The Group Managing Director of United Bank for Africa, (UBA) Plc, Oliver Alawuba, has explained that the bank’s inability to declare a final dividend for the 2025 financial year was due to the directive of the Central Bank of Nigeria’s (CBN) to exit the regulatory forbearance window, which resulted in over N1 billion loan provisioning.
CBN Forbearance, granted UBA in 2020, is a regulatory relief to commercial banks and financial institutions during periods of severe economic distress.
It helped the bank manage the widespread economic disruptions and distressed loan portfolios caused by the COVID-19 pandemic.
Speaking during the bank’s 64th Annual General Meeting, Alawuba acknowledged shareholders’ concerns over the absence of a final dividend, noting that the bank had maintained a strong dividend-paying tradition in previous years.
According to him, the bank paid robust dividends in both 2023 and 2024, including a dividend yield of up to 15 per cent in 2024.
However, he noted that the 2025 financial year presented a different operating environment following the CBN’s decision to discontinue the forbearance regime introduced to support banks during challenging economic periods.
Alawuba said the bank’s exit from the forbearance arrangement compelled it to make provisions exceeding ₦1 billion in line with prudential guidelines issued by the apex bank.
He noted that the current CBN leadership has maintained a strict compliance posture, which he described as positive for the overall stability and credibility of the financial system.
The UBA Group Managing Director stated that the provisioning requirement impacted the bank’s profitability and ultimately affected dividend distribution for the year under review.
He, however, assured shareholders that management had already put in place stronger recovery structures and more aggressive mechanisms aimed at recovering non-performing loans and improving asset quality.
According to him, the bank has already begun to witness encouraging signs from the recovery efforts, expressing confidence that recovered loans would eventually be written back into profits and made available for future dividend payments.
Alawuba reaffirmed management’s commitment to restoring the bank’s strong dividend culture, assuring investors that the institution remains focused on sustainable profitability, regulatory compliance, and long-term shareholder value creation.
