Union Bank declares 39.3% increase in PAT

Union Bank Plc has declared 39.3 per cent increase in profit after tax to N13 billion in nine month period ended September 2016 from N9 billion in September 2015.

The bank in its report to the Nigerian Stock Exchange (NSE) said its profit before tax grew by 39 per cent from N9.6 billion to N13.3 billion in September 2016.

Union Bank gross earnings increased by seven per cent to ₦91.4billion from ₦85.4billion recorded in nine months of 2015.

The bank said its net impairment charge for credit losses rose by 388 per cent ₦12.8billion from N4.4 billion in nine months of 2015 with Non-performing loan (NPL) ratio increasing to 9.4 per cent as against seven per cent in 2015.

Chief Executive Officer of Union Bank of Nigeria, Mr. Emeka Emuwa, said, “Our core pre-tax profits are up 27 per cent to ₦12.4billion from N9.8billion during the same period in 2015, fuelled largely by interest income and our thriving retail business.

“We are encouraged by this performance which comes in the face of a recessionary environment, increased impairments and headwinds in our trade business due to scarcity of foreign exchange.

“Our steady effort to build a low cost, customer centric retail business over the past 18 months is demonstrating results and continues to win us a new, growing retail customer base, as well as industry recognition with our recent Business  Day Award for the Most Improved Retail Bank in Nigeria.

“While the operating environment remains a challenge, we will continue to focus on executing our strategy, defending our loan book and adhering to prudent risk management principles.’

Speaking further on the Bank’s numbers, Chief Financial Officer, Oyinkan Adewale said: “Our revenues are up across board and the Bank’s asset yields improved from 14.2per cent to 16.1 per cent when compared to same period in 2015. Our non-interest revenue is up 27per cent, excluding one-time gains, on the back of treasury and channel banking revenues in the retail business.

“We continue to manage our cost of funds, resulting in 14per cent reduction in interest expenses year-on-year, not withstanding a nine per cent growth in customer deposits and 25per cent increase in medium term borrowings.

“Our cost optimisation initiatives continue to yield good results; cost-to-income ratio has improved to 62 per cent to 70per cent in the previous year.

“Cost-to-income is buoyed by income and operating expenses in line with expectations in spite of inflationary and devaluation pressures. We will continue to implement our cost discipline initiatives across the Bank to stay within our cost targets.”