Union Bank Plc has attributed the increase in profits in its unaudited result for the nine months ended September 30, 2020 to robust digital platforms as well as solid risk management structure adopted by the bank during the period.
The bank’s profit before tax increased by two per cent to ₦15.9 billion against ₦15.5 billion achieved in the corresponding period in 2019, while gross earnings: was ₦118.8bn in contrast to ₦111.9 billion in similar period in the previous year.
The result also showed that Interest income rose by one per cent from ₦84.9 billion to ₦85.4 billion. Net interest income before impairment also increased by 15 per cent to ₦41.7 billion from ₦36.4 billion recorded in the previous year.
Customer deposits also appreciated by 28 per cent to ₦1.1trillion from ₦886.3 billion achieved in Dec 2019. According to the bank, the rise in customer deposit is a reflection of investments in customer-led products and digital channels, which resulted in the acquisition of over 600K new-to-bank customers and deepening of wallet share of existing customers.
The Chief Executive Officer of the bank, Emeka Emuwa, said: “Notwithstanding the realities of a tougher operating environment arising from the ripple effects of the Covid-19 pandemic, the bank delivered a 6 per cent growth in gross earnings from ₦111.9 billion in 9M 2019 to ₦118.8 billion in 9M 2020.
“We reached a major milestone as our customer deposits crossed the ₦1 trillion mark this quarter, growing by 28 per cent to ₦1.1 trillion compared to ₦886.3 billion at the end of 2019. This reflects increasing customer loyalty and our intense retail drive. Our customer acquisition strategy has been reinforced by the versatility of our digital platforms and channels, which continue to drive customer satisfaction.
“We grew our loan book by 14% to ₦678.0 billion from ₦595.3 billion in December 2019 as we cautiously extended credit to the real sector. We will continue to explore bankable lending opportunities in the Nigerian economy guided by our robust risk management practices.
“The civil unrest, which erupted in October and led to significant destruction of property and small businesses across the country, will have real impact on business and the operating environment; and even as restrictions have eased, Covid-19 also remains a present threat in our day-to-day operations.
He assured that the bank would work with its partners and through its corporate citizenship initiatives to support individuals, businesses and communities where the bank operates to grow the economy.
Chief Financial Officer, Joe Mbulu said: “With the $40 million (USD) financing secured from the International Finance Corporation for lending to trade finance customers, we are continuing to expand our funding engagements with DFIs to support our strategic business initiatives.
“For the rest of the year, we remain focused on our business priorities in the face of the Covid-19 challenge and will continue to leverage increasing customer loyalty, stronger digital platforms and channels as well as solid risk management structure to deliver on our objectives.”
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