UBA: Powering Ahead with Stunning Repeat Performance in Q3

For its unbroken record performance in the first three quarters of the year, Africa’s Global Bank, United Bank for Africa (UBA) Plc, has not only demonstrated that old age comes with experience, but that its plan to end the year with a superlative performance is achievable, reports Festus Akanbi

It wasn’t all that long ago when Nigerian banks had a dose of the challenges that shook the nation’s economy to its foundation between December 2022 and March this year.
It was a period of uncertainty brought by an unpopular policy of the naira redesign which placed Nigerian banks at the receiving end of pressure from the customers and the regulatory authorities, with the attendant fear that the confusion might scuttle efforts of banks to post good performance results for year 2023.

However, as the 2023 financial year began to unravel, banking industry watchers could observe that despite the prevailing economic crisis, many banks were able to break even and surpass previous performances, a development which was attributed to years of investment in key human and technology as well as a clear understanding of the industry.
One of these leading operators with a strong consistency in its impressive performance is Africa’s Global Bank, United Bank for Africa (UBA) Plc. The bank has over seven decades of providing uninterrupted banking operations, dating back to 1949 when the British and French Bank Limited (BFB) commenced business in Nigeria.
UBA, which undeniably tops the chart of the front runners in the Nigerian banking industry, during the week, released its third quarter, 2023 performance results (an impressive growth across all key performance metrics) which clearly showed a considerable improvement over its second quarter results.

Facts and Figures

In continuation of its remarkable performance achieved in the first two quarters of the current fiscal year, the bank’s gross earnings grew by 115.2 per cent to N1.309 trillion up from N608bn recorded last year, while operating income rose by 146 per cent from N414 billion in September 2022; to N1.018 trillion in the year under consideration.
The bank’s financial report also indicated an impressive 262% rise in Profit before Tax (PBT) to close at N502.01 billion compared to N138.49 billion recorded at the end of the third quarter of 2022, while profit after tax also rose impressively by 287.2% from N116 billion recorded a year earlier to N449.29 billion massively surpassing its annualised return on average equity for Q3 2023 at 131 per cent to 44.37%.
The results showed a very strong balance sheet, as the Total Assets rose to N16.24 trillion, representing a 49.5% increase over the N10.86 trillion recorded at the end of December 2022, while its Customer Deposits rose to N11.63trillion, representing a 48.6% rise, up from N7.8 trillion at the end of the last financial year.  
Its shareholders’ funds remained very strong at N1.778 trillion up from N922.1 billion which it recorded in December 2022, an indication of a strong capacity for internal capital generation and growth.

Earlier in its second quarter results, UBA had demonstrated substantial progress in increasing the contribution and market share from its subsidiaries in Africa and globally. The group reported a profit before tax of N404 billion, representing an extraordinary increase of 371 per cent when compared to N85.75 billion recorded in the first half of 2022. This translated to an annualised Return on Average Equity of 57.7 per cent as against 17.1 per cent a year earlier.
The results also showed as of June 30, 2023, a profit after tax (PAT) of N378.24 billion, representing a leap of 437.8 per cent over H1 2022. Operating Income grew by 206.6 per cent to N783.96 billion in June 2023; higher than N255.67 billion reported a year earlier.

The Group delivered a 164 per cent growth in its Gross Earnings which rose to N981.78 billion as of June 2023, up from N372.36 billion recorded last year in June 2022. Total Assets continued a strong upward trajectory, rising above the N15trn mark, as it hit N15.38 trillion, representing a 41.7 per cent leap up from N10.86 trillion recorded at the end of last year.  Customer Deposits also rose by a sharp 42.4 per cent to N11.14 trillion in the period under consideration; as against N7.8 trillion recorded at the end of 2022.
Shareholders’ Funds increased to N1.712 trillion reflecting the Group’s strong capacity for internal capital generation.

Working Round the Clock

Banking industry watchers noted that the growth trajectory, which has continued to ender UBA to investors and the banking public in all its areas of coverage didn’t just come without working for it.  It was pointed out, for instance, that while other banks are limited by some of the current economic realities in Nigeria and in Africa, the management of UBA has continued to push the frontiers of performance.
The bank recently announced an initiative aimed at providing robust and comprehensive financing solutions to support and boost activities of Small and Medium scale Enterprises (SMEs) across the African continent.

Through this initiative, UBA will be allowing SMEs to access financing for small businesses that specialise in the key sectors of Agro-processing, Pharmaceuticals, Automotive Transport, and Logistics.
The financing initiative is powered by UBA’s recent partnership with the African Continental Free Trade Area (AfCFTA) secretariat to provide financing for up to $6 billion over the next three years to eligible SMEs across Africa, an agreement which was signed on the sidelines of the 30th Afreximbank Annual Meeting (AAM) which was held in Accra, Ghana.

Another initiative entered this year was its commitment to the empowerment of the continent’s creative industry, pledging to continue leading the charge in this sector. According to the bank’s Group Deputy Managing Director, Muyiwa Akinyemi, UBA has made substantial investments in the creative industry, including its lifestyle and entertainment channels, REDTV and REDRadio, which he said are a testament to the bank’s visionary commitment towards nurturing and promoting talent. He said that these strategic endeavours have acted as transformative catalysts, propelling the growth of the creative sector and enabling Africa’s talents to shine brightly
Also, in recognition of its solid presence in Africa, UBA was admitted as a member of the prestigious Partnership for Carbon Accounting Financials (PCAF). By this admission, UBA is the only financial institution from West Africa to be selected and listed among the 14 members of the global core team representing all regions.

According to the chief executive officer, of PCAF, Ace Robinson, “UBA stood out exceptionally after a rigorous application process, which attracted over 50 highly qualified candidates from across the PCAF signatory community. The bank is the only financial institution from West Africa to be listed on the prestigious global core team, which is commendable and shows that UBA is indeed at the forefront when it comes to pushing the Carbon Accounting agenda.
Perhaps, one of its greatest investments is the one on its human resources. The bank was one of the few operators which reaffirmed its commitment to prioritise the welfare of their employees and their families amid the current economic realities and its impact on living conditions.
The bank recently announced the implementation of a cost-of-living adjustment for its staff effective immediately, saying over the past few months, it had closely monitored the effect of the rising cost of living on its employees and recognised the importance of addressing these challenges proactively. Labour issues commentators said UBA has again warmed itself into the hearts of its employees because the upward salary adjustments were done without being pushed to do so.

Eyes on Full-Year Performance

Commenting on the third quarter result, UBA’s Group Managing Director/CEO, Mr. Oliver Alawuba, remarked that the Group has once again shown sustainable and remarkable improvement in key performance metrics over the period, reflecting its commitment to delivering value to shareholders and various stakeholders.
Speaking on plans and strategy to sustain and surpass the performance at the end of the year, the GMD explained that the bank will continue to leverage its customer-centric strategies, speed to market, and innovation to consolidate market share in its various jurisdictions, as he pledged the bank’s commitment towards expanding and deepening digital and other transactional banking offerings while building strategic alliances to take advantage of emerging opportunities in due time.

“Looking ahead, we are optimistic that the growth trajectory will be sustained in the final quarter of the year as we remain focused on consolidating the gains achieved so far in delivering enhanced returns to our shareholders.,” Alawuba pointed out.
United Bank for Africa Plc is a leading Pan-African financial institution, offering banking services to more than 35 million customers, across 1,000 business offices and customer touch points in 20 African countries. With a presence in New York, London, Paris, and Dubai, UBA is connecting people and businesses across Africa through retail, commercial, and corporate banking, innovative cross-border payments and remittances, trade finance, and ancillary banking services.