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UBA hinges future performance on efficiency, asset quality


Kennedy Uzoka

Pan-African financial institution, United Bank for Africa (UBA) Plc, has assured its local and international investors that focus on improved asset quality, as well as the continuous adoption of cost efficient measures, will help it achieve the 2019 financial year objectives and priorities.

This, the bank said, will culminate to stronger indices, laced with the capacity to churn out strong double-digit growth in annuity-based trade services, enhanced offerings and improved customer service.

Already, the bank has instituted a number of enhanced risk management and control frameworks, which in no small measure, contributed to its financial performances and overall balance sheet growth over the years.

The Group Managing Director/Chief Executive Officer, Kennedy Uzoka, who noted this while presenting the bank’s 2018 full year results, during an international investor/analysts conference call, explained that UBA’s well diversified asset book, supported by stable funding structure, placed it in a premium position to perform remarkably despite the falling economic indices in its operating environment.

“Despite slow recovery in economic activities in Nigeria (our single largest market), the Group’s total assets has grown by 19.7%, driven largely by a strong deposit growth of 23%, as the drive for retail deposits continue to yield desired results.

“Leveraging on enhanced customer service, the Group grew retail deposits by 48%, thus strengthening the funding base and providing the foundation for lower cost of funds in 2019.”

“Notably, the growth in balance sheet also partly reflects the impact of exchange rate difference between the reporting dates (2017: N331/USD vs. 2018: N359/USD), as 37% of loans and 27% of overall balance sheet is FCY-denominated. The Group maintained its appetite for a well-diversified balance sheet, with over 60% in liquid, low risk instruments,” he said.

Uzoka explained to the investors that the bank recorded impressive growths across major financial lines, recording a 48 per cent year-on-year growth in retail deposits and improved CASA ratio to 77 per cent.

While speaking on the strength of the financial institution in the coming years, especially on the back of it’s African and non-African subsidiaries, Uzoka said the bank’s recent foray into key markets and economies remain a milestone that will catapult the institution in the coming years.

“UBA is a unique pan-African franchise with diversified risk and earnings across fast growing African economies with sound governance, risk management and compliance culture which can be seen from our adherence to international best practice.

“Our robust digital banking platform through which we are leveraging technology to serve over 15 million customers in a cost efficient approach that has helped to deepen African banking penetration.

“We have the strong financial capacity backed by high capitalization (BASEL II capital ratio well above requirement) and strong liquidity, and we have worked hard towards connecting Africa and the world through our presence in key African markets and major global financial centres such as New York, London and Paris,” he added.

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