UBA Posts N401.5bn Profit Before Tax In H1, Declares N2 Interim Dividend

United Bank for Africa has released its 2024 half-year earnings, declaring a profit before tax of N401.5 billion, compared to the N403.6 billion reported a year earlier.

The results also showed that the bank recorded double-digit growth in its gross earnings and operating incomes.

At the end of the first two quarters of the year, despite the tough macroeconomic climate in Nigeria and the geopolitical challenges across major African countries where the bank has subsidiaries, UBA recorded a 39.6 per cent increase in its gross earnings, which rose from N981.77 billion in 2023 to N1.371 trillion in June 2024.

Interest income also increased by 134.3 per cent to N1.003 trillion, up from N428.2 billion recorded in June last year, while total assets went up by 37.2 per cent from N20.6 trillion in December 2023 to close at N28.3 trillion. Customer deposits also leapt by 33.7 per cent in the same period to close at N23.2 trillion, up from N17.3 trillion recorded at the end of 2023.

The bank’s impressive profit position was underpinned by a robust N614.4 billion in net interest income after impairments, representing a 395% increase compared to the N124.1 billion reported in the same period in 2023. This indicates that the quality of its half-year profit was driven by core business fundamentals and not forex gains.

UBA also impressed investors with a record interim dividend of N2 per share.

The results filed showed that profit before tax (PBT), which stood at N403 billion in June 2023, closed the half-year at N402 billion, while profit after tax (PAT) dropped slightly from N378 billion to N316 billion in the year under consideration. However, the bank’s shareholders’ funds increased by 47 per cent from N2.03 trillion in December 2023 to N2.99 trillion.

In line with the bank’s culture of paying both interim and final cash dividends, the Board of Directors of UBA Plc has declared an interim dividend of N2.00 per share for every ordinary share of N0.50 each held by its shareholders, representing a 300% increase compared to the N0.50 declared in the same period of 2023.

While commenting on the results, UBA’s group managing director/chief executive officer, Mr Oliver Alawuba underscored the bank’s commitment to consistently delivering value to its shareholders.

He said, “UBA Group has continued to deliver strong double-digit growth in high quality and sustainable banking revenue streams, driven by focused growth in our balance sheet, transaction, and digital banking businesses across geographies in line with our strategic goals.

“The Group’s performance has been buoyed by consistent strong growth in all core and sustainable banking income lines. Our intermediation business showed strong growth, with net interest income expanding by 143% year-on-year to N675 billion.”

On plans for the rest of the year, Alawuba said, “As the Group intensifies its customer acquisition drive, we are making significant investments in technology, data analytics, product research, and innovation to enhance our value proposition and customer experience.”

The executive director of Finance & Risk, Ugo Nwaghodoh, expressed delight at the milestone achieved by the bank in driving operational efficiency, as reflected in the cost-to-income ratio normalising around the 50% range.

“Our cost optimisation provides scope for further moderation, as we explore options towards a drastic reduction of our foreign currency denominated cost components, robotising and automating processes, and applying artificial intelligence to our operations,” he stated.

He disclosed that the Group will focus on effectively managing heightened credit, operational, cyber, and information security risks as it continues to conduct its business within the tenets of a moderate risk appetite in alignment with its sustainability goals.

“The Group has made significant progress and is on course to shore up its share capital to support its medium to long-term aspirations while aligning with the recent regulatory requirements in Nigeria and other jurisdictions that we operate in,” Nwaghodoh further explained.