Global financial institution, United Bank for Africa (UBA) Plc is very well capitalized with shareholders’ fund in excess of N2 trillion, its Group Managing Director/CEO, Oliver Alawuba, announced at the weekend.
He spoke at the bank’s full year 2023 investor conference call held in Lagos.
Alawuba disclosed that the bank will in due course raise the required component of capital in line with the Central Bank of Nigeria (CBN) directives.
Against a backdrop of challenging and volatile geopolitical and economic conditions, he said the bank delivered another year of record earnings.
Alawuba said the bank’s gross earnings and profit before tax reached their highest levels in its history.
“Gross earnings grew year-on-year (y-o-y) by 143.3 per cent to N2.1 trillion and our profit before tax increased by 277.2 per cent to N757.7 billion, asserting UBA’s position as a leading financial institution,” he said.
He explained that the growth was fueled by a significant increase in net interest income, due to a combination of a strong expansion in the loan portfolio, higher net interest margins, and a substantial contribution from foreign exchange operations. The FX operations benefited from increased business activity and improved profit margins.
“Operating costs increased by 69 per cent, driven significantly by the substantial impact of an over 100 per cent increase attributable to our foreign operations and FX currency denominated expenses in domestic operations. Notwithstanding the adverse macroeconomic conditions, the fundamental strength of underlying asset quality persists, as reflected in a Non-Performing Loan (NPL) ratio of 5.85 per cent,” he said.
The bank’s Executive Director, Finance and Risk Management, Ugo Nwaghodoh, said operating income rose 168 per cent to N1.6 trillion.
He said: “Given the inflation that we have seen globally and the devaluation in some markets, operating expenses rose 78 per cent from N350 billion in 2022 full year to N592 billion at the end of 2023 full year. And in spite of that, PBT rose to N557 billion from N201 billion in full year 2022 to N758 billion at the end of full year 2023. And indeed, profit after tax up to N608 billion from N170 billion same time last year while total assets grew 90 per cent to N20.7 trillion and deposits also grew 93 per cent to N17.4 trillion.”
Continuing, he said the valuation of the naira, which is the reporting currency, is pivotal to some of the growth that the bank recorded on some of these balance sheet lines.
On outlook guidance for financial year 2024, he said: “We’re guiding a full year deposit growth of about 20 per cent, loan growth of about 20 per cent, cost of risk of about 3.8 per cent, non-performing loan ratio of about 4.5 per cent, return on average equity of about 30 per cent, return on assets of about three per cent, capital adequacy ratio of about 30 per cent, cost to income ratio at about 45 per cent, and net interest margins will be about 7.5 per cent”.
The bank also got multiple external recognitions including winning the
African Champion of the Year 2023 at the Africa Financial Industry Summit (AFIS) in Lome, Togo; Bank of the Year Africa 2023 awarded by The Banker, United Kingdom, with eight subsidiaries were awarded Bank of the Year by The Banker, United King-dom.
These are UBA Cameroon, UBA Chad, UBA Ghana, UBA Cote d’Ivoire, UBA Mozambique, UBA Congo, UBA Sierra Leone and UBA Tanzania.
Credit: thenationonlineng.net
