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Union Bank’s gross earnings hit N175bn in 2021

Union Bank records N6.4bn profit, gross earnings up 18% 

Union Bank of Nigeria Plc said its gross earnings went up 8.9per cent to N175.0 billion, as against the N160.7 billion recorded in the Full Year 2020.

The Group in its audited financial statements for the year ended December 31, 2021, recorded a steady revenue growth and strong business momentum driven by non-interest income.

Union Bank has sustained steady performance as a result of increased customer engagement from an enhanced operating and go-to-market model and gains derived from our digital penetration strategy.

Non-interest income grew by 26.7per cent to N55.7billion as against N44.0billion in Full Year 2020 driven by significant increases in debt recoveries.

Net operating income after impairments went down by 3.6per cent to N99.7billion and Profit before tax was also down by 19.3per cent to N20.5billion.

Also, operating expenses marginally grew by 1.5per cent to N79.1billion, reflecting tight cost control despite inflationary pressures.

Gross loans went up by 22per cent at N899.1billion as the bank expands its lending to key economic sectors of opportunity.

Customer deposits were also up 20.4per cent at N1.4trillion (N1.1 trillion in Dec 2020) as we continue to expand our product base and digital channels.

Commenting on the results, Chief Executive Officer of the Bank, Emeka Okonkwo, said “following an enhancement to our operating and go-to-market model to deliver better performance and efficiency leveraging our network across the regions, we are increasing our customer engagement and product penetration which is translating into higher customer revenues across geographies.

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“On the back of this, the Bank has continued to record headline growth by diversifying our income streams and accelerating our recoveries programme.

“For the full year, our gross earnings grew by 8.9per cent from N161billion to N175billion, while our net operating income after impairments dropped by 3.6per cent to N99.7billion from N103.4billion. Interest income grew by 1per cent as our earnings asset base expanded with a growing loan book.

“We continued our strong growth in non-interest income through a combination of aggressive recoveries, which grew 119per cent in the period, from N7.2billion to N15.9billion and further growth in fee and commission income (33per cent) and e-business (26per cent). These were delivered on the back of sustained multi-channel growth in users, volume and value across our digital and agent channels. Total active UnionMobile users now stand at 3.3 million, up 20per cent while our Union360 customer base grew by 22per cent to 26,400,” he said.

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Speaking further, Okonkwo said in 2022, the Bank will continue to focus on broadening and deepening the strong foundations we have built while enhancing our digital delivery platforms and service propositions to customers.

He said, “We remain deeply thankful to our erstwhile core investors, Union Global Partners and Atlas Mara who have been instrumental to our journey since 2012. Their invaluable support and expertise helped steer the Bank through turbulent waters and into an era of growth and stability.

“As we turn a new chapter for our Bank with a new core investor expected to come on board, we are proud of the solid foundation built over the last ten years and look forward to a seamless transition and continued successes in the future,” he said.

Speaking on the Full Year 2021 numbers, Chief Financial Officer of the bank, Joe Mbulu said, “We maintained very strong cost controls during the year despite the inflationary pressures and the translation effect of currency depreciation on our cost base.

“Operating expenses increased marginally by 1.5per cent with increasing regulatory, depreciation and amortisation costs. Customer deposits grew by 20per cent while our loan book grew by 22per cent from N736.7billion to N899.1billion, as we deepened support for key sectors in the economy.

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“We have remained proactive in the way we manage our growing risk assets, maintaining our asset quality during the year with our NPL ratio growing marginally from 4per cent to 4.3per cent,” he said.

On the e-Banking Channels, the bank said active users across its mobile and digital platforms grew by 23per cent as we delivered a range of upgrades across our channels including account opening and account blocking as well as features like QR payments and HMO payments.

Within the year under review, the bank’s expanded retail and digital portfolio enabled growth across its business segments with the retail deposit and loan books growing by 10per cent respectively while SME loan books grew by 233 per cent, a trend expected to continue across all business segments.

The bank also introduced new group loans and asset financing solutions for small businesses making it easier for collectives to access credit and simplified loan products and payment solutions for retail customers.

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