By Anastasia John E
Lagos, Nigeria – United Bank for Africa (UBA) has reported a significant 33.1 per cent increase in its quarterly profit compared to the same period last year, driven by robust growth in income from both lending activities and investment securities.
The bank’s financial results for the first three months of 2025, released on Wednesday, revealed a notable shift in its interest income composition. Income from investment securities, including bonds, treasury bills, and promissory notes, contributed 48.7 per cent to the total interest income, up from 45.7 per cent in the corresponding period of 2024. This indicates a potentially reduced reliance on income from loans and advances, which have faced challenges due to increased borrower defaults linked to high interest rates.
UBA’s net interest income, which represents the difference between interest earned on loans and interest paid on deposits, saw a healthy 17 per cent rise to N351.9 billion. This growth occurred despite Nigeria’s benchmark interest rate climbing to 27.5 per cent during the review period, up from 24.8 per cent a year prior. While the higher rates allowed lenders to charge more for loans, they also contributed to a rise in payment defaults across the banking sector. Consequently, UBA’s impairment charges for credit losses surged nearly sevenfold compared to the first quarter of 2024.
Despite the increased provisions for bad loans, UBA recorded substantial gains in other areas. Net trading and foreign exchange income soared by 211.2 per cent, largely due to an 82.4 per cent reduction in fair value losses on derivatives. Overall, the bank’s pre-tax profit rose by 30.7 per cent, and its after-tax profit reached N189.8 billion, a significant increase from the N142.6 billion recorded in the same period last year.
