Emeka Emuwa, CEO, Union Bank


Despite slight drop in gross earnings in nine months, Union Bank leveraged on technology and effective cost management to grow its bottom-line in its third quarter financial performance.

The bank post-tax profit was up 4 per cent to ₦15.2 billion as at September 2019, compared to ₦14.7 billion in the same period, the nine months financial statement it sent to the Nigerian Stock Exchange (NSE) last week showed.

Similarly, it grew pretax profit by 5 per cent to ₦15.6 billion, compared to ₦14.9 billion in Q3 2018, in spite gross revenue dipping 4 per cent to ₦117.2bn, dragged down by decline in average earning assets.

Meanwhile, Interest income slipped 2 per cent to ₦90 billion during this period against ₦91.5 billion in Q3 2018, while non-interest income was also down 12 per cent to ₦27.1billion from N30.7 billion in the corresponding period last year, on the back of reduced market volatility this year, which caused trading income to dip 38.3 per cent.

And net interest income after impairment increased 6 per cent to ₦44.3billion (9M 2018 :₦42.0bn) driven by the impact of collections on impaired facilities as Union Bank succeeded making a cash recoveries of N8.4 billion in the first nine months of this year, which was 114 per cent higher than N3.9 billion during the same period last year.

The bank performance in nine month was good, considering the tough operating environment, said David Adonri, Managing Director, Highcap Securities.

“The bottom line of Union Bank has improved due to higher efficiency,” he reasoned.

The bank cost optimisation drive brought operating expenses down 3 per cent to ₦56.2 billion, however, impairment provision for loan losses ballooned 237.23 per cent to N462 million in nine months.

With the Central Bank cutting down the volume of investment in government securities and increasing commercial lenders’ loan-to-deposit ratio to 65 per cent, banks in the country have increased the tempo for retail banking.

Consequently, Union Bank raked in more customer deposits in Q3 2019, up 4 per cent to ₦892.9 billion, compared to ₦857.6 billion it garnered as at December 2018.

Meanwhile, the bank created 9 per cent higher risk assets to N566.5 billion from ₦519.7billion billion in Q3 2018 as total assets grew 23.04 per cent to N1.8 trillion and total liabilities increased 25.88 to N1.56 trillion in December 2018.

Emeka Emuwa, CEO, Union Bank explained, “our continued focus on consumer centric service and product propositions is yielding solid results, contributing to a 28% growth in our electronic channels fee income which is at ₦5.6billion for the period. Our debt recovery drive continues to record successes with ₦8.4bn of recoveries year to date.

“In line with our stated business objectives, we are continuing to grow our asset book by creating quality risk assets in targeted sectors. This has led to a 9% growth in our loan portfolio to ₦566.5bn compared to N519.7bn at year-end 2018.”

In the same vain, Joe Mbulu, Chief Financial Officer of the bank , noted, “our efficiency initiatives, including the deployment of Robotics Process Automation as well as our cost optimisation programme, ensured we delivered 4 per cent growth in Profit After Tax (PAT), recording ₦15.2 billion compared to ₦14.7billion in the prior year period.

“Our operating expenses reduced by 3 per cent to ₦56.2bn from ₦58.0bn in 9M 2018 and the Bank’s customer-related non-interest revenue drivers remained strong with net fee and commission income growing 10% to ₦9.5bn from ₦8.7bn for the corresponding period in 2018.”

He opined that Union Bank would continue to maintain adequate levels of capital with its Capital Adequacy Ratio (CAR) at 17.8 per cent which is above the regulatory threshold and Non-Performing Loans (NPLs) declined to 8. per cent from 8.7 per cent as at year-end 2018.



Fidelity Bank beats industry expectations,  declares N23b Profit In Q3

Despite the wobbly economy, Fidelity Bank Plc has declared Gross Earnings of N161.4billion, an increase of 16.3 percent when compared to ₦138.7 billion reported in the same period in 2018. This is no mean achievement in an operating environment where businesses are either dying or relocating to better ease of doing business regions.

Whereas other banks are recording single digit profit, Fidelity Bank maintains a double digit profit.

According to the Bank’s third quarter results for the period ended September 2019 , profit-before-tax also increased by 14.7 percent from ₦20.1 billion to ₦23.0 billion.

The nine month’s results which was made public last week showed double-digit growth in revenues, deposits and profitability, among others financial measurements.

Gross Earnings grew by 16.3 percent to ₦161.4 billion from ₦138.7 billion reported in the same period in 2018 whilst profit-before-tax soared by 14.7 percent from ₦20.1 billion to ₦23.0 billion.

In other indices, total assets grew by 14.6 percent to ₦1,970.6 billion from ₦1,719.9 billion billion in the same period last year. Total deposits; a measure of customer confidence, increased by 14.0 percent to close at ₦1,116.4 billion from ₦979.4 billion in 2018 FY.

“We look forward to sustaining the momentum in Q4 2019 and achieving our set targets for 2019 Financial Year”, said MD/CEO, Fidelity Bank Plc, Nnamdi Okonkwo. According to him, Retail Banking continued to deliver impressive results as savings deposits increased by 9.2 percent to N248.9 billion, further adding that the bank is on course to achieving the 6th consecutive year of double-digit savings growth. “Savings deposits now accounts for about 22.3 percent of total deposits, an attestation of our increasing market share in the retail segment”.

The growth in deposits is further complemented by its digital banking push which has resulted in having over 46.4 percent of its customers enrolled on the mobile/internet banking products and recording over 82.0 percent of total transactions on digital platforms.

“Digital Banking continued to gain traction driven by the bank’s new initiatives in the retail lending and increased cross-selling of our digital banking products”, he added.

Non-performing Loans (NPLs) Ratio improved to 4.8 percent from 5.7 percent in the 2018FY while absolute NPL declined by 4.9% in Q3 2019 compared to Q2 2019.All other Regulatory Ratios remained above the required thresholds with Capital Adequacy Ratio (CAR) at 16.4 percent and Liquidity Ratio at 32.6 percent.

Buoyed essentially by innovative digital technologies, Fidelity Bank’s retail strategy has become a major game-changer for the business. This was again evident in the H1 2019 results as savings deposits now account for about 22.6 percent of total deposits – a clear sign of the bank’s increasing market share in the retail segment. “We are on course to achieving the 6th consecutive year of double-digit savings growth”, he stated.

Total Deposits however increased by 12.0 percent to N1,097.0bn from N979.4bn driven by double-digit growth in both local and foreign currency deposits. Non-performing Loans (NPLs) Ratio improved to 5.4 percent from 5.7 percent in the 2018FY due to the growth in the loan book. With regulatory ratios such as the Capital Adequacy Ratio at 17.0 percent, Liquidity Ratio at 34.8 percent, well above required threshold, Okonkwo was optimistic that the bank will sustain this sterling performance in the second half of the year.

Fidelity Bank is a full-fledged commercial bank operating in Nigeria with over 4 million customers who are served across its 240 business offices and various digital banking channels.

The bank which focuses on select niche corporate banking sectors as well as Micro Small and Medium Enterprises (MSMEs), has in recent times won accolades as the Best SME Friendly Bank, Best in Mobile Banking and the Most Improved Corporate/Investment Bank among several industry awards and recognition.




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