The Chairman of the Board of Administrators, United Bank for Africa Plc (UBA), Tony Elumelu, on Friday assured stakeholders that the bank will meet the Central Bank of Nigeria’s (CBN) N500 billion minimal capital requirement for worldwide industrial banks by Q3 2025, forward of the deadline.
Elumelu disclosed this throughout the 63rd Annual Common Assembly of the bank held on the Transcorp Hilton in Abuja, attended by Nairametrics.
Nairametrics beforehand reported that the CBN had elevated the capital base for industrial banks with worldwide authorization to N500 billion, and for nationwide banks to N200 billion.
This sweeping monetary reform, introduced on Thursday, March 28, 2024, mandates substantial will increase within the minimal capital base for banks, relying on the scope of their operations.
The coverage directive specifies that industrial banks with worldwide authorization should now shore up their capital base to N500 billion.
UBA’s Capital Adequacy
Reacting to the event, Elumelu acknowledged that the minimal capital necessities set by the apex bank purpose to strengthen the monetary sector and higher place it to assist the actual economic system.
“Banks got till March 2026 to adjust to these new efficiency necessities, with choices together with elevating extra capital, pursuing mergers and acquisitions, or downgrading their licenses to align with present capital ranges,” he added.
- He defined that according to the CBN directive, UBA started its capital elevating actions with its first rights situation in November 2024.
“The rights situation closed in December 2024 with 6.84 billion atypical shares of fifty kobo every provided to current shareholders at N35 per share.”
- He famous that the difficulty was oversubscribed by N11.6 billion (4.8%), and your complete quantity of N251.0 billion has been verified and authorized by the Central Bank of Nigeria (CBN).
- He added, “The ultimate capital elevate is predicted to be accomplished in Q3 2025, properly forward of the CBN deadline.”
- He additionally highlighted that the proceeds from the rights situation will probably be used to spend money on extra digital applied sciences and enterprise enlargement, strengthening the bank’s seven-and-a-half many years of spectacular efficiency.
CEO Feedback on Dividends and UBA’s Income Drive
In a press interview on the occasion, UBA CEO Oliver Alawuba assured stakeholders that the bank would proceed to pay robust dividends to shareholders.
“What we are able to guarantee our shareholders right now is that UBA will proceed to pay extra dividends. The entire dividends to be paid for the yr ended December 31, 2024, quantity to N102 billion. And that is just the start,” he added.
- He emphasised that UBA has moved past paying small dividends in Kobo.
“I’m positive our shareholders by no means imagined that UBA would pay a complete dividend of 5 naira in a single yr.
“If you take a look at the dividend yield, we’re the very best amongst our friends—and we are going to proceed to ship on that,” he added.
Concerning shareholder expectations, Alawuba acknowledged that UBA, now current in 24 nations, is closely investing in digital banking, the way forward for the banking sector.
In accordance with him, these initiatives will drive extra income for UBA, making greater dividend payouts possible within the coming yr.
What to Know Concerning the CBN Requirement
In accordance with the CBN round, to satisfy the minimal capital necessities, banks are anticipated to think about injecting contemporary fairness capital by personal placements, rights points, and/or presents for subscription; pursuing mergers and acquisitions (M&As); and/or upgrading or downgrading their license authorization.
Moreover, the round famous that the minimal capital will consist solely of paid-up capital and share premium. It emphasised that the brand new capital requirement is not going to be based mostly on shareholders’ funds.
Extra Insights
Nairametrics beforehand reported that for the yr ended December 31, 2024, UBA recorded a pre-tax revenue of N803.7 billion, a 6% improve from the N757.6 billion recorded the earlier yr.
Put up-tax revenue for the group surged by 26.14% to N766.5 billion, up from N607.6 billion in 2023.
This represents the very best annual revenue ever recorded by the bank, solidifying its standing as one among Nigeria’s most persistently performing monetary establishments.
Over the previous two years alone, UBA has reported a cumulative revenue of N1.37 trillion—a pointy distinction to the N570.4 billion it posted over the five-year interval main as much as 2023, in accordance with Nairametrics estimates.
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