Union Bank of Nigeria reports N16bn profit before tax in 9 months

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By Kayode Tokede

Union Bank of Nigeria Plc has announced its unaudited financial statements for the period ended 30th September, 2021 with profit before tax relatively flat at N16billion as against N15.9billion reported in nine months of 2020.

The Nigerian Exchange Limited (NGX) on Thursday announced gross earnings increase of three per cent to N121.8billion as against N118.8billion reported in nine months of 2020..

The bank also reported three per cent increase in net operating income after impairments to N71.2billionv as against N69.3billion reported in nine months of 2020, driven by stronger non-interest income.

Non-interest income is up 26per cent to N42billion (N33.4billion in 9M 2020) supported by growth in fees and commission from e-business, credit and trade transactions as well as debt recoveries.

Operating expenses went  up three per cent to N55.2billion (N53.4billion in 9M 2020), reflecting higher non-discretionary regulatory costs as well as depreciation and amortisation costs from technology spend.

Gross loans are up 16per cent at N855.7billion (N736.7billion in Dec 2020) reflecting increased lending to growth sectors of the economy.

Customer deposits are up 14 per cent at N1.3trillion (N1.1trillion in Dec 2020) reflecting gains from our marketing drive for low-cost deposits and deepened customer loyalty.

The Chief Executive officer, Mr. Emeka Okonkwo, in a statement said. “We continue to demonstrate the resilience of our business despite the volatility in the macro-economic environment, growing our gross earnings by eight per cent and delivering stable Profit Before Tax of N16 billion. This stability is underpinned by our strategic focus on deepening our customer engagements and meeting their needs as we grow our core business.

“Consequently, our deposit base is up 14per cent to N1.3 trillion, and our loan book has expanded by 16per cent to N855.7 billion driven by our compelling campaigns, new product offerings and effective sales channels. We have also achieved stronger transaction volumes across our businesses and channels, driving growth in fees and commissions, while we ensure robust cost controls.

“As we approach the end of the year, we are focused on building on our efficiency and optimising our core business while deepening our relationships with customers.”

Speaking on the nine months 2021 numbers, Chief Financial Officer, Joe Mbulu said, “We are focused on executing our plans for revenue diversification, driving strong growth in transaction volumes while we continue our strong debt recovery initiatives. These are mitigating the on-going impact of relatively low risk asset margins.

“During the period, non-interest income increased by 26per cent to N42 billion, driven by stronger net fee and commissions which gained 44per cent to N10.3 billion from N7.2 billion and recoveries which grew by 163per cent to N13 billion from N4.9 billion.

“We also maintained very strong control over our expenses, which grew by 3.3per cent, well below the rate of inflation as we continue to realise the benefits of our cost efficiency culture and mindset.

“With our capital adequacy ratio at 15.8per cent, above regulatory requirements and good asset quality with NPLs at 4.7per cent despite continued growth in our loan book, we are focused on further optimising our capital structure to support our growth plans as we look towards 2022 and beyond.”