UNION BANK SCALES FIRST HALF BUT...

From the figures to June this year, Union Bank PLC ended the first half on a good note but one wonders if enough provision for burden of its foreign loans was made.

According to the unaudited results for the period, almost everything went well for Union Bank with the exception of net impairment provision 195.3% increase to N8780m and income from other sources drop by 8.81% to N5132m.

Gross earnings increased by 8.45% to N60069m propelled more by 66% rise in fee and commission to N6262m ,14% increase in net trading income to N3289m and 162.2% increase in profit to N318m from subsidiary sale from N511m loss previously.

Then firm grip over costs led to only 1.46% increase in personnel cost to N14920m and 7.15% decrease in other operating expenses to N11718m.

Union bank says that interest income rose by 3.87% to N44344m and interest expense dropped by 18.4% to N13397m.

Heart warming as this may be, there is need for closer look at debt service cost since not less than 81.2% of its borrowed funds by June was denominated in foreign currencies.

All said, combination of cost control and fair income growth combined to help Union Bank profit before tax rise by 37.2% to N8925m.

That is, well ahead of gross earnings growth leading to profit margin of 14.9% compared to 11.7% previously.

UNION BANK: Nbn.
              Half year
                  2016.         2015
G. Earnings 60.7.       55.4
Int. Income 44.3.       42.7
Int  cost      13.4.       16.4
Impairment 8.78.       2.97
Commission 6.26.    3.77
Trading inc.  3.29.     2.88
Sale gains    0.32    (0.51)
Other inc.    5.13.    5.63
Personnel  14.9.     14.7
Other cost  11.7.     12.6
Profit          8.93.     6.51
Margin %  14.9.      11.7

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