Banking
UBA Expects Overseas Operations to Boost 2018 Earnings
By Dipo Olowookere
Last month, the United Bank for Africa (UBA) Plc announced that its London subsidiary had been given the permission to operate wholesome banking activities in the United Kingdom.
This made the Africa’s global bank the only Sub-Saharan African lender to conduct banking operations in New York and London, as well as 20 other African countries.
For the Head of Investor Relations at UBA, Mr Abiola Rasaq, this development will boost earnings of the financial institution in 2018.
Speaking with newsmen at a briefing in Lagos last week, Mr Rasaq noted that with the expansion to the UK and the US, UBA would record more business from its operations in those jurisdictions.
“We took a decisive step to expand our business in London. We have a subsidiary in London, which is in addition to the New York office.
“To the best of our knowledge, we are the only Nigerian bank that has a deposit-taking licence in the United States. No other bank in Nigeria does that. And we say that proudly because today, we also service the correspondent banking needs of a number of Nigeria banks in the USA because of our deposit-taking licence.
“So, what we did was to take our business in the UK a little further by applying to the UK Prudential Regulation Authority, which is more or less like their central bank. We applied to the PRA and invariably to the Financial Conduct Authority of the UK.
“Just early this year, we were given the authorisation to deepen and expand our business in the UK.
“We are happy to say that 2018 going forward, you will see more business going through our UK business,” Mr Rasaq told journalists at the press conference.
Commenting the lender’s mobile banking app, Mr Rasaq said the platform has recorded a huge success, emerging highest at 4.2 among other Nigerian banks’ apps in the Google Store,
“There is lot of things we are doing around our digital banking, because we have seen that this is the way to go; that if the future of banking.
“To that extent, the best thing to do is to continue to go digital, so that we can serve our customer best,” he said.
Mr Rasaq said the bank will continue to grow the business and make it a world class financial institution and an envy of the continent.
Also speaking at the event, the Group Chief Finance Officer of UBA, Mr Ugo Nwaghodoh, attributed the bank’s improved performance in the 2017 financial year to prudent balance sheet management, among other things.
In its 2017 earnings, UBA recorded gross earnings of N462 billion, a 20 percent growth in overall revenue for the year.
This, according to Mr Nwaghodoh, was due to growth in loan book and treasury assets, as well as efficient balance sheet management.
“The yield environment was positive and relatively high during the first half of the year. Despite growing our revenue, we also had strong control on our cost of funding.
“The banking business is intermediation. How efficient you are in the intermediation process is very vital. This borders on how much you bought money and sold money.
“Cost of funding was kept under significant check despite the tight liquidity environment you saw in the second half of the year. We were able to keep our weighted average cost of fund at 3.7 percent.
“We kept it constant from 2016 in a market where fixed deposit interest rate went as high as 20 percent.
“That efficiency in interest income and cost of funding side led to a net interest income growth of about 25 percent,” he said.
In its financial statements for the year ended December 31, 2017, UBA declared a profit after tax of N78.6 billion compared with N72.3 billion in the corresponding period of 2016, while it achieved a profit before tax of N105.3 billion in 2017 against N90.6 billion in 2016.
In addition, the bank achieved an interest income of N325.7 billion against N264 billion in 2016, while the net interest income stood at N207.6 billion as at December 31, 2017 compared with N165.2 billion as at December 31, 2016.
For the net trading and foreign exchange income, it closed at N49.1 billion in the period under review against N43.8 billion in 2016.
In 2017, the group’s Nigeria operations contributed N314.5 billion to the total N461.6 billion generated as revenue compared with N268.8 billion in 2016, while the rest of Africa added N150.7 billion to the revenue versus N121.9 billion in 2016, and its operations outside Africa added N12.6 billion last year against N9.8 billion two years ago.
Furthermore, out of the N78.6 billion raked as profit in 2017, Nigeria contributed N41.1 billion compared with N47.2 billion in 2016, rest of Africa added N33.8 billion in 2017 against N24.3 billion in 2016, and outside Africa put N5.3 billion in 2017 in contrast to N3.4 billion in 2016.
By Modupe Gbadeyanka
About N3.6 trillion has been repaid to the Central Bank of Nigeria (CBN) by the Asset Management Corporation of Nigeria (AMCON) since its inception in 2010.
This information was revealed by the chief executive of AMCON, Mr Gbenga Alade, during a media parley to update the press on the activities of the agency.
Mr Alade said at the moment, the organisation still owes the central bank about N3 trillion for toxic assets of banks in the country.
He praised the organisation for its asset recovery drive, stressing that when compared with others across the world, Nigeria has done well.
“It is important to stress that the corporation has done tremendously well, especially when compared to other notable government-owned Asset Management Corporations around the world.
“Based on the balance at purchase, AMCON outperformed other Asset Management Corporations all over the world by achieving over 87 per cent in recoveries despite the unique challenges associated with debt recovery in Nigeria.
“The Malaysian Danaharta, which is adjudged one of the best performing Asset Management Corporation’s, only achieved 58 per cent. The Chinese Asset Management Corporation, despite its stricter laws, achieved just 33 per cent.
“Only the Korean Asset Management Corporation (KAMCO), South Korea, has achieved more recoveries than AMCON, with about 100 per cent. This was due to their brute force with which they chased the obligors.
“Despite KAMCO’s recovery records, the agency is still operational to date with slight realignments in its mandate.
“Other noted Asset Management Corporations that have transitioned into a perpetual institution of the various governments include, China Asset Management Company, Federal Deposit Insurance Corporation (FDIC) USA, and KFW Germany.
“So, gentlemen, without sounding immodest, AMCON has done well, and we will not relent until all the outstanding debts are fully realized,” Mr Alade stated.
On the financial performance of AMCON, he said last year, the firm posted a revenue of N156.25 billion and operating expenses of N29.04 billion, while for the 2025 fiscal year should be a revenue of N215.15 billion and operating expenses of N29.06 billion.
By Modupe Gbadeyanka
One of the non-interest banks in Nigeria, The Alternative Bank (AltBank), has opened a new branch in Effurun, Delta State.
The new office will serve the Edo-Delta region and provide purposeful banking and real financial empowerment for individuals, entrepreneurs, and businesses, a statement from the firm stated.
The lender disclosed that the Effurun branch is a bold move in its mission to reshape banking in Nigeria.
The launch was graced by key dignitaries, including the Ovie of Uvwie Kingdom, Emmanuel Ekemejewa Sideso Abe I; the Chairman of Uvwie Local Government, Anthony O. Ofoni, represented his vice, Andrew Agagbo; and the Special Adviser to the Governor of Delta State on Community Development, Mr Ernest Airoboyi; amongst others.
The Divisional Head for South at The Alternative Bank, Mr Chukwuemeka Agada, emphasised the institution’s commitment to Warri and its surrounding communities.
“By establishing a presence here, we are initiating a transformation in the way banking serves the people of Delta. Our purpose-driven approach ensures that customers’ financial goals are not just met but exceeded,” he stated.
“This branch represents our pledge to empower Warri’s dynamic businesses and families, providing them with the tools to grow without compromise,” Mr Agada added.
“We understand the heartbeat of this community, and we are excited to integrate our bank into the fabric of this dynamic region,” he stated further.
On his part, the representative of the Ovie, Mr Samuel Eshenake, challenged the bank to facilitate development and employment within the Effurun community.
The Regional Head for Edo/Delta at The Alternative Bank, Mr Akanni Owolabi, embraced this challenge, pledging that the bank will work sustainably to drive local commerce.
“At The Alternative Bank, we are committed to being an active partner in the development of Effurun. We see this branch as a catalyst for creating opportunities, driving employment, and supporting the growth of local businesses.
“Our mission is to empower this community, ensuring that every step forward is one of progress, prosperity, and shared success.”
By Aduragbemi Omiyale
A partnership aimed to enable seamless, real-time and secure transactions for cardholders across Africa and the rest of the world has been entered into by Payattitude and PAPSSCARD, the card scheme initiative of the Pan-African Payment & Settlement System (PAPSS).
The collaboration will allow Payattitude cards issued by banks and other deposit-taking institutions to be co-branded with PAPSSCARD, Discover, Diners and Pulse for acceptance across their networks in Nigeria, Africa and worldwide.
As an initiative of the African Export-Import Bank (Afreximbank) and a key financial infrastructure supporting the African Continental Free Trade Area (AfCFTA), the PAPSSCARD scheme will facilitate instant cross-border payments in local currencies.
“This partnership reflects our commitment to cross-enterprise alliances and enabling inclusive, efficient, and borderless payments across Africa and the world
“With Payattitude, Nigerian cardholders and financial institutions can now enjoy the benefits of a Nigerian card that can be used worldwide,” a director at Payattitude, Dr Agada Apochi, said.
The acting chief executive of PAPSSCARD, Mr John Bosco Sebabi, said the aim is “to connect African payment ecosystems, reduce the cost and inefficiencies of cross-border payments, and strengthen African sovereignty over payments infrastructure.
“Collaborating with Payattitude, a key innovator in Nigeria’s payment space, represents a significant step towards a more unified African payment landscape.”
The chief executive of PAPSS, Mr Mike Ogbalu, said, “By bringing together PAPSSCARD’s robust cross-border payment capabilities with Payattitude’s leadership in the Nigerian digital payments, we are taking tangible steps toward building a single African market where individuals and businesses can transact easily and securely, both within and beyond Africa.”
Payattitude is the first-in-kind Nigerian Payment Scheme to pioneer multibank App and USSD Code *569#.
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