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The United Bank for Africa (UBA), one of the largest banks in Nigeria, has reported that its after-tax profits rose 25 percent year-on-year for the full year ended on December 31, 2015.

According to the bank’s audited full-year 2015 consolidated financial statements released late on Monday, after-tax profits rose to N59.65 billion in 2015, compared to N47.91 billion reported in 2014.

Gross earnings rose 10 percent to N314.8 billion, from N287 billion in 2014. Total assets and net assets declined by 0.3 percent and 3 percent to N2.753 trillion and  N332.62 billion, respectively.

"Our 2015 profit is a new record and I am pleased that our performance is beginning to reflect the hard work and discipline of our Board, Management and Staff in creating superior value for our stakeholders," UBA's Group Managing Director, Phillips Oduoza, said.

The bank reported that deposits declined 4 percent to N2.08 trillion, from N2.17 trillion reported the year before due to withdrawal of public sector deposits as implementation of the Treasury Single Account (TSA) began.

The bank’s higher year-on-year profits comes weeks after Fitch, a ratings agency, revised the credit rating of three large Nigerian banks – including UBA (others being First Bank and GT Bank) – from stable to negative because of their significant exposures to the oil and gas sector.

Fitch said, although UBA has a modest exposure to the oil and gas sector (20 percent of its loan book), it was concerned about the fact that one-third of UBA’s loan book is in foreign currency.

In 2015, UBA’s total non-performing loans rose 30 percent year-on-year to N45.25 billion, compared with N32 billion in 2014. The bank’s loan provisions for the 2015 full year also rose 37 percent year-on-year to N5.05 billion, compared with N3.18 billion in 2014.

However, net loans declined 3 percent to N1,038 trillion, from N1,073 trillion in 2014.

For the 2015 full year, UBA’s earnings per share rose to N1.79 compared with N1.53 recorded in 2014. The bank has proposed a divided of 40 kobo per share, plus an interim of 20 kobo bringing total dividend to 60 kobo per share.

"We remain committed to growing in a responsible manner that aligns with our vision of building an enduring institution. Notwithstanding the challenging business environment, our resilient business model, geographic diversification, proactive strategies, and strong governance created an edge for us through the year," Mr. Oduoza said.  

In contrast to UBA’s earnings growth, four other Nigerian banks, First Bank, Ecobank, FCMB and Diamond Bank have issued profit warnings to investors ahead of the release of their 2015 full-year results.
 
UBA recently announced the appointment of Kennedy Uzoka as its new Group Managing Director. Uzoka succeeds Phillips Oduoza, whose two terms as Group Managing Director expires on July 31, 2016.