UBA: N100 Share Price Achievable – Oliver Alawuba

He made this statement in response to a question from the media at the world press conference celebrating the bank’s 75th anniversary, held at its headquarters in Lagos.

United Bank for Africa (UBA) is one of Nigeria’s oldest banks and the first to list on the NGX in 1978.

The management of the bank took questions from a cross section of the media regarding the bank’s past, present and future across its several operations.

One question posed to UBA’s GMD/CEO, Oliver Alawuba, concerned the bank’s share price, which is considered undervalued despite its recent surge.

At the press conference,  the GMD/CEO Oliver Alawuba was also asked if he could commit to achieving a share price target of N100 per share during his tenure at UBA.

In response, Alawuba confidently stated, “N100 is possible; here at UBA, we push the frontiers.”

The Chief Financial Officer of the bank, Ugochukwu Nwagodoh also chimed in making reference to the 237% growth in the bank’s share price over the last year.

He pointed to the revenue streams from the bank’s subsidiaries outside Nigeria as a sign of the bank’s potential for share price appreciation.

UBA Plc’s share price was flat for almost a decade until the recent surge in 2023. Between 2019 and 2022, UBA’s share price averaged around N5 per share, despite profitability growth and declaring dividends. Despite the current share price of N21, the bank still trades at less than 50% of book value and 1x its price-to-earnings multiples.

Regarding the possible external listing of UBA in other capital markets outside Nigeria, Nwagodoh stated that the bank is continuously exploring ways to reach out to the investor community, reviewing options and giving them consideration.

On possible acquisition of a fintech, Nwagodoh stated that the bank will explore potential acquisitions and will not overlook any opportunity. He noted that the bank will not go on any acquisition sprees but will only target businesses that “add value” to the bank. He also mentioned that UBA currently offers most of the services provided by fintech companies.

Concerning the need for the bank to improve its capital importation numbers, it was stated that UBA is working on improving this aspect of their business. In 2023, UBA saw a surge in profits due to the foreign exchange balance on their balance sheet. Nwagodoh explained that banks have around 30-40% of their balance sheet made up of foreign currency components.

Nwagodoh stated that the profits were “one-off” and that they do not expect to see such a “jumbo windfall” happening again.

UBA Nigeria Plc, one of Nigeria’s oldest and largest banks, reported its audited accounts for 2023, revealing gross earnings of N2 trillion, a significant increase from N835 billion just a year earlier.

This achievement marks the bank’s highest gross earnings on record and ranks as one of the highest in the banking sector for 2023.

This achievement marks the bank’s highest gross earnings on record and ranks as one of the highest in the banking sector for 2023.

Following the top-line performance, the bank announced a profit after tax of N607.696 billion in 2023, which represents a 257% surge from N170.277 billion in 2022.UBA released its unaudited financial results for Q1 2024 showing pre-tax profit grew by 154.74% year-on-year to 156.344 billion.