For the first quarter ended March 2017, United Bank for Africa Group (UBA) recorded Profit After Tax of N22.4billion, indicating 32 percent year-on-year growth compared to N17.0 billion achieved in the corresponding period of 2016.
The group also 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.
The Group Managing Director/CEO, Mr. Kennedy Uzoka,in a statement expressed satisfaction 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 grewby 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.
While emphasizing the increasing relevance of its African operations to its bottom line, Uzoka said, “Our businesses outside Nigeria continued to wax stronger, contributing 35% of our earnings. We remained prudent in risk asset creation growing net loans by 2% year-to-date, as we have continued to monitor development in key sectors of the economy to take advantage of emerging bankable opportunities in due time. 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.”
Also speaking on UBA’s financial performance and position, the Group CFO, Ugo Nwaghodoh,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.
