Union Bank of Nigeria Plc says it made a profit before tax of N27.708bn for the financial year ended December 31, 2014, almost N24bn higher than the N3.769bn profit before tax the group reported for the corresponding year.

The group’s audited results for the year showed that it grew its gross earnings to N135.897bn from N121.398bn a year earlier, while its profit after tax rose to N26.825bn from N3.836bn.

The group explained that its profits were boosted by one-off gains from the sale of subsidiaries. Specifically, it said it realised N6.3bn from the sale of subsidiaries.

The Managing Director and Chief Executive Officer, Union Bank of Nigeria, Mr. Emeka Emuwa, was quoted in a statement from the group as saying that the focus for 2014 was on implementing the foundational pillars of our transformation strategy with a vision to rebuild Union Bank into a highly respected provider of financial services in Nigeria.

He said, “We optimised our talent base, making significant hires into key roles and ensuring we have the right people in the right functions, and aligned our staff compensation and overall costs to be competitive within the industry.

“We also overhauled operations and processes in order to consistently deliver quality service to our customers, and established a Central Processing Center to provide streamlined, cost efficient and consistent processing of branch operations. Notwithstanding the significant investments in these initiatives, we stabilised our cost line and kept expenses flat.”

The Union Bank MD explained that it recorded significant growth in net operating income, and the disposal of five of its non-banking subsidiaries, in compliance with CBN’s Regulation 3 requirement, added a substantial boost to its bottom line in 2014.

Going into 2015, he said, key financial indicators for the bank had been normalised and growth trajectory remains positive.

He added, “As we continue to execute strategic transformation initiatives, we expect to see continued improvement in both our financial and operational performance as we roll out a new core banking platform which will markedly transform our customer service and product delivery capabilities.”

The Chief Financial Officer, Union Bank, Mrs. Oyinkan Adewale, explained further that having substantially cleaned up its loan book in 2013, Union Bank was able to reduce net impairment charge by 75 per cent and improve NPL ratio from six per cent in 2013 to 5.1 per cent in 2014.

“We have better leveraged our capital base, with a 44 per cent growth in the loan book, and growth in loan to deposit ratio from 48 per cent in December 2013 to 64 per cent at the end of 2014. While undergoing significant spending on our transformation initiatives, we have kept OPEX (net of restructuring costs) flat,” she added.

According to her, Union Bank is on course to drive down its cost to income ratio towards our target of 60 per cent, with 68 per cent in 2014, down from 74 per cent in 2013.