By Abdulquddus OKELE InvestAdvocate

Lagos (INVESTADVOCATE)-Africa’s global lender, the United Bank for Africa Plc (UBA) last Friday announced a total dividend of 85 kobo per share for the period ended December 31, 2017 as it reports sustained strong performance with growing contribution and market share from Africa.

The lender offered a final dividend of 65 kobo (20 kobo interim) amounting to a total dividend of 85 kobo per share compared to 75 kobo paid in 2016.

To show a significant growth in the contribution and market share from its pan-African subsidiaries, among other positive trends in the financial performance, UBA’s  pretax profit in the review climbed up 16.1 percent to N105.26 billion from N90.6.4 billion recorded a year ago.

Africa’s global lender said in a statement that subsidiaries outside Nigeria contributed a third of the Group’s top-line and 45 percent of the profit for the year, a remarkable improvement from 31 percent contribution made by the ex-Nigeria offices in 2016. This, according to market analysts affirms the success of the Bank’s expansion strategy, with target of 50 percent contributions by 2020.

The Bank’s operating income grew to N326.6 billion, a 20.6 percent increase compared to N270.9 billion recorded in 2016. This, according to analysts, affirms the capacity of the Group to deliver strong performance through varying economic cycles and challenging business environment.  

The audited results also showed that the Bank’s Total Assets peaked at N4.07 trillion, translating into 16.1 percent year-on-year growth from the figure of N3.50 trillion recorded as at 2016 financial year. In the 2017 financial year, the Bank’s Net loans achieved a prudent 9.7 percent growth at N1.65 trillion, while the customer deposits grew to N2.73 trillion, representing 10 percent YoY growth on N2.49 trillion recorded in 2016 financial year.  

“Reflecting a strong internal capital generation, the Bank’s shareholders’ fund also soared 18.2 percent to N529.4 billion in the 2017 financial year, the statement said.

“The results, underlines the success of our strategy of expanding across Africa, diversifying revenues and capturing the broader business opportunities inherent in Africa’s growth. The results reinforce the sustainability of our business model and the capacity to deliver superior long-term return to shareholders, as the economic and business environment improve, ” Kennedy Uzoka, the GMD/CEO of UBA said.

“In 2017, we made strong progress in our strategic initiative of dominating transaction banking across all our countries of operation, gaining market share in all lines of our business. Even as the non-oil sectors of our largest country of operation, Nigeria, remained relatively weak, we still grew earnings by 20 percent to N462 billion, a third of which is attributable to non-funded income,” he affirmed.  

On his part, Ugo Nwaghodoh, group chief finance officer(GCFO), speaking on UBA’s financial performance and position, said; “In a period of high interest rates, we achieved a relatively low 3.7 percent cost of funds. This operational efficiency reflects the benefit of our rich pool of stable savings and current account deposits. The net interest margin stabilized at 7 percent, even as yields on treasury assets dropped in the last quarter of 2017. Our core transaction banking offerings gained strong momentum, with income from these business lines growing by double digits.”

“We remain committed to our responsible approach to balance sheet management, with focus on growing risk asset and broader balance sheet in a profitable and prudent manner. Amidst a subdued Nigerian credit market, we grew our loan portfolio by 10 percent, leveraging our robust liquidity and capitalization to support good businesses through this challenging economic cycle. We closed the year with a Basel II capital adequacy ratio of 19 percent and a liquidity ratio of 50 percent, well ahead of 15 percent and 30 percent regulatory requirement respectively. Our disciplined approach to lending and broader risk management continues to uphold our asset quality,” Nwaghodoh added. 

Apart from the strong financial performance in 2017, UBA Group proved its leadership on the continent as the Banker Magazine crowned the Group, “African Bank of the Year 2017”.  To further demonstrate the group’s strength and dominance in the financial sector on the continent, four of UBA Group’s operations in Africa also led contenders in their respective countries to emerge the Best Bank of the Year 2017 in their respective markets. UBA Congo, UBA Tchad, UBA Gabon and UBA Senegal emerged the Best Bank of the Year in Congo, Tchad, Gabon and Senegal, reinforcing the strong franchise of the Group across its chosen markets in Africa.