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Union Bank of Nigeria Announces 23% Drop in Profit

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On the backdrop of weak gross earnings and decline in net interest income, Union Bank of Nigeria Plc (UBN), announced 23 per cent drop in profit after tax to N19.4billion in 2021 from N25.1billion reported in 2020.

 

 

 

The lender in its audited financial statement for full year ended December 31, 2021 released on the Nigerian Exchange Limited (NGX) also reported 20 per cent drop in profit before tax to N20.8billion from N25.9billion in 2020.

 

UBN in 2021 reported 7.3per cent growth in gross earnings to N172billion in 2021 from N160.3billion reported in 2020, while net interest income dropped by 23 per cent to N44.5billion in 2021 from N57.4 billion in 2020.

 

The group, thus, reported 18.5 per cent increase in total assets to N2.59trillion in 2021 from N2.19trillion reported in 2020.

 

The Chief executive officer, Union Bank of Nigeria, Mr. Emeka Okonkwo, in a statement said: “Following an enhancement to our operating and go-to-market model to deliver better performance and efficiency leveraging our network across the regions, we are increasing our customer engagement and product penetration which is translating into higher customer revenues across geographies.

 

“On the back of this, the Bank has continued to record headline growth by diversifying our income streams and accelerating our recoveries programme. For the full year, our gross earnings grew by 8.9per cent from N161billion to N175billion, while our net operating income after impairments dropped by 3.6 per cent to N99.7billion from N103.4billion. Interest income grew by one per cent as our earnings asset base expanded with a growing loan book.

 

“We continued our strong growth in non-interest income through a combination of aggressive recoveries, which grew 119per cent in the period, from N7.2billion to N15.9billion and further growth in fee and commission income (33per cent) and e-business (26per cent). These were delivered on the back of sustained multi-channel growth in users, volume and value across our digital and agent channels.

 

“Total active Union Mobile users now stands at 3.3 million, up 20per cent while our Union360 customer base grew by 22per cent to 26,400. In 2022, the Bank will continue to focus on broadening and deepening the strong foundations we have built, while enhancing our digital delivery platforms and service propositions to customers.

 

“We remain deeply thankful to our erstwhile core investors, Union Global Partners and Atlas Mara who have been instrumental to our journey since 2012. Their invaluable support and expertise helped steer the Bank through turbulent waters and into an era of growth and stability.

 

“As we turn a new chapter for our Bank with a new core investor expected to come on board, we are proud of the solid foundation built over the last ten years and look forward to a seamless transition and continued successes in the future.”

 

Also commenting, the Chief Financial Officer, Union Bank of Nigeria, Joe Mbulu said: “We maintained very strong cost controls during the year despite the inflationary pressures and the translation effect of currency depreciation on our cost base.

 

“Operating expenses increased marginally by 1.5per cent with increasing regulatory, depreciation and amortisation costs. Customer deposits grew by 20per cent while our loan book grew by 22per cent from N736.7billion to N899.1billion, as we deepened support for key sectors in the economy.

 

“We have been remained proactive in the way we manage our growing risk assets, maintaining our asset quality during the year with our NPL ratio growing marginally from four per cent to 4.3per cent.”

Culled from THISDAY

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