New Telegraph

Union Bank posts N11.3bn HY’20 profit

Union Bank Plc has reported a profit before tax of N11.3 billion for the half year ended June 30, 2020 as against N11.2 billion posted in H1 2019. Gross earnings was up 10 per cent to N79.9 billion from N72.4 billion in H1 2019, driven by an increase in earning assets. Interest income was up 6 per cent to N57.2 billion from N53.8 billion in H1 2019, also driven by increase in earning assets Net interest income before impairment grew by 21 per cent to N28.0 billion from N23.2 billion in H1 2019, driven largely by a reduction in interest expense. Commenting on the results, Emeka Emuwa, CEO said: “The impact of COVID- 19 and associated movement restrictions on the Bank and the wider economy has been broad. The total lockdown of major commercial centers Lagos, Abuja and Ogun and partial lockdowns across the country, slowed business operations in Q2’20.

“Notwithstanding these significant headwinds, the bank delivered a 10 per cent increase in its top line revenue of N79.9 billion for H1’20. In addition, net interest income before impairments is up 21 per cent to N28.0 billion and non-interest income up 22 per cent to N22.7 billion.

“The slowdown limited growth in key income lines including fees and commissions and cash recoveries. However, we continue to reinforce the use of our digital channels with 90 per cent of transactions completed digitally in H1’20 (vs. 57 per cent in H1’19), which translated to a 42 per cent growth in e-business fees from N2.5 billion in H1’19 to N3.6bn in H1’20. “We deliberately grew our loan portfolio both in the retail and commercial/ corporate banking space resulting in a six per cent growth in interest income.

Given the constrained operating environment, we continue to proactively monitor our loan portfolio and support our customers in line with the Central Bank’s guidance on forbearances. “Nevertheless, growing our loan book remains a strategic focus area for us for the rest of the year as we continue to identify new opportunities emerging in the face of the pandemic.

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