Pan-African financial services group, United Bank for Africa (UBA) Plc, has announced its full year 2016 financials, showing consistent growth trajectory with impressive contributions from the bank’s eighteen African subsidiaries (outside of Nigeria), which jointly contributed over 32 percent of the Group’s revenue.
The feat achieved by the subsidiaries is a remarkable improvement compared to 2015 financial year, when the businesses cumulatively contributed a quarter of the revenue.
The bank’s result released last week showed that of the 18 UBA subsidiaries in Africa, 16 are profitable, whilst the remaining two subsidiaries showed strong prospect for becoming profitable in 2017, as the businesses recorded significant market penetration in 2016.
Group managing director, UBA Plc, Mr Kennedy Uzoka, who disclosed this, expressed delight at the performance of the subsidiaries, particularly as he had direct responsibility for the subsidiaries whilst he was the deputy managing director before he was appointed the group managing director in 2016.
Notably, Kennedy, who was the CEO, UBA Africa until his appointment, successfully transformed the businesses within three years, raising the contribution of the subsidiaries to almost a third of Group’s revenue, from barely 20 per cent in 2013.
He added that the staff were fully committed and diligent in executing the bank’s strategies towards improving service quality all of its channels and across geographies.
He therefore, reiterated his optimism on a positive outlook for the Group, as he believes that UBA has the capacity to sustain strong growth in Nigeria and across the chosen markets in Africa.
“We grew gross earnings by 22 per cent to N384 billion, supported by strong growth in both interest and non-interest income lines. The local currency weakness in a number of our chosen markets, particularly the naira devaluation in Nigeria, impacted on our cost of doing business. Nonetheless, we continued to implement our cost management initiatives, which helped to mitigate the inflationary pressure on our operating expenses,” he said.
Continuing, he added, “We will remain prudent in our risk asset creation, with diligent adherence to our risk management best practices. Whilst we will continue to grow across our operations in Africa, now representing 32 per cent of Group revenue, we will maintain our culture of banking only quality and profitable assets.”
On his part, UBA’s chief financial officer, Mr Ugo Nwaghodoh, expressed optimism in the markets where the bank operates, disclosing plans to focus more on key areas.
“For instance, Cote d’Ivoire is a strong market for us and we have put things in place to strengthen our business there. We want to deepen our market share in that market and improve our service and product offerings, such as the introduction of novel digital banking offerings, and we are indeed looking at some big transactions that will ensure our scale in a way that aligns with our culture of prudent and quality growth,” he said.
He expressed satisfaction at the performance of the bank’s Africa operations, particularly in synergy extraction and pursuit of scale economics to achieve market share and earnings targets.
“Our performance in 2016 reflects the strong potential and resilience of our business. We grew top and bottom lines by 22 per cent and 32 per cent respectively and we are making remarkable progress towards our medium-term vision for our African subsidiaries (ex-Nigeria), which contributed a third of our profit, as we continue to leverage innovative offerings to grow our share of the respective markets,” Nwaghodoh said