UBA Grows Gross Earnings by 9.8% as Loan Loss Expense Increases by 58% in Q4’15


Tuesday, March 15, 2016 12:42PM /Cordros Capital

United Bank of Africa Plc (UBA) yesterday released results for the financial year ended 31 December 2015. UBA declared a final dividend of 40 kobo (20 kobo interim) with the closure date running from March 30, 2016 to April 5, 2016, whilst the proposed payment date is April 12, 2016.


  1. Gross earnings increased by 9.8% y/y, however, Q4'15 numbers were more somber, declining by 15.2% q/q, after a 62.6% q/q slump in non-interest income.


  1. Interest income increased by 19.0% y/y, after a flattish Q4'15 whilst interest expense was contained, increasing by 6.1% y/y (+2.9% q/q). Therefore, net interest income grew by a robust 30.0% y/y.


  1. Loan loss expense increased by 58.7% y/y, but surprisingly fell q/q after recoveries, mainly from the bank's rest of Africa operations (60% -70%), surpassed impairments made in the fourth quarter of 2015. Operating expense climbed   by 5.4% y/y.


  1. Overall, PBT and PAT increased by 21.8% y/y and 24.5% y/y respectively. ROAE improved to 20.0% from 19.2% in FY'14. Loans to customers and customer deposits both fell by 3.3% and 4.1% respectively.

Initial Impression of the Result - Below our expectation but above consensus forecast.


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