By Omoh Gabriel, Business Editor
United Bank for Africa Plc (UBA), the pan African banking group with operations in 19 African countries, as well as presence in New York, London and Paris, released its Q3 2010 financial results, underlining its strong operating performance and inherent resilience in a challenging environment.
Pre-tax profits grew over 225%, compared with the same period in 2009. Profit before tax and exceptional items were N16.9 billion, compared to a loss of N13.5 billion in the same period last year. Despite the challenging environment we operated in, the Group reported gross earnings of N136.4 billion.
“This is a strong set of results that demonstrates both the Group’s prudent management and continued commitment to its strategic objectives” said Group Executive Director, Finance and Risk, Mr. Emmanuel N. Nnorom, noting that the Group’s focus on initiatives to reduce costs resulted in improved efficiencies, with operating expenses declining by 6.4% to N73.5 billion during the period under review.
Mr. Nnorom said that the Group continued its policy of ensuring adequate provisioning on risk assets. “However, the level of provisioning dropped by 84.6%, from N37.1 billion charged for the same period in 2009 due to extensive recoveries.”
On the balance sheet side, UBA recorded considerable growth in key parameters, when compared to December 2009. The Group’s asset base as at September 30, 2010 increased by 7.5% to N1.66 trillion (N1.55 trillion in December 2009).The Group’s liquid assets and liquidity ratio remain strong at 42% in comparison with the regulatory minimum of 25% and capital adequacy ratio at 17%, also above the regulatory minimum of 10%.
Deposits rose by 7.4% from N 1.25 trillion in December 2009 to N 1.34 trillion as at September 2010 and shareholders’ funds reached N 189.7 billion. Total capital was further enhanced by the recently raised N 20 billion in Tier 2 capital, through the issue of a 7 year unsecured subordinated bond.