United Bank for Africa (UBA) has announced its highest-ever annual profit, posting a post-tax profit of ₦766.5 billion for the financial year 2024. This marks a 26.14% increase from the ₦607.6 billion recorded in 2023, further cementing the bank’s reputation as a top-performing financial institution in Nigeria.
Strong Financial Performance
UBA’s pre-tax profit rose by 6.08%, reaching ₦803.7 billion, compared to ₦757.6 billion in the previous year. This growth was fueled by a high-interest rate environment, which significantly boosted earnings from loans and investments in government securities.
Over the past two years, UBA has reported a cumulative profit of ₦1.37 trillion, a stark contrast to the ₦570.4 billion recorded over the five years leading up to 2023.
Dividend Payout and Asset Growth
To reward shareholders, the bank has proposed a final dividend of ₦3.00 per share, bringing the total dividend for 2024 to ₦5.00 per share. This translates to a total payout exceeding ₦170 billion, making it the highest dividend ever distributed by the bank.
UBA also experienced a significant rise in total assets, which surged 46.82% year-on-year to ₦30.3 trillion, up from ₦20.65 trillion in 2023. This makes UBA one of the largest financial institutions in Nigeria, ranking alongside Access Holdings and Zenith Bank.
Key Financial Highlights (2023 vs. 2024)
- Interest Income: ₦2.3 trillion (+120.4%)
- Net Interest Income: ₦1.5 trillion (+116.35%)
- Pre-tax Profit: ₦803.7 billion (+6.08%)
- Post-tax Profit: ₦766.5 billion (+26.14%)
- Earnings per Share (EPS): ₦21.73 (+24.24%)
- Total Assets: ₦30.3 trillion (+46.82%)
- Shareholders’ Equity: ₦3.419 trillion (+68.39%)
Drivers of UBA’s Record-Breaking Profits
The bank’s earnings were primarily driven by a strong increase in interest income, particularly from loans and government securities, such as treasury bills. Investment securities alone contributed ₦1.1 trillion in interest income, accounting for nearly half of total interest earnings.
While banks benefited from high yields on treasury instruments, tighter monetary conditions led to reduced demand for credit, impacting lending activities.
UBA also saw impressive growth in electronic banking fees, earning ₦236 billion from transactions conducted via ATMs, POS terminals, mobile banking, and card payments. However, operating expenses rose significantly, with fees and commission expenses jumping by 97.88% to ₦233.9 billion.
A notable decline was recorded in foreign exchange trading profits, which fell to ₦181.7 billion, a 72.43% drop from ₦659.2 billion in 2023. This reflects lower volatility in Nigeria’s exchange rate compared to the previous year.
Expanding Pan-African Operations
UBA’s financial results highlight the growing impact of its pan-African operations, with subsidiaries outside Nigeria contributing 51.7% of total revenue. This marks a significant shift from 2019, when non-Nigerian businesses accounted for just 31% of the bank’s earnings.
With a presence in over 20 African countries, UBA continues to establish itself as one of Nigeria’s most successful cross-border financial institutions.
Capitalization and Market Reaction
In November 2024, UBA initiated the first phase of its recapitalization plan, launching a ₦239.4 billion rights issue at ₦35 per share to meet the Central Bank of Nigeria’s ₦500 billion minimum capital requirement.
Following the announcement of its record-breaking financial results, UBA’s share price jumped 4.48%, closing at ₦38.45 per share, as investors reacted positively to its performance and dividend declaration.
Outlook for 2025
With continued expansion across Africa and strategic investments in technology and risk-free securities, UBA is well-positioned for sustained growth. While the bank faces challenges such as rising operational costs and a fluctuating foreign exchange market, its strong capital base and diversified revenue streams suggest a positive outlook for the future.
As the first among Nigeria’s Tier-1 banks to release its full-year 2024 results, UBA has set a strong precedent for the industry, reinforcing investor confidence in its long-term growth strategy.
