Culled—Proshare
17/10/2018/NSE with additional comments from FBNQuest Research
United Bank for Africa (UBA) released Q3 ‘2018 results this morning. See below the results and initial view.
Source: NSE
FBN Quest – Initial View
Implications: When annualised, UBA’s 9M 2018 PBT tracks behind consensus PBT forecast of N113.8bn. As such, we expect to see the market to react negatively to this set of numbers.
Positives: Non-interest income grew 25% y/y – though largely expected – mainly driven by growth in income from trade transactions and e-banking income. Further down the P&L, PAT declined by 16% y/y due to based effects (income tax rate of 14.6% vs 10.6% in Q3 2017). In terms of balance sheet trends UBA‘s, loan book and deposits grew by 3% q/q and 10% q/q respectively.
Negatives: Funding income fell by -22% y/y while loan loss provisions increased by 14% y/y. While the former surprised negatively, the latter beat our forecast; however, the negative surprise was the more impactful of the two. As such, PBT came in flay y/y and missed by 31%.
Rating: We rate UBA Outperform. Our estimates are under review.
UBA Q3 2018 results: actual vs. FBNQuest Capital Research Est (N m’s)
Source: NSE; FBNQuest Capital Estimates
