In 1949
the British and French Bank Limited, a subsidiary of Banque Nationale de Crédit
(Paris), began operation in Nigeria. It was against the backdrop of Nigeria's
independence from Britain that British and French Bank Limited metamorphosed
into UBA in 1961. UBA became a
company quoted on the Nigerian Stock Exchange in 1970.
United
Bank for Africa Plc merged with Standard Trust Bank Plc in the wake of the
recapitalisation exercise in the banking sector in 2005.Thereafter,UBA acquired Continental Trust Bank
Limited.
It has established
its presence in 22 countries including 19 African countries. Technological
improvement has resulted in streamlined and efficient operations.
UBA has
a large distribution network in Nigeria from where it derives roughly 76% of
its revenue and 78% of its Profit After Tax (PAT). Total deposits have grown at
a 3-year compound annual rate of 5% compared to 15% of two years ago. However,
loans are expanding faster than deposits which has pushed total debts to over
NGN300 billion. A greater proportion of these debts are repayable in a year
which is likely going to put downward pressure on net earnings.
Though
the retail end of the market is very lucrative, competitive pressure is eating
deep into its profitability as banks contend for business in this segment.
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