19025_UNION_BANK_-_HALF-YEAR_JUNE_2017_FINANCIAL_STATEMENTS_JULY_2017
Union Bank of Nigeria Plc (UBN) on Thursday said its pretax profit for the period ended June 30, 2017 increased 5.99 percent to N9.46 billion from N8.92 billion posted a year earlier.
Profit after tax (PAT) also grew 5.01 percent to N9.20 billion from N8.76 billion declared in the same period of 2016.
Gross earnings of the lender, appreciated to N73.68 billion in the review period of 2017 from N60.06 billion recorded in 2016 half-year (H1); indicating a rise of 22.66 percent, Union Bank said in a filing with the Nigerian Stock Exchange (NSE).
“Union Bank remains on course to meet its key 2017 business objectives, including plans to raise up to fifty billion Naira (N50 billion) in Tier 1 capital through a rights issue during the third quarter. The capital increase supports UBN’s strategy to accelerate business growth and position itself as a leading commercial bank in Nigeria. The rights issue is expected to launch in the third quarter once all regulatory approvals have been secured,” the lender said in a statement.
Commenting on Union Bank’s half year results, Mr. Emeka Emuwa, Chief Executive Officer said:
” As our centenary celebrations continue and with the launch of our N50 billion rights issue in the second half of the year, 2017 will remain a very busy year for the Bank. With our clear focus on enhancing the operational efficiency of the franchise, Gross Earnings grew by 23 percent in the first half of the year to N73.7 billion, from N60.1 billion in H1 2016. In a challenged economy, the Group delivered Profit Before Tax (PBT) of N9.5 billion, a 6% growth over the corresponding period in 2016.
Despite stiff competition, our sales strategy and competitive brand continue to provide positive momentum, with Customer Deposits growing by 15 percent from December 2016 to N759.3 billion at the end of the period. In the second half of the year, our focus will centre on our rights issue launch; we will remain nimble to take advantage of emerging opportunities and while improving on service delivery to our customers.”
Speaking on the first half numbers, Chief Financial Officer, Oyinkan Adewale, said: “Improved foreign exchange availability enabled us to bring our foreign currency loan book down to 44 percent of total loans, from 50 percent at the end of 2016. 18 percent customer deposit growth in the Nigerian bank allowed us to bring Loans to Deposit Ratio down to 65 percent from 82 percent at the end of 2016. Sustaining low cost deposit generation momentum, we were able to improve our low-cost deposit base to 69 percent of total deposits, from 65 percent at the end of 2016.
The Group NPL ratio increased to 8.2 percent. This increase reflects the impact of a 5 percent decline in Gross Loans over the period, without which June 2017 NPL ratio would have been 7.82 percent. With total provision coverage in excess of 185 percent, NPLs remain extremely well covered.
Going into third quarter (Q3) 2017, we will focus on optimising funding costs and contine to keep operating expenses in check, while applying sound risk management practices to minimize impairment costs to ensure we deliver a sustainable financial performance.”
