UBA’s profit in the first half of 2021 helped by the rest of Africa

Despite the low-performing environment in its largest market, Nigeria, the Pan-African Bank, United Bank for Africa (UBA) recorded a 33.4% improvement in after-tax profit in the first three months of 2021, writing BUKOLA IDOWU.

According to the bank, its profitability had been helped by its operations in the rest of Africa which excludes Nigeria. The bank’s half-yearly financial statements, recently published on the Nigerian Exchange Limited, showed that its profit before tax reached 76.2 billion naira in June 2021, compared to 57.1 billion naira recorded in the same period of 2020. .

This translates into an annualized return on equity (RoAE) of 17.5% compared to 14.4% a year earlier, despite the difficult business and economic environment that emerged from the slowness of activities following the global containment caused by the Covid-19. pandemic.

In keeping with the bank’s culture of paying both an interim and final cash dividend, UBA’s board of directors declared an interim dividend of 20 kobo per share for each common share of 50 kobo each held by its shareholders.

Speaking on the bank’s finances, UBA Group Managing Director and CEO Mr. Kennedy Uzoka said: “This first half has been strong for us as the global economic recovery has exceeded expectations, creating a positive effect on consumers and business confidence, savings and investment activities.

“We have found this to have a positive impact on our business, as we continue to leverage our key strategic levers – people, processes and technology, and our customer-centric philosophy, to revolutionize the customer experience. at UBA. “

Noting that the bank’s investment in the rest of Africa (excluding Nigeria) continues to yield good results for the group, he said that “the benefits of the diversification of pan-African activities accruing to the group are once again obvious, with growth in gross profits and interest income. 5.1% and 8.3% respectively, despite the low performing environment in our largest market, Nigeria.

Results submitted to the Nigerian Exchange Limited showed that the group’s after-tax profit was N60.6 billion, a significant increase of 36.3%, from the N44.4 billion recorded in the first. semester 2020.

Likewise, gross revenues reached 316 billion naira, an increase of 5% from the 300.6 billion naira recorded in June 2020.

According to the results, as of June 30, 2021, the group’s total assets have passed the 8 trillion naira mark to 8.3 trillion naira, up from 7.7 trillion naira at the end of fiscal 2020. Its Customer deposit also broke the 6 trillion naira mark, increasing 7.4% to 6.1 trillion naira during the period under review, from 5.7 trillion naira in December 2020.

In addition, the group’s shareholder funds reached N752.5 billion, up from N724.1 billion in December 2020, reflecting its strong capacity to generate internal capital. Uzoka said, “We are making remarkable progress in our strategy which gradually positions UBA as the bank of choice on the continent, thanks to our focus on technological innovation and the best customer experience. “

The GMD stressed that the bank recognizes the far-reaching effects of the pandemic on businesses around the world and remains focused on its promise to always provide our customers with the best possible banking experiences.

“Our performance in the first half of 2021 reflects our gradual efforts to build on the strong momentum with which we started the year. As a purpose-built organization, we remain committed to our pursuit of sustained growth in client acquisition, transaction volumes and balance sheet as we consolidate our position in the ‘World Bank for Africa “in the years to come, thereby improving livelihoods across the continent,” Uzoka explained.

UBA Group CFO (GCFO), Ugo Nwaghodoh, for his part noted that the bank’s objective was to significantly improve the quality of earnings while maintaining positive operating leverage as well as quality of first-rate assets.

“The Group recorded a return on average equity (RoAE) of 17.5%, against 15.1% in the first half of 2020 and a net interest margin of 5.8%, an improvement compared to 5.4 % in H1 2020) as we diligently play the volatile return environment for the best return on our interest earning assets.

“The capital position remained solid, with capital adequacy and liquidity ratios of 23.9% against 22.4% in the first half of 2020 and 58.3% against 58.2% in the first half of 2020) . It’s strong enough to support our growth ambitions, ”he said.

GCFO stressed that even though the operating environment remains largely uncertain and volatile, despite a marked improvement in macroeconomic stress induced by Covid-19, UBA will continue to build resilience through its geographically diverse business model to support gross profit growth. of the group.

“We remain committed to our respective targets of 18% and 15% RoAE and deposit growth for fiscal 2021, as we continue to invest in growth opportunities in our areas of operations, while managing prudently capital and balance sheet, ”Nwaghodoh said.

UBA provides banking services to more than twenty-five million customers, in more than 1,000 business offices and customer contact points, in 20 African countries.

With a presence in the United States of America, UK and France, UBA connects people and businesses across Africa through retail; commercial and corporate banking; innovative cross-border payments and remittances; trade finance and ancillary banking services.

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