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Shareholders task Union Bank on dividend payment in 2014

by Business News Report

Some shareholders of Union Bank of Nigeria (UBN) Plc on Tuesday demanded improved dividend payout from the board of the bank in the current year. The shareholders made the demand at the bank’s 45th Annual General Meeting (AGM) held in Lagos.

Mr Shola Aboderin, President, Ibadan Zone Shareholders Association, urged UBN to implement strategic plans that would leverage returns on investments for retail investors in 2014.

Aboderin said the shareholders had waited long for UBN dividend payment and needed to be compensated adequately. He said that contrary to other opinions, UBN minority shareholders invest mainly for the annual dividend payment. Aboderin, however, commended the bank for the impressive growth posted in the 2013 financial year in spite of the nation’s challenging operating environment.

He also urged the bank to intensify efforts aimed at increasing its deposit base to enhance profit and shareholders’ future dividends. Mr Bayo Adeleke, Secretary, Independent Shareholders Association of Nigeria, called for the rebranding of the bank to boost customers’ confidence.
Adeleke said that UBN’s service delivery needed to be overhauled and repackaged with new products lines to meet the dynamic needs of Nigerians. According to him, the board and management of the bank need to be more innovative in their approach to modern banking and the changing national business environment. Mr Matthew Akinlade, Vice-President, Nigeria Shareholders Solidarity Association, said that the bank needed to invest in technology to ensure efficient service delivery.

Akinlade said that the bank should renovate its branches to maintain leadership in the industry.

The shareholders mandated the bank to shop for medium-term funding through debt instrument or Tier II securities for 750 million dollars (N123.8 billion). Earlier, Mr Emeka Emuwa, the bank’s Group Managing Director, attributed the non-declaration of dividend in 2013 to the bank’s negative revenue reserve. Emuwa reassured the shareholders of the board and management’s commitment toward future payment of dividend.

He said the bank would reposition its business to reflect a balanced retail, commercial and corporate banking model that would enhance the nation’s financial inclusion.

“We have begun our branch optimisation work and expect that by end of 2014, more than 60 branches will be upgraded to serve our customers better,” he said.

Emuwa added that the bank would complete the divestment process from portfolio companies in 2014 to focus on its commercial banking business.

According to him, the bank will upgrade its bank-wide information technology to enhance service delivery and increase reliability. The company during the period under review, posted gross earnings of N121.39 billion against N117.21 billion achieved in the comparative period of 2012. Profit before tax stood at N3.77 billion compared with N2.87 billion in 2012.

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