Business
UBA achieves revenue growth of 83 percent, pays interim dividends in nine months
United Bank for Africa (UBA), a leading Tier 1 bank, announced a significant increase in its operating results for the first nine months of 2024. This growth was driven by a remarkable 170% rise in interest income, which surged from N666.3 billion in nine months of 2023 to N1.8 trillion in the corresponding period of 2024.
This growth was achieved despite significant macroeconomic challenges, including inflationary pressures, an unstable naira, and difficult economic conditions. By September 2024, Nigeria’s headline inflation averaged 32.77%, and the naira had depreciated to N1,541.94 per USD.
UBA attributed the increase in interest income to its expanded credit offerings across various sectors. There was a 335.5% increase in lending to banks, a 136.6% rise in consumer credit, and a 123% growth in loans to corporations.
Although there was a decrease in non-interest income and a 211.6% surge in interest expenses, UBA’s gross earnings jumped by 83.3% year-over-year, reaching N2.4 trillion in 9M 2024.
Key Financial Highlights:
Gross Earnings: N2.4 trillion, +83.3% YoY
Interest Income: N1.8 trillion, +170% YoY
Non-Interest Income: N435.8 billion, down 24.1% YoY
Profit Before Tax: N603.5 billion, +20.2% YoY
Profit After Tax: N525.3 billion, +16.9% YoY
Total Assets: N31.8 trillion, +95.9% YoY
Customer Deposits: N27.1 trillion, +97.5% YoY
Loans & Advances: N7.8 trillion, +53.7% YoY
Shareholders’ Fund: N3.59 trillion, +101.6% YoY
Strong Asset Growth and Dividend Payout
UBA’s total assets nearly doubled, reaching N31.8 trillion. This growth was supported by a 125.5% increase in cash and balances, a remarkable 1,238.6% surge in financial assets, and a significant rise in investment securities and loans. Additionally, customer deposits grew by 97.5%, reaching N27.1 trillion, while shareholders’ equity increased by 101.6%, amounting to N3.59 trillion.
Given this growth, UBA’s board has approved an interim dividend of N2 per 50 kobo shares, demonstrating the bank’s commitment to enhancing shareholder value. Additionally, the appointment of Mr. Chukwuma Nweke as Managing Director, effective October 1, 2024, marks a significant leadership change aimed at further improving operational efficiency.
UBA is currently and diligently strategizing to complete new regulatory capital requirements. The bank’s Tier 1 capital stands at N115 billion, but it must raise N385 billion to comply with the Central Bank of Nigeria’s (CBN) minimum capital requirement of N500 billion for banks with international licenses. As of now, UBA has not revealed a strategy for recapitalization.
