Union Bank of Nigeria Plc has announced gross earnings of N147.32 billion for the group for the financial year ended March 31, 2009, representing an increase of 30 per cent over last year’s figure of N112.99 billion.
In the same vein, gross earnings for the bank increased by 40 per cent from N92.94 billion in the preceding year to N130.19 billion during the period under review. The group’s total assets grew from N1.215 trillion achieved in the preceding year to N1.329 trillion in 2009, while the bank recorded N1.197 trillion from the figure of N993.93 billion recorded in 2008, indicating a growth rate of 21 per cent. Also, group’s deposits rose from N682.31 billion in 2008 to N772.13 billion, while the bank’s deposits increased from N649.33 billion to N758.39 billion in 2009 representing an increase of 17 per cent.
However, the full provision made for bad loans and other non-performing credits in a full swoop impacted negatively on the group’s profitability. The group’s profit before provisions stood at N39.74 billion at the end of 2009 financial year.
The increase in the provision for risk assets to N83.283 billion brought loss before taxation and exceptional items to N43.539 billion, compared to a profit of N33.012 billion in 2008.
The bank’s management, led by Mrs Funke Osibodu as Group Managing Director and Chief Executive, remains very optimistic that Union Bank would again assume its rightful position in the banking industry now that its books have been cleaned up and is poised to exploit the business opportunities arising from the gradual recovery in the global economy.
Mrs Osibodu also stressed the need for the esteemed customers to remain steadfast with the bank and increase their patronage, as the bank was being repositioned to them, thereby guaranteeing better value for shareholders in the years ahead.
The management of Union Bank has restructured its operation with a view to enabling it render world class services to customers globally.
Mrs Funke Osibodu, on assumption of office, had embarked on surprise visits to various branches of the bank across the country with a view of assessing the quality and map out strategy to improve the situation.
Although, two months after the visitations, many customers have attested to good transformations in customer services at Union Bank branches in terms of timely services, personal attention by staff, improved banking environment, facilities and information technology infrastructure.
Mrs Osibodu said the business process and infrastructure upgrade team of the bank has transformed many of the bank’s branches into modern banking offices with ambience such as the Davies Street branch, Tinubu branch, Victoria Island branch, Foreshore Towers branch and Adeola Odeku branch among numerous owners.
Speaking at the Savings Bonanza Draw of the bank at Owerri, Imo State recently, the managing director encouraged the bank’s customers to spread the good news about the positive changes in the financial institution.
She informed the customers that the new changes in the leadership of Union Bank was intended to make the bank, more “Time tested, bigger, stronger, more more reliable”.
Osibodu pointed out that the changes were introduced to safeguard the interest of the shareholders and more importantly, those of the depositors.
She added that Union Bank is being repositioned to provide excellent services to its highly esteemed customers, thereby guaranteeing better value for stakeholders.
Union Bank was one of the five banks, whose top executives were fired on August 14 by the Central Bank of Nigeria (CBN) for presiding over decisions that impaired the finances of the banks. Osibodu took over from the former Group Managing Director, Barth Ebong. The sum of N120 billion was injected into Union Bank from the N420 billion set aside for the five banks by the CBN.
Industry observes applaud the positive changes in the customer services of Union Bank, while acknowledging the fact that given the pedigree of the financial institution it could easily get over its challenges.
Union Bank has recovered substantial portion of its non-performing loans which has buoyed its liquidity. Aside its N1.128 trillion asset base, the bank has a deposit base of over N682 billion from a customer base of 4.82 million, the largest in the industry.
The bank boasts of the world class IT infrastructure, flexcube, which ensures a robust platform for electronic business as well as a rejuvenated workforce with the largest concentration of experienced and qualified bankers which as at August 2009 stood at 6, 042.
Union Bank has restructured its processes tools, human capital and owner resources with a view to emerging the best in the industry. The acronym project GEAR, simply means G-gross the bank from good to great, E-eclipse the competition, A – aligning the bank’s strategy, people, processes and technology, R-redefine the bank’s position in the industry as leaders in the banking industry. The new managing director and chief executive officer had promised to focus on people management, business development and relationship management, risk management and control, all necessary to leap frog a bank’s core business, above any crisis situation.
FG Approves N169.72bn Private Sector Investments In Roads
The Federal Executive Council (FEC) has approved N169.7 billion private sector investments for at least four road infrastructures through the government’s Tax Credit Scheme.
The roads include a 234-kilometre stretch from Bali to Sheti through Gashaka to Gembu in Taraba State, at the sum of N95,232,474,010.72; and a second road, which consists of three roads worth N74,486,577,050.
Minister of Works and Housing, Babatunde Fashola, disclosed this to State House correspondents at the end of the FEC’s meeting presided over by President Muhammadu Buhari at the Presidential Villa, Abuja, on Wednesday.
Fashola, who noted that the scheme was initiated in 2019 through Executive Order 7 signed by the President, said the arrangement allowed private sector players to finance public infrastructure instead of paying taxes and then offset it over time using tax credits.
For the 234-kilometre road in Taraba, which would cost N95.23 billion, Fashola said a N20 billion under the NNPC Tax Credit Scheme would be disbursed to begin the project soonest.
According to him, “the two main memoranda (presented to the council) relate to the uptake by the private sector in response to the tax credit programme, which we initiated in 2019, by Mr. President signing of Executive Order 7 to allow private sector finance public infrastructure in lieu of tax and then to offset it over time using tax credits.
“So, the first road that was awarded today on that policy initiative is the Rule Road from Bali to Sheti, through Gashaka to Gembu in Taraba State. A total of 234 kilometres reconstruction of that road in the sum of 95,232,474,010.62.
“The existing road, for those who are familiar with it, has no concrete stone base. It is just laterite on the asphalt so it doesn’t last and it’s breaking up and leading to potholes.
“So we’ve re-awarded this now for reconstruction under the tax credit scheme, there’s a N20 billion provision under the NNPC tax credit scheme that will be used to kickstart this immediately.
“The second road which is also the tax credit scheme, which was approved by the council is actually three roads. The applicant, in this case, is Mainstream Energy Solutions, a major energy player in the country is now seeking to also participate in this policy by investing a total of N74,486,577, 050,” he explained.
Speaking on behalf of his counterparts in the Ministries of Aviation, Power and Agriculture, the Minister of Information and Culture, Lai Mohammed, revealed that the council approved N3.49 billion for the purchase of an office building in Abuja for the Ministry of Aviation.
This, he said, would cluster the various agencies under the ministry into a single location.
He also revealed that council awarded a N553.58 million contract for the establishment and deployment of Advanced Report Generation Utility Engine Web-based Reporting Tools in favour of Messrs Sinecou Limited with a delivery date of 12 months.
JET-A1: Domestic Airlines Predict Increased Flight Ticket To N100,000
Domestic airlines under the aegis of the Airline Operators of Nigeria have said that rising operational costs occasioned by aviation fuel price hikes, foreign exchange shortage, etc. may push the base economy flight ticket to N100,000.
Spokesperson for local airlines/Chairman, United Airlines, Professor Obiora Okonkwo, made the disclosure during an exclusive interview with The Tide’s source on Wednesday in Abuja.
Beyond the lingering aviation price hike crisis, the airline chief said local operators were being compelled to source foreign exchange from the parallel market at high rates due to a lack of adequate supply from the Central Bank of Nigeria through the commercial banks.
Consequently, he said an increase in the base economy flight ticket to at least N100,000 might be inevitable for all domestic airline operators, if the current situation persists.
“Obviously, it is inevitable. I can tell you that all the airline operators, in the last three months, have been losing money, a huge amount of money. There is too much stress on the operational fronts for them to break even.
“Even if the aviation fuel is made available, there must be a review to reflect the minimal operational cost. We are offering patriotic services to the nation and understand the essential part of it. We are part of this economic development process in Nigeria but it is coming at a very huge sacrifice.
“Nothing less than N100,000, between N100,000 and N120,000 base price, even with Jet A1 fuel at N400 – N500. That is what it is”, Okonkwo said.
Noting that meetings with the CBN in this regard are yet to yield any positive result in the provision of adequate forex, he stressed the need for the aviation industry to be seen as an essential service that should have special consideration in financial matters.
He clarified that the operators have no joy in increasing fares, but that it has become necessary for them to avoid shutting down and running out of business.
“In the industry, it is expected that you will gain some here and lose some there, but the biggest challenge indigenous operators are having is that the cost of everything is high.
“You source money from the commercial bank rates. You source money from the black market. No moratorium for your loans and the banks and AMCON are quick to jump on you”, he explained.
Corroborating this view, the Chief Operating Officer, Ibom Air, Mr. George Uriesi, said local airlines had reached a point in their operational cost that ‘something has to give in’.
“Something has to give in. It’s either the prices of fuel should come down, or the prices of airfares go up from where they are.
“So far, the airlines have tried very much to work within the airfares as they are. All sides of the divide are aware that the airlines have done the best that they can do.
“I don’t know what tomorrow holds but at some point, if the airline doesn’t survive, it goes down, to the detriment of everybody – the people who work for the airline, the people who fly on the airline, the country’s economy, everything goes down. So, airlines are just trying to be stable and patriotic. That’s where we are”, Uriesi said.
Uriesi, a former Managing Director of the Federal Airports Authority of Nigeria, said it was difficult to tell how long the local carriers would be able to continue with the high operational cost.
‘Youths Key To Economic Advancement’
An economist, Prof. Pat Utomi, has stressed the need to invest in youths to enable them transform Nigeria’s economy.
Noting that youths have the capacity to reverse the dwindling fortunes of the economy, Utomi, who was the keynote speaker at the first International Conference on Innovation, Entrepreneurship and Business Management organised by the University of Lagos Business School (ULBS), said Nigeria is till being challenged.
“Our country is still challenged. We are the poverty capital of the world. According to a report, in the next 10 years, between us and Congo Democratic Republic,would produce 40 per cent of the world’s poorest people.
“Thus, we should invest massively in our young people to enable them transform the country and the economy. They have the capacity to change this country for good,” he said.
The Professor of Political Economy also underscored the importance of deploying technology in deepen entrepreneurship and growth.
He said through the tech space Africa would make over $14billion with youths, adding that 60 per cent of the cash would be for Nigeria.
Earlier, Vice Chancellor, University of Lagos, Prof. Oluwatoyin Ogundipe lauded the leadership of the ULBS for its performance.
He noted that plans were underway to build a mini-refinery for the institution’s Department of Petroleum Engineering.
Pioneer Executive Director, ULBS, Prof. Abraham Osinubi, said the conference was aimed at halting the disconnect between the academia and industry by creating an interactive avenue for new ideas to solve real life problems.
The event also witnessed the launch of the ULBS journal, Lagos Management and Business Review.
Thw Conference had as its theme: “Adapting to business landscape in disruptive times”.
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