Despite over N2trn shareholders’ fund, UBA ‘ll raise CBN-required component of capital —Alawuba
THE Group Managing Director and Chief Executive Officer of United Bank for Africa Plc, Mr. Oliver Alawuba has said that the bank is very well capitalised with shareholders’ fund in excess of N2 trillion, but will in due course, raise the required component of capital in line with the Central Bank of Nigeria (CBN)’s directives.
He made this known during the UBA full year 2023 investor conference call held over the weekend.
A lawuba thus provided insights into the Bank’s remarkable end of year 2023 Financial results.
According to him, the team of committed and motivated workforce, management and well diversified board will continue to work assiduously to sustain the bank’s performance and propel the it towards actualising strategic goals.
“We will continue to push the frontiers of innovation and technology adoption to build significant value for shareholders through our digital banking business.
“UBA will sustain its focus on the ‘Customer’, with unique value propositions in line with the ideals of our “Customer First” (C1st) Philosophy.
“We will also continue to leverage our diversified global operations and actively manage our balance sheet in response to rapidly changing macroeconomic conditions across our various markets.”
Against a backdrop of challenging and volatile geopolitical and economic conditions, UBA delivered another year of record earnings. “Our gross earnings and profit before tax reached their highest levels in our history.
This growth was fuelled by a significant increase in net interest income, due to a combination of a strong expansion in the loan portfolio, higher net interest margins, and a substantial contribution from foreign exchange operations.
Alawuba stated that the FX operations benefited from increased business activity and improved profit margins.
The Bank entered 2024 from a position of strength, with proven resiliency, a powerful brand and a strong capital position.
“As we begin 2024, “execution” will continue to be on the front burner, with an unrelenting focus on market leadership and excellent customer experience at all touch points.
“We are well positioned to continue our market-leading position across multiple markets and deliver on our ambition to grow. We have a strong customer franchise and core capabilities, “ he further stated,
Also speaking, the Executive Director, Finance and Risk Management, Ugo Nwaghodoh presented the key highlights of UnA›s Full-Year numbers, which shows that gross earnings rose from ₦853 billion same time last year to ₦2.1 trillion at the end of FY 2023. 143percent growth, largely on the back of strong double-digit growth in both the funded income and non-funded transactional incomes.
Given the inflation seen globally and the devaluation in some markets, operating expenses according to Nwaghodoh rose 78percent from ₦350 billion in 2022 full year to ₦592 billion at the end of 2023 full year.
And in spite of that, Peofit Before Tax (PBT) rose ₦557 billion from ₦201 billion in full year 2022 to ₦758 billion at the end of full year 2023.
And indeed, profit after tax up to ₦608 billion from ₦170 billion same time last year. Total assets grew 90percent to ₦20.7 trillion. Deposits also grew 93percent to ₦17.4 trillion.
He acknowledged that the valuation of the Naira, which is the reporting currency, is pivotal to some of the growth that were recorded on some of these balance sheet lines.
“The rise in the cost of risk was largely on the back of the fact that we feel that the portfolio impairment that we should carry should reflect the weakening in a number of economies and the impact of devaluation and removal of fuel subsidy, among others, on customers› businesses.
“And that has led to, for us, potential heightening of credit risk, which has meant that we needed to reserve much more for portfolio impairment. So, we expect that there might be some defaults somewhere down the lane, and we are reflecting all of that in the impairment numbers, “ he stated.
On outlook guidance for FY 2024, the Executive Director said UBA is guiding a full year deposit growth of about 20percent, loan growth of about 20percenr, cost of risk of about 3.8percent, non-performing loan ratio of about 4.5percent, return on average equity of about 30percent and return on assets of about 3percent.
Others are, capital adequacy ratio of about 30percent, cost to income ratio at about 45percent, and net interest margins will be about 7.5percent.
UBA received multiple external recognitions during the year, including :African Champion of the Year 2023 at the Africa Financial Industry Summit (AFIS) in Lome, Togo; Bank of the Year Africa 2023 awarded by The Banker, United Kingdom, solidifying our position as the leading financial institution on the African continent among others.
Other top executives that participated in the conference are: Muyiwa Akinyemi, Group Deputy Managing Director, Alex Alozie, Executive Director and Group Chief Operating Officer, Sola Yomi-Ajayi, Executive Director International Banking, Abiola Bawuah, Executive Director and CEO UBA Africa, among others.
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