AFRICA’S Global Bank, United Bank for Africa Plc (UBA), emerged tops in asset growth among Nigeria’s major financial services institutions, especially those in Tier-1 category.
Details from the 2023 financial statements of the ‘Big Five’ recently submitted to the Nigerian Exchange Limited (NGX), revealed that UBA achieved the highest asset growth rate of 90.22 percent to beat its peers during the year.
While all the banks raked in tremendous earnings in both the topline and bottom-line performance, UBA stood at a significant distance ahead with almost doubled asset growth of 90.22 percent to N20.65 trillion in 2023 from N10.85 trillion in the previous year.
It was trailed by Access Holdings which recorded a 78 percent asset growth of N26.68 trillion during the period against N14.99 trillion in 2022, though it remains the largest bank by asset.
Zenith Bank Plc recorded an asset jump of 65.8 percent with N620.36 trillion delivered in 2023, compared with the N12.28 trillion in the preceding year, though it remains Nigeria’s most capitalized bank (N1.04 trillion).
Similarly, behemoth FBN Holdings Plc, Nigeria’s oldest financial services institution, hit a 60 percent asset growth of N16.90 trillion from N10.58 trillion in the previous year.
The reports also revealed that GTCO Plc’s asset growth of N9.37 trillion compared with the N6.45 trillion in prior year, constituted a 45.27 percent rise. This placed GTCO on the bottom of the ‘Big Five’ – all with a combined asset growth of 65.58 percent to N93.96 trillion in the review period, against N55.15 trillion in 2022.
UBA’s outstanding asset performance stemmed largely from a number of factors which includes a remarkable triple-digit growth of 139.5 percent in gross earnings from N835 billion reported in 2022 to N2 trillion in 2023.
This impressive triple-digit growth in gross earnings resulted in a year-on-year (YoY) increase of 277.19 percent in profit before tax (PBT) from N200.87 billion in 2022 to N757.68 billion in 2023.
Profit after tax (PAT) also recorded triple-digit growth of 257 percent from N170.27 billion to N607.69 billion in the period ended 31 December, 2023.
This performance not only sets a record for the bank but also ranks among the top two best results showing in the lead in asset growth.
The gross earnings of N2 trillion was also a contribution of enhanced unterest income of N1,075 or 93 percent increase while net interest income rose to N707.540 billion representing an 86 percent increase.
The group recorded net fees and commission income of N189.059 billion or 47.7 percent as trading and foreign exchange gains rose by 814 percent to N659.25 billion
Further study of the results showed that the increase in interest income is attributed to the growth in the size of risk assets and their effective repricing, alongside the rise in the yield of other interest-bearing instruments over the year. Growth in non-interest income was driven by significant trading gains and an increase in gains from the revaluation of foreign currencies.
Cost of fund (interest expense) increased tas a result of the high interest environment. Interest expense rose by 107 percent from N177.6 billion in 2022 to N367.8 billion in 2023. Notwithstanding the 77.42 percent growth in operating expenses in 2023, the Group’s bottom-line was not negatively impacted due to improved top-line performance.
The Group has continued to deepen its market leadership in key corporate and retail deposit segments as customer deposits increased by 90.4 percent from N7.82 trillion to N14.89 trillion in 2023.
The enhanced assets performance is also reflective of the growth in total deposits and the revaluation of foreign currency deposits. Gross loans grew by 61.51 percent from N3.43 trillion in 2022 to N5.54 trillion in 2023 due to the revaluation of foreign currency loans and the growth in local currency risk assets.
United Bank for Africa (UBA) was named the ‘African Bank of the Year’ at the 2023 Bankers Awards organised by The Banker Magazine — a publication of the Financial Times of London last December.
Dominating the African continent, UBA not only clinched the title of African Bank of the Year at the event, but also propelled its subsidiaries to victory in eight additional African nations.
The bank’s subsidiaries in Cameroon, Chad, Ghana, Cote d’Ivoire, Mozambique, Congo, Sierra Leone, and Tanzania all emerged as the Bank of the Year in their respective countries.
According to the statement, it would be the second time in the past three years that the bank has won the regional award as the best bank in Africa, after winning the title in 2021.
Oliver Alawuba, UBA’s group managing director, said the recognitions came as a reassurance that the bank was on track in its goal of consolidating its leadership position in Africa, and creating superior value for its stakeholders
“UBA is honoured to be named the Bank of the Year in these eight countries and to receive the overall Award for Africa,” he said.
He added. “This accomplishment is a testament to the hard work, dedication, and innovative spirit of the entire UBA team.
“We remain committed to delivering top-notch banking services that positively impact the lives of our customers across the continent.
“We have our millions of customers across the globe and our many thousands of staff to thank for this. They are the very reason why we keep winning and receiving these accolades.”
Joy Macknight, Editor of the Banker Magazine, said UBA remains a clear winner across a wide range of criteria, having performed impressively across its footprint with a strong financial performance across most of its markets.
“In a year of strong competition among the continent’s major banking groups, UBA has gained the edge on its rivals to win the Bank of the Year award for Africa for the 2nd time in three years,” she said.
“The award recognises the bank’s strength across Africa, including many of its most competitive markets.”
Furthermore, the Group is undertaking urgent necessary actions to meet the new minimum N500 billion equity capital requirement to maintain its international authorisation within the timeframe stipulated by the Central Bank of Nigeria (CBN). This will strengthen its presence in key markets to continue positioning for sustainable growth and value addition for stakeholders.
