Tony Elumelu’s United Bank for Africa reports $254.4 million in profit for 9M 2021

One of Nigeria’s largest financial services groups, United Bank for Africa Plc (UBA), has posted N104.6 billion ($254.4 million) in profit between Jan. 1 and Sept. 30, as the group’s earnings benefit from double-digit growth in net-interest income thanks to its pan-African business diversification.

Figures contained in the company’s third-quarter filing revealed that profits for the nine-month period ending on Sept. 30 rose by 35.6 percent from N77.1 billion ($187.6 million) in 2020 to N104.6 billion ($254.4 million) in 2021.

UBA is a Nigeria-based financial services group with operations in 20 African countries, the UK, the United States and France.

One of Africa’s most influential businessmen, Tony Elumelu, holds a substantial 6.39-percent stake in the group, deriving a $44.7-million (N18.4 billion) asset valuation from the pan-African bank, which ranks among Nigeria’s largest lenders.

The bank’s solid financial performance in the first nine months of its current fiscal year was driven by its well-diversified banking business.

The diversity in its interest-income mix, coupled with its effective cost-optimization strategy, gave profits the necessary 35.6-percent boost in the period under review, as net-interest income grew by 23.3 percent to N229.3 billion ($557.7 million), while interest expenses declined by 12.7 percent to N114.4 billion ($278.4 million).

Meanwhile, non-interest income declined marginally from N107.8 billion ($262.2 million) in the first nine months of 2020 to N105.6 billion ($256.9 million) in the same period in 2021 as a result of income generated from its trading business.

According to the bank’s balance sheet, the improvement in profit during the period led the value of equity attributable to shareholders to rise from N695 billion ($1.69 billion) at the start of the year to N767 billion ($1.87 million) as of Sept. 30.

The growth in shareholder equity was triggered by a robust 8.5-percent growth in UBA’s balance sheet, as its assets expanded from N7.7 trillion ($18.7 billion) on Dec. 31, 2020 to N8.35 trillion ($20.3 billion) as of Sept. 30, 2021.

As of press time, Oct. 25, shares in the Lagos-based lender were worth N8.4 ($0.020) per share, six-basis points lower than its opening price this morning.

At this price valuation, UBA had a market capitalization of N287.3 billion ($698.8 million), while Elumelu’s 6.39-percent stake was valued at N18.4 billion ($44.7 million).