MON 19 APRIL, 2021-theGBJournal- United Bank for Africa Plc (UBA), (Bloomberg: UBA: NL; Reuters: UBA.LG) has announced its Unaudited 2021 First Quarter Financial Results. Gross earnings grew 5.6% year-on-year (YoY) to N155.4 billion, total assets grew 2.5% year-to-date to N7.9 trillion, whilst profit before tax grew 24.0% to N40.6 billion.
Highlights:
Income Statement
-Gross Earnings: N155.4 billion, compared to N147.2 billion in 2020Q1 (5.6% YoY growth).
-Operating Income: N106.6billion, a 13.5% YoY increase compared to N93.9 billion in 2020Q1.
-Operating Expenses of N64,5 billion, compared to N58.7 billion in 2020Q1 (9.9% YoY growth).
-Profit Before Tax: N40.6 billion, compared to N32.7 billion in 2020Q1 (24.0% YoY growth).
-Profit After Tax: N38.2 billion, a 26.8% YoY growth, compared to N30.1 billion in 2020Q1.
-Cost-to-Income Ratio: 60.4%; compared to 62.4% in 2020Q1.
-Return on Average Equity (RoAE): 20.5%; compared to 19.9% in 2020Q1.
Balance Sheet
-Total Assets: N7.9 trillion, compared to N7.7 trillion, as at FY2020 (2.5% YTD growth).
-Net Loans: N2.8 trillion; a 4.6% YTD compared to N2.6 trillion as at FY2020.
-Customer Deposits: N5.8 trillion, compared to N5.7 trillion as at FY2020; representing 2.0% growth.
-Shareholders’ Funds: N762.4billion, up 5.3% compared to N724.1 billion as at FY2020.
Kennedy Uzoka, the GMD/CEO UBA Commented extensively on the result. He said ‘’This impressive 2021Q1 results reflect the capacity of our business to sustainably grow earnings, even in a highly uncertain macroeconomic environment. The Group achieved 5.6% year-on-year (YoY) growth in gross earnings to N155.4 billion, even as profit for the period grew 27% YoY to N38.2billion. Operating income for the period was N106.6 billion, a 13.5% growth when compared to 2020Q1,’’
According to the GMD, the Bank remains optimistic on the macroeconomic outlook of the countries they operate in, ‘’especially as COVID-19 vaccine distribution gains traction globally, whilst commodity prices and currencies continue to stabilize.’’
‘’Our robust capital and liquidity positions have positioned us to continue to support our customers across diverse sectors and markets, guided by prudent risk management practices,’’ he said.
Uzoka added that the Bank is diligently executing its priorities for the year, as they continue to leverage its people, process, and technology to deliver best customer experience across all our channels and touchpoints, achieving industry leadership and dominance.
‘’The bank is making strong progress in Nigeria, where our continuous market share and efficiency gains are translating into higher profit. We have also recorded commendable wins across all our geographies in terms of customer acquisition, transaction volumes and profitability. We are committed to sustaining this strong start through the year; leveraging our Customer-First (C-1st) philosophy and unparalleled execution to deliver even stronger returns to our esteemed shareholders in 2021 and beyond.’’
Also speaking on the performance, the Group CFO, Ugo Nwaghodoh said; ‘’I am particularly pleased with our annualized return on average equity of 20.5% and return on average asset of 2.0%, as these buttress our commitment to delivering sustainable value to our stakeholders. We continued to deploy our balance sheet efficiency and digital-led cost optimization initiatives to achieve desired outcomes.
Cost-to-income ratio improved by 200bps to 60.4% during the period, whilst cost of funds settled at 2.0%, a 130bps reduction from 3.3% in 2020Q1.
We grew non-funded income by 23.1%, driven by electronic banking income, commissions on transactional services and credit-related fees and commissions, amongst others. Notably, electronic banking income grew by 50.4% year-on-year following impressive group-wide growth in our digital banking customer base and transactions.
With improving deposit mix, positive trends in interest and non-interest income as well as improving cost profile, we are upbeat on the quarters ahead, and optimistic of outperforming our 18% ROAE target for the year. We are confident on the strong prospect for earnings growth, particularly as we are better positioned to consolidate recent market share gains in Nigeria and other geographies where we operate. This result is a strong start for the year; and we are optimistic on sustaining this exciting performance through the year and beyond.
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