Union Bank Plc has promised to deepen its focus on accelerating digitization to drive customer acquisitions and transactions in the country.
Emeka Okonkwo, the Chief Executive Officer of the bank who disclosed this in his reaction to the bank’s performance in the first quarter of the year,said its business and operating model are being enhanced to deliver on revenue and product penetration targets across geographies and segments where we have identified opportunities.
The bank’s Profit before tax went up by 12% to ₦6.9bn driven by higher non-interest income and lower operating expenses,gross earnings down by 15% to ₦36.4bn on account of lower interest environment in the Nigeria financial sector,while net operating income after impairments went relatively flat at ₦24.3bn
Non-interest income increased by 10% to ₦14.1bn due to successful debt recovery efforts, operating expenses down by 4% to ₦17.3bn because of outcome of sustained cost optimisation efforts,gross loans, up by 3% at ₦757.4bn,customer deposits flat at ₦1.1trillion and non-performing loans ratio flat at 4%
Speaking on the Q1 2021 numbers, Chief Financial Officer, Joe Mbulu said:
“We have continued to deliver improved efficiency, enabling growth in PBT, which grew by 12% to ₦6.9bn. We are continuing to partly mitigate the impact of a lower interest margin and high inflation environment by maintaining a focus on cost which drove a reduction in operating expenses by 3.4% from N18bn to N17.3bn and an enhanced cost-income ratio of 71.4%, from 74.3% in Q1 2020.
The 10% growth in non-interest income recorded during the quarter was supported by strong growth in recoveries as well as an improvement in net income from other financial instruments which rose by 109% to ₦3bn from ₦1.4bn.
Our capital position remains strong, with a capital adequacy ratio (CAR) of 17.3%, while our non-performing loan ratio remains good at 4%. These are critical enablers to deliver our 2021 strategic priorities.”
