UBA slashes dividend by 80% in 2014

The United Bank for Africa (UBA) has slashed the dividend payable to its shareholders for the financial year ended December 31, 2014 by 80 per cent.
The bank is proposing a dividend of 10k per share, compared with 50k paid in 2013.
The dividend is contained in the company’s audited results released by the Nigerian Stock Exchange (NSE) on Friday in Lagos.
The bank posted a profit before tax of N56.2 billion, against the N56.1 billion it earned in the corresponding period of 2013.
Its profit after tax stood at N48 billion, as against the N46.60 billion achieved in 2013.
The bank’s gross earnings rose by 10 per cent to N290 billion, compared with the N264.7 billion in the previous period.
The bank attributed its growth in earnings to a diversified and stable income base.
Interest income in the period under review also increased by 5.91 per cent to N197 billion from the N186 billion in December 2013.
Also, the bank’s non-interest income rose by 18.17 per cent to N93.3 billion, from the N79.0 billion achieved in the preceding period of 2013.
Its shareholders’ funds grew by 13 per cent to N265 billion in 2014, from the N235 billion in 2013.
Mr Ugo Nwaghodoh, the bank’s Group Chief Financial Officer, said that the bank would continue to record a steady and sustained increase in profitability by leveraging on low cost stable funds.
Nwaghodoh said that the bank would embrace rising opportunities within its target markets in Nigeria and across Africa.
“The performance of our African business was boosted by increased cross selling of our products and a number of other strategic initiatives.
As we gain critical mass in the African market, we look forward to increased earnings, in line with the diversification of our business across Africa,” Nwaghodoh said.
Mr Phillips Oduoza, the bank’s group Managing Director, said that the cash dividend of 10k proposed was to create sustainable long-term value to all shareholders.
Oduoza said the dividend “is to effectively reflect the balance between giving short term return to investors and the commitment to create sustainable long term value to all shareholders.”
“We will leverage on our adequate capitalisation and liquidity to grow market share across target business lines,” Oduoza said.
He said that the board considered shareholders’ dividend expectation, capital requirements for growth opportunities, and increasing regulatory capital requirements under Basel II, in proposing the dividend.
“The board decided in favour of the retention of higher earnings to strengthen the capital base, in line with the strategic goal of increasing our share of the market across all our business segments,” Oduoza said.
He added that the bank would remain committed to creating sustainable long term value to all shareholders.