Gross earnings at the lender fell 38 percent to 80.7 billion nairaArticle | July 4, 2012 – 10:00am
Union Bank of Nigeria on Tuesday posted a 2011 pre-tax loss of 122 billion naira ($750 million), compared with a profit of 36.5 billion naira a year ago, it said in a filing with the stock exchange, giving no reason for the loss.
Gross earnings at the lender fell 38 percent to 80.7 billion naira, it said, while net assets recovered to 196 billion naira during the period, from a loss of 115.8 billion naira last year.
A large chunk of the losses are likely to be due to write downs of bad debts left over from a 2008/9 banking crisis.
Shares in the lender shed 4.35 percent to 3.72 naira on the news, almost the maximum 5 percent swing allowed, and underperforming the broader index, which gained 0.55 percent to hit 21,690 points.
Union Bank last year sold a 60 percent stake in itself to a group of institutional investors led by African Capital Alliance private equity for $750 million to help it recapitalise.
It was one of nine lenders that the central bank bailed out to the tune of $4 billion in 2009, after it judged they were dangerously undercapitalised.
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