Home Business Union Bank Declares N24.65bn PAT,  N0.25k Dividend For 2020FY

Union Bank Declares N24.65bn PAT,  N0.25k Dividend For 2020FY

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Union Bank of Nigeria (UBN) Plc on Friday declared a dividend of 25kper share to its shareholders for the financial year ended Dec. 31, 2020.

The bank said this in its audited financial statements for the year ended Dec. 31, 2020 released by the Nigerian Stock Exchange.

An analysis of the result shows a gross earnings of N156.89 billion in contrast with N159.86 billion achieved in the corresponding period of 2019.

Profit before tax rose to N25.43 billion compared with N24.75 billion posted in 2019.

Also, profit after tax stood at N24.65 billion from N24.38 billion in the comparative period of 2019.

Commenting on the results, the bank’s Chief Executive Officer, Mr Emeka Emuwa, said the company delivered a strong set of results in spite of the impact of the COVID-19 pandemic on its operations and the wider economy.

Emuwa said the bank’s investments in technology and building a progressive work culture over the past eight years, enabled a swift response to the pandemic that allowed its workforce transition to remote working while maintaining the productivity required to deliver these strong set of results in 2020.

“The bank has delivered a strong set of results notwithstanding the impact of COVID-19 on our operations and the wider economy, enabling the Board of Directors to continue to return value to shareholders with a proposed dividend payment for the second year in a row.

“This demonstrates the strong foundations we have built, as we continue to deliver against our target of becoming a leading financial institution in Nigeria.

“For the full year, we grew across key income lines. Net income after impairments grew 8.3 per cent from N95.5 billion to N103.4 billion and translated into 2.8 per cent  growth in profit before tax to N25.4 billion from N24.7 billion.

“The core of this performance is driven by the growth in our loan book, with 23.8 per cent increase in gross loans, to N736.7 billion from N595.3 billion in 2019,” Emuwa said.

He noted that the pandemic accelerated trends in customer behaviour with rapid increase in digital adoption.

“We have seen rapid increase in digital adoption with a 38 per cent year-on-year increase in active users on our UnionMobile channel with total active users now at 2.9 million.

“Our UnionOne and Union360 platforms for businesses grew by 11 per cent from 25,000 users to 27,700 users. 94 per cent of transactions in the bank are now done digitally, up from 89 per cent in 2019.

“We also aggressively grew UnionDirect (our agent network) by 6x from 3,100 to 18,100 in line with our focus on our retail business,” Emuwa stated.

He explained that with the bank’s investments yielding positive results, it was well positioned as a strong leader in the retail and digital space.

“In 2021, the bank will focus on enhancing revenues and shareholder value by revving up customer acquisition, engagement and transactions through seamless customer journeys and an optimised service delivery platform.

“I am convinced that with the excellent management team and a clear strategy in place, Union Bank is well positioned to continue to compete and deliver value to its shareholders,” he said.

Also speaking on the numbers, the Chief Financial Officer, Joe Mbulu said: “We are pleased with both our top and bottom-line performance in 2020, in light of the impact of the pandemic and economic challenges.

“Significant inflationary pressures and the translation of currency depreciation drove growth in our cost base.

“However, we maintained strong control, limiting operating expense increase to 10 per cent (N77.9 billion from N70.8 billion), well below the rate of inflation,” Mbulu said.

Consequently, he said the bank recorded marginal increase in cost to income ratio to 75.4 per cent from 74.1per cent.

“Our customer deposits hit a milestone during the year, crossing the one trillion naira mark to N1.13 trillion  from N886.3 billion in 2019, an increase of 27.1 per cent.

“We continued to proactively manage our growing risk asset portfolio and recorded better asset quality, with our NPL ratio improving from 5.8 per cent to 4.0 per cent.

“This achievement, combined with a solid capital adequacy at 17.5 per cent and continued top-line growth, provides the platform for strong growth going forward,” Mbulu said.

The chief financial officer said the bank would continue to grow its loan portfolio in 2021.

“We will continue to grow our loan portfolio in 2021, which we expect to be a significant driver of growth, combined with our value chain synergies across our business which will drive customer and transaction growth during the year and beyond,” he said.

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