Following the release of unimpressive audited financial statements for 2017, and unaudited financial statements for the nine months ended September 2018, investors in Unity Bank of Nigeria Plc have lost N1.16 billion in market capitalisation. The loss followed a -12.3 percent slide in its share price which moved from N0.81 per share on Monday 29 2018 to close the week at N0.71 per share on Friday 2, 2018.
The management of the bank released the audited financial statements for 2017; unaudited financial statements for the period ended March 31 2018; unaudited half year financial statements for the period ended June 30 2018, as well as the unaudited financial statements for the nine months ended September 30 2018, all on November 2, 2018. The full year results for 2017 and the results for the first and second quarters for 2018 were released after the regulatory grace days have lapsed.
Consequently, the Nigerian Stock Exchange (NSE) on November 1, 2018 suspended trading in the shares of Unity Bank and other five stocks. However, following the compliance with the NSE rules and regulations, the suspension on Unity Bank was removed while that on other five stocks stays.
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“The delay in filling the financial statements was occasioned by certain corporate actions, including the on-going discussions with the bank’s prospective investors undertaken by the bank which necessitated extensive reviews by our primary regulator. In furtherance of this, the bank consulted extensively with both the NSE and CBN and obtained extension up to October 31, 2018 to file the accounts for which it remains appreciative.
“We are pleased to inform our stakeholders that discussions with our prospective investors are progressing according to plan and will be concluded shortly, following which necessary regulatory approvals would be sought and announcement made”, Unity Bank management said in a note to the Exchange.
In the audited financial statements for the period ended December 31, 2017, Unity Bank realised N86.63 billion as interest income, representing 24.9 percent increase over N69.38 billion made same period in 2016. However, a 78 percent spike in interest expenses from N19.9 billion in 2016 to N35.5 billion in 2017 caused net interest income to witness a marginal increase of 3.4 percent to N51.2 billion as at December 2017 compared with N49.5 billion in December 2016.
Impairment losses or credits loss expense for the year, N27.8 billion, and goodwill, N16.5 billion, both added up to N44.3 billion, further reduced the Unity Bank’s net operating income to N10.2 billion in 2017, as against N28.2 billion made same period in 2016.
Although, the bank’s total operating expenses fell by 7.2 percent to N24.5 billion in December 2017, down from N26.3 billion in comparable period in 2016, Unity Bank’s total comprehensive income of for 2017 was a loss of N13.8 billion. That was in contrast to N532.4 million profit it made at the end of 2016.
Loan and advances to customers in 2017 nosedived by 97 percent from N277.2 billion in December 2016 to a paltry N9 billion as at December 2017. Consequently, total assets fell by 68 percent from N492.7 billion in 2016 to N156.5 billion in 2017.
Deposits from customers remained flat at N252.3 billion in December 2017 as against N264.2 billion in 2016, representing a marginal decline of 4.5 percent.
The unaudited nine months results for the period ended September 30, 2018 were in no way a source of succour to investors. Gross income fell by 60 percent to N26.1 billion from N65 billion made in similar period in 2017.
Net interest income further fell by 74 percent to N9.9 billion by September 2018 compared with N38.5 billion in similar period in 2017. The net operating income for the period was N16.1 billion as against N21.3 billion in 2017. Unity Bank reported a profit of N585.8 million in contrast to N2.45 billion same period in 2017. However, the bank reported a net loss of N699 million from the sale of financial assets, and that made the bank to report a loss of N114.1 million for the nine months ended September 2018, compared with a loss of N1.54 billion in similar period in 2017.
The other stocks on which NSE’s suspension order stands are Fortis Microfinance Bank, Thomas Wyatt Nigeria, Multi-Trex Integrated Foods, Golden Guinea Breweries, and Deap Capital Management & Trust.
The last financial statement by Fortis Microfinance Bank was its nine months unaudited financial reports for the period ended September 30, 2017 which was released on November 13, 2017. On August 14, 2018, the management of the bank notified the Nigerian Stock Exchange (NSE) of the sudden resignation of its interim managing director, Bunmi Lawson, and no information since then on the appointment of a substantive CEO for the bank.
Thomas Wyatt latest financial statement was its full year audited financial statements for the period ended March 31, 2018 released on October 10, 2018. There are no records of its first and second quarters for 2018.
Deap Capital released its audited financial statement for December 2017 on July 16, 2018 and no records of its results for first, second and third quarters of 2018. Similarly, Golden Guinea Breweries released its audited financial statements for the period ended march 31, 2018 on October 3, 2018. There are no records for the first two quarters of the New Year.
TELIAT SULE
