Unity Bank offered yet more evidence of the strength of the Nigeria banking industry as the lender reported half-year profit up by 91.5 percent. Unity Bank reported gross income of N30.85 billion for the six-month period to June 2014, an increase of 2.24 percent year-on-year (YoY), from N30.17 billion as of half-year (HY) 2013.
Profit before tax surged by 81.34 percent to N7.89 billion in HY 2014, compared with N4.35 billion as of HY 2013. Profit after tax followed the same growth trajectory as it spiked by 91.51 percent to N7.10 billion in HY 2014, as against N3.70 billion as of HY 2013.
Earnings per share increased by 74.59 percent to 18.49k from 10.59k in HY 2013.
The fulcrum of the stellar performance of the bank’s bottom-line is its savvy management of costs.
Operating cost in the period under review dropped by 10.71 percent to N13.77 billion compared with N15.33 billion as of HY 2013, while cost to income ratio declined to 61 percent in HY 2014, from 76 percent as of HY 2013.
The bank is aggressive about lending, as loans to deposits in the period increased to 68.90 percent as against 64.37 percent in 2013. Loans and advances in the first six months of the year rose by 4.98 percent to N205.48 billion from N195.23 billion, as of full-year (FY) 2013.
The customers and other deposits were up slightly by 1.66 percent to N298.22 billion from N303.37 billion as of FY 2013.
The bank had recently opened application list for a rights issue of 38.447 billion ordinary shares, starting the first part of a two-part new capital issue that is expected to inject more than N39 billion into the bank.
The net proceeds of the new capital issues would be used for new branch development, upgrade of information and communication technology, human resource development, working capital and products and channel upgrade, among others.
The bank is ranked ninth in the banking industry based on spread, with 238 branches nationwide.
The bank came into existence as a result of the re-capitalisation policy of the CBN in 2005, which saw nine banks come together to form synergy.
The bank’s share price closed at N0.50 on the floor of the Nigerian Stock Exchange, while market capitalisation was N19.22 billion, July 4, 2014.
BALA AUGIE
