Unity Bank’s profit loss hits N14.9bn in one year

…As NSE slams N79.9m fine on bank over infractions
…We don’t have non-performing loans, complies with regulatory criteria- Bank
Unity Bank Plc has reported N14.9 billion loss in its 2017 audited financial statement submitted to the Nigerian Stock Exchange (NSE), as against reported N2.18 billion Profit after Tax (PAT) in 2016.

The long awaited 2017 results of Unity Bank came on the heels of NSE suspension on its share price on last week Thursday.

It is instructive to note that the management of Unity Bank reacted with the filing of all outstanding results on early Friday.

From the 2017 financial statement, the bank reported N14.2 billion loss before tax as against N2.8 billion reported in 2016.

The bank reported 23.1 per cent increase in Impairment losses to N44.25 billion in 2017 from N35.9 billion reported in 2016 while total operating expenses dropped by 7.2 per cent to N24.46 billion as against N26 billion reported in 2016.

Unity Bank’s total assets dropped significantly by 68.2 per cent to N156.5 billion in 2017 from N492.68 billion reported in 2016, attributable to 96.8per cent drop in loans and advances to customers.

From the bank’s balance sheet position, loans and advances to customers dropped from N277 billion reported in 2016 to N8.96 billion in 2017 while customers deposit decreased by 4.5 per cent to N252 billion from N264.2 billion reported in 2016.

Regarding over non-compliance to post listing requirements, the NSE imposed N79.9 million sanctions on Unity Bank.

Unity Bank had failed to comply with post listing requirement of the Exchange which includes the late filing of 2017 full financial year results, first quarter results of 2018, half-year results of 2018 and third quarter results of 2018.

Findings by The Daily Times also revealed that NSE imposed N40.7 million sanction on Unity Bank for late filing of 2017 audited result and accounts; N29 million and N9.8 million for late filing of the first quarter and half year results of 2018 respectively.

Furthermore, the financial institution was sanctioned with N200,000 fine for the late filing of third-quarter results of 2018.

But the Unity Bank in a statement, attributed the delay to ongoing discussions with the bank’s prospective investors, stressing that discussions are in progress and will be concluded shortly.

Shedding more light on the situation, the Company Secretary, Unity Bank, Mr. Mohammed Shehu, in a signed statement said, “the delay in filing the financial statements was occasioned by specific corporate actions, including ongoing discussions with the Bank’s prospective investors undertaken by the Bank which necessitated extensive reviews by our primary regulator.

“In furtherance of this, the Bank consulted extensively with the NSE and Central Bank of Nigeria and obtained an extension of up to October 31, 2018, to file the accounts for which it remains appreciative.

“We are pleased to inform our stakeholders that discussion with our prospective investors are progressing according to plan and will be concluded shortly, following which necessary regulatory approvals would be sought and the announcement made.”

The bank further disclosed that it now carries zero Non-Performing Loan (NPL) and is in full compliance with regulatory criteria.

The statement reads in part: “As part of the Bank’s recapitalisation strategies, the Bank obtained the approval of the CBN to dispose of all its NPLs to an institutional assets management company.

“Consequently, upon payment of the initial consideration by the debt buyer, Loans and advances with a gross amount of N436billion have been derecognized, along with the associated IFRS impairment and Regulatory Risk Reserves.

“This follows the conclusion of the transaction in line with a Transaction Implementation Agreement (TIA) and a Sales and Purchase Agreement (SPA) signed with the institutional assets management company.”