16 Oct NIGERIA | UBA Plc | Earnings Flash | 16-Oct-2017 | Elixir Research
Dear Valued Investor,
United Bank for Africa Plc., today posted its Q3-2017 results. The numbers came-off strong across key indicators with the bank recording encouraging growth year-on-year. However, on a quarter-on-quarter basis, profit was marginally weak probably due to the relatively lower yield environment in Q3.
Key highlights below:
• Year-to-date, the bank reported 6.05% expansion in its loan book to ₦1.60 trillion and 1.37% growth in deposits to ₦2.52 trillion.
• Gross earnings up 26% y/y to ₦333.91 billion, made up of a 30% y/y jump in interest income to ₦238.09 billion and 19% y/y growth in non-interest income. As with the high interest rate environment, interest expense rose by 21% y/y to ₦85.80 billion.
• Impartment loss rose 42% y/y to ₦12.91 billion. Total operating expenses increased to ₦145.70 billion, up 26% y/y from ₦115.30 billion.
• PBT was 33% y/y higher to ₦78.33 billion while PAT rose by 23% y/y to ₦60.92 billion due to a sharp jump in taxation to ₦17.41 billion, up 87% y/y. However, PBT was down 35.1% q/q to ₦20.8 billion and PAT lower by 10.6% to ₦18.6 billion.
The outlook generally is still positive for the banks as they consolidate on favourable yield on investment assets and stable foreign exchange market to deliver solid numbers for 2017, though impairment levels remain a major worry. However, going into 2018, the pressure to grow earnings from the loan book will be more given lower outlook on interest rates. Single-digit loan growth clearly shows that the bank was not aggressive with risk asset creation.
Kindly see snapshot of the result below: