Union Bank
Grosses N163.8bn in 2017
Union Bank of Nigeria (UBN) Plc, considered one of Nigeria’s oldest surviving and most revered monetary establishments, has recorded appreciable development in key efficiency indicators in the primary quarter (Q1) 2018, giving prospects of higher returns for the enterprise yr.
The bank’s interim report and accounts for Q1 ended March 31, confirmed that gross earnings rose by 15 per cent, whereas income earlier than and after tax grew by 16 per cent and 17 per cent respectively.The Q1 report, which was launched alongside the audited report for 2017 yesterday, on the Nigerian Stock Exchange (NSE), confirmed that Union Bank improved on its final yr’s commendable efficiency.
The three-month report confirmed gross earnings of N39.5billion in Q1 2018 in opposition to N34.3billion in Q1 2017. Profit earlier than tax rose from N4.7billion in Q1 2017 to N5.4billion a yr after. Profit after tax additionally elevated to N5.3billion in Q1 2018 in contrast with N4.5billion a yr in the past.
The Chief Executive Officer, Union Bank, Emeka Emuwa, stated the Q1 outcomes mirrored the bank’s renewed give attention to driving effectivity and productiveness with a view to totally leveraging assets together with human, expertise, and new capital to maximise the underside line.
“While we are just in the early stages of this drive, we are already starting to see positive results,” Emuwa stated The top-line efficiency was pushed by enchancment in internet curiosity margins from 7.1 per cent to eight.7 per cent, and 18 per cent enhance in non-interest earnings due to enhanced buying and selling earnings and elevated volumes on alternate banking channels.
Interest earnings had grown by 14 per cent to N31.7billion in Q1 2018, in opposition to N27.7billion a yr in the past. Net curiosity earnings earlier than impairment elevated by 22 per cent to N17.8billion in contrast to N14.6billion in the course of the assessment interval, pushed by 14 per cent enhance in curiosity earnings, and a decrease six per cent enhance in curiosity expense. Non-interest earnings additionally rose by 18 per cent from N6.6billion to N7.8 billion.
The audited report for the yr ended December 31, 2017, confirmed that gross earnings rose by 26 per cent from N126.6billion in 2016 to N163.8billion in 2017. Profit earlier than tax was largely flat at N15.5billion in 2017 in opposition to N15.7billion in 2016.The CEO defined that the group’s non-performing mortgage ratio had improved to 14.9 per cent by March finish from 19.eight per cent initially of this yr. He famous that the bank has continued to preserve aggressive give attention to its impaired loans and is anticipated to resolve some massive exposures in the course of the yr, which can additional drive down the ratio.
He also said that the bank has been pushing strongly on debt restoration efforts throughout board together with initiating or persevering with authorized motion the place mandatory.“For the first half of the year, we will continue to hone initiatives around our productivity drive, focusing our people on targeted opportunities across regions and optimising our technology and digital platforms to deliver operational efficiency and improved customer service,” Emuwa stated.
Operational highlights indicated persevering with success of the bank’s easy, tech-savvy development technique with 68 per cent enhance in new-to-bank accounts, underlining customer acceptance of latest merchandise and rising model penetration.
The bank additionally noticed 90 per cent enhance in quantity of funds switch transactions on its alternate channels, highlighting efficiencies gained from expertise investments that are driving elevated customer adoption. This led to 58 occasions enhance in internet alternate channel charge earnings, underlining efficiencies gained from investments in alternate channels.
Chief Financial Officer of Union Bank, Oyinkan Adewale, stated whereas the Q1 outcomes mirrored the adoption of International Financial Reporting Standards (IFRS) 9, which got here into impact initially of 2018, the bank’s regulatory threat reserve was ample to take up the influence of the brand new accounting guidelines.
“Our capital adequacy ratio (CAR) remains robust at 17.9 per cent in spite of the impact of IFRS 9 on impairments. Liquidity ratio is at 39.4 per cent, well above the minimum requirement, while net interest margin improved to 8.73 per cent in first quarter 2018 from 7.14 per cent in first quarter 2017,” Adewale stated.
She famous that regardless of 19 % and 27 % enhance in the bank’s Asset Management Corporation of Nigeria (AMCON) levy, and Nigeria Deposit Insurance Corporation (NDIC) premium respectively, the bank’s working bills elevated by solely 10 per cent, reflecting administration’s persevering with give attention to optimising working prices.“We will continue to be proactive in managing the risks in our business as we pursue targeted opportunities identified for growth,” Adewale assured.