Banking
UBA Raises Interim Dividend Payout by 150% After 438% Leap in H1 2023 Profit
By Aduragbemi Omiyale
The board of United Bank for Africa (UBA) Plc has raised the bar in the interim dividend payout for the first half of 2023, increasing it to 50 Kobo from 20 Kobo in the same period of 2023.
This was after the bank recorded triple-digit growth in the bottom line, as the profit before tax (PBT) jumped by 371 per cent to N404 billion from the N85.75 billion recorded in the first half of 2022, translating to an annualised Return on Average Equity of 57.7 per cent as against 17.1 per cent a year earlier, as the profit after tax (PAT) went up by 437.8 per cent to N378.24 billion.
As for the balance sheet, the total assets continued a strong upward trajectory, rising by 41.7 per cent to N15.38 trillion from the N10.86 trillion recorded at the end of last year.
In the period under consideration, customer deposits also rose by a sharp 42.4 per cent to N11.14 trillion from N7.8 trillion recorded at the end of 2022, and shareholders’ funds increased to N1.712 trillion, reflecting the group’s strong capacity for internal capital generation.
As for the top line, UBA also delivered an outstanding performance for the half year ended June 30, 2023, according to the financial statements submitted to the Nigerian Exchange (NGX) Limited on Tuesday amid the tough global macroeconomic backdrop and geo-political challenges.
Gross earnings went up by 164 per cent to N981.78 billion from N372.36 billion in the first six months of 2022, with operating income growing by 206.6 per cent to N783.96 billion from N255.67 billion.
Commenting on the results, the Group Managing Director of UBA, Mr Oliver Alawuba, said the exceptional performance underscored the company’s commitment to consistently deliver value to its shareholders.
He added that UBA made progress in digital payments and retail penetration and also benefitted from the effect of revaluation gains arising from the harmonization of foreign exchange rates at the different access windows in Nigeria.
“The Group recorded strong double-digit growth in revenues and profits from its operations; the result also reflects the effect of sizeable revaluation gains arising from the harmonization of currency exchange rates in Nigeria.
“Our reporting currency found a new exchange level at about N756 to $1 as of June 30, 2023, compared with N465 at the beginning of the year.
“The results again demonstrate the benefits of our long-held diversification strategy across Africa and globally. The growth of our international business, most recently in the UAE, only reinforces this earnings quality.
“Our business is on a steady growth trajectory as we further strengthen our risk management traditions and practices necessary technology investments to deliver premium service to our customers.
“We have also continued to finance landmark projects in critical sectors of the economies across Africa, facilitating intra-Africa trade with our valuable offerings and providing a versatile last-mile distribution network for Africa-bound donor and multilateral agency funds.
“The three core geographical pillars of our business (Nigeria, Rest of Africa and Rest of the World) are making strong contributions to the Group profit, further justifying our global strategy and business positioning across Africa, UAE, France, UK and USA, and demonstrating the benefits of positioning UBA as the financial intermediary for Africa and the rest of the world,” Mr Alawuba stated.
On the plans for the rest of the year, he said, “As we approach the last quarter of the year, the Group remains strategically positioned to sustain the strong performance, consolidating on H1 2023 results, to deliver superior returns to our esteemed shareholders.”
On his part, the Executive Director of UBA for Finance and Risk, Mr Ugo Nwaghodoh, said, “Our HY2023 financial numbers reflect excellent performance across key metrics as we diligently execute our priorities for the year. Annualized return on average equity at 57.7 per cent was bolstered by improved operating income and revaluation gains.”
By Aduragbemi Omiyale
The Central Bank of Nigeria (CBN) has reaffirmed that the old and new Naira notes will continue to be used for financial transactions in the country beyond December 31, 2024.
There had been rumours that the old and redesigned N200, N500, and N1,000 banknotes would no longer be legal tender from Wednesday, January 1, 2025, because the central bank would phase out the notes in compliance with a Supreme Court judgement of November 29, 2023.
But the apex bank, in a statement signed by its acting Director of Corporate Communications, Mrs Hakama Ali, on Friday, clarified that the apex court’s judgement being cited did not authorise the bank to phase out the banknotes by the end of this year.
According to her, the court allowed the CBN to leave the old and new notes to be used concurrently until it decides to gradually phase out the former.
The central bank’s spokesperson urged members of the public to disregard claims suggesting the old series of these denominations would cease to be valid at the end of this year.
She urged them to continue to accept all Naira notes for daily transactions, encouraging banks to also adopt alternative payment methods such as electronic channels to reduce the pressure on physical cash usage.
“The Central Bank of Nigeria (CBN) has observed the misinformation regarding the validity of the old N1000, N500, and N200 banknotes currently in circulation.
“In line with the bank’s previous clarifications and to offer further assurance, the CBN wishes to reiterate that the subsisting Supreme Court ruling granted on November 29, 2023, permits the concurrent circulation of all versions of the N1000, N500, and N200 denominations of the Naira indefinitely.
“For the avoidance of doubt, all versions of the naira, including the old and new designs of N1000, N500, and N200 denominations, as well as the commemorative and previous designs of the N100 denomination, remain valid and continue to be legal tender without any deadlines,” the statement noted.
By Adedapo Adesanya
Access Bank Plc, the banking subsidiary of Access Holdings Plc, has entered into a binding agreement with South African-based Bidvest Group Limited for the acquisition of 100 per cent equity stake in Bidvest Bank Limited.
The deal for the 24-year-old South African lender is due to be completed in the second half of 2025, upon regulatory approval.
This shows Access Bank’s further expansion plans in line with goals set by its late founder, Mr Herbert Wigwe.
The agreement to acquire 100 percent stake in Bidvest Bank reflects Access Bank’s commitment to strengthening its footprint in South Africa and consolidating on its position as the continent’s gateway to global markets as it seeks to optimise the benefits of recent acquisitions and accelerate its transition towards a greater focus on efficiencies.
Bidvest Bank, founded in 2000 is a niche and profitable South African financial institution providing a diverse range of services, including corporate and business banking solutions and diverse retail banking products.
As of its year ended June 2024, Bidvest Bank reported total assets equivalent of $665million and audited profit before tax of $20million.
Upon conclusion of this acquisition, Bidvest Bank will be merged with the bank’s existing South African subsidiary to create an enlarged platform to anchor the regional growth strategy for the SADC region.
This is coming just as the bank opened a new branch in Malta as part of efforts to focus on international trade finance after obtaining a banking licence from the European Central Bank (ECB) and the Malta Financial Services Authority (MFSA).
Access Bank said the licence marks a transformative milestone in bolstering Europe-Africa trade flows.
The Maltese branch was established by Access Bank UK Limited, the subsidiary of Access Bank Plc, which is also the subsidiary of Access Holdings Plc, which is listed on the Nigerian Exchange (NGX) Limited.
By Modupe Gbadeyanka
To strengthen Europe-Africa trade ties, Access Bank has opened a new branch in Malta. It will focus on international trade finance, employing approximately 30 people in its initial phase, with plans for controlled expansion over time.
It was learned that this Maltese branch was established by Access Bank UK Limited, the subsidiary of Access Bank Plc, which is also the subsidiary of Access Holdings Plc, which is listed on the Nigerian Exchange (NGX) Limited.
Access Bank Malta Limited commenced operations after obtaining a banking licence from the European Central Bank (ECB) and the Malta Financial Services Authority (MFSA).
Access Bank said the licence marks a transformative milestone in bolstering Europe-Africa trade flows.
Malta, a renowned international financial centre, and a gateway between the two continents, is strategically positioned to play a pivotal role in advancing commerce and fostering economic partnerships.
This strategic expansion into Malta enables The Access Bank UK Limited to leverage growing trade opportunities between Europe and Africa.
It underscores the organisation’s commitment to driving global trade, financial integration, and supporting businesses across these regions.
“By establishing operations in Malta, we will gain a foothold in a market that bridges European and North African economies, moving us one step closer to our goal of becoming Africa’s Gateway to the World.
“It further enhances our bank’s capacity to support clients with innovative solutions tailored to cross-border trade and investment opportunities,” the chief executive of Access Bank, Mr Roosevelt Ogbonna, stated.
“Europe has emerged as Africa’s leading trading partner, driven by initiatives such as the Economic Partnership Agreements between the EU and African regions and the African Continental Free Trade Area (AfCFTA).
“With Europe-Africa economic relations entering a new phase, The Access Bank Malta Limited is ideally positioned to deepen trade and meet the financing and banking needs of our clients in these expanding markets,” the chief executive of Access Bank UK, Mr Jamie Simmonds, commented.
Also speaking, the chief executive of Access Bank Malta, Renald Theuma, said, “Malta is uniquely positioned as a bridge between Europe and Africa, making it an ideal location for our subsidiary. This move allows The Access Bank Malta Limited to engage more closely with customers in Europe and deliver tailored financial solutions that drive growth and connectivity across both continents.”
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