United Bank For Africa Plc · NSENG:UBA
United Bank For Africa — FY2017 and Q1 2018 Earnings Presentation
32 slides from United Bank For Africa's earnings presentation, May 2018
Slide 1: Investor Presentation
Investor Presentation MAY 2018 1 Africa’s Global Bank
Slide 2: Disclaimer and Note of Caution
Disclaimer and Note of Caution • IMPORTANT: From time to time, the Bank makes written and/or oral forward-looking statements. These are included in this presentation and in other communications. In addition, representatives of the Bank may make forward-looking statements orally to analysts, investor
Slide 3: Table of Contents
Table of Contents Section Page 1. Introduction to UBA 4 2. Operating Environment 11 3. Financial Overview 16 4. Outlook and Key Takeaway 26 5. Appendix 29 3
Slide 4: Introduction to UBA
Section 1 Introduction to UBA
Slide 5: UBA Profile at a Glance
UBA Profile at a Glance A truly Pan-African Bank, with operations across 20 key African markets, London, New York and Paris Third largest bank in Nigeria, Funding, Liquidity & Capital (2018Q1) Over 20,000 direct and support staff at Group Level 3rd by total assets, deposits and profits with an estim
Slide 6: Evolution of UBA
Evolution of UBA With a 68 year history, UBA is one of the strongest and most recognised banking brands to originate from Sub-Sahara Africa Acquired majority interest in two Won Financial Times’ banks based in B/Faso and Benin Bankers’ Awards for Best Overall Bank in Africa, Successfully raised ₦20b
Slide 7: Evolution of UBA - Building a Pan African Platform
Evolution of UBA - Building a Pan African Platform Over the last 10 years, UBA has established a pan African platform on the back of a successful Nigerian bank 1949 – 2008 2009 – 2011 2012 – 2018 London London London Paris Paris Paris New York New York New York Chad Chad Burkina Burkina Mali Faso Fa
Slide 8: A Leading Full Service Pan-African Business
A Leading Full Service Pan-African Business UBA has successfully established its African franchise and now has growing operations in 20 African countries Burkina Faso Benin Chad UBA’s Market Total Total Headline2 % Interest Share Assets Deposits UBA Nigeria 100% Top Tier ₦2,601.8bn ₦1,776.7bn UBA Gh
Slide 9: UBA's Credit Ratings
UBA’s Credit Ratings All rating agencies have “Stable Outlook” on UBA Plc Fitch GCR Agusto & Co S&P National National National National Scale •Short term F1 (nga) • Short-term A1+ (NG) • Long term Aa- • ngBBB/ngA-2 •Long term A+ (nga) • Long term AA - NG) • Short term Aa- International Foreign Curre
Slide 10: Operating Environment
Section 2 Operating Environment
Slide 11: Nigeria's Path to Recovery
Nigeria’s Path to Recovery Operating Environment Oil & External Reserves Economy recovers from recession with 0.7%, Stronger foreign currency receipt from oil 1.4% and 1.9% GDP growth in 2017Q2, Q3 sales and growing non-oil exports are and Q4 respectively, driven mainly by crude complementing im
Slide 12: Interest rate to ease, as Naira stabilizes and inflation moderates in Nigeria
Interest rate to ease, as Naira stabilizes and inflation moderates in Nigeria • The MPC maintained the policy rate (MPR) at 14% since July 2016, as it Monetary policy has been stable - tight prioritized price stability over growth. posture aimed at stemming exchange rate and inflationary pressures •
Slide 13: Nigerian Naira gaining strength and inflation easing
Nigerian Naira gaining strength and inflation easing • The Federal Government has managed the Niger Delta challenges, leading to NGN/USD and Oil Price Performance; positive relative calm and recovery of oil output, which now hovers around 2.2mbpd of oil 385 correlation 80 equivalent. 380 70 • Follow
Slide 14: Selected African Markets – Key developments
Selected African Markets – Key developments Ghana Southern Africa – Mozambique and Zambia • Higher oil production and price, rising cocoa output and stronger gold • Fiscal constraint remains the downside risk to economic growth in production helped to jump-start Ghana GDP, growing at >9%, with a str
Slide 15: Financial Overview
Section 3 Financial Overview
Slide 16: 2017 Full Year Results Snapshot
2017 Full Year Results Snapshot 31-Dec-17 31-Dec-16 % Change Gross Earnings 461,557 383,647 +20.3% COMPREHENSIVE Net Interest Income 207,632 165,200 +25.7% INCOME & PROFIT Net Operating Income 326,565 270,889 +20.6% TREND (N’million) Operating Expenses (188,610) (152,501) +23.7% Profit Before Tax 10
Slide 17: Earnings Have Proven Strong and Resilient
Earnings Have Proven Strong and Resilient 462 Non-Interest Income Interest Income 384 26% 31% 30% 315 Gross Breakdown Earnings of Gross Trend Earnings 74% (N’billion) 69% 70% 2015FY 2016FY 2017FY 2015FY 2016FY 2017FY 327 105.3 271 90.6 Operating 210 Profit Before 68.5 Income Tax (N’billion) (N’billi
Slide 18: Efficiency Gains To Drive Margin Improvements
Efficiency Gains To Drive Margin Improvements 7.1% 7% 6.7% 4.0% 3.7% 3.7% Net Interest Cost of Margin (%) Funds (COF) (%) 2015FY 2016FY 2017FY 2015FY 2016FY 2017FY 2017FY 2016FY • Notwithstanding tight system liquidity, net interest margin remains stable at 7%, as we sustained cost of funds at 3.7%.
Slide 19: Well Diversified Asset Book Supported By Stable Funding Structure
Well Diversified Asset Book Supported By Stable Funding Structure Deposits Debt Equity Other 3.0% 3.4% 2.6% 4.07 11.2% 12.7% 13.0% 3.50 7.4% 9.9% 14.0% 2.75 Total Assets Funding (N’trillion) Structure 78.4% 74.0% 70.5% 2015 FY 2016 FY 2017 FY 2015 FY 2016 FY 2017 FY Mandatory reserves- cash • In spi
Slide 20: Stable and Well Diversified Loan Portfolio
Stable and Well Diversified Loan Portfolio... 1.7 6.7% 1.6 1.1 Total Loan 3.9% NPL Ratio Book (%) (N’trillion) 1.7% 2015 FY 2016 FY 2017 FY 2015 FY 2016 FY 2017 FY Others Others 10% 3% Agriculture Commerce Government 3% Oil & Gas* 10% General 8% 12% 21% Non - ICT Communication 37% Loan Book 5% Manuf
Slide 21: Supported by Solid Capital and Liquidity
...Supported by Solid Capital and Liquidity... UBA Liquidity Ratio (Year-end) Regulatory Requirement (30%) 61% 60% 53% 50% 50% 39% Loan-to- Liquidity Deposit Ratio (%) Ratio (%) 2015 FY 2016 FY 2017 FY 2015 FY 2016 FY 2017 FY UBA (Nigeria) Basel II Capital Ratio UBA Group CAR (%) Regulatory requirem
Slide 22: Plus an Intense Focus on Asset Quality and Cost Efficiency
...Plus an Intense Focus on Asset Quality and Cost Efficiency Coverage Ratio (including regulatory reserves) 2.0% 2.0% 240% 135% 90% 6.7% Cost of Risk NPL Ratio (%) (%) 3.9% 0.4% 1.7% 2015 FY 2016 FY 2017 FY 2015 FY 2016 FY 2017 FY • UBA’s vision and financial goals are based on creating a sustainab
Slide 23: 2018 First Quarter Results Snapshot
2018 First Quarter Results Snapshot 31-Mar-18 31-Mar-17 % Change Gross Earnings 119,366 101,249 +17.9% COMPREHENSIVE Net Interest Income 53,553 51,589 +3.8% INCOME & PROFIT Operating Income 77,554 72,567 +6.9% TREND (N’million) Operating Expenses (49,679) (44,023) +12.8% Profit Before Tax 26,555 25,
Slide 24: Efficiency Gains To Sustain Margin Upside
Efficiency Gains To Sustain Margin Upside 76 7.6% 73 6.9% 7.0% 50 Net Net Interest Operating Margin (%) Income (N’Billion) 2016Q1 2017Q1 2018Q1 2016Q1 2017Q1 2018Q1 2018Q1 2017Q1 19% • Reflecting improving efficiency in operations, operating income grew to N76 18% billion despite the tight system li
Slide 25: Outlook and Key Takeaways
Section 4 Outlook and Key Takeaways
Slide 26: 2018FY Guidance
2018FY Guidance 1 Net Interest Margin ≈ 7% 2 Cost-to-Income Ratio (ex-impairment) ≈ 55% 3 Cost of Risk ≈ 1.5% 4 NPL Ratio <5% 5 Loan Growth 15% 6 Deposit Growth 18% 7 Return on Average Assets ≈2.3% 8 Return on Average Equity ≈18% 26
Slide 27: Key Takeaways
Key Takeaways o A unique pan-African franchise – diversified risk and earnings across fast growing African economies. o Sound governance, risk management and compliance culture – adherence to international best practice. o A robust digital banking platform – leveraging technology to serve over 14 mi
Slide 28: Appendix
Appendix
Slide 29: Summary Financials – Audited Results
Summary Financials ::: Audited Results As at 31 December 2017 31 December 2016 31 December 2015 ASSETS (₦ millions) Cash and bank balances 898,083 760,930 655,371 Financial assets held for trading 31,898 52,295 11,249 Derivative assets 8,227 10,642 1,809 Loans and advances to banks 20,640 22,765 14,
Slide 30: Summary Financials – Audited Results
Summary Financials ::: Audited Results For the year ended 31December 2017 2016 2015 2014 (₦ millions) Interest income 325,657 263,970 229,629 196,680 Interest expense (118,025) (98,770) (96,030) (90,547) Net interest income 207,632 165,200 133,599 106,133 Fee and commission income 82,937 73,199 61,8
Slide 31: UBA Magic Banking
UBA \G UBAM United Bank for Africa United Bank for Africa Out of | Help Airtime? | Yourself “2919: MAGIC BANKING You can chat with me for your 2p Account | Money | Airtime | Balance enquiry | Customer Whether you want to buy airtime account, transfer money, ‘opening | transfer | top up assistance as
Slide 32: UBA Global Investor Services
Asset Registration eSettlement of Trades Securities Verification Portfolio Valuation Safe Custody Euroclear Services 4+234-1-2807335 globalinvestorservices@ubagroup.com UBA Global Investor Services 57, Marina, Lagos, Nigeria UBAMN We dedicate these Awards to our Customers. Thank you very much for yo
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