March 06, (THEWILL) – Africa’s Global Bank, United Bank for Africa (UBA) Plc, has announced an impressive performance in key financial parameters of its 2021 full year report for the period ended December 31, 2021.
The Tier-1 bank said in its audited results submitted to the Nigerian Exchange Friday that its profit before tax {PBT) rose 20.3 percent to N153.1 billion, compared to N127.3 billion at the end of the preceding year.
Similarly, profit after tax (PAT) grew by 8.7 percent to N118.7 billion in 2021, compared to N109.2 billion recorded in 2020.
Despite the huge challenging business and slow economic recovery in most of its countries of operations, its gross earnings rose significantly to N660.2 billion representing an increase of 7 percent compared to N616.8 billion recorded at the end of the 2020 financial year.
Total assets also followed the growth trajectory, hitting an unprecedented N8.5 trillion or 11 percent rise to the year under review, up from N7.7 trillion in 2020.
This marks the first time the bank’s assets will cross the N8 trillion mark indicating sound management decisions in resource management and aggressive pursuit of customer deposit.
The report showed that net loans grew by 7.7 percent growth to N2.8 trillion, whilst customer deposits rose by 12.2 percent to N6.4 trillion, compared to N5.7 trillion in the corresponding period of 2020.
This reflects increased customer confidence, enhanced customer experience, successes from the ongoing business transformation programme and the deepening of its retail banking franchise.
The lender’s operating income rose by 10% to N443 billion compared to N403 billion in the prior year, whereas operating expenses closed the period at N279 billion.
The Global Bank proposed a final dividend of 80 kobo for every ordinary share of 50 kobo for the financial year ended December 31, 2021.
The final dividend which is subject to the affirmation of the shareholders at its Annual General Meeting will bring the total dividend for the year to 100 kobo as the Bank had paid an interim dividend of 20kobo earlier in the year.
Commenting on the result, the Group Managing Director/CEO, Kennedy Uzoka, said that notwithstanding the tight and challenging operating environment, UBA continues to deliver a significant performance.
He said, “The year 2021 can best be described as a year of global recovery; economies around the world began to witness early-stage recoveries, as supply chains recover from the devastating disruptions suffered in 2020.
Consequently, UBA recorded a remarkable 7% growth in top line to N660 billion (USD1.56bn), and profit before tax (PBT) of N153.1 billion, up 20.3% from the prior year. Net Loans and advances grew by 7.7% to N2.8 trillion with exposure mostly to resilient economic sectors including oil & gas, agriculture and manufacturing. Deposit from customers grew 12.2%, crossing the N6 trillion mark, to N6.4trillion.”
The GMD explained that the quality of UBA’s portfolio, as well as the strength of the bank’s credit risk management frameworks and policies, remain the bedrock of the positive results that the bank has been recording over the years, adding that the current performance highlights UBA’s relentless customer focus, and leverage on its key strategic levers – People, Process and Technology.
“Looking forward, I am particularly excited about our ongoing Enterprise Transformation Program which is designed to enhance the bank’s process agility, service delivery and customer experience. We are also making sizeable investments in cutting-edge technology and cyber security, to keep our innovative digital banking offerings above the curve, as we tool and re-tool our human resources to compete and win in a rapidly changing and evolving landscape. This will ensure the bank continues to achieve respectable top and bottom-line growth through the medium to long term,” the GMD stated.
UBA’s Group Chief Financial Official, Ugo Nwaghodoh, who corroborated the GMD’s comments, said, once again, the bank has shown resilience. It achieved sizable growth and strengthened its balance sheet despite the slow pace of economic recovery that characterized the year 2021.
“Through active and diligent assets and liabilities management, the bank was able to protect its net interest margin and achieved a downward moderation of Cost of funds (CoF) by 70 basis points to 2.2% from 2.9% in the prior year.”
According to him, the group’s capital adequacy ratio at 24.9% was well above the required regulatory minimum and reflects a strong capacity for business growth. “The Group’s non-performing loan ratio improved further to 3.6% from 4.7% at the end of 2020. This testifies to the quality of UBA’s loan portfolio even as the bank remains relentless in its resolve to drive down the Cost-to-Income ratio, which stood at 63.0% at the end of the year.”
Nwaghodoh added that the bank achieved further strides in growing its business and gaining market share across its pan-African operations, with the region accounting for 63.2% of the Group’s profitability, compared to 55.4% in 2020; Loans and advances as well as Deposit in the region were also up 14.5% and 27.3% respectively from a year earlier.
In his concluding remarks, the CFO stated “We recognise the changing competitive landscape and are proactively positioning to consistently deliver on our strategic objectives and commitment to shareholders.”
UBA is investing massively in technology to explore the huge opportunities in modern financial services amid tough competition.
About the Author
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
