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UBA Delivers Double-Digit Growth In Gross Earnings As Profit Hits N132bn

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UBA Records 27% PAT Growth, 20.5% ROAE In 2021 Q1

…Gross Earnings Crosses N600bn Mark

…Proposes Final Dividend of N0.35k

Pan-African financial institution, United Bank for Africa Plc (UBA) has announced its audited results for the full-year ended December 31, 2020, recording impressive growth across its top and bottom lines.

The 2020 audited financials filed at the Nigerian Stock Exchange (NSE) on Monday, showed that the bank’s gross earnings grew by 10.8 percent to N620.4 billion, compared to N559.8 billion recorded in the corresponding period of 2019. The bank’s total assets also grew by 37.0 percent to N7.7 trillion for the year under review.

Despite the challenging business environment during the Covid-19 pandemic and the resultant effect on economies globally, the bank’s Profit Before Tax was impressive at N131.9 billion, compared to N111.3 billion at the end of the 2019 financial year. In the same vein, the Profit After Tax rose remarkably by 27.7 percent to N113.8 billion compared to N89.1 billion recorded at the end of the 2019 financial year.

On the cost side, Operating Expenses grew by 10.1 percent to N249.8 billion, as against N217.2 billion in 2019, well below average inflation rate of 13.2 per cent for the year, thus reflecting the bank’s cost effectiveness.

In its usual tradition of rewarding shareholders, the bank proposed a final dividend of N0.35 kobo for every ordinary share of 50 kobo. 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 N0.52kobo as the bank had paid an interim dividend of N0.17 kobo earlier in the year.

UBA recorded a remarkable 24 percent growth (to N2.6 trillion) in loans to customers, whilst customer deposits increased by 48.1 percent to N5.7 trillion, compared to N3.8 trillion recorded in the corresponding period of 2019, reflecting increased customer confidence, enhanced customer experience, successes from the ongoing business transformation programme and the further deepening of its retail banking franchise.

Commenting on the result, the Group Managing Director/CEO, Kennedy Uzoka noted that the year 2020 was important for UBA Group, as it gained further market share in most of its countries of operation.

He said, “We ended a very challenging year on a reassuring note. The bank recorded double-digit growth in both our top and bottom lines, as gross earnings and after-tax profit grew by 10.8% and 27.7% to N620.4billion and N113.8 billon respectively. Return on equity was 17.2%, even as our cost-to-income ratio moderated to 61.3%. Our earnings per share of N3.20 is a 26.8% growth from the preceding year, as we continue to ensure maximum value creation for our highly esteemed shareholders.”

Continuing, Uzoka said, “Despite the tumultuous impact of Covid-19 pandemic globally and across our 23 countries of operation, we created N519.0 billion additional loans as we continued to support our customers and their businesses. Customer deposits grew 48.1% to N5.7 trillion, driven primarily by additional N1.8 trillion in retail deposits. As a global bank, we remain well capitalized and determined to successfully drive financial inclusion on the continent through our innovative products and vast network. Our capital adequacy and liquidity ratios came in at 22.4% and 44.3%, well above the respective regulatory minimum of 15.0% and 30.0%.

READ ALSO: Makinde Vows Not To Condone Miscarriage Of Justice Over Wakili, OPC

Speaking on the bank’s strategy, he said, “Our primary strategy will continue to focus on providing excellent services from our customers’ standpoint, putting the customer first always. Looking ahead, I am inspired by the achievements we have made since the launch of our transformation programme. We have expanded market share considerably across the geographies where we operate and are consolidating our digital banking leadership in Africa. We will continue to leverage our diversified business model and dedicated workforce to further strengthen our position as ‘Africa’s Global Bank’.”

On the performance, the Group Chief Financial Official, Ugo Nwaghodoh said, “The persistent low interest rate environment in 2020 exerted significant downward pressure on margins. Notwithstanding, our interest income for the year grew by 5.7% (to N427.9 billion), driven by 8.2% and 7.5% year-on-year growth on interest income on loans and investment securities respectively. Our interest expense declined by 8% (to N168.4billion) driven largely by a 34.2% decline in interest expense on customer deposits in our Nigerian operations, bringing down the Group’s cost of funds to 2.9%, from 4% in 2019.

Nwaghodoh said, “We have prudently stepped up our reserves for loan impairments, hence the 37.4% YoY growth to N22.4billion, implying a 0.9% cost of risk. These reserves provide adequate cover for impairments and should help minimise the need for further reserves in the current year, in view of the improving global operating environment. Our NPL ratio has declined to 4.7% (from 5.3% in 2019), driven by growth in the loan book, robust credit risk monitoring architecture, and payment of Past Due Obligations (PDOs).”

The CFO added that as Nigeria continues to see signs of recovery from the Covid-19 pandemic led by resumption of economic activities across the globe, increase in consumer spending, and continued progress on vaccine deployment, UBA is well-positioned for greater synergy across the Group. “We remain committed to our prudent risk management practices, and optimistic of best value for our stakeholders in the days ahead,” he added.

United Bank for Africa Plc is a leading pan-African financial institution, offering banking services to more than twenty-one million customers, across over 1,000 business offices and customer touch points, in 20 African countries. With presence in the United States of America, the United Kingdom and France, UBA is connecting people and businesses across Africa through retail; commercial and corporate banking; innovative cross-border payments and remittances; trade finance and ancillary banking services.

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Buhari Asks Senate To Amend PIA, Ignores Oil Areas’ Demand For 5%

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Buhari Asks Senate To Amend PIA, Ignores Oil Areas' Demand For 5%

As President Muhammadu Buhari seeks to amend certain provisions of the Petroleum Industry Act (PIA), he is silent on the demand of oil communities for five percent equity share.

The joint National Assembly committees that worked on the PIB had proposed a five per cent equity share for the development of the host communities but the Senate led the campaign for its reduction to three per cent while the House of Representatives approved the panel’s recommendation.

The conference committee set up by the presiding officers of both chambers in their recommendation, fixed the equity share at three per cent and was invariably approved by the National Assembly.

The development degenerated into a controversy with senators from the South-South geopolitical zone kicking against it and asked Buhari to resolve the impasse by seeking an amendment to increase the equity share to five per cent.

However, the new amendments proposed by the president did not address the concerns of the South-South stakeholders.

READ ALSO: Why Buhari Govt Won’t Name, Shame Financiers Of Terrorism – Adesina

Rather, Buhari’s fresh request centred basically on the need to review the administrative structure of the Upstream Regulatory Commission and the Nigerian Midstream and Downstream Petroleum Regulatory Authority.

Buhari is seeking the senators’ approval to increase the numbers of the non-executive board members of each of the regulatory agencies from two to six, in order to capture the six geopolitical zones.

He said: “The Petroleum Industry Act 2021 provided for the appointment of two non- executive members for the board of the two regulatory institutions.

“I am of the view that this membership limitation has not addressed the principle of balanced geopolitical representation of the country.

“Therefore, I pray for the intervention of the 9th Assembly to correct this oversight in the interest of our national unity.

“Needless to add that this amendment will provide a sense of participation and inclusion to almost every section of the country in the decision making of strategic institutions such as oil industry.

“if this amendment is approved, it will now increase the number of the non-executive members from two to six that is one person from each of the six geopolitical zones of the country.”

The president also removed the ministers of finance and petroleum resources from the board of the two agencies.

According to him, the two ministers already have constitutional responsibilities of either supervision or inter-governmental relations.
He said: “They can continue to perform such roles without being on the board.

“It is also important to note that administratively, the representatives of the ministries on the board will be directors – being the same rank with the directors in the institution

“This may bring some complications in some decision-making especially on staff-related matters.”

READ ALSO: How Buhari’s Panel Sold Six-storey Building For Paltry N100m

Buhari added that the appointments of the executive directors who would be in charge of the seven departments in the NMDPRA should not be subjected to Senate confirmation since they are civil servants who were promoted in the course of their career.

He said :“The Act has made provision for seven departmental heads in the Authority to be known as executive directors.

“Their appointment (according to the PIA) will also be subjected to Senate confirmation. This category of officers are civil servants and not political appointees.

“The Senate is invited to note the need to exempt serving public officers from the established confirmation process for political appointments.

“This will ensure effective management of the regulatory institutions through uniform implementation of public service rules for employees of the Authority.

“In the future, these positions will obviously be filled by the workers in the Authority.”

Buhari said the proposed amendment would also increase the membership of the board from nine to 13 members that is representing 44 per cent expansion of the board site.

He said: “This composition would strengthen the institutions and guarantee national spread and also achieve the expected policy contributions.”

 

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Obasanjo Lashes Out At Buhari Over Borrowing

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Obasanjo Lashes Out At Buhari Over Borrowing

Erstwhile President Olusegun Obasanjo has condemned the Federal Government’s plan to take fresh loans amid criticism by Nigerians over incessant borrowing by the current administration.

While speaking to Channels Television in South Africa, Obasanjo described as criminal, the alleged move to accumulate debts for the next generation to pay.

Obasanjo expressed worries that if the existing debts remain unserviced or unpaid by the President Muhammadu Buhari’s administration, it might become a huge problem for successive governments.

The president, a few days ago, requested the approval of the National Assembly to borrow the fresh sums of $4,054,476,863 and €710 million.

READ ALSO: Buhari Orders Incorporation Of NNPC Limited, Names Board Members

Reacting, the former president who believes that borrowing is not a problem, however, stated that the challenge would be the utilization of the borrowed fund and the plan or capacity to pay back.

He said: “But if you are borrowing and accumulating debts for the next generation and the next generation after them, it is criminal. What are you borrowing for?

“If we are borrowing for recurrent expenditure, it is the height of folly. If we are borrowing for development that can pay for itself, that is understandable. Then the payment, how long will it take to pay itself?”

 

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Buhari Orders Incorporation Of NNPC Limited, Names Board Members

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Buhari Appoints EFCC Board Members

President Muhammadu Buhari has ordered the incorporation of the Nigerian National Petroleum Company Limited.

In a statement on Sunday by the Special Adviser to the President (Media and Publicity), Femi Adesina, he said that the president gave the order in his capacity as the Minister of Petroleum.

“This is in consonance with Section 53(1) of the Petroleum Industry Act 2021, which requires the Minister of Petroleum Resources to cause for the incorporation of the NNPC Limited within six months of commencement of the Act in consultation with the Minister of Finance on the nominal shares of the Company,” the statement said.

The statement said the Group Managing Director of the NNPC, Mr Mele Kolo Kyari, had been directed to take necessary steps to ensure that the incorporation of the NNPC Limited is consistent with the provisions of the PIA 2021.

READ ALSO: How Bureaux De Change Finance Terrorism – CBN

President Buhari has also approved the appointment of the Board and Management of the NNPC Limited, with effect from the date of incorporation of the company.

The President named Senator Ifeanyi Ararume aa Chairman of the Board while Mele Kolo Kyari and Umar I. Ajiya were appointed as Chief Executive Officer, and Chief Financial Officer, respectively.

Other Board Members are; Dr Tajudeen Umar (North East), Mrs Lami O. Ahmed (North Central), Mallam Mohammed Lawal (North West), Senator Margaret Chuba Okadigbo (South East), Barrister Constance Harry Marshal (South South), and Chief Pius Akinyelure (South West).

 

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