Mar 31, 2016 - Union Bank of Nigeria Plc and Subsidiary Companies. Consolidated financial statements for the period ende
Union Bank of Nigeria Plc FIRST QUARTER INTERIM REPORT 31 March 2016
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016
Consolidated and Separate Statements of Profit or Loss and Other Comprehensive Income For the period ended 31 March 2016 Group Mar.2016 N million
Notes Gross earnings Continuing Operations: Interest income Interest expense Net interest income (NRFF) Net impairment charge for credit losses Net interest income after impairment charge for credit losses Net fee and commission income Net trading income Cash recoveries Gain on sale of subsidiaries Other operating income
Group Mar.2015 N million
Bank Mar.2016 N million
Bank Mar.2015 N million
27,275
27,283
26,600
29,018
9 9
21,488 (6,599)
20,530 (7,912)
21,021 (6,588)
20,046 (7,878)
14(a)
14,889 (1,140) 13,749
12,618 (2,432) 10,186
14,433 (1,131) 13,302
12,168 (2,430) 9,738
2,718 2,740 169 160
2,058 2,135 307 (185) 2,296
2,591 2,681 169 138
1,940 2,099 307 2,421 2,205
10 11 12 12
Non interest income (NII) Operating income
5,787 19,536
6,611 16,797
5,579 18,881
8,972 18,710
Net impairment loss on other financial assets 14(b) Net operating income after net impairment loss on other financial assets Personnel expenses 14 Depreciation and amortisation Other operating expenses 15
19,536 (7,490) (1,227) (6,024)
16,797 (7,595) (987) (5,832)
18,881 (7,151) (1,190) (5,884)
18,710 (7,261) (952) (5,561)
(14,741) -
(14,414) -
(14,225) -
(13,774) -
4,795
2,383
4,656
4,936
16
(76) 4,719
(76) 2,307
(46) 4,610
(29) 4,907
Discontinued operations Gross income from discontinued operations Gross expense from discontinued operations Profit/Loss before tax from discontinued operations Income tax expense from discontinued operations
37 37 37 37
-
142 (36) 106 (9)
-
-
Profit/Loss for the period from discontinued operations
37
-
97
-
-
Total expenses Share of profit of equity accounted investee Profit before income tax from continuing operations Income tax expense from continuing operations Profit for the period from continuing operations
Continuing and discontinued operations: Profit before tax Income tax Profit after tax
4,795 (76) 4,719
2,489 (85) 2,404
4,656 (46) 4,610
4,936 (29) 4,907
-
-
-
-
(22) (5,609) (5,631) (912)
1,090 666 1,756 4,160
(5,656) (5,656) (1,046)
701 701 5,608
Other comprehensive income, net of income tax Remeasurement of defined benefit liability Items that are or may be reclassified to profit or loss Foreign currency translation differences for foreign operations Fair value gains/(losses) on available-for-sale investments Other comprehensive income for the period Total comprehensive income for the period
2
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 Group Mar.2016 N million
Notes
Profit attributable to: Equity holders of the Bank Non-controlling interest Profit for the period
4,715 4 4,719
Group Mar.2015 N million
Bank Mar.2016 N million
Bank Mar.2015 N million
2,384 20 2,404
4,610 4,610
4,907 4,907
(916) 4 -
4,140 20 -
(1,046) -
5,608 -
(912)
4,160
(1,046)
5,608
Total comprehensive income attributable to: Equity holders of the Bank Non-controlling interest Transfer to statutory reserve Transfer to contingency reserve Total comprehensive income for the period
Earnings per share for profit from total operations attributable to equity holders of Bank Basic and diluted (Kobo)
17
28
14
27
29
Earnings per share for profit from continuing operations attributable to equity holders of bank Basic and diluted (Kobo)
17
28
13
27
29
3
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016
Consolidated and Separate Statements of Financial Position Notes ASSETS Cash and cash equivalents Non-pledged trading assets Pledged assets Derivative assets held for risk management Loans and advances to customers Investments in equity accounted investee Investment securities Trading properties Investment in subsidiaries Property and equipment Intangible assets Deferred tax assets Other assets Assets classified as held for sale TOTAL ASSETS LIABILITIES Derivative liabilities held for risk management Deposits from banks Deposits from customers Current tax liabilities Other liabilities Retirement benefit obligations Other borrowed funds
Liabilities classified as held for sale TOTAL LIABILITIES EQUITY Share capital and share premium Treasury shares Retained deficit Other reserves EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE BANK Non-controlling interest
Group Mar.2016 N million
18 19 20 21 21 22 23 24 26 27 28 29 30 37(b)
31 32 33 34 35 36
37(c)
38
39
TOTAL EQUITY TOTAL LIABILITIES AND EQUITY
Group Dec.2015 N million
Bank Mar.2016 N million
Bank Dec.2015 N million
142,352 4,652 67,378 1,722 372,408 24 178,496 2,608 50,341 3,504 95,882 162,797 1,086,675 397 1,087,072
82,252 84,728 1,820 366,721 24 215,137 3,177 49,772 3,749 95,883 138,686 1,046,495 397 1,046,892
86,133 4,652 67,378 1,722 358,470 171,671 1,124 10,567 50,269 3,102 95,875 162,099 1,013,062 325 1,013,387
54,451 84,728 1,820 348,984 209,223 1,124 10,567 49,692 3,318 95,875 138,030 997,812 325 998,137
50,634 602,666 579 110,954 3,921 75,309 844,063
44,091 570,639 382 107,534 4,267 76,059 802,972
7,642 587,236 276 109,413 3,889 75,309 783,765
11,800 569,116 229 106,035 4,230 76,059 767,469
844,063
802,972
783,765
767,469
400,109 (244,353) 81,912
400,109 (244,902) 83,377
400,109 (249,028) 78,541
400,109 (249,372) 79,931
237,668 5,341
238,584 5,337
229,622 -
230,668 -
243,009
243,920
229,622
230,668
1,087,072
1,046,892
1,013,387
998,137
Signed on behalf of the Board of Directors on 19 April, 2016 by:
__________________________
___________________
Emeka Emuwa
Oyinkansade Adewale
Group Managing Director
Director/CFO
FRC/2013/CIBN/00000001774
FRC/2013/ICAN/00000001775
3
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the year ended 31 March 2016
Consolidated and Separate Statements of Cash Flows For the year ended 31 March 2016
Notes Cash flows from operating activities Profit for the year Income tax expense Profit before tax Adjustments for: Impairment losses on loans and advances
Recoveries on loans and advances Impairment on property and equipment Allowances on other assets Gain on sale of property and equipment
Group Mar.2016 N million
Group Bank Dec.2015 Mar.2016 N million N million
Bank Dec.2015 N million
16
4,719 76 4,795
13,987 561 14,548
4,610 46 4,656
17,721 420 18,141
13(a)
1,140
15,072
1,131
15,005
13(a)
-
-
13(b) 12
-
(5,124) 200 2,097 (1,660)
(5,124) 200 2,097 (1,660)
Gain on disposal of available for sale - unquoted equity Gain on sale of trading properties Gain on sale of subsidiaries Depreciation of property and equipment Amortisation of intangible assets Recoveries on investment properties Dividend income from equity investment
24 12 12
Interest paid on borrowings Contributions to defined contribution plans Increase/ (decrease) in liability for defined benefit plans
9
16 973 256 -
12
Change in non-pledged trading assets Change in pledged assets Change in derivative financial instruments-assets Change in loans and advances to customers Change in other assets Change in derivative financial instruments-liabilities Change in deposits from banks Change in deposits from customers Change in other liabilities Income tax paid Payment from defined contribution plan Payment from defined benefit plan Net cash provided/(used in) by operating activities
7
(193) (728) 332 3,509 772 (686)
15 964 226 -
(193) (728) (3,591) 3,480 666 (686)
1,728 154 20
8,683 644 4,347
1,728 154 20
8,683 644 4,310
9,089
41,813
8,894
41,244
(4,652) 17,350 98 (6,827) (24,586) 6,543 32,027 3,421 32,463 13 (155) (291)
745 (793) (7) (63,872) (18,236) (1,813) (17,799) 43,022 3,953 (12,987) (1,004) (623) (7,626)
(4,652) 17,350 98 (10,617) (24,187) (4,158) 18,120 3,378 4,226 1 (155) (291)
745 (793) (56,493) (18,317) (1,820) (6,255) 61,685 2,854 22,850 (826) (623) (7,626)
32,030
(22,240)
3,780
13,776
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the year ended 31 March 2016 Cash flows from investing activities Purchase of investment properties Proceeds from sale of investment properties Acquisition of trading properties Proceeds from sale of unquoted equities Proceeds from sale of trading properties Proceeds from sale of property and equipment Proceed from disposal of subsidiaries Acquisition of property and equipment Acquisition of intangible assets Investment securities Dividend income received Net cash used in investing activities
20
(1,515) 439 31,032 30,570
(4,546) (2,053) 212 1,536 3,438 12,350 (6,677) (2,078) (10,532) 686 (7,664)
10 (1,515) (11) 31,896 30,380
212 1,534 3,438 3,596 (6,669) (1,913) (7,907) 686 (7,022)
(750) (1,728) (2,478)
(2,076) (8,683) (10,759)
(750) (1,728) (2,478)
(2,076) (8,683) (10,759)
60,122 82,252 (22) 142,352
(40,663) 121,960 955 82,252
31,682 54,451 86,133
(4,006) 58,457 54,451
35 569 10
Cash flows from financing activities Repayment of borrowings Interest paid on borrowings Net cash from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Effect of exchange rate fluctuations on cash held Cash and cash equivalents at end of period/year
8
-
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 Consolidated and Separate Statements of Changes in Equity For the period ended 31 March 2016 Group Share capital N million Balance at 1 January 2016 Total comprehensive income for the period Profit for the period
8,468
Share premium N million
Statutory reserve N million
Treasury shares N million
Fair value reserve N million
Regulatory risk reserve N million
Other reserves N million
391,641
22,062
-
33,050
23,876
4,389
Noncontrolling interest Total equity N million N million
Retained deficit N million
Total N million
(244,902)
238,584
5,337
243,921
4,715
4
4,719
-
-
692
-
-
-
-
-
-
-
-
-
-
(22)
-
(22)
-
(22)
-
-
-
-
(5,609)
-
-
-
(5,609)
-
(5,609)
Appropriation: Transfer from regulatory reserves Transfer from other reserves
-
-
-
-
(2,983) (491)
-
-
-
Total comprehensive income for the period
-
-
692
-
391,641
22,754
-
Share premium N million
Statutory reserve N million
391,641 391,641
19,404 19,404
Other comprehensive income, net of tax Foreign currency translation diferrence Fair value gains/(loss) on available-for-sale investment
Balance at 31 March 2016
8,468
2,983 -
(100)
(5,018)
2,983
(122)
28,032
26,859
591
4,267
4,023
549 (244,353)
(916) 237,668
4 5,341
(912) 243,009
December 2015
Share capital N million Balance at 1 January 2015 Prior year adjustment Opening restated Total comprehensive income for the year Profit for the year Other comprehensive income, net of tax Foreign currency translation diferrence Fair value gains/(loss) on available-for-sale investment Appropriation: Transfer from regulatory reserves Total comprehensive income for the period Total contribution and distributions to owners Balance at 31 December 2015
8,468 8,468
Treasury shares N million (35) (35)
Fair value reserve N million
Regulatory risk reserve N million
Other reserves N million
Retained deficit N million
Total N million
28,313 28,313
8,667 8,667
3,407 3,407
(242,969) (706) (243,675)
216,896 (706) 216,190
11,330
13,988
Noncontrolling interest Total equity N million N million 5,338 5,338
-
-
2,658
-
-
-
-
-
-
-
-
-
-
982
-
982
-
982
-
-
-
-
7,400
-
-
-
7,400
-
7,400
(2,652) 4,748 (11) 33,050
15,209 15,209 23,876
982 4,389
8,468
391,641
2,658 22,062
35 -
5
(12,557) (1,227) (244,902)
22,370 24 238,584
(1)
222,234 (706) 221,528
(1) 5,337
13,987
22,369 24 243,921
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 Consolidated and Separate Statements of Changes in Equity For the period ended 31 March 2016 Bank Share capital N million
Balance at 1 January 2016 Total comprehensive income for the period Profit or loss Other comprehensive income Fair value gains/(loss) on available-for-sale investment Transfer between reserves Total comprehensive income for the period Transactions with owners, recorded directly in equity Contributions by and distributions to owners Total contribution and distributions to owners Balance at 31 March 2016
8,468
Share premium N million
Statutory reserve N million
Treasury shares N million
Fair value Regulatory risk reserves reserves N million N million
391,641
22,062
-
32,240
23,876
1,753
Other reserves N million
Retained deficit N million
Total N million
(249,372)
230,668
-
-
692
-
-
-
-
3,918
4,610
-
-
-
-
(5,656) 591
2,983
-
(3,574)
(5,656) -
-
-
692
-
(5,065)
2,983
-
391,641
22,754
-
Share premium N million
Statutory reserve N million
391,641 391,641
19,404 19,404
-
27,213 27,213
8,667 8,667
8,468
27,175.0
26,859.0
1,753.0
344
(1,046)
(249,028)
229,622
Retained earnings N million
Total N million
1,753 1,753
(251,172) (706) (251,878)
205,974 (463) 205,268
December 2015 Share capital N million Balance at 1 January 2015 Prior year adjustment Opening restated
8,468 8,468
Treasury shares N million
Fair value Regulatory risk reserves reserves N million N million
Other reserves N million
Total comprehensive income for the year Profit or loss
-
-
2,658
-
-
-
-
15,063
17,721
Other comprehensive income Fair value reserve (available-for-sale) financial assets Transfer between reserves
-
-
-
-
7,679 (2,652)
15,209
-
(12,557)
7,679 -
Total other comprehensive income for the year Total comprehensive income for the year
-
-
2,658
-
5,027 5,027
15,209 15,209
-
(12,557) 2,506
7,679 25,400
22,062
-
32,240
23,876
1,753
(249,372)
230,668
Balance at 31 December 2015
8,468
391,641
6
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016
9
Net interest income
Interest income Cash and cash equivalents Loans and advances to customers Investment securities Total interest income
10
Bank Mar.2016 N million
Bank Mar.2015 N million
483 14,241 6,764 21,488
176 13,530 6,824 20,530
474 13,894 6,653 21,021
176 13,092 6,778 20,046
4,871 1,728 6,599
4,121 3,791 7,912
4,860 1,728 6,588
4,087 3,791 7,878
Net interest income
14,889
12,618
14,433
12,168
Group Mar.2016 N million
Group Mar.2015 N million
Bank Mar.2016 N million
Bank Mar.2015 N million
Net Fees and commission income
1,763 283 372 147 153 2,718
Commission on turnover Account Maintenance Fee E-business fee income (See note (a) ) Commission on off balance sheet transactions Other fees and commission
1,056 355 114 415 118 2,058
1,789 283 372 147 2,591
1,056 355 114 415 1,940
E-business fee income/charge Group Mar.2016 N million 187 (7) 192 372
ATM on-us POS E-card maintenance
11
Group Mar.2015 N million
Interest expense Deposits from customers Other borrowed funds Total interest expense
Credit Related fees and commissions income
(a)
Group Mar.2016 N million
Group Mar.2015 N million 73 1 40 114
Bank Mar.2016 N million 187 (7) 192 372
Bank Mar.2015 N million 73 1 40 114
Net trading income/(loss)
Bank Group Group Bank Mar.2016 Mar.2015 Mar.2016 Mar.2015 N million N million N million N million Gain on disposal of fixed income securities 2,632 338 2,632 338 Mark to market gains on fixed income securities (23) 147 (23) 147 Foreign exchange gain on trading 131 1,650 72 1,614 Nigerian banking regulations require the Bank to make an annual appropriation to a statutory reserve.2,740 As stipulated by2,135 S.16(1) of the Banks 2,681and Other Financial 2,099Institutio Net trading (loss)/income includes the gains and losses arising both on the purchase and sale of trading instruments and from changes in fair value.
9
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016
12
Other operating income
Dividends Gainson ondisposal disposalofofinvestment property and equipment Gain property Foreign exchange revaluation gain Rental income Sundry income
Group Mar.2016 N million -(16) (67) 40 203 160
Group Mar.2015 N million 493 922 41 840 2,296
Bank Mar.2016 N million -(15) (67) 40 180 138
Bank Mar.2015 N million 493 922 41 749 2,205
Group Mar.2016 N million
Group Mar.2015 N million
Bank Mar.2016 N million
Bank Mar.2015 N million
13 Net Impairment loss on financial assets (a) Net impairment charge for credit losses
Net impairment charge for credit losses: -specific impairment -portfolio impairment Total net impairment loss on financial assets 14
639 501 1,140
1,925 507 2,432
630 501 1,131
1,923 507 2,430
Personnel expenses
Wages and salaries Contributions to defined contribution plans Increase in liability for defined benefit plans
10
Group Mar.2016 N million
Group Mar.2015 N million
Bank Mar.2016 N million
Bank Mar.2015 N million
7,316 154 20 7,490
7,408 167 20 7,595
6,977 154 20 7,151
7,074 167 20 7,261
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 15
Other operating expenses
Auditors' remuneration NDIC Premium Rents and Rates Accomodation and travels Fleet management and vehicle related expenses Repair and Maintenance Transformation Expense Professional fees Advertising and Promotion expenses Security expense Expenses on software Donations and Subscriptions General administrative expenses (see note (a) below) Insurance AMCON surcharge
(a)
Group Mar.2016 N million
Group Mar.2015 N million
Bank Mar.2016 N million
Bank Mar.2015 N million
50 690 239 174 214 276 304 401 251 712 45 1,361 73 1,234 6,024
45 572 254 231 178 152 137 397 93 193 312 46 1,981 79 1,162 5,832
50 690 239 161 214 239 282 401 251 712 45 1,295 71 1,234 5,884
45 572 221 222 178 152 137 379 93 193 312 46 1,770 79 1,162 5,561
Group Mar.2016
Group Mar.2015
Bank Mar.2016
Bank Mar.2015
N million
N million
N million
N million
63 265 5 98 307 91 10 20 72 146 286 1,361
64 300 26 98 384 227 9 10 80 783 1,981
63 265 5 98 307 91 10 20 72 146 220 1,295
64 300 26 98 384 227 9 10 80 572 1,770
General administrative expenses
Office cleaning Cash movement expense Entertainment Directors fees and allowances Diesel and power Stationery, printing, postage and telephone Sports promotion Penalties Restitution and other charges Group restructuring expenses Other expenses
11
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 16
Income tax expense
(a)
Recognised in the profit or loss Group Mar.2016 N million Current tax expense NITDA Levy
Group Mar.2015 N million
76
76
76
Total income tax expense
76
Bank Mar.2016 N million 46 46
Bank Mar.2015 N million 29 29
In line with the Company Income Tax Act, 1990, as amended, the Bank is not liable to pay income tax as the Bank recorded a tax loss for the year. The Bank is exempted from paying minimum tax under the Act, as it has imported share capital of over 25%. No education tax was charged because the Bank has no assessable profit for the year. 17
Earnings per share
(a)
Basic earnings per share Earnings/(loss) per share has been computed based on profit after taxation attributable to the Group ordinary shareholders and the weighted average number of shares in issue during the period is as follows. Weighted average number of ordinary shares
Issued ordinary shares at beginning of the period Weighted effect of shares issued during the period
(b)
Group Mar.2015 16,936 16,936
Bank
Bank
Mar.2016 16,936 16,936
Mar.2015 16,936 16,936
Group Mar.2016
Group Mar.2015
Bank Mar.2016
Bank Mar.2015
Profit attributable to ordinary shareholders
In millions of Nigerian Naira
Profit/(Loss) for the period attributable to equity holders Basic earnings/(loss) per share (in kobo) Profit from continuing operations attributable to equity holders of bank Basic earnings/(loss) per share (in kobo) (c)
Group Mar.2016 16,936 16,936
4,715 28 4,719 28
Diluted earnings per share The Group does not have any dilutive potential ordinary shares, therefore, Basic EPS and Diluted EPS are the same for the Group.
12
2,384 14 2,307 14
4,610 27 4,610 27
4,907 29 4,907 29
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016
18
Cash and cash equivalents
Group Mar.2016 N million
Cash and balances with banks Unrestricted balances with central bank Money market placements
19
Bank Bank Mar.2016 Dec.2015 N million N million
24,434 38,756 79,162 142,352
34,189 14,185 33,878 82,252
22,766 38,756 24,611 86,133
32,762 14,185 7,504 54,451
Group Mar.2016 N million 767 3,885
Group Dec.2015 N million -
Bank Mar.2016 N million 767 3,885
Bank Dec.2015 N million -
Non-pledged Assets (Held for trading)
Government bonds Treasury bills
4,652 20
Group Dec.2015 N million
-
4,652
-
Pledged assets Financial assets that may be repledged or resold by counterparties
Treasury bills Bonds Placement
Group
Group
Bank
Bank
Mar.2016 N million 6,696 57,503 3,179 67,378
Dec.2015 N million 14,620 65,913 4,195 84,728
Mar.2016 N million 6,696 57,503 3,179 67,378
Dec.2015 N million 14,620 65,913 4,195 84,728
Financial assets are pledged as collateral as part of securitized borrowing under terms that are usual and customary for such activities. 21
Derivative financial instruments Group
Mar.2016 Assets Liabilities N million N million
Instrument Type: Foreign exchange
Bank
1,722 1,722
Dec.2015 Assets Liabilities N million N million -
Mar.2016 Assets Liabilities N million N million
Instrument Type: Foreign exchange
1,722 1,722
1,820 1,820
-
Dec.2015 Assets Liabilities N million N million -
1,820 1,820
-
The Group uses derivatives not designated in a qualifying hedge relationship, to manage its exposure to foreign currency risks. The instruments used include forward contracts and cross currency linked forward contracts. 21
Loans and advances to customers at amortised cost Group
Group
Bank
Bank
Mar.2016 N million
Dec.2015 N million
Mar.2016 N million
Dec.2015 N million
Gross amount
397,592
388,794
383,596
370,949
Specific impairment Portfolio impairment
(14,225) (10,959)
(11,565) (10,508)
(14,225) (10,901)
(11,565) (10,400)
Total impairment
(25,184)
(22,073)
(25,126)
(21,965)
Carrying amount
372,408
366,721
358,470
348,984
(a)
13
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended31 March 2016
22
Investment in equity accounted investee
Cost Balance, beginning of the period
Group
Bank
Bank
Dec.2015 N million
Mar.2016 N million
Dec.2015 N million
115 115
115 115
91 91
91 91
(91) 24
(91) 24
(91) -
(91) -
Group Mar.2016 N million
Group Dec.2015 N million
Bank Mar.2016 N million
Bank Dec.2015 N million
50,261 2,122 21,285 3,136 76,804 (4,072) 72,732
57,257 2,195 21,371 41,480 122,303 (4,058) 118,245
44,959 2,122 21,285 1,613 69,979 (4,072) 65,907
52,843 2,195 21,371 39,980 116,389 (4,058) 112,331
Group Mar.2016 N million 2,122
Group Dec.2015 N million 2,195
Bank Mar.2016 N million 2,122
Bank Dec.2015 N million 2,195
15,745 126 42 2 50 305 10 3 11 1152 122 3,718 21,285
15,844 126 42 2 50 305 10 1,152 122 3,718 21,371
15,745 126 42 2 50 305 10 3 11 1,152 122 3,718 21,285
15,844 126 42 2 50 305 10 1,152 122 3,718 21,371
Total
23,408
23,566
23,408
23,566
Less: specific impairment allowance
(4,072)
(4,058)
(4,072)
(4,058)
19,336
19,508
19,336
19,508
57,454 31,758 16,552
48,273 31,702 16,917
57,454 31,758 16,552
48,273 31,702 16,917
105,764
96,892
105,764
96,892
178,496
215,137
171,671
209,223
(Impairments) /increase in value Balance, end of the period 23
Group Mar.2016 N million
Investment securities
Available-for-sale investment securities comprise: Treasury bills Equity: Quoted Unquoted Bonds
see Note 23a see Note 23b
Less: specific impairment allowance
Quoted 23a Investment in REIT 23b Unquoted AFC Smartcard Nigeria Auto Clearing System (NAC) Interswitch Credit Reference Company (CRC) Afrexim Bank Nig Superswitch Infrastructure Afprint Nig. Investment Neimeth Inter Pharm. Banque de Benin AIB Cotonu Investment in SMEEs
Held to maturity investment securities comprise: Treasury bills Federal Government of Nigeria -Bonds State Government of Nigeria -Bonds Corporate Bonds
Investment securities
14
-
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016
24
Trading properties This represents the cost of real estate properties held by the Group which are designated for resale. The movement on the trading properties account during the period was as follows:
Group
Group
Mar.2016 Dec.2015 N million N million
25
Bank
Bank
Mar.2016 Dec.2015 N million N million
Balance, beginning of year
3,177
1,930
1,124
Additions Disposal Reclassification from discontinued operations Transfer to assets held for sale Balance, end of period
(569) 2,608
(806) 2,053 3,177
1,124
1,930 (806) 1,124
Investment Properties These investment properties were last revalued during the period ended 31 December 2013 by Messrs. Bode Adediji Partnership, a firm of estate surveyors and valuers, using the open market basis of valuation, and their reports were dated 16 March 2013 and 16 December 2013 for Union Homes Savings and Loans Plc and UBN Property Company Limited respectively. As at 31 December 2014, the Directors are of the opinion that there were no material fluctuations in the value of the Bank's investment properties since the last valuation.
Group Group Mar.2016 Dec.2015 N million N million 4,546 (35) 4,546 4,511 4,546 4,511 4,546
Balance, beginning of the year Additions Disposal Reclassification Impairment allowance Balance, end of the period
26
Bank Bank Mar.2016 Dec.2015 N million N million -
Investment in subsidiaries Cost Bank Bank Mar.2016 Dec.2015 N million N million 2,195 2,195 8,372 8,372 10,567 10,567
UBN Property Company Limited Union Bank UK Plc
15
(a)
(i)
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 The subsidiary companies, country of incorporation, nature of business and percentage equity holding are detailed below:
Company Name
Country Incorporation Nature of business
UBN Property Company Limited (ii) Union Bank UK Plc (iii) Atlantic Nominees Limited (iv)
Nigeria Nigeria Nigeria
period end
Property Development 31 January Licensed UK Bank 31 January Real Estate 31 January
Direct ownership interest Mar.2016 Dec.2015 Status/% Status/% 39 39 100 100 100 100
UBN Property Company Limited (Registered office at 36, Marina, Lagos) The Company has 5,626,416,051 ordinary shares of N1.00 each of which 39.01% (December 2015 - 39.01%) is held by the Bank. In line with IFRS 10- Consolidated Financial Statement, Union Bank of Nigeria Plc has control over this entity as it has the power, exposure to variability of returns and a strong link between power and variability of returns. The Bank also governs the financial and operating policies of UBN Property Company Limited.
(ii)
Union Bank UK Plc (Registered office at 14-18 Copthal Avenue, London EC2R7BN) The Bank directly holds 100% holding of Union Bank UK's 60,000,000 ordinary shares and 99% of its 50,000 deferred shares of GBP1 each and 1% indirect holding through Williams Street Trustees Limited, the nominee company for Union Bank of Nigeria Plc . Union Bank UK Plc was incorporated in December, 2004 as an authorised United Kingdom subsidiary to carry out the business formerly conducted by the London Branch of Union Bank of Nigeria Plc.
(iii)
Atlantic Nominees Limited The Bank holds 49,990 (approx. 100%) out of 50,000 ordinary shares of N1 each. The balance of 10 is held by Union Trustees Limited. The Company is a Special Purpose Vehicle of former Universal Trust Bank Plc, one of the banks acquired by Union Bank in 2005. The Company was incorporated to hold interests in landed properties. The carrying value of the investment in Union Property Company Limited is included in 'assets classified as held for sale' (see Note 37(b)).
16
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 (c) Condensed results of consolidated entities (i) The condensed financial data of the continuing operations as at 31 March 2016, are as follows Condensed statement of comprehensive income
Statement of Comprehensive income Operating income Net operating income after net impairment loss Operating Expenses Net impairment loss on financial assets Share of proit of equity accounted investees Profit before income tax Taxation Profit after income tax
Group balances N million 20,676 19,536 (14,741) (1,140)
Consolidation entries N million 6 6 (7) 0
4,795
(0)
(76)
(0)
4,719
(0)
Total N million 20,670 19,530 (14,734) (1,140) 4,795 (76) 4,719
Bank N million 20,011 18,879 (14,227) (1,131)
Union Properties Union Pension N million N million 40 40 -
Atlantic Nominees N million -
Union Bank UK N million 619 610
(31) -
-
-
(477) (9)
9
-
-
133
4,653 (46) 4,607
(3)
-
-
(27)
6
-
-
106
Condended Statement of financial position Group balances N million Cash and cash equivalents Non-pledged trading assets Pledged assets Derivative financial instrument Loans and advances to customers Investments in equity-accounted investee Investment securities Assets held for sale Trading properties Investment properties Investment in subsidiaries Property and equipment Intangible assets Deferred tax assets Other assets Total assets Financed by: Derivative financial instruments Deposits from banks Deposits from customers Liability on investment contract Liability on insurance contract Current tax liabilities Other liabilities Retirement benefit obligations Other borrowed funds Liabilities classified as held for sale Equity and reserves Total liabilities
Consolidation entries N million
Total N million
Bank N million
Union Properties Union Pension N million N million
Atlantic Nominees N million
Union Bank UK N million
142,352 4,652 67,378 1,722 372,408 24 178,496 397 2,608 4,511 50,341 3,504 95,882 162,797
(15,073) 24 1 (325) (10,567) 0 (1) (54)
157,425 4,652 67,378 1,722 372,408 178,495 722 2,608 4,511 10,567 50,341 3,504 95,883 162,851
86,133 4,652 67,378 1,722 358,470 171,671 325 1,124 10,567 50,269 3,102 95,875 162,099
4,038 1,484 4,511 7 28
434
397 -
67,254 13,938 6,824 65 402 8 290
1,087,072
(25,995)
1,113,067
1,013,387
10,068
434
397
88,781
50,634 602,666 579 110,954 3,921 75,309 243,009
(0) (15,073) (39) (10,883)
50,634 617,739 579 110,993 3,921 75,309 253,891
7,642 587,236 276 109,413 3,889 75,309 229,622
274 1,027 32 8,735
434
397
42,992 30,503 29 553 14,703
1,087,072
(25,995)
1,113,066
1,013,387
10,068
434
397
88,781
17
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 (b) Condensed results of consolidated entities (i) The condensed financial data of the continuing operations as at 31 December 2015, are as follows Condensed statement of comprehensive income
Statement of Comprehensive income Operating income Net operating income after net impairment loss Operating Expenses Net impairment loss on financial assets Share of profit of equity accounted investees Profit before income tax Taxation Profit after income tax
Group balances N million 81,850 72,606 (58,164) (9,244)
Consolidation entries N million (3,946) (4,013) 23 (67)
14,442 (552) 13,890
(3,990) (1) (3,990)
Total N million 85,796 76,619 (58,187) (9,177)
Bank N million 83,269 74,092
UBN Property Company Ltd N million 448 448
(55,952) (9,177)
(343) -
-
105
-
187
(107)
-
(25)
(2)
-
162
-
-
18,432
18,140
(551)
(420)
17,880
17,720
Total N million
Bank N million
Union Pension N million -
Union Bank UK N million 2,079 2,079 (1,892) -
Condensed Statement of financial position Group balances N million Cash and cash equivalents Pledged assets Derivative financial instrument Loans and advances to customers Investments in equity-accounted investee Investment securities Assets held for sale Trading properties Investment properties Investment in subsidiaries Property and equipment Intangible assets Deferred tax assets Other assets Total assets Financed by: Derivative financial instruments Deposits from banks Deposits from customers Liability on investment contract Liability on insurance contract Current tax liabilities Other liabilities Retirement benefit obligations Other borrowed funds Liabilities classified as held for sale Equity and reserves Total liabilities
Consolidation entries N million
UBN Property Company Ltd N million
Union Pension N million
Union Bank UK N million
82,252 84,728 1,820 366,720 24 215,137 397 3,177 4,546 49,771 3,749 95,883 138,686
(10,917) 24 72 (10,567) (95)
93,169 84,728 1,820 366,720 215,137 325 3,177 4,546 10,567 49,771 3,749 95,883 138,781
54,451 84,728 1,820 348,983 209,223 325 1,124 10,567 49,692 3,318 95,874 138,031
3,264 2,053 4,546 10 28
434
35,454 17,737 5,914 69 431 9 289
1,046,891
(21,484)
1,068,375
998,136
9,901
434
59,903
44,091 570,638 382 107,533 4,267 76,059 243,921
(10,920) (80) (10,484)
44,091 581,558 382 107,613 4,267 76,059 254,405
11,800 569,116 229 106,035 4,230 76,059 230,668
163 972 37 8,730
434
32,291 12,442 (10) 605 14,574
1,046,891
(21,485)
1,068,376
998,137
9,902
434
59,903
18
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 27 (a)
Property and equipment Group: The movement in these accounts during the period was as follows: Leasehold land and buildings N million
Fixtures and fittings N million
Furniture & equipment N million
Motor vehicles N million
Capital work in progress N million
Total N million
48,647 (1) 368 (139) 368 49,243
3,052 18 (19) (18) 3,032
15,665 (4) 789 (342) (99) 16,009
3,230 (14) (8) 3,208
2,181 340 (200) 2,321
72,775 (5) 1,515 (514) 43 73,813
48,834 14 2,032 (2,233)
2,613 508 (69)
3,755 1 45 (596) 25 3,230
1,361 820 2,181
70,708 28 6,677 (4,688) 50 72,775
Cost Balance at 1st January, 2016 Exchange difference Additions Disposals Reclassification to other assets
Balance as at 31 March 2016 Balance at 1st January, 2015 Exchange difference Additions Disposals Reclassification from discontinued operations Balance as at 31 December 2015
-
-
48,647
3,052
14,145 13 3,272 (1,790) 25 15,665
10,211 (1) 228 (130) 200 149 10,657
1,167 70 (7) 1,229
8,379 (2) 649 (337) (199) 8,490
3,087 26 (14) (3) 3,096
159 (159) -
23,003 (3) 973 (488) 200 (212) 23,472
9,554 10 955 (508) 200 10,211
965 261 (59) 1,167
7,904 8 2,200 (1,752) 19 8,379
3,552 1 103 (591) 21 3,087
159 159
22,134 19 3,519 (2,910) 200 40 23,003
Balance as at 31 March 2016
38,586
1,803
7,519
112
2,321
50,341
Balance as at 3I December 2015
38,436
1,885
7,286
143
2,022
49,772
Depreciation and impairment losses Balance at 1st January 2016 Exchange difference Charge for the period Disposals Write-off/Adj Reclassifications
Balance as at 31 March 2016 Balance at 1st January, 2015 Exchange difference Charge for the period Disposals Write-off/Adj Reclassification from discontinued operations Balance as at 31 December 2015
(iii) Net Book Value
(iv) In the opinion of the directors, the market value of the Group's properties is not less than the value shown in the financial statements. (v) Exchange difference relates to the conversion of property and equipments acquired in the overseas office at the rate of exchange ruling at the end of the period. (v) Capital work in progress represents construction costs in respect of new offices. On completion of construction, the related amounts are transferred to appropriate categories of property and equipment. (vi) There were no capitalised borrowing costs related to the acquisition of property and equipment during the period (December 2015: nil)
19
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 (b)
Bank: The movement in these accounts during the period was as follows:
Leasehold land and buildings N million
Fixtures and fittings N million
Furniture & equipment N million
Motor vehicles N million
Capital work in progress N million
Total N million
Reclassifications
48,437 368 (10) 368
3,052 18 (19) (18)
15,426 789 (259) (101)
3,186 (14) (8)
2,181 340 (200)
72,282 1,515 (302) 41
Balance as at 31 March 2016
49,163
3,032
15,855
3,164
2,321
73,535
Balance at 1st January, 2015 Additions Disposals Balance as at 31 December 2015
48,638 2,032 (2,233) 48,437
2,613 508 (69) 3,052
13,952 3,264 (1,790) 15,426
3,737 45 (596) 3,186
1,361 820
70,301 6,669 (4,688) 72,282
(i) Cost Balance at 1st January 2016
Additions Disposals
2,181 .
(ii) Accumulated depreciation
Leasehold land and buildings N million
Leasehold improvements N million
Furniture & equipment N million
Motor vehicles N million
Balance at 1st January 2016 Charge for the period Disposals Reclassifications Write-off/Adj
10,352 228 (1) (200) 200
1,167 70 (7) -
8,022 642 (252) (7) -
3,049 25 (14) (6) -
Balance as at 31 March 2016
10,579
1,229
8,405
3,053
-
23,266
7,594 2,180 (1,752)
3,536 103 (591) -
-
21,819 3,480 (1,158) (1,552)
-
22,590
Balance as at 1 January 2015 Charge for the period Disposals Impairment loss (See (iv) below) Balance as at 31 December 2015
9,724 936 (508) 200
965 261 (59)
Capital work in progress N million
-
Total N million
22,590 964 (275) (213) 200
10,352
1,167
8,022
3,049
Balance as at 31 March 2016
38,584
1,803
7,450
111
2,321
50,269
Balance as at 3I December 2015
38,085
1,885
7,404
137
2,181
49,692
(iii) Net Book Value
(iv) In the opinion of the directors, the market value of the Bank's properties is not less than the value shown in the financial statements.
(v) Capital work in progress represents construction costs in respect of new offices. On completion of construction, the related amounts are transferred to appropriate categories of property and equipment. (vi) There were no capitalised borrowing costs related to the acquisition of property and equipment during the period (December 2015: nil)
20
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 28
Intangible assets Group Mar.2016 N million Cost Balance, beginning of the year Additions Transfer from work-in-progress Exchange translation difference Balance, end of period
Group Dec.2015 N million
Bank Mar.2016 N million
Bank Dec.2015 N million
6,395 (439) (7) 5,956
4,263 2,078 54 6,395
5,314 11 5,325
3,401 1,913 5,314
1,841 1,841 772 33 2,646
1,996 1,996 226 1 2,223
1,330
Balance, beginning of the year Amortisation for the period Reclassification Exchange translation difference Balance, end of period
2,646 2,646 256 1 (2) 2,901
Carrying amounts as at period end Balance as at 1 January
3,055 3,749
3,749 2,422
3,102 3,318
3,318 2,071
Amortization and impairment losses Balance, beginning of year
(i)
In the opinion of the directors, the market value of the Group's software is not less than the value shown in the financial statements.
(ii)
There were no capitalised borrowing costs related to the acquisition of software during the period (December 2015 : nil)
29
Deferred tax assets and liabilities Recognised deferred tax assets and liabilities Deferred tax assets and liabilities are attributable to the following:
1,330 666 1,996
Group 31 March 2016
Property, equipment, and software Allowances for loan losses Foreign exchange gains Tax loss carry forward Others Net tax assets (liabilities)
Assets N million 573 100,638 1,711 102,922
Liabilities N million 6,847 192 7,039
Net N million (6,847) (192) 573 100,638 1,711 95,883
Assets N million
Liabilities N million
Net N million
31 December 2015
Property, equipment, and software Allowances for loan losses Foreign exchange gains Tax loss carry forward Others Net tax assets (liabilities)
(1) 573 100,638 1,711 102,921
21
6,847 192 7,039
(6,848) (192) 573 100,638 1,711 95,882
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 Bank 31 March 2016 Assets N million Property, equipment, and software Allowances for loan losses Foreign exchange gains Tax loss carry forward Others Net tax assets (liabilities)
573 100,630 1,711 102,914
Liabilities N million 6,847 192 7,039
Net N million (6,847) (192) 573 100,630 1,711 95,875
31 December 2015 Assets N million 573 100,630 1,711 102,914
Liabilities N million 6,847 192 7,039
Net N million (6,847) (192) 573 100,630 1,711 95,875
Group Mar.2016 N million 95,883 (1)
Group Dec.2015 N million 95,883 -
Bank Mar.2016 N million 95,875 -
Bank Dec.2015 N million 95,875 -
95,882
95,883
95,875
95,875
102,922 (7,039)
102,921 (7,039)
102,914 (7,039)
102,914 (7,039)
Property, equipment, and software Allowances for loan losses Foreign exchange gains Tax loss carry forward Others Net tax assets (liabilities) Deferred tax assets and liabilities Movement on the net deferred tax assets/(liabilities) account during the period:
Balance, beginning of the year Credit for the period Net assets/(liabilities) of discontinued operations Net deferred tax assets/(liabilities) Made up of Deferred tax assets Deferred tax liabilities Recognised and unrecognised deferred tax assets
Recognition of deferred tax assets of N95,883 (December 2015: 95,883) is based on management's profit forecasts (which are based on the available evidence, including historical levels of profitability), which indicate that it is probable that the Group's enities will have taxable profits against which these assets can be utilized. Deferred tax assets have not been recognised in respect of the following items, because it is not probable that future taxable profit will be available against which the Group can use the benefits. 30
Other assets
Cash Reserve Requirement (see (i)) Excess CRR balance to be refunded (see (ii)) Total Cash Reserve Requirement
Group Mar.2016 N million 122,060 25,523 147,583
Group Dec.2015 N million 102,090 25,523 127,613
Bank Mar.2016 N million 122,060 25,523 147,583
Bank Dec.2015 N million 102,090 25,523 127,613
619 2,214 4,121 14,068 21,022 (5,808) 15,214
758 2,430 2,780 11,302 17,270 (6,197) 11,073
619 2,073 3,997 13,635 20,324 (5,808) 14,516
758 2,370 2,618 10,868 16,614 (6,197) 10,417
Other assets: Clearing Accounts receivable and prepayments Prepayments Sundry assets Impairment on other assets Net other assets
162,797 22
138,686
162,099
138,030
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 (i)
The Bank had restricted balances of N122.060 billion (Dec. 2015: N102.090 billion) with the Central Bank of Nigeria (CBN) as at 29 February 2016, representing the cash reserve requirement (CRR). The CRR is a mandatory cash deposit which should be held with the Central Bank of Nigeria as a regulatory requirement.The CRR is non interest bearing and is not available for use in the Group’s day-to-day operations. As at the end of March 2016, the CRRs in force were Public Sector Deposits 22.5% (Dec 2015: 20%) and Private Sector Deposits 22.5% (Dec 2015: 20%). The MPC meeting held on March 21 - 22, 2016 revised CRR to 22.5% for both Public and Private Sector Deposits.
(ii)
Towards the end of 2015, the harmonised CRR rate was reduced from 25% to 20%. The excess CRR funds will only be released to banks to fund approved eligible real sector projects. The amount refundable to the Bank is N25.523 billion (Dec. 2015: N25.523 billion)
31
Deposits from banks Group Mar.2016 N million 7,642 42,992 50,634
Money market deposits (See note (i) below) Other deposits from banks
(i)
32
Money market deposits LCY inter bank takings FCY inter bank takings
7,642 7,642
7,642 7,642
Bank Dec.2015 N million 11,800 11,800
11,800 11,800
Group Mar.2016 N million
Group Dec.2015 N million
Bank Mar.2016 N million
Bank Dec.2015 N million
220,340 228,221 154,105
210,006 214,200 146,433
221,762 211,369 154,105
208,205 214,478 146,433
602,666
570,639
587,236
569,116
Group Mar.2016 N million 382 108 76 13 579
Group Dec.2015 N million 822 3 445 (1,051) 163 382
Bank Mar.2016 N million 229 46 1 276
Bank Dec.2015 N million 635 420 (826) 229
Group Mar.2016 N million 24,681 19,310 1,187 8,525 922 25,046 332 2,224 4,549 7,800 4,629 795 2,864 8,089 110,954
Group Dec.2015 N million
Bank Mar.2016 N million 24,681 19,310 1,187 8,525 922 25,046 332 2,224 4,549 7,800 4,629 795 2,864 6,548 109,413
Bank Dec.2015 N million 20,560 30,096 1,121 8,279 720 23,979 327 2,236 3,486 4,629 654 4,221 5,727 106,035
Current tax liabilities
Balance, beginning of year Foreign exchange translation difference Reclassification Charge for the period Payments during the period Transfer to assets held for sale Balance, end of period 34
11,800 11,800
Bank Mar.2016 N million 7,642 7,642
Deposits from customers
Term deposits Current deposits Savings
33
Group Dec.2015 N million 11,800 32,291 44,091
Other liabilities
Deposits for foreign currency Due to foreign correspondent banks (See note (a) below) PAYE and other statutory deductions Draft and Bills payable
Sundry creditors Creditors and accruals Unearned income Provision for claims and contingencies (a) Accounts payable OBB takings Provisions for Ex-staff claims Insurance premium payable Electronic collections and other e-payment liabilities Other credit balances
23
20,560 30,096 1,121 8,279 719 23,979 327 2,236 3,488 4,629 654 4,221 7,225 107,534
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016
35 Employee benefit obligations Group Group Mar.2016 Dec.2015 N million N million Post employment benefit obligation (see (a) below) Other long-term employee benefits (see (b) below)
3,223 698 3,921
3,566 701 4,267
Bank Mar.2016 N million 3,191 698 3,889
Bank Dec.2015 N million 3,529 701 4,230
(a) Post employment benefit obligation Group Group Mar.2016 Dec.2015 N million N million Defined contribution scheme (see (a) below) Defined benefit obligation (See (ii) below)
151 3,072 3,223
152 3,414 3,566
Bank Mar.2016 N million 151 3,040 3,191
Bank Dec.2015 N million 152 3,377 3,529
(i) Defined Contribution Scheme Group Group Mar.2016 Dec.2015 N million N million Balance, beginning of year Charge during the period Contribution remitted during the period Balance, end of period
152 154 (155) 151
131 644 (623) 152
Bank Mar.2016 N million
Bank Dec.2015 N million
152 154 (155) 151
131 644 (623) 152
The Group and its employees make respective contributions of 10% and 8% of basic salary, housing and transport allowance to each employee's retirement savings account maintained with employees' nominated Pension Fund Administrators.
(ii) Defined benefit obligation The Group also has a Legacy defined benefits pension scheme for its staff, prior to passage of the Pension Reform Act. Under the scheme, terminal benefits were determined with reference to the employees' salaries upon disengagement. The Group has successfully transferred all such benefits to the Retirement Savings Accounts (RSA) of the affected employees and is being funded by a plan asset. Obligations to affected employees is being actuarially determined annually to determine if the plan assets are adequate to cover the obligations. Funds are transferred to the Pension Fund Administrators of employees where the plan asset is determined to be inadequate. The Bank has reclassified from other liabilities to employee benefit obligations, the balance of N6.680billion (1 January 2014: N12.602billion) relating to the net liabilities on post employment defined benefit obligation in respect of pre-2006 employees of the Bank. This has now been accounted for and disclosed in line with IAS 19 - Employee Benefits. In prior years, the balance was inadvertently misclassified as part of other liabilities. This has now been corrected by restating the affected financial statement line items for prior years. (b) Other long-term employee benefits Other long-term employee benefit represents liability in respect of long service award. The basis of determining the benefit due to an employee is as stated below: (i) Less than 5 years of service: 12 weeks total emolument for each completed year of service. (ii) 5 years but less than 15 years of service: 14 weeks total emolument for each completed year of service. (iii) 15 years of service and above: 16 weeks total emolument for each completed year of service. The total emolument is defined as basic salary, housing and transport allowance and lunch subsidy. (i) The amounts recognised in the statement of financial position in respect of long service award are as follows:
(i) The amounts recognised in the statement of financial position are as follows: Nig Group Group Mar.2016 Dec.2015 N million N million Present value of unfunded obligation Present value of funded obligation Total present value of the obligation Fair value of plan assets Present value of net obligation
Bank Mar.2016 N million
Bank Dec.2015 N million
698 698 698
701 701 701
698 698 698
701 701 701
698
701
698
701
Recognized liability for defined benefit obligations
24
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 36 Other borrowed funds
Due to CAC ( see (a)) BOI on-lending facilities (see note (b) below) Other borrowings ( see (c))
Group Mar.2016 N million
Group Dec.2015 N million
Bank Mar.2016 N million
Bank Dec.2015 N million
10,226 7,537 57,546 75,309
10,938 7,840 57,281 76,059
10,226 7,537 57,546 75,309
10,938 7,840 57,281 76,059
(a)
This represents the outstanding balance on an unsecured facility of N18,167,000,000 disbursed by the Central Bank of Nigeria (CBN), as part of its developmental role, in collaboration with the Federal Government of Nigeria represented by the Federal Ministry of Agriculture and Water Resources which established the Commercial Agriculture Credit Scheme for promoting agricultural enterprises in Nigeria. The funds are made available to participating banks at zero cost, for on lending to commercial agricultural enterprises at a maximum rate of 9.00% p.a.
(b)
This represents the outstanding balance of an intervention credit granted to the Bank by the Bank of Industry (BOI), a company incorporated in Nigeria for the purpose of refinancing / or restructuring existing loans to Small and Medium Scale Enterprises (SMEs) and manufacturing companies. The total facility is secured by Federal Government of Nigeria securities worth N18.4 billion (Dec. 2015: N18.4 billion) and has a 15-year tenor and repayable quarterly. A management fee of 1% , deductible at source, is paid by the Bank to BOI under the on-lending agreement and the Bank is under obligation to on-lend to customers at an all-in interest rate of 7% per annum. Though the facility is meant for on-lending to borrowers in specified sectors, the Bank remains the primary obligor to the BOI and therefore assumes the risk of default of customers.
(c)
Other borrowings consist of the following foreign currency denominated facilities:
Standard Chartered Bank Afreximbank Ecobank EBISA Skye Enterprises Diamond Bank (UK) Ltd Mashreq Bank Union Bank, UK African Finance Corporation UBA New York
25
Bank
Bank
Mar.2016
Dec.2015
N million 16,331 19,957 1,708 4,998 5,638 990 7,924 -
N million 25,204 20,073 1,000 1,403 5,608 3,993
57,546
57,281
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016 37 Discontinued operations (a) Profit for the period from discontinued operations
Profit for the period from discontinued operations represents the operating results of subsidiaries held for sale in line with the Bank's Regulation 3 compliance plan to divest from non-banking subsidiaries. Included in discontinued operations are the results and balances of Union Trustees Limited, Atlantic Nominees Limited and Union Properties Limited. The profit for the period from discontinued operations comprises: Group Mar.2016 N million
Group Mar.2015 N million
Gross income Gross expense
-
142 (36)
Interest Income Interest Expense Net interest income Recoveries on credit losses Net interest income after impairment charge for credit losses
-
77 77 77
Net fee and commission income Net trading income Other operating income Underwriting profit Total operating income Total non-interest income
-
65 65
Operating Income
-
142
Net impairment loss on financial assets Net operating income after net impairment loss on other financial assets
-
(8) 134
Personnel expenses Depreciation and amortization Other operating expenses
-
(15) (13) (28) -
Loss before tax from discontinued operations
-
106
Income tax expense Loss from discontinued operations (net of tax)
-
(9) 97
-
Share of profit of equity accounted investee
64 1
(b) Assets classified as held for sale Group Mar.2016 N million 188 209
Cash and cash equivalents Investments in subsidiaries Investment properties Other assets
397
26
Group Dec.2015 N million 188 209 397
Bank Mar.2016 N million 325 325
Bank Dec.2015 N million 325 325
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016
DISCONTINUED OPERATIONS Statements of Financial Position Condensed statement of financial position for discontinued operations
Union properties N million
Statement of financial position
Atlantic Intragroup Nominee adj N million N million
Total N million
ASSETS Investment properties Other assets
188 209
-
188 209
TOTAL ASSETS
-
397
-
397
LIABILITIES TOTAL LIABILITIES
-
-
-
-
27
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016
38 Capital and reserves Share capital
(a)
Group Mar.2016 N million
Authorised : 19,023,125,000 Ordinary shares of 50 kobo each
9,512
Group Mar.2016 N million (b)
Issued and fully paid 16,935,806,472 Ordinary shares of 50kobo each
8,468
(d)
9,512
Group Dec.2015 N million
8,468
Bank Mar.2016 N million
9,512
Bank Mar.2016 N million
8,468
Bank Dec.2015 N million
9,512
Bank Dec.2015 N million
8,468
Group Mar.2016 N million 8,468 8,468
Group Dec.2015 N million 8,468 8,468
Bank Mar.2016 N million 8,468 8,468
Bank Dec.2015 N million 8,468 8,468
Balance, beginning of year Balance, end of period
Group Mar.2016 N million 391,641 391,641
Group Dec.2015 N million 391,641 391,641
Bank Mar.2016 N million 391,641 391,641
Bank Dec.2015 N million 391,641 391,641
Share capital and share premium
400,109
400,109
400,109
400,109
Balance, beginning of year Balance, end of period (c)
Group Dec.2015 N million
Share premium Share premium is the excess paid by shareholders over the nominal value for their shares.
Other reserves The other reserves includes Statutory reserves, Fair value reserve, Regulatory risk reserves, Small and Medium Scale Industries Reserve (SMEEIS) and Capital reserve. Group Group Bank Bank Mar.2016 Dec.2015 Mar.2016 Dec.2015 N million N million N million N million Statutory reserves 22,754 22,062 22,754 22,062 Fair value reserve
28,032
33,050
27,175
32,240
Regulatory risk reserve
26,859
23,876
26,859
23,876
4,409
4,431
1,895
1,895
(14,918)
(14,918)
(14,918)
(14,918)
SMEEIES reserve
6,774
6,774
6,774
6,774
Capital reserve
5,489
5,589
5,489
5,489
Other reserves
2,513 81,911
2,513 83,377
2,513 78,541
2,513 79,931
Translation reserve Excess clawback reserves
28
Union Bank of Nigeria Plc and Subsidiary Companies Consolidated financial statements for the period ended 31 March 2016
(i)
Statutory reserves Nigerian banking regulations require the Bank to make an annual appropriation to a statutory reserve. As stipulated by S.16(1) of the Banks and Other Financial Institution Act of Nigeria, an appropriation of 30% of profit after tax is made if the statutory reserve is less than paid-up share capital and 15% of profit after tax if the statutory reserve is greater than the paid up share capital. The Bank made a transfer of N636mn to statutory reseves during the period ended 31 March 2016 (2015 N736mn).
(ii)
Fair value reserve The fair value reserve includes the net cumulative change in the fair value of available-for-sale investments securities recognised in other comprehensive income.
(iii) Regulatory risk reserve The regulatory risk reserve warehouses the difference between the impairment on loans and advances computed under Nigeria GAAP based on the Central Bank of Nigeria prudential guidelines and provisions specified by the central banks of foreign subsidiaries, compared with the incurred loss model used in calculating the impairment under IFRSs. (iv)
Other reserves The other reserves include Small and Medium Scale Industries Reserve (SMEEIS), Contingency reserve, Capital reserve, Translation reserve.
(v)
Small and Medium Scale Industries Reserve (SMEEIS): The SMEEIS reserve is maintained to comply with the Central Bank of Nigeria (CBN) requirement that all licensed banks set aside a portion of the profit after tax in a fund to be used to finance equity investment in qualifying small and medium scale enterprises. Under the terms of the guideline (amended by CBN letter dated 11 July 2006), the contribution was 10% of profit after tax for the first 5 periods , and thereafter reduced to 5% of profit after tax. However, this is no longer mandatory and therefore no reserve was made during the period ended 31 Jan 2016. The reserve is non-distributable.
(vi)
Translation reserve Translation reserve comprises all foreign exchange differences arising from translation of the financial statements of foreign operations.
(vii) Excess Capital Clawback Under the recapitalisation plan of the Bank executed in 2011, the Asset Management Corporation of Nigeria (AMCON) provided Financial Accommodation to bring the Bank's Completion Net Assets Value (NAV) to zero. The Financial Accommodation provided by AMCON exceeded the Bank's Completion NAV of zero, calculated as at 31 December 2011, by N14.918 billion. This excess amount was refunded to AMCON during the year ended 31st December,2012.
(e)
Retained deficit Retained deficit represents the carried forward income net of expenses plus current period profit attributable to Group's shareholders.
39
Non-controlling Interest Movement in the non controlling interest
Group Mar.2016 N million 5,337 4 -
Balance, beginning of year Profit/(loss) for the period Increase/(dimunition) in non controlling interest Balance, end of period
5,341
29
Group Dec.2015 N million 5,338 (1) 5,337
