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Union Bank declares 25 kobo dividend for 2020 on strong business fundamentals despite impact of Covid-19

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LAGOS, NIGERIA – March 19, 2021: Union Bank has released its audited financial
statements for the year ended 31st December 2020. The bank’s results for the period show
sustained growth in key income lines and significantly improved fundamentals,
notwithstanding a constrained operating environment largely due to the impact of the Covid-
19 pandemic.
Union Bank’s investments in technology and building a progressive work culture over the
past eight years, enabled a swift response to the pandemic that allowed our workforce
transition to remote working while maintaining the productivity required to deliver these
strong set of results in 2020.
Commenting on the results, Emeka Emuwa, CEO said:
“The Bank has delivered a strong set of results notwithstanding the impact of COVID-19 on
our operations and the wider economy, enabling the Board of Directors to continue to return
value to shareholders with a proposed dividend payment for the second year in a row. This
demonstrates the strong foundations we have built, as we continue to deliver against our
target of becoming a leading financial institution in Nigeria.
For the full year, we grew across key income lines. Net income after impairments grew 8.3%
from ₦95.5bn to ₦103.4bn and translated into 2.8% growth in Profit Before Tax to ₦25.4bn
from ₦24.7bn.
The core of this performance is driven by the growth in our loan book, with 23.8% increase in
gross loans, to ₦736.7bn from ₦595.3bn in 2019.
The pandemic accelerated trends in customer behaviour and we have seen rapid increase in
digital adoption with a 38% YOY increase in active users on our UnionMobile channel with
total active users now at 2.9 million. Our UnionOne and Union360 platforms for businesses
grew by 11% from 25,000 users to 27,700 users. 94% of transactions in the Bank are now
done digitally, up from 89% in 2019.
We also aggressively grew UnionDirect (our agent network) by 6x from 3,100 to 18,100 in
line with our focus on our retail business. With our investments yielding positive results, we
are well positioned as a strong leader in the retail and digital space.
In 2021, the Bank will focus on enhancing revenues and shareholder value by revving up
customer acquisition, engagement and transactions through seamless customer journeys
and an optimized service delivery platform.
As I retire following eight years of rebuilding and repositioning this storied institution, I am
convinced that with the excellent management team and a clear strategy in place, Union
Bank is well positioned to continue to compete and deliver value to its shareholders.
Speaking on the FY 2020 numbers, Chief Financial Officer, Joe Mbulu said:
“We are pleased with both our top and bottom-line performance in 2020, in light of the
impact of the pandemic and economic challenges. Significant inflationary pressures and the
translation of currency depreciation drove growth in our cost base, however we maintained
strong control, limiting operating expense increase to 10% (₦77.9bn from ₦70.8bn), well
below the rate of inflation. Consequently, we saw marginal increase in our cost to income ratio to 75.4% from 74.1%.
Our customer deposits hit a milestone during the year, crossing the ₦1tr mark to ₦1,131.1bn
from ₦886.3bn in FY 2019, an increase of 27.1%. Low cost deposits were up by 17%,
constituting 68% of total deposits helping to push cost of funds down by 1.4%.
We continued to proactively manage our growing risk asset portfolio and recorded better
asset quality, with our NPL ratio improving from 5.8% to 4.0%. This achievement, combined with a solid capital adequacy at 17.5% and continued top-line growth, provides the platform
for strong growth going forward.
We will continue to grow our loan portfolio in 2021, which we expect to be a significant driver
of growth, combined with our value chain synergies across our business which will drive
customer and transaction growth during the year and beyond.
Our UBUK subsidiary remains classified as “Available for Sale” as the sale process
continues albeit delayed due to the pandemic-induced lockdowns”

I am Paschal Ogechi Obi Chikero . I have written and published three books , I wrote Festus Keyamo's biography- Lion In Isolation .I have been a Reality TV show Producer/Creator, an Actor and Film Script Writer.

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