- E-business Fees Rise 71% to ₦2.1bn
Driven by robust cost-efficiency measures, the Union Bank has announced its Group’s unaudited financial statements for the quarter ended March 31 2020 which showed impressive performance during the period.
A release by the bank revealed that the lender posted profit before tax of ₦6.2 billion which is 19 per cent higher compared to ₦5.2 billion in Q1 2019.
Gross earnings grew 18 per cent to ₦42.6 billion as against ₦36.1 billion in Q1 2019, driven by an increase in earning assets.
Similarly, interest income rose by 18 per cent from ₦25.2 billion in Q1 2019 to ₦29.7 billion in Q1 2020.
Further peep into the report showed that net interest income before impairment climbed by 38 per cent to ₦14.8 billion when compared to ₦10.8 billion in Q1 2019, driven by the growth in treasury assets.
Non-interest income recorded 18 per cent increase to ₦12.9 billion compared to ₦10.9 billion in Q1 2019, driven by robust trading income, growth in e-business and revaluation gains.
The bank’s net operating income was ₦24.2 billion representing 7 per cent from ₦22.7 billion in Q1 2019.
Other impressive highlights of the report include operating expenses slightly up 3 per cent to ₦18.0 billion compared to ₦17.1 billion in Q1 2019; gross loans which recorded 3 per cent rise to ₦611.1 billion from ₦595.3 billion as of December 2019, and customer deposits that rose by 1 per cent to ₦897.6 billion against ₦886.3 billion at December 2019.
Commenting on the results, the CEO, Emeka Emuwa, said: “Coming off a strong 2019, we maintained focus on executing our strategic priorities in Q1 2020, delivering double-digit growth across all our major income lines.
“Profit Before Tax (PBT) grew by 19 per cent to ₦6.2 billion from ₦5.2 billion in Q1 2019. Our Gross Earnings are also up by 18 per cent to ₦42.6 billion from ₦36.1bn in Q1 2019.
“Our platforms and channels continue to drive our performance as Non-Interest Income increased by 18 per cent from ₦10.9 billion in Q1 2019 to ₦12.9 billion for the period with e-business fees contributing ₦2.1 billion, a 71 per cent growth compared to Q1 2019.
“The current COVID-19 pandemic presents daunting challenges for the global economy and consequently Nigeria and our business.
“Our focus in the short term is on ensuring business continuity through our strong operational risk framework; ensuring the health and well-being of our employees by adopting stringent health and safety protocols at our operating branches and offices; and supporting our customers through the crisis.
“We have reinforced our digital platforms to continue delivering value and convenience to our customers while aligning our focus areas to where opportunities emerge during and post COVID-19.
“We will continue to support the government, private entities and our communities in the fight against COVID-19.”
Also, speaking on the Q1 2020 numbers, Chief Financial Officer, Joe Mbulu said: “Headline numbers delivered 19 per cent growth in profit before tax to ₦6.2 billion compared to ₦5.2 billion in Q1 2019.
“The 18 per cent Y-o-Y growth in non-interest income was driven by stronger trading income of ₦5 billion compared to ₦2.2 billion in Q1 2019, e-business income of ₦2.1 billion compared to ₦1.2 billion in Q1 2019 and revaluation gains of ₦2.7 billion compared to ₦0.1 billion in the same period last year.
“Our operational efficiency also improved with cost-income ratio declining Y-o-Y to 74.3 per cent from 76.9 per cent in Q1 2019 as our cost optimisation programme continues to yield results.
“We have also kept NPL ratios flat currently at 5.9 per cent compared to 5.8 per cent as at December 2019.
“While the current COVID-19 pandemic has dimmed the global economy outlook for the year, we will leverage our strong capital position with Capital Adequacy Ratio (CAR) at 19.9 per cent and our solid risk management framework towards delivery of our 2020 objectives.”