United Bank for Africa Plc (UBA) on Thursday announced its Audited 2016 Half Year Financial Results for the period ended June 30, 2016 showing the bank recorded gross earnings of N166 billion, net operating income of N109 billion and profit before tax of N40 billion.

The bank also recorded a significant growth in total assets, rising 20% to N3.3 trillion, crossing the three trillion mark. Following the sterling performance, the bank’s Board recommended the payment of N0.20 interim dividend on every ordinary share of N0.50 each.

Speaking on the results, Kennedy Uzoka, the GMD/CEO, UBA Plc said they have been achieved amidst waning economic fundamentals.

“We delivered profit in excess of N40 billion and grew balance sheet by 20%, with our on-balance sheet total assets crossing the N3 trillion mark. Even as Naira depreciation and inflationary pressure increased the cost of doing business in Nigeria, we leveraged our economics of scale, enhanced operational efficiency and Group shared service structure to moderate our cost-to-income ratio by 90bps,” he said.

UBA achieved several strong positives in its performance for the half year. The bank’s net loan position rose 29% to N1.29 trillion partially boosted by the depreciation in the value of the Naira. UBA also recorded a significant 16% growth in deposits to N2.41 trillion already surpassing the 15% target growth in deposits set at the beginning of the year. Another positive for UBA was a drop in cost to income ratio to 63% as at half year compared to 64% in same period of 2015. It is noteworthy that the bank maintained its strong asset quality, with non-performing loans ratio at 2.4%; well below the CBN set limit of 5% for the banking industry.

Uzoka assured that; “UBA will sustain its culture of keeping a healthy balance sheet, with strong liquidity and capitalisation, as reflected in the liquidity and BASEL II capital adequacy ratios of 45% and 18% respectively.” He further stated; “notwithstanding the current slowdown in economic activities, we see bright spots ahead, especially as we see strong prospect to grow market share across all chosen economies, through our enhanced dedication to customer service.”

Explaining the major drivers behind UBA’s strong performance, the Group CFO, Ugo Nwaghodoh said: “This impressive performance was driven by increased transaction volume, balance sheet growth and efficiency as well as a disciplined management of operating cost. We achieved a 60bps moderation in funding cost, despite the tighter interest rate environment, as we continue to improve our deposit mix, towards low cost savings and current accounts.”

Nwaghodoh said that UBA’s performance in the period endorses the bank’s resilient ability to profitably grow its business from sustainable core banking offerings.

“Notwithstanding the challenging macro and regulatory environment, we achieved a 17.3% return on average equity in the period” even as the total equity of the bank grew 23% to N407 billion.

He explained that the bank’s African subsidiaries continue to record significant milestones in their performance, as two erstwhile loss making subsidiaries are now profitable and having positive contribution to the bank’s bottom line.

“Overall, African subsidiaries, contributed a quarter of the Group’s profit, with an even stronger outlook, as we deepen our penetration of the respective markets, the Group CFO added.”

United Bank for Africa (UBA) Plc, is one of Africa’s leading banking Groups with operations in 19 African countries and offices in three global financial centres: London, Paris and New York.

From a single country operation in Nigeria, Africa’s largest economy, UBA has evolved into a pan-African provider of banking and related financial services, to more than 11 million customers, through over 1000 Business Offices and diverse channels globally.

•Photo shows UBA GMD/CEO Kennedy Uzoka.

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