April 25, 2019/InvestmentOme Report
- Net interest income of N58.1billion, up 5.7% q/q; up 8.4% y/y
- Non-interest income of N25.6billion, up 72.0% q/q, up 6.8% y/y
- Profit before tax of N30.1billion, up 9.0% q/q; up 13.6% y/y
- Profit after tax of N28.6billion, up 69.5.5% q/q; up 20.8 y/y
UBA posted its Q1 2019 late yesterday. It stated a 5.7% q/q (8.4% y/y) rise in net interest income, coupled with a 72.0% q/q (6.8% y/y) boost in non-interest income. These were enough to buffer impairment charges of N1.7billion (up 17.9% y/y) and a 7.6% q/q (4.6% y/y) rise in total opex. Resultantly, PBT was up 9.0% q/q (13.6% y/y) to N30.2billion, while PAT came in strong, up 69.5% q/q (20.8% y/y) to N28.7billion, on the back of a lower effective tax rate.
Similar to both Zenith & GT, UBA’s net loans were relatively flat q/q but up 4.7% y/y. Nonetheless, net interest margin and cost of funds were relatively flat. However, the bank’s interest income was up 4.9% q/q (9.1% y/y).
The bank also reported a 5.4% q/q growth in deposits. There was also a slight improvement in the deposit mix as term deposits declined 200bps q/q to 21% of total deposits. Despite the slight drop in fee and commission income, net fee and commission grew 16.4% q/q (11.7% y/y) on the back of the 27.7% q/q decline in fee and commission expense.
There was a slight improvement in cost to income ratio as it was down 190bps q/q to 62.1% despite the growth recorded in opex. Cost of risk increased marginally to 0.4% from 0.3% in Q4 2018.
To sum up, UBA’s performance was satisfactory with ROE and CAR of 22.3% and 24.5% respectively.
|
UNITED BANK FOR AFRICA PLC Q1 2019 (YE: DEC) (N millions) |
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|
Q1 2019 |
Q/Q |
Y/Y |
||
|
Interest Income |
98,561 |
4.9% |
9.1% |
|
|
Interest Expense |
-40,486 |
3.7% |
10.1% |
|
|
Net Interest Income |
58,075 |
5.7% |
8.4% |
|
|
Non-interest income |
25,637 |
72.0% |
6.8% |
|
|
Profit before provisions |
83,712 |
19.8% |
7.9% |
|
|
Loan Impairment charges |
-1,714 |
-127.9% |
17.9% |
|
|
Total Opex |
-51,944 |
7.6% |
4.6% |
|
|
PBT |
30,156 |
9.0% |
13.6% |
|
|
Tax |
-1,492 |
-86.1% |
-47.1% |
|
|
Tax rate |
4.9% |
-3391.0bps |
-566.8bps |
|
|
PAT |
28,664 |
69.5% |
20.8% |
|
Source: Company financials, Investment One Financial Services Research
|
Q1 2019 BANKS COMPARISON SHEET |
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|
NGN billion (unless stated otherwise) |
|
ACCESS |
ZENITH |
GT BANK |
UBA |
|
|
Key Income Statement Figures |
Gross Earnings |
160.1 |
158.1 |
110.3 |
131.7 |
|
|
Net Interest Income |
56.8 |
86.1 |
58.2 |
58.1 |
||
|
Non-interest Income |
46.8 |
32.7 |
35.8 |
25.6 |
||
|
Total Expenses |
-55.1 |
-59.4 |
-35.9 |
-51.9 |
||
|
Loan Impairment Charges |
-3.4 |
-2.1 |
-0.7 |
-1.7 |
||
|
Profit Before Tax |
45.1 |
57.3 |
57.0 |
30.2 |
||
|
Y/Y PBT Growth |
|
64.4% |
6.1% |
8.0% |
13.6% |
|
|
Dividend (Kobo per share) |
nil |
nil |
nil |
nil |
||
|
EPS (kobo per share) |
139 |
160 |
174 |
82 |
||
|
Key Balance Sheet Figures |
Total Assets |
6,427 |
5,877 |
3,556 |
5,115 |
|
|
Total Liabilities |
5,851 |
5,098 |
2,929 |
4,572 |
||
|
Total Equity |
576 |
779 |
627 |
543 |
||
|
Key Ratios |
Net Interest Margin |
5.6% |
8.9% |
9.9% |
7.0% |
|
|
Cost of Fund |
4.4% |
3.0% |
nil |
4.0% |
||
|
Cost to Income |
53.2% |
50.9% |
38.6% |
62.1% |
||
|
NPL ratio |
10.2% |
4.9% |
7.0% |
nil |
||
|
Liquidity (bank level) |
47.6% |
66.7% |
47.7% |
50.0% |
||
|
Cost of Risk |
0.5% |
0.4% |
0.1% |
0.4% |
||
|
Capital adequacy ratio (bank level) |
19.1% |
25.0% |
22.3% |
24.5% |
||
|
ROE |
30.9% |
25.2% |
32.8% |
22.3% |
||
|
ROA |
2.9% |
3.4% |
5. |
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