tight interest rate environment, we recorded a 30bps reduction in cost of funds to 3.4%, a positive result of our customer service-led approach to low cost deposit mobilization. As at Q1, low cost savings and current accounts (CASA) represent 80% of our deposit funding,” Uzoka explained.

He said that the group’s business outside Nigeria continued to wax stronger, contributing 35 per cent, as the group remained prudent in cost management. “Albeit the structural challenges that exist in Africa, the opportunities and returns are immense and compelling. We will deepen our penetration across our chosen markets, as we diligently execute our strategies for consistent market share gain.” Uzoka said.

Ugo Nwaghodoh, the Group CFO, speaking on UBA’s financial performance and position, said the Bank’s performance in the first quarter further proves its resilience and very strong prospect of the business across its chosen markets. He said that beyond the sterling growth in top and bottom lines, he remained particularly impressed with the quality of the earnings, which reflects the bank’s focus on the core business of financial intermediation and transaction banking.