Tag: United Bank for Africa (UBA) Plc

United Bank for Africa (UBA) Plc has reaffirmed its leadership as one of the continent’s most innovative and resilient financial institutions, after the bank, for the third time in five years, was adjudged African Bank of the Year 2025 by The Banker.com.

UBA also won the Best Bank of the Year awards in nine of its 20 African subsidiaries, bringing its total awards this year to ten as UBA Benin, UBA Chad, UBA Republic of Congo (Congo-Brazzaville), UBA Liberia, UBA Mali, UBA Mozambique, UBA Senegal, UBA Sierra Leone, and UBA Zambia, all came out tops as the best banks in their respective countries, underscoring the bank’s strength across West, Central and Southern Africa and highlighting the depth of its Pan-African franchise.

The Banker.com, a leading global finance news publication published by the Financial Times of London, organises the annual Bank of the Year Awards, and this year’s edition was held at a grand ceremony at the Peninsula, London.

UBA’s Group Managing Director, Oliver Alawuba, while reacting to the achievement, said the recognition affirms the bank’s long-term strategy and customer-first philosophy.

“This honour reflects the strength of our Pan-African network, the trust of our customers, and the dedication of our people. Winning Africa’s Bank of the Year for the third time in five years is not by chance; it is a testament to disciplined execution, innovation, and a deep understanding of the markets we serve.

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 “Our nine country awards across diverse regions of Africa show that UBA is not just growing, but growing with impact. We remain committed to driving financial inclusion, supporting economic development, and deploying technology that makes banking simpler, faster, and more accessible to Africans everywhere,” Alawuba said.

Chief Executive Officer, UBA UK, Deji Adeyelure, received the awards on behalf of the bank, representing Group Managing Director, Oliver Alawuba, and was accompanied by the bank’s Head Business Development, Mark Ifashe, and Head, Financial Institutions, Shilpam Jha.

The Banker’s awards are widely regarded as the most respected and rigorous in the global banking industry, celebrating institutions that demonstrate outstanding performance, innovation and strategic execution.

In its remarks on UBA’s winnings, the banker.com stated: “For the third time in five years, UBA Group has won the coveted Bank of the Year award for Africa. UBA Group time after time punches above its weight against its larger African rivals. The bank this year also takes home nine separate country awards (one more than it gained for its last continental win in 2024), equivalent to around a quarter of the awards for the continent, and more than any of its continent-wide rivals.

“Perhaps even more impressive is the fact that the awards were won across a broad geographic spread, going to lenders based in the Economic Community of West African States (Benin, Liberia, Senegal, Sierra Leone, and former member Mali), the Central African Economic and Monetary Community (Chad, Republic of Congo) and the Southern African Development Community (Mozambique, Zambia). Its award wins were particularly notable in the highly competitive categories for Benin and Mozambique”.

The Banker also highlighted UBA’s strong financial performance and commitment to future growth. In 2024, the Group recorded a 46.8 per cent increase in assets and a 6.1 per cent rise in pre-tax profits in local currency terms, while continuing to invest significantly in talent and technology. West Africa remains UBA’s heartland, with operating revenue and profit increasing by 87 per cent and 89 per cent respectively in H1 2025.

The bank’s digital and innovation leadership was equally recognised. During the year under review, and launched its Advance Top-Up buy-now-pay-later feature on the *919# USSD platform, expanding financial access for customers, while the bank’s chatbot Leo continued its strong growth trajectory, with transaction volumes rising by 29 per cent year-on-year in H1 2025. Notably, in August, Leo became the first African banking chatbot to enable cross-border payments via the Pan-African Payment and Settlement System (PAPSS).

United Bank for Africa is one of the largest employers in the financial sector on the African continent, with 25,000 employees group-wide and serving over 45 million customers globally. Operating in twenty African countries, the United Kingdom, the United States of America, France and the United Arab Emirates, UBA provides retail, commercial and institutional banking services, leading financial inclusion and implementing cutting-edge technology.

More than half of United Bank for Africa (UBA) Plc’s earnings are contributed by global subsidiaries. Besides, self-service automated banking services have become main drivers for earnings.  With impending expansions in Europe and Middle East and continuous technological upgrades, emerging data show a sturdy outlook for the UBA Group, despite elevated costs. Deputy Group Business Editor Taofik Salako examines the underlying figures behind analysts’ consensus on the outlook for the UBA Group

Analysts believe that United Bank for Africa (UBA) Plc could continue to see positive investors’ response to its earnings performance in 2025. On the back of the release of the UBA Group’s first quarter earnings for 2025, most analysts expect that the share price of the banking group could nearly double over the next reporting period, with most conservative estimates expecting at least above average, double-digit return in capital gains.

The release of the first quarter 2025 earnings report came as shareholders approved the payment N171 billion as cash dividends for the 2024 financial year. Total dividend per share for 2025 stood at N5, implying a dividend yield of some 14 per cent on recent pricing range. Shareholders received final dividend of N102.6 billion or N3 per share, in addition to interim dividend of N68.4 billion or N2 per share, for the 2024 business year.  

Despite elevated costs and regulatory and operating concerns at its Nigerian base, analysts’ reviews generally showed a sustainable growth trajectory.

Starting figures

Key extracts of the interim report and accounts of UBA for the three-month ended March 31, 2025 released at the Nigerian Exchange (NGX) showed that gross earnings rose by 34 per cent from N570.2 billion in first quarter 2024 to N764.3 billion in first quarter 2025. The top-line growth was driven by 36 per cent growth in interest income, which rose from N440.76 billion to N599.8 billion. Significant increase in core banking incomes, with considerable growth in trading and foreign exchange incomes, helped to moderate muted increase in fees and commission incomes, the second largest contributor to gross earnings. Fees and commission incomes increased from N113.65 billion in first quarter 2024 to N124.07 billion in first quarter 2025. Net trading and foreign exchange income jumped from N11.9 billion to N37.04 billion.

However, interest income growth came at a higher cost, with interest expenses rising by 77 per cent to N248 billion in first quarter 2025 as against N140.1 billion in first quarter 2024. With these, operating income rose by 22.6 per cent from N378.59 billion to N464.24 billion. Profit before tax grew by 30.7 per cent to N204.27 billion in first quarter 2025 as against N156.34 billion in first quarter 2024. After taxes, net profit increased by 33.1 per cent from N142.58 billion to N189.84 billion. Earnings per share, consequently, rose from N3.96 in first quarter 2024 to N5.35 in first quarter 2025.

The balance sheet also expanded within the first three months of the year. Total assets added some N1.4 trillion to close March 2025 at N31.71 trillion compared with N30.32 trillion recorded by December 31, 2024. Deposits from customers had grown from N21.89 trillion in December 2024 to N22.86 trillion by March 2025. Loans and advances however moderated from N6.95 trillion to N6.83 trillion. Total shareholders’ funds increased from N3.42 trillion in December 2024 to N3.68 trillion in March 2025.

Reference year

With the first quarter 2025 results, UBA appears on course to surpass its previous performance in 2024, when top-line rode on the back of global growth to cross the N3 trillion mark. The audited report and accounts for the year ended December 31, 2024 showed that gross earnings jumped by 53.6 per cent from N2.08 trillion in 2023 to N3.19 trillion in 2024. Interest income had surged from N1.075 trillion in full-year 2023 to N2.37 trillion in full-year 2024. Net interest income doubled from N707.54 billion to N1.53 trillion. Net fee and commission income also increased from N189.06 billion in 2023 to N355 billion in 2024. Profit before tax grew to N803.72 billion in 2024 as against N757.68 billion in 2023. After taxes, net profit rose from N607.7 billion to N766.6 billion, an increase of 26.1 per cent.

The group’s total assets grew by 46.8 per cent to N30.4 trillion by December 2024 as against N20.65 trillion by December 2023. Group’s loans and advances to customers increased from N5.229 trillion in 2023 to N6.955 trillion in 2024. Deposits from customers leapt to N21.89 trillion in 2024 as against N14.89 trillion in 2023. Shareholders’ funds also rose from N2.03 trillion in 2023 to N3.42 trillion in 2024, an increase of 68.39 percent.

A global bank

Segmental analysis indicated that a buildup in the momentum of contributions from the bank’s subsidiaries across Africa and other global markets. Ex-Nigeria- the group’s bank operations across Africa and the world, excluding Nigeria, contributed more to the profit and loss as well as the balance sheet in 2024. The global diversity of the group’s operations provided cushions for operating markets’ challenges, particularly the Nigerian market, which had grappled with spillover effects of macroeconomic challenges and reforms. Ex-Nigeria contributed N1.775 trillion to the top-line in 2024, with pre and post-tax profits of N687.13 billion and N598.51 billion respectively. Out of the group’s total customer deposits of N21.9 trillion in 2024, Ex-Nigeria accounted for N15.1 trillion. It also showed stronger business growth with loan and advances of N4.03 trillion, compared with N3.80 trillion from the Nigerian market.

While the Nigerian market has also shown resilience with segmented top-line growth from N1.355 trillion in 2023 to N1.659 trillion in 2024, Ex-Nigeria has been more nimble. A sub-segmental analysis underlined increasing benefits from the African expansions and the other international markets. Total revenue from African subsidiaries, excluding Nigeria, crossed the trillion naira mark to N1.52 trillion in 2024 as against N767.48 billion in 2023. Net profit from this group jumped from N152.50 billion in 2023 to N426.94 billion in 2024. Rest of Africa- which included other African subsidiaries, excluding Nigeria, recorded loans and advances and customer deposits of N3.35 trillion and N12.335 trillion respectively in 2024 as against N2.141 trillion and N7.339 trillion respectively in 2023.

UBA Group’s “Rest-of-the-World”- which included other global subsidiaries, excluding Africa, has also seen a stronger momentum. Total deposits from this segment rose from N1.456 trillion in 2023 to N2.779 trillion in 2024. Net profit from the non-African subsidiaries rose from N99.2 billion in 2023 to N171.6 billion in 2024. Top-line contribution increased from N161.2 billion to N258.5 billion. 

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Analysts’ reviews

There appears to be a positive consensus on the outlook for the UBA Group. Afrinvest Group revised its projected 12-month target price for UBA upward by more than 73 per cent citing “upbeat earnings projections for the company over the next 12 months”.

Analysts at Afrinvest stated that their optimism on the UBA Group was anchored on “elevated interest rate environment, tech-driven products innovation, and business expansion drives”.

Cordros Capital Group, which also increased its already expansive target price, stated that the first quarter 2025 results indicated that the UBA Group could surpass analysts’ previous projections. Cordros Capital has now revised its top-line growth forecast for 2025 for the UBA Group to 26.7 per cent, from previous forecast of 23.4 per cent. Analysts expected sustained interest and non-interest incomes growths, citing UBA Group’s diversified operations among other advantages.

“We believe UBA’s international operations will continue to provide support for sustained topline growth,” Cordros Capital stated, citing a positive outlook for the group’s non-interest income profile, which significant portion was driven by e-banking revenue, which contributed about 33 per cent of the non-interest income in 2024. With even expected expansion in outstanding shares due to ongoing recapitalisation programme, Cordros Capital projected increase in actual dividend payout and double-digit dividend yield for the 2025 business year.

“We expect the group’s international operations – which contributed 51.7 per cent of group revenue in 2024, to support interest income amid likely rate cuts during the year. Noteworthy, UBA is set to receive regulatory authorisation in France this year and further plans to expand into Saudi Arabia,” Cordros Capital stated.

FSDH Capital, which tracked investors’ reaction to the first quarter 2025 results, noted immediate positive reaction and optimism around the UBA Group’s shares. FSDH described the first quarter 2025 as “steady set of numbers”, highlighting the 34 per cent growth in gross earnings. However, sequence analysis by the FSDH showed a slowdown in first quarter 2025 when compared with the previous fourth quarter of 2024. This could be attributable to seasonal peculiarities. Analysts at FSDH, meanwhile, retained an overall positive assessment, headlining the first quarter 2025 analysis as a “steady performance”.

Recapitalisation

UBA is currently in the final process of the release of the funds raised under the first phase of the bank’s recapitalisation plan. UBA, which had registered a N400 billion equity capital raise programme with the Securities and Exchange Commission (SEC), had in the fourth quarter of 2024 floated a N239.4 billion rights issue. The bank is expected to undertake the final phase of the capital raising exercise by the second half of 2025, with a target to surpass the N500 billion minimum capital requirement for its international commercial banking licence. The Central Bank of Nigeria (CBN) had in March 2024 announced recapitalisation of the banking industry, with its unique definition of qualified minimum capital as share premium and share capital implying that nearly all banks have to raise new equity funds. UBA Group, for instance, has shareholders’ funds of N2.03 trillion by the end of 2023, which rose to N3.42 trillion by the end of 2024, driven by retained earnings and other reserves. The deployment of the net proceeds from the capital raising programmes is expected to boost the group’s global expansion and digital capabilities.

Group Chairman, United Bank for Africa (UBA) Plc, Mr. Tony Elumelu, said the bank would make a huge success of its recapitalisation and sustain its seven and a half decades pedigree as a resilient and sustainable financial services group.

According to him, while the recapitalisation enables the bank to meet the regulatory minimum capital requirement, it also provides opportunities to drive organic expansion and business growth within and outside Nigeria in continuation of the group’s long-term strategy as Africa’s leading financial institution.

He said the group would invest the net proceeds in additional digital technologies and business expansions that will strengthen the bank’s seven and half decades of impressive performance.

He outlined that the group would invest the net proceeds in expanded lending to small and medium enterprises (SMEs), substantial additional investments in technologies to consolidate its reputation as a cutting-edge financial services group and to deliver more robust customer experience.

According to him, new investments in information and communication technology (ICT) would further strengthen the group’s digitization and operational efficiency, thus fostering improving coordination and synchronisation amongst the various entities and delivering improved service delivery and customer satisfaction.

He pointed out that with presence in key global financial hubs including United Kingdom (UK), United States of America (USA), France and United Arab Emirates (UAE), the bank would deepen its global operations by investing more in these global markets and further extend its global reach.

He added that the bank, which currently has operations in 19 African countries outside of Nigeria, would also make additional investments in existing African operations while exploring new opportunities.

Group Managing Director, United Bank for Africa (UBA) Plc, Oliver Alawuba, said the performance of the bank demonstrated its continued focus on driving earnings growth, preserving asset quality, expanding business operations and deepening market share.

He said continued investment in the group’s highly diversified global network allows UBA to deliver high quality and consistent earnings.

He said the group’s globally diversified business structure, which has seen top-line contributions from ex-Nigeria increasing from 31 per cent in 2019 to about 52 per cent in 2024, has positioned the bank for long-term shareholder value.

Alawuba said the group’s strategic plan was to solidify UBA’s position as a truly global African institution over the next 75 years.

“In the next 75 years, we envision a UBA with presence in every African country and will expand its footprints to over 100 countries across the world, deepening its role as a truly global African institution,” Alawuba said, as the bank celebrated its 75th anniversary.  

He projected that UBA would serve more than one billion customers worldwide, leveraging cutting-edge technology, customer-first innovation, and trusted partnerships to meet the evolving needs of individuals, businesses, and governments.

“It is about a renewed commitment to innovation, service, and social impact; a renewed ambition to lead Africa as a strong player in the global economy; and a renewed pledge to remain a beacon of excellence for generations to come. At UBA, we are building more than a bank; we are building a future for the next generation of Africans — one defined by opportunity, inclusion, and transformation,” Alawuba said.

With the impending release of proceeds from the first tranche of the bank’s capital raising exercise, a resilient domestic market focused on quality credit risk management and a nimble global network, there is enough reasonable basis to support analysts’ positive projection for the UBA Group.