Union bank annual report 2015

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Union Bank of Nigeria Plc

Annual Repo rt & Acco unts 31 December 20 15

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Annual Repo rt & Acco unts31 December 20 15

Table of Contents Page

No tice o f Annual General Meeting

Financ ial Highlights

Co rpo rate Pro file

Chairman's Statement

Chief Executive Officer's Statement

Directo rs, Officers and Pro fessio nal Adviso rs

Pro file o f Bo ard Members

Co rpo rate Governance

Directo rs' Repo rt

Statement o f Direc to rs' Respo nsibilities

Repo rt o f the Audit Co mmittee

Independent Audito r's Repo rt

Independent Bo ard Evaluatio n Repo rt

Co nso lidated and Separate Statements o f Pro fit o r Lo ss and Other Co mprehensive Inco me

Co nso lidated and Separate Statements o f Financ ial Po sitio n

Co nso lidated and Separate Statements o f Changes in Equity

Co nso lidated and Separate Statements o f Cash Flows

No tes to the Co nso lidated Financ ial Statements

Value Added Statement

Financ ial Summary

Sales and Service Centre Lo catio ns

E-Dividend/ E-Bo nus Fo rm

Proxy Fo rm

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NOTICE is hereby g iven that the 47th Annual General Meet ing (“AGM”) o f Unio n Bank o f Nigeria Plc will be held in the Ballro o m, Oriental Ho tel, 3 Lekki Ro ad, Vic to ria Island, Lago s o n Thursday, 2nd June, 20 16 at 11.0 0 a.m. to transact the fo llowing business:

ORDINARY BUSINESS

1. To receive and ado pt the Audited Gro up Financ ial Statements fo r the financ ial year ended 31st December, 20 15 to gether with the repo rts o f the Directo rs, Audito rs, Bo ard Appraiser and Audit Co mmittee.

2. To autho rize the Directo rs to fix the remuneratio n o f the Audito rs.3. To elec t/ re-elec t Direc to rs.4 . To elec t/ re-elec t members o f the Statuto ry Audit Co mmittee.

SPECIAL BUSINESS

Ord inary Resolut ion:

1. To approve the remuneratio n o f Direc to rs.

Special Resolut ions:

2. To amend the Bank's Memo randum and Artic les o f Asso c iatio n (“MEMART”) as hereinafter stated:

2(a) Alterat ion of t he MEMART

i. Deleting the Share Capital Histo ry attached to the MEMART and replac ing same with the fo llowing :

Share Capital History

1. On 7th July 1969 the autho rised share capital o f the Co mpany was increased to £10 ,0 0 0 ,0 0 0 divided into 10 ,0 0 0 ,0 0 0 o rdinary shares o f £1 each.

2. On 28th January 1971 by a Spec ial Reso lutio n, all the o rdinary shares were co nverted into 20 ,0 0 0 ,0 0 0 o rdinary shares o f N1 each (o ne Naira).

3. By a Spec ial Reso lutio n dated 10 th January 1977 the autho rised share capital o f the Co mpany was increased fro m N20 ,0 0 0 ,0 0 0 to N30 ,0 0 0 ,0 0 0 by the creatio n o f 10 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f N1 each.

4 . By a Spec ial Reso lutio n dated 23rd January 1978 the autho rised share capital o f the Co mpany was increased fro m N30 ,0 0 0 ,0 0 0 to N50 ,0 0 0 ,0 0 0 by the creatio n o f 20 ,0 0 0 ,0 0 0 o rdinary shares o f N1 each.

5. By a Spec ial Reso lutio n at the 13th AGM held o n 27th January 1982 the autho rised share capital o f the Co mpany was increased fro m N50 ,0 0 0 ,0 0 0 to N10 0 ,0 0 0 ,0 0 0 by the creatio n o f 50 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f N1 each.

6. By a Spec ial Reso lutio n passed at the 22nd AGM held o n 23rd January 1991 the autho rised share capital o f the Co mpany was further increased fro m N10 0 ,0 0 0 ,0 0 0 to N20 0 ,0 0 0 ,0 0 0 (80 0 ,0 0 0 ,0 0 0 o rdinary shares o f 25 ko bo each) by the creatio n o f 40 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 25 ko bo each.

7. By a Spec ial Reso lutio n passed at the 23rd AGM held o n 29th o f January, 1992 the autho rised share capital o f the Co mpany was further increased fro m to N20 0 ,0 0 0 ,0 0 0 to N250 ,0 0 0 ,0 0 0 (1,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 25 ko bo each) by the creatio n o f 20 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 25 ko bo each.

NOTICE OF ANNUAL GENERAL MEETING


Annual Repo rt and Acco unts31 December 20 15

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8. By a Spec ial Reso lutio n passed at the 25th AGM held o n 23rd February 1994, the autho rised share capital o f the Co mpany was further increased fro m N250 ,0 0 0 ,0 0 0 to N50 0 ,0 0 0 ,0 0 0 (2,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 25 ko bo each) by the creatio n o f 1,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 25 ko bo each.

9. By a Spec ial Reso lutio n passed at the 27th AGM held o n 27th March 1996, all the 2,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 25 ko bo each o f the Co mpany, were co nso lidated and divided into 1,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 50 ko bo each (i.e. an autho rised share capital o f N50 0 ,0 0 0 ,0 0 0 ).

10 . By a Spec ial Reso lutio n passed at the 29th AGM held o n 4th March, 1998 the autho rised share capital o f the Co mpany was increased fro m N50 0 ,0 0 0 ,0 0 0 to N1,0 0 0 ,0 0 0 ,0 0 0 by the creatio n o f 1,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each.

11. By a Spec ial Reso lutio n passed at the 32nd AGM held o n 8th August, 20 0 1 the autho rised share capital o f the Co mpany was increased fro m N1,0 0 0 ,0 0 0 ,0 0 0 to N3,0 0 0 ,0 0 0 ,0 0 0 divided into 6,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 50 ko bo each (by the creatio n o f 4 ,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each).

12. By a Spec ial Reso lutio n passed at an Extra-o rdinary General Meeting held o n 1st December, 20 0 4 the autho rised share capital o f the Co mpany was increased fro m N3,0 0 0 ,0 0 0 ,0 0 0 to N5,0 0 0 ,0 0 0 ,0 0 0 divided into 10 ,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 50 ko bo each (by the creatio n o f 4 ,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each).

13. By a Spec ial Reso lutio n passed at the 37th AGM held o n 6th September, 20 0 6 the autho rised share capital o f the Co mpany was increased fro m N5,0 0 0 ,0 0 0 ,0 0 0 to N7,50 0 ,0 0 0 ,0 0 0 divided into 15,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 50 ko bo each (by the creatio n o f 5,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each).

14. By a Spec ial Reso lutio n passed at an Extra-o rdinary General Meeting held o n 27th September 20 07 the autho rised share capital o f the Co mpany was increased fro m N7,50 0 ,0 0 0 ,0 0 0 to N10 ,0 0 0 ,0 0 0 ,0 0 0 divided into 20 ,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 50 ko bo each (by the creatio n o f 5,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each).

15. By a Spec ial Reso lutio n passed at the 39th AGM held o n 26th November, 20 0 8 the autho rised share capital o f the Co mpany was increased fro m N10 ,0 0 0 ,0 0 0 ,0 0 0 to N15,0 0 0 ,0 0 0 ,0 0 0 divided into 30 ,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 50 ko bo each (by the creatio n o f 10 ,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each).

16. By a Spec ial Reso lutio n and No tice o f Reductio n dated the 30 th September, 20 11, the autho rised share capital o f the Co mpany was reduced fro m N15,0 0 0 ,0 0 0 ,0 0 0 to N9,511,562,50 0 divided into 19,0 23,125,0 0 0 o rdinary shares o f 50 ko bo each (by the reductio n o f 10 ,976,875,0 0 0 o rdinary shares o f 50 ko bo each).

ii. Reword ing Clause 3(b) in the Memo randum o f Asso c iatio n, to read:

“To establish, carry o n, co ntinue, extend and develo p the business o f a bank in Nigeria and, elsewhere and in particular but witho ut restric ting the generality o f the fo rego ing powers, to carry o n the business o f receiving mo ney in current, savings and o r depo sit acco unts, o f paying and o r co llec ting cheques drawn o r paid in by custo mers and o f making advances to custo mers”.

iii. Revising the enactment year o f the Co mpanies and Allied Matters Act (“CAMA”) fro m 1990 to 20 0 4 in all applicable c lauses in the MEMART.



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2(b) A lterat ion of t he Art icles of Associat ion ( “ t he Art icles” )

i. Reword ing Clause 5 to read:

“Subjec t to the provisio ns o f Sectio n 141 o f the Act o r any amendments thereto , if at any time the share capital is divided into different c lasses o f shares, the rights attached to any c lass (unless o therwise provided by terms o f issue o f the shares o f that c lass), may, whether o r no t the Co mpany is being wo und up, be varied with the co nsent in writing o f the ho lders o f three-quarters o f the issued shares o f that c lass o r with the sanctio n o f a spec ial reso lutio n passed at a separate general meeting o f the ho lders o f shares o f the c lass, the provisio ns o f these Artic les relating to general meetings shall apply, but the necessary quo rum shall be two perso ns at least ho lding o r representing by proxy o ne-third o f the issued shares o f the c lass and that any ho lder o f shares o f the c lass present in perso n o r by proxy may demand a po ll”.

ii. Reword ing Clause 9 to read:

“Every perso n who se name is entered as a member in the Register o f Members shall be entitled witho ut payment to receive within two mo nths o f the allo tment and three mo nths fro m the date o f a transfer (o r within such o ther perio d as the co nditio ns o f the issue shall provide) a transfer o f all his shareho lding to an acco unt designated by the shareho lder with the Central Securities Clearing System Plc (“CSCS”) o r the delivery o f o ne share certificate fo r all his shares o r several certificates each fo r o ne o r mo re o f his shares upo n payment fo r every certificate o f such amo unt as the Directo rs shall fro m time to time determine. Every no tice o f share transfer o r share certificate shall spec ify the shares to which it relates and the amo unt paid up thereo n. Provided that in respect o f a share o r shares held jo intly by several perso ns, the Co mpany shall no t be bo und to issue mo re than o ne share certificate o r no tice o f transfer o f the shareho lding to mo re than o ne shareho lder's acco unt with CSCS, and delivery o f a share certificate o r evidence o f the CSCS transfer o f shares to o ne o f several jo int ho lders shall be suffic ient delivery to all the jo int ho lders.”

iii. Delet ing from Clause 11: “(Altered by a Spec ial Reso lutio n passed o n 12th March, 1979)” such that the c lause reads:

“The Co mpany shall no t g ive, whether direc tly o r indirec tly (whether by means o f a lo an, guarantee, the provisio n o f security o r o therwise) any financ ial assistance fo r the purpo se o f o r in co nnectio n with a purchase o r subscriptio n made o r to be made by any perso n o f o r fo r any shares in the Co mpany o r in its ho lding co mpany provided that no thing in this regulatio n shall pro hibit transactio ns mentio ned in Sectio n 159(3) o f the Act.”

iv. Delet ing from the Art icles:

1. Clauses 12 to 15 o n 'Lien o n Shares'. 2. Clauses 16 to 21 o n 'Calls o n Shares'. 3. Clauses 22 to 27 o n 'Transfer o f Shares'.

v. Reword ing Clause 28 to read:

“The Co mpany shall be entitled to charge a reaso nable fee o n the reg istratio n o f every pro bate, letter o f administratio n, certificate o f death o r marriage, power o f atto rney, no tice in lieu o f distringas, o r o ther instrument.”

vi. Reword ing Clause 29 to read:

“In case o f death o f a member, the survivo r o r survivo rs where the deceased was a jo int ho lder and the legal perso nal representatives o f the deceased where he was a so le ho lder shall be the o nly perso ns reco gnised by the Co mpany as having any title to his interest in the shares.”



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vii. Reword ing Clause 30 to read:

“Any perso n beco ming entitled to a share in co nsequence o f the death o r bankruptcy o f a member may, upo n such evidence being pro duced as may fro m time to time pro perly be required by the Directo rs and subjec t as hereinafter provided, elec t either to be reg istered himself as ho lder o f the share o r to have so me perso n no minated by him reg istered as the transferee thereo f.”

viii. Reword ing Clause 31 to read:

“If the perso n so beco ming entitled shall elec t to be reg istered himself, he shall deliver o r send to the Co mpany a no tice in writing signed by him stating that he so elec ts. If he shall elec t to have ano ther perso n reg istered he shall testify his elec tio n by executing to that perso n a transfer o f the share.”

ix. Delet ing Clauses 33 to 39 on Forfeit ure of Shares.

x. Reword ing Clause 41 to read:

“The ho lders o f sto ck may transfer the same, o r any part thereo f in the same manner, and subjec t to the same regulatio ns, which the shares fro m which the sto ck aro se might prio r to co nversio n have been transferred, o r as near thereto as c ircumstances admit and the Directo rs may fro m time to time fix the minimum amo unt o f sto ck transferable but so that such minimum shall no t exceed the no minal amo unt o f the shares fro m which the sto ck aro se”.

xi. Delet ing “ or special” f rom Clause 44 such that t he Clause reads:

“The Co mpany may fro m time to time by o rdinary reso lutio n increase the share capital by such sum, to be divided into shares o f such amo unt, as the reso lutio n shall prescribe.”

xii. Delet ing Clause 45 on Pre-empt ive Rights of Shareholders.

xiii. Reword ing Clause 51 to read:

“An AGM and a meeting called fo r the passing o f a Spec ial Reso lutio n shall be called by at least twenty-o ne days' no tice in writing . A meeting o f the Co mpany o ther than an AGM o r a meeting fo r the passing o f a Spec ial Reso lutio n shall be called by at least twenty-o ne days' no tice in writing . The no tice shall be exc lusive o f the day o n which it is served o r deemed to be served and o f the day fo r which it is g iven and shall spec ify the place, the day, the ho ur o f meeting and the general nature o f the business to be transacted, and shall be g iven, in the manner hereinafter mentio ned o r in such o ther manner, if any, as may be prescribed by the Co mpany in General Meeting , to such perso ns as are under the regulatio ns o f the Co mpany, entitled to receive such no tices fro m the Co mpany.

Provided that a meeting o f the Co mpany shall, no twithstanding that it is called by sho rter no tice than that spec ified in this regulatio n, be deemed to have been duly called if it is so agreed by all the members entitled to attend and vo te thereat”.

xiv. Reword ing Clause 53 to read:

“All business shall be deemed spec ial that is transacted at an Extra-o rdinary General Meeting , and also that is transacted at an Annual General Meeting , with the exceptio n o f dec laring a dividend, the co nsideratio n o f the audited financ ial statements and the repo rts o f the Directo rs and Audito rs, the elec tio n o f Direc to rs in the place o f tho se retiring and the appo intment o f and the fixing o f the remuneratio n o f the Audito rs, which shall be deemed to be o rdinary business.”



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xv. Reword ing Clause 56 to read:

“The Chairman, if any, o f the Bo ard o f Direc to rs shall preside as Chairman at every General Meeting o f the Co mpany, o r if there is no such Chairman, o r if he shall no t be present within thirty minutes after the time appo inted fo r the ho lding o f the meeting o r is unwilling to ac t, the Directo rs present shall elec t o ne o f their numbers to be the chairman o f the meeting”.

xvi. Reword ing Clause 80 (a) to read:

The Directo rs' tenure o f o ffice shall be as fo llows: (a) The Chief Executive Officer and Executive Directo rs shall upo n appo intment to the

Bo ard, serve in the respective o ffices until they attain the retirement age o f 60 years, subjec t to the terms o f engagement co ntained in their respective co ntract(s) o f Executive Employment, statuto ry and o r regulato ry direc tives.

xvii. Reword ing Clause 91 to read:

“The Directo rs to retire in every year shall be tho se who have been lo ngest in o ffice since their last elec tio n, but as between perso ns who became Directo rs o n the same day tho se to retire shall (unless o therwise agreed amo ngst the Directo rs) be determined by the precedence o f their surnames in alphabetical o rder.”

xviii. Reword ing Clause 95 to read:

“The Co mpany may fro m time to time by o rdinary reso lutio n increase o r reduce the number o f Direc to rs generally, and may no t determine in what ro tatio n the increased o r reduced number is to go o ut o f o ffice”.

xix. To insert t he fo llow ing clauses after Clause 10 0 in the sec tio n o n 'Pro ceedings o f Direc to rs' which wo uld read:

1. A Directo r may attend and partic ipate at Bo ard o f Direc to rs o r Bo ard Co mmittee meetings by physical attendance o r attendance by means o f video , telepho ne, o r any o ther elec tro nic co mmunicatio n mo de that allows the Directo r to hear and be heard in his partic ipatio n in deliberatio ns o f the meeting .

2. A Directo r attending a meeting by any elec tro nic co mmunicatio n mo de shall co unt to fo rm the quo rum at the meeting and any reso lutio n passed with vo tes cast by such Directo r shall be valid as if the reso lutio n was passed at a Bo ard o r Bo ard Co mmittee meeting at which such Directo r was physically present.

3. The Chairman o f the Bo ard o r a Bo ard Co mmittee may o nly Chair a meeting while being physically present at such meeting .

4 . The Directo rs shall determine the maximum number o f meetings a Directo r may attend by video , telepho ne, o r any o ther elec tro nic co mmunicatio n mo des within a financ ial year.

5. No tice o f Bo ard o f Direc to rs o r Bo ard Co mmittee meetings may be served o n every Directo r o r Alternate Directo r either perso nally o r by dispatching the no tice by po st o r co urier o r by elec tro nic mail (excepting sho rt mail service and so c ial media platfo rms) to the g iven addresses provided that fo r no tices to be served o utside Nigeria such no tice shall be g iven o nly by po st, co urier o r elec tro nic mail.

6. Where a no tice is served by po st o r co urier, service is deemed to have been effec ted at the expiratio n o f seven (7) days fro m the time the no tice is po sted and a no tice served by elec tro nic mail is deemed to have been effec ted at the time the elec tro nic mail is despatched.



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xx. In Clause 10 2, replac ing “five minutes” with “thirty minutes” as the time after which the Directo rs may appo int a Chairman fo r any Bo ard o r o ther meeting when the incumbent Chairman is absent.

xxi. In Clause 10 4 , replac ing “five minutes” with “thirty minutes” as the time after which a Co mmittee may appo int a Chairman fo r any Bo ard co mmittee o r o ther meeting when the incumbent Chairman is absent.

xxii. Reword ing Clause 117 to read:

“Except as by the Act, expressly autho rised, no dividend shall be paid o therwise than o ut o f pro fit and subjec t to the co nditio ns (if any) fro m time to time impo sed by o r under any relevant leg islatio n and o r regulatio n.”

xxiii. Reword ing Clause 118 to read:

“The Co mpany shall maintain a Statuto ry Reserve Fund in acco rdance with the requirements o f the Banking Act.”

xxiv. Reword ing Clause 119 to read:

“In additio n to such payments as are provided fo r in Artic le 117 the Directo rs may at any time set aside o ut o f the pro fits o f the Co mpany such amo unts as they think pro per and transfer them to an Ordinary Reserve Fund which shall at the discretio n o f the Directo rs be applicable fo r any purpo se to which the pro fits o f the Co mpany may be pro perly applied, and pending such applicatio n may, at their discretio n, either be employed in the business o f the Co mpany o r be invested in such investments (o ther than shares o f the Co mpany) as are permitted under the Banking Act and as the Directo rs may fro m time to time think fit. The Directo rs may also witho ut plac ing the same in the Ordinary Reserve Fund carry fo rward any pro fits, which they may think prudent no t to divide.”

xxv. Reword ing Clause 120 to read:

“Subjec t to the rights o f perso ns, if any, entitled to shares with spec ial rights as to dividends, all dividends shall be dec lared and paid acco rding to the amo unts paid o r c redited as paid. All dividends shall be appo rtio ned and paid pro po rtio nately to the amo unts paid o r c redited as paid o n the shares during any po rtio n o r po rtio ns o f the perio d in respect o f which the dividend is paid; but if any share is issued in terms providing that it shall rank fo r dividends as fro m a particular date such share shall rank fo r dividend acco rding ly.”

xxvi. Delet ing Clause 121 o n “Unpaid Calls”.

xxvii. Deleting fro m Clauses 127, 128 and 129 all references to “Pro fit and Lo ss Acco unts” and “Balance Sheet” and replac ing same respectively with “Co nso lidated and Separate Statements o f Pro fit o r Lo ss and Other Co mprehensive Inco me” and “Co nso lidated and Separate Statements o f Financ ial Po sitio n”.

2(c) “That fo llowing the deletio n o f the above-stated c lauses fro m the Artic les o f the Co mpany, all the c lauses retained in the Artic les be renumbered acco rding ly and all typo graphical erro rs in the Artic les amended”.

2(d) “That all sec tio ns o f the CAMA c ited in the Co mpany's MEMART sho uld be reviewed and o r amended to ensure co rrectness”.

2(e) “That the Co mpany's MEMART inco rpo rating the above-listed amendments, be and are hereby approved and ado pted as the MEMART o f the Co mpany, in substitutio n fo r and to the exc lusio n o f all previo us editio ns thereo f”.



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2(f) “That the Co mpany Secretary be and is hereby autho rised to file the amended MEMART o f the Co mpany at the Co rpo rate Affairs Co mmissio n”.

NOTES

a) PROXY

A member o f the co mpany entitled to attend and vo te is entitled to appo int a proxy to attend and vo te in its, his o r her stead. A proxy fo rm is supplied with the No tice. Executed proxy fo rms sho uld be duly stamped at the Stamp Duties Office and depo sited at the o ffice o f the Co mpany Registrar, GTL Registrars Limited, 2 Burma Ro ad, Apapa, Lago s no t less than fo rty-eight (48) ho urs befo re the meeting .

b) STATUTORY AUDIT COMMITTEE

Any member may no minate a shareho lder fo r elec tio n as a member o f the Statuto ry Audit Co mmittee by g iving no tice in writing o f such no minatio n to the Co mpany Secretary at least twenty-o ne (21) days befo re the Annual General Meeting .

c) CLOSURE OF THE REGISTER OF MEMBERS

The Register o f Members and Transfer Bo o ks o f the Co mpany will be c lo sed fro m Mo nday, 16th May 20 16 to Friday, 20 th May 20 16 (bo th days inc lusive).

d) RIGHT OF SHAREHOLDERS TO ASK QUESTIONS

Pursuant to Rule 19.12 (c ) o f the Nigerian Sto ck Exchange's Rulebo o k 20 15, kindly no te that it is the right o f every shareho lder to ask questio ns no t o nly at the meeting but also in writing prio r to the meeting . We urge that such questio ns be submitted to the Co mpany Secretariat no t later than two (2) weeks befo re the meeting date.

BY ORDER OF THE BOARD

Somuyiwa Adedeji SonubiCo mpany SecretaryFRC/ 20 13/ NBA/ 0 0 0 0 0 0 0 20 61Unio n Bank o f Nigeria PlcStallio n Plaza36 MarinaLago s

Dated the 9th day of May 20 16

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FINANCIAL HIGHLIGHTS

Gross Earnings Prof it before Tax Prof it After Tax

N117.21 billio n N14.55 billio n N13.99 billio n

Group

Dec 20 15

N’ Million

Group

Dec 20 14

N’ Million

%

Change

%

Change

Bank

Dec 20 15

N’ Million

Bank

Dec 20 14

N’ Million

Major Prof it or Loss Account Items

Gro ss earnings 117,211 135,898 (14) 118,366 10 9,821 8

Pro fit befo re tax 14,548 27,70 8 (47) 18,141 20 ,691 (12)

Pro fit after tax 13,987 26,825 (48) 17,721 20 ,486 (13)

Earnings per share 83k 151k (45) 10 5k 121k (13)

Major Balance Sheet Items

Depo sits fro m custo mers 570 ,639 527,617 8 569,116 507,431 12

Lo ans and advances 366,721 312,797 17 348,984 30 2,372 15

To tal Assets 1,0 46,892 1,0 0 8,451 4 998,137 920 ,230 8

To tal Equity 243,921 221,528 10 230 ,668 20 5,268 12



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Unio n Bank o f Nigeria Plc (“UBN” o r “the Bank”) was established in 1917 and is o ne o f Nigeria's lo ng-standing and mo st respected financ ial institutio ns, o ffering a po rtfo lio o f banking services to individuals, SMEs, co mmerc ial and co rpo rate c lients.

Our o fferings inc lude current, savings and depo sit acco unt services, funds transfer, fo reign currency do mic iliatio n, lo ans, overdrafts, equipment leasing and trade finance. These services are provided thro ugh an extensive netwo rk o f over 325 sales and service centres, over 720 Auto mated Teller Machines (“ATMs”) spread acro ss Nigeria and alternate channels inc luding o nline banking , mo bile banking , debit cards and po int o f sale systems.

Fo llowing the banking refo rms initiated by the Central Bank o f Nigeria (“CBN”), UBN in September 20 12, co nc luded a successful recapitalisatio n pro cess with the injec tio n o f US$50 0 millio n by Unio n Glo bal Partners Limited (“UGPL”), a co nso rtium o f lo cal and internatio nal investo rs. UGPL acquired 65% o f the Bank's shareho lding while the Asset Management Co rpo ratio n o f Nigeria (AMCON) held 20 .0 4% with the remaining 14.96% held by a diverse gro up o f shareho lders. In December 20 14 and January 20 15 respectively, Atlas Mara Limited acquired AMCON's shareho lding and majo rity shareho lding in African Develo pment Co rpo ratio n, a member o f the UGPL Co nso rtium.

Under new leadership, UBN redefined its ambitio n and mapped o ut a strategy to be a highly respected provider o f quality banking services. Executio n o f this strategy is well underway, leverag ing a ro bust transfo rmatio n team largely fo cused o n peo ple, pro cesses and techno lo gy.

The Bank's transfo rmatio n effo rts are yielding po sitive results as evident fro m its financ ial perfo rmance. Other no table achievements to date inc lude the successful migratio n to a new co re banking platfo rm, implementatio n o f a new mo bile banking platfo rm, launch o f five smarter banking centres, co mpletio n o f over 10 0 + branch pro jec ts, implementatio n o f a business pro cess management so ftware, upgrade to a state o f the art data centre, establishment o f a central pro cessing centre to drive o peratio nal effic ienc ies and reinfo rcement o f the talent base.

In Octo ber 20 15, UBN unveiled its new brand identity, signaling its evo lutio n into a simpler, mo re energ ized bank, dedicated to providing quality banking services. The new brand identity po sitio ns the Bank co mpetitively in the industry with o ppo rtunities to deepen existing custo mer relatio nships and attract a new base o f custo mers.

As UBN prepares to celebrate 10 0 years o f serving c lients in Nigeria, the pace o f growth set by the transfo rmatio n pro gramme is pro o f that the Bank is o n track to regain its po sitio n as a leading banking institutio n in Nigeria.

CORPORATE PROFILE



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CHAIRMAN’S STATEMENT

Int roduct ion

Distinguished shareho lders, ladies and gentlemen, o n behalf o f the Bo ard o f Unio n Bank o f Nigeria Plc . (“UBN” o r “the Bank”), it is my pleasure to welco me yo u to the Bank's 47th Annual General Meeting . This is my first statement to yo u as the Chairman o f the Bo ard o f UBN. I hereby present the annual repo rt and acco unts fo r the financ ial year ended 31st December 20 15.

The Global Economy

20 15 was c lo uded by uncertainty acro ss develo ped and emerg ing markets, which led to slow growth o r dec line aro und mo st parts the wo rld. The g lo bal eco no my reco rded a growth o f 3.1%, a slight dip fro m 20 14 's 3.4%. Slower growth in the wo rld eco no my was attributed to

lower co mmo dity prices, manufacturing slowdown in emerg ing markets, particularly China, and financ ial market vo latility. India overto o k China as the fastest growing eco no my as it reco rded stro ng growth o f 7.5% in 20 15 co mpared to 7.3% in 20 14 versus 6.9% growth reco rded by China in 20 15.

Fo r develo ped eco no mies, the United States reco rded stro ng employment growth in 20 15, which is expected to result in higher wages, spending and higher inflatio n in 20 16. Co nsequently, fo r the first time in almo st a decade, interest rates in the U.S. increased by 0 .25% to 0 .5% in December 20 15. In the Eurozo ne, growth fro m Germany remained stro ng in 20 15 increasing to 1.7% due to an expansio nary mo netary po licy which stimulated do mestic co nsumptio n. France and Spain also reco rded growth spurred by low o il prices, low interest rates and increased co nsumptio n.

In Sub-Saharan Africa (SSA), growth slowed to abo ut 3.6% fro m 5.1% in 20 14 due to falling co mmo dity prices. Lower o il prices particularly affec ted Nigeria and Ango la resulting in a dec line in fo reign reserves and fo reign exchange valuatio n pressures.

Internatio nal Mo netary Fund (IMF) pro jec tio ns indicate that g lo bal growth will reach 3.4% in 20 16, with China expected to remain a key player in the g lo bal eco no my. Co mmo dity dependent natio ns in Africa and Latin America are however expected to face o ngo ing challenges in the near term due to lower revenues. Fo r these reaso ns and o ther fundamental do mestic fac to rs, SSA growth is estimated at 3.3% in 20 16 fro m a previo us fo recast o f 4 .4% anno unced in Octo ber 20 15.

The Nigerian Economy

In 20 15, the Nigerian eco no my experienced vo latility stemming fro m g lo bal financ ial pressures and po litical uncertainty. The suspense surro unding the elec tio ns and the swearing in o f a new President was the fo cal po int fo r the first half o f 20 15. The kno ck-o n effec ts fro m delayed elec tio ns and subsequently delayed appo intment o f cabinet members, co upled with the dec line in o il prices resulted in slower gro ss do mestic pro duct (GDP) growth o f 2.8% in 20 15, co mpared to the 6.2% growth in 20 14.

The no n-o il sec to r – largely driven by trade and agriculture – remained the co re co ntributo r to GDP; while the o il sec to r shrank by 5.5%, fo llowing a 1.3% dro p in 20 14. Inflatio n increased co nsistently during the year with the 12-mo nth inflatio n average at 9.0 % (vs. 8.1% in 20 14). This was attributed to the impact o f exchange rate deprec iatio n o n impo rted go o ds and services, as well as reduced supply o f fo o d fro m the no rth-eastern part o f Nigeria due to unrest in the reg io n.

With the co untry's main revenue generato r, Bo nny Light crude o il, c lo sing the year at $36.20 co mpared to $63.80 in December 20 14, the Federal Government's revenues were severely depleted with several states failing to meet mo nthly o bligatio ns.

The Central Bank o f Nigeria (“CBN”) intro duced a range o f currency co ntro l po lic ies to ease the pressure o n the fo reign reserves. These restric tio ns resulted in the removal o f Nigerian bo nds fro m the JP Mo rgan Index fo r Emerg ing Markets.



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At the end o f 20 15, the Federal Government pro po sed a N6 trillio n budget fo r 20 16. The budget inc luded allo catio n o f 31% fo r capital expenditure, 44% fo r no n-debt recurring expenditure and 23% fo r debt servic ing . The expansio nary budget is expected to have a po sitive kno ck-o n effec t o n the eco no my in the fo rm o f jo b creatio n, infrastructure develo pment and eco no mic diversificatio n.

The Banking Indust ry

Prevailing headwinds in the g lo bal and lo cal eco no my gave rise to a number o f po licy changes to suppo rt the mo netary and fiscal tightening stance o f the Federal Government. Key changes made within the year inc lude:

• Reductio n in co mmissio n o n turnover fro m N2 to N1 per mille which to o k effec t in January 20 15.• The deadline fo r the implementatio n o f higher capital adequacy ratio requirements under

Basel II was extended to June 20 16.• Cash Reserve Requirement (“CRR”) harmo nized at 31% in May 20 15 fo r public and private

sec to r depo sits. Subsequently reduced to 25% and further to 20 % by year end.• Reductio n in the spending limits o n Naira deno minated cards abro ad; ban o n fo reign currency

payments fo r lo cal transactio ns, and the exc lusio n o f 41 impo rt items fro m accessing fo reign currency at the o ffic ial market.

• Sale o f fo reign exchange to Bureaux de Change (BDC) was halted. • Decrease in mo netary po licy rate fro m 13% to 11% in o rder to improve market liquidity.• Implementatio n o f Treasury Sing le Acco unt which resulted in the transfer o f N1.2trillio n (US$6

billio n) o f public sec to r funds.• Increase in the General Lo an Lo ss Provisio n fro m 1% to 2% fo r perfo rming lo ans.

The o perating enviro nment fo r banks in Nigeria was significantly impacted by the co mbinatio n o f the above mentio ned regulato ry changes, lower o il prices, po licy co nstraints and dec lining value o f the Naira which ultimately affec ted the bo tto m-line. Furthermo re, new capital requirements have resulted in the need fo r additio nal capital to co mply with regulatio n and suppo rt growth.

Our Bank

Our Transformat ion In 20 15, we co ntinued with the executio n o f o ur strategy to be a highly respected provider o f quality banking services in Nigeria. Our transfo rmatio n to a simpler, smarter bank was evident acro ss several areas – physical infrastructure with the renovatio n o f several o f o ur branches; techno lo gy upgrades; peo ple, pro cess enhancements and o ur re-energ ized brand. No table achievements made acro ss o ur businesses and o peratio ns resulted in stro ng 20 15 financ ial results.

Our New Brand Ident it y

We unveiled o ur new brand identity at a spectacular launch event in Octo ber 20 15. The refreshed brand po sitio ns us co mpetitively in the Nigerian financ ial industry and enhances o ur ability to attract a new custo mer base. We are now fo cused o n providing simple and smart banking so lutio ns to all o ur custo mers.

Sustainab ilit y

In 20 15, we co nso lidated o ur sustainability effo rts acro ss the nine Nigerian Sustainable Banking Princ iples. We acknowledge that o ur co mmitment to go o d stewardship stems fro m direc t ownership o f o ur ac tio ns as an o rganizatio n and ensuring we understand the direc t impact these have o n o ur enviro nment.

We have implemented a mo re structured appro ach towards mo nito ring o ur Enviro nmental and So c ial (“E&S”) fo o tprint and have created detailed E&S risk pro cesses which govern how we co nduct business.

We co ntinue to be an industry leader and a key co ntributo r to financ ial inc lusio n. We have established new co llabo rative partnerships acro ss the industry, with sustainability o riented o rganizatio ns and reco nfigured o ur governance framewo rk to ensure we have the right level o f engagement with all relevant stakeho lders.



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Our appro ach to sustainability is lo ng term and we will co ntinue do ing business in a manner that is benefic ial to o ur c lients, o ur employees, o ur business, o ur co mmunities and o ur enviro nment.

Changes in our Group St ructure

In co mpliance with CBN's Regulatio n 3 o n the Sco pe o f Banking Activities and Anc illary Matters, which restric ts Nigerian banks to o perate as co mmerc ial, merchant o r spec ialized banks, we are pleased to say that we have successfully and pro fitably co mpleted divestment o f the fo llowing subsidiaries: Unio n Capital Markets Limited, Unio n Assurance Co mpany Limited, UBN Insurance Bro kers Limited, Unio n Registrars Limited, Unio n Trustees Limited and Unio n Ho mes Savings and Lo ans Plc .

Divestment o f UBN Pro perty Co mpany Limited is o ngo ing . Unio n Pensio n Custo dians Limited has been liquidated and regulato ry approval has been granted by the Co rpo rate Affairs Co mmissio n.

Financial Performance in 20 15

The quality o f o ur earnings is o ne o f the critical pillars o f Unio n Bank's transfo rmatio n effo rts and the Bo ard and Management are co mmitted to delivering co nsistent growth in earnings to ensure that we are able to return value to all shareho lders in the near future.

The Bank maintained its po sitive perfo rmance trajec to ry in spite o f challeng ing market co nditio ns. This is a testament to the success o f o ur transfo rmatio n effo rts and reflec ts the significant investments we have made in o ur peo ple, platfo rms and pro cesses.

Gro ss earnings fo r the Bank increased by 8% fro m N10 9.8billio n in 20 14 to N118.4billio n in 20 15. This inc ludes N3.6billio n o ne-o ff gain o n dispo sal o f subsidiaries as we co ntinued the implementatio n o f CBN Regulatio n 3. Pro fit befo re tax (“PBT”) fo r the Bank c lo sed at N18.1billio n fo r 20 15. Exc luding o ne-o ff gain o f N3.6billio n fro m sale o f subsidiaries, co re PBT grew fro m N14.4billio n in 20 14 to N14.6billio n in 20 15.

Operating expenses reduced by 2% fro m N57.2bn in 20 14 to N56.0 bn in 20 15. The downward trend in expenses is expected to co ntinue and reflec ts o ur co st effic iency effo rts over the past 18 to 24 mo nths. Our co st-to -inco me ratio remained at the 20 14 level o f 67%.

Custo mer depo sits are up 12% to N569.1billio n (N507.4billio n in Dec 20 14), co mpared to 6% growth achieved year-o n-year in 20 14; reflec ting increased custo mer co nfidence, a re-energ ised brand and the success o f new pro ducts. Lo ans and advances also increased by 15% to N349billio n fo r the Bank as we co ntinued o ur risk-co nsc io us growth in prio rity sec to rs o f the eco no my.

Board Changes

In 20 15, Senato r Udo ma Udo Udo ma, Mr. Adekunle Adeo sun and Mr. Dickie Ulu resigned fro m the Bo ard o f Direc to rs. I wo uld like to thank them fo r their valuable co ntributio ns to Unio n Bank during their tenure. We welco me Mr. Adekunle So no la as an Executive Directo r as well as Mrs. Beatrice A. Hamza-Bassey, Ms. Arina McDo nald and Mr. Jo hn Vitalo as No n-Executive Directo rs.

Awards and Recognit ion

Unio n Bank received several awards in 20 15 reflec ting the significant enhancements in o ur platfo rms and o ur capabilities. No table awards inc lude: • “Best Bank to Suppo rt Nigeria's Small and Medium Scale Enterprises” - Business Day• “Best Partic ipating Bank in Nigeria” – CBN Agricultural Credit Guarantee Scheme Fund• “Best Co mmerc ial Agriculture Bank” - Nigeria Agriculture Awards• “Cashless POS Activatio n Champio n” – Mastercard

Out look for 20 16

We expect the challeng ing macro eco no mic enviro nment to persist in 20 16 with o il prices remaining depressed. Nevertheless, we expect that as the government executes its eco no mic prio rities - seeking further diversificatio n o f the eco no my and increasing investments in capital infrastructure - the no n-o il sec to rs sho uld receive a bo o st, c reating significant o ppo rtunity fo r co nsumers, industry and investo rs.



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Fo r the banking sec to r in 20 16, we remain o ptimistic abo ut the o ppo rtunities to build a sustainable future fo r Unio n Bank and will co ntinue to pursue sustainable growth by executing o ur strateg ic prio rities acro ss o ur business segments.

Conclusion

Ladies and Gentlemen, o n behalf o f the Bo ard, I thank yo u sincerely fo r yo ur unreserved suppo rt and co ntinued trust and co nfidence in Unio n Bank. A spec ial thank yo u to o ur staff fo r their hard wo rk thro ugho ut the year and to o ur loyal custo mers who have remained with us alo ng o ur jo urney.

We all remain co mmitted to achieving the transfo rmatio n o f Unio n Bank.

Thank yo u.

Cyril Odu Chairman

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CHIEF EXECUTIVE OFFICER'S STATEMENT

Dear Shareho lders,

It is my pleasure to welco me yo u to the 47th Annual General Meeting o f o ur bank, Unio n Bank o f Nigeria Plc . I am pleased to info rm yo u that we made significant strides in 20 15 to advance Unio n Bank's ambitio n to be a highly respected provider o f quality banking services. This is no twithstanding a turbulent macro eco no mic c limate and regulato ry develo pments impacting bo tto m-line acro ss the banking industry.

The Bank was successful in executing key initiatives in 20 15 which have po sitio ned us mo re co mpetitively in the industry and ultimately will help Unio n Bank beco me mo re pro fitable in the sho rt and lo ng term. Here are so me o f the successes reco rded in 20 15:

Our Brand Refresh: A refreshed brand identity was unveiled in Octo ber 20 15 to reflec t o ur new simpler, smarter pro po sitio n. Our ico nic white stallio n which represents decades o f heritage is now mo re dynamic and energetic , and we have updated the identity to be mo re vibrant and co ntempo rary. Based o n custo mer respo nses, we believe that o ur refreshed brand po sitio ns us mo re co mpetitively in the industry and we are now better able to bro aden o ur custo mer base.

Network Upgrade: We made significant pro gress in the o ptimizatio n o f o ur sales and service centres aro und the co untry. So far we have co mpleted 110 pro jec ts inc luding refurbishments, new builds, relo catio ns and c lo sures. We also increased o ur ATM fo o tprint by 12% bring ing o ur to tal number o f ac tive ATMs to 710 by the end o f 20 15. These effo rts ensure o ur custo mers are able to access services mo re easily, in the right lo catio ns and in a pro fessio nal enviro nment.

Technology Upgrade: We successfully migrated to o ur new co re banking platfo rm. This was a majo r undertaking fo r the bank and we delivered the new platfo rm witho ut any downtime o r significant disruptio n to service fo r o ur custo mers. The Bank has also built a state o f the art data centre which co mpares to no ne o ther in the market to day. These upgrades are yielding results and we have achieved 20 % reductio n in transactio n pro cessing times, improving service delivery to o ur custo mers and o pening up o ur capac ity fo r future growth. Our mo bile and o nline banking platfo rms were also upgraded leading , to increased ado ptio n o f the platfo rms by custo mers in 20 15.

Process Opt imisat ion: We co ntinued to overhaul and streamline key pro cesses in the bank to ensure effic iency and co nsistent service delivery to o ur custo mers. So me o f these inc luded migrating pro cesses to the new Central Pro cessing Centre, o utso urc ing cheque and mailro o m management and restructuring the ATM reco nc iliatio n pro cess.

People and Organizat ion: With critical hiring co nc luded in 20 15, we now have in place a pro fessio nal and credible leadership team driving o ur business and transfo rmatio n. Carlo s Wanderley, who has over 23 years' experience in banking and co nsumer retail in develo ped and emerg ing markets, now heads o ur Retail banking business. Adekunle So no la, who has over 24 years' experience in co rpo rate and investment banking , is now Head o f o ur Co mmerc ial banking business. Bo th business heads jo ined the Bank in early 20 15.

We also enhanced o ur talent develo pment mo del by intro duc ing employee engagement pro grammes, ac tive mento ring initiatives and a perfo rmance management system.

Business Model Enhancement : In Retail Bank, we are driving a low co st mo del which has significantly improved service delivery to o ur custo mers and also increased the use o f o ur vario us channels. Our pro duct po rtfo lio was streamlined and two innovative savings pro ducts were intro duced to the Nigerian market.

The Co mmerc ial Bank was restructured to be leaner and mo re effic ient. We also enriched o ur sales fo rce effec tiveness pro grams to ramp up custo mer acquisitio ns and grow the co mmerc ial banking c lient base.

Within Co rpo rate Bank, we have further strengthened the team by recruiting sec to r and pro duct experts. We migrated over 180 co rpo rate c lients o nto the Unio nOne payments and trade platfo rm, increasing transactio nal banking activity and inco me.



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Our Premium Desk Service fo r to p tier co rpo rate c lients co ntinues to deliver superio r custo mer experience to co rpo rate custo mers. We have assembled a pro active and knowledgeable Treasury team that is well able to manage market vo latility and has moved Unio n Bank's ranking o n the Financ ial Markets Dealers Quo tatio ns fro m 20 th place in 20 14 to 8th po sitio n in 20 15.

Service Excellence: Our improvement in service delivery was affirmed thro ugh custo mer respo nses and o ur improved ranking o n independent industry surveys inc luding the KPMG 20 15 banking survey.

Our Financial Performance in 20 15The Bank co ntinues to deliver co nsistent financ ial perfo rmance since returning to pro fitability in 20 12. In 20 15, Unio n Bank reco rded pro fit befo re tax (“PBT”) o f N18.1billio n. No twithstanding the to ugher o perating enviro nment and exc luding o ne-o ff gains fro m the sale o f subsidiaries in 20 15, o ur co re PBT grew fro m N14.4billio n in 20 14 to N14.6billio n in 20 15.

At the Gro up level, with the sale o f o ur no n-banking subsidiaries largely co nc luded in 20 14, gro ss earnings and PBT are expectedly lower in 20 15 witho ut the o ne-o ff gains fro m the previo us year. We are now a leaner and mo re effic ient gro up, fo cused o n co re retail, co rpo rate and co mmerc ial banking .

We have successfully kept o perating co sts down fo r the fo urth co nsecutive year, while making investments in techno lo gy, peo ple, pro cesses and marketing co mmunicatio n. Lo ans and Advances were up 15% to N349billio n fo r the Bank and 17% to N367billio n fo r the Gro up owing largely to risk-co nsc io us growth in target sec to rs o f the eco no my. Additio nally, o ur balance sheet remains stro ng with to tal assets fo r the Bank and Gro up c lo sing at N998billio n and N1,0 47billio n respectively.

Our Expectat ions for 20 16While market co nditio ns in Nigeria, and g lo bally, are expected to remain challeng ing in 20 16, I am co nfident that the Bank is well-po sitio ned to navigate the eco no mic headwinds g iven o ur c learly mapped o ut strateg ic prio rities, o ur energ ised wo rkfo rce and o ur co mmitment to innovatio n and co st management. We are fo cused o n executio n to ensure we acco mplish o ur o bjec tives in the sho rt and lo ng term. We have agreed to fo cus o n the fo llowing prio rities:

• We will co ntinue to drive o ur business prio rities, fo cusing o n growing o ur depo sit base, transactio nal inco me and c lient base. We are pro actively managing o ur risks, reduc ing o peratio nal co sts, effec tively utilising capital and managing liquidity.

• Fro m a growth and differentiatio n perspective, we will fo cus o n trade and retail, growing o ur public sec to r business in light o f the o ppo rtunities created by the new administratio n, as well as drive mo re value chain synerg ies acro ss o ur businesses in Nigeria and the UK.

• We co ntinue to fo cus o n attracting , rewarding and retaining the right talent as well as driving a pro ductive employee base thro ugh training and providing the right to o ls and enviro nment to fo ster employee growth and satisfac tio n.

• We will leverage and fo ster innovatio n to drive lo ng-term value creatio n fo r the Bank by improving custo mer acquisitio n, custo mer retentio n and custo mer expansio n.

• We are co mmitted to enhanc ing the Bank's market perceptio n and share-o f-mind with existing and target co nsumers.

To day, we are a stro nger Bank, better able to serve o ur custo mers with innovative pro ducts and pro fessio nal services. We will co ntinue to build o n these successes which are already starting to yield financ ial success fo r the Bank.

On behalf o f the management and staff, I thank yo u, o ur esteemed shareho lders, fo r yo ur co ntinued suppo rt and steadfast loyalty. As we push fo rward into 20 16, I assure yo u o f o ur co mmitment to returning Unio n Bank to its po sitio n as a leading financ ial services provider in Nigeria.

Emeka EmuwaChief Executive Officer



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A. Directors 1 • Udo ma Udo Udo ma, CON - Chairman 2 • Cyril Odu - Chairman

• Emeka Emuwa - Chief Executive Officer3 • Adekunle Adeo sun - Executive Directo r

• Oyinkansade Adewale - Executive Directo r/ Chief Financ ial Officer

• Kando lo Kaso ngo - Executive Directo r/ Chief Risk Officer

• Ibrahim Kwargana - Executive Directo r

• Emeka Oko nkwo - Executive Directo r4 • Adekunle So no la - Executive Directo r

• Mansur Ahmed - No n-Executive Directo r

• Onikepo Akande, CON - No n-Executive Directo r

• Jo hn Bo tts - No n-Executive Directo r

• Richard Burrett - No n-Executive Directo r

• Ian Clyne - No n-Executive Directo r5 • Beatrice Hamza-Bassey - No n-Executive Directo r

• Richard Kramer - No n-Executive Directo r5 • Arina McDo nald - No n-Executive Directo r

• Adeyemi Osindero - No n-Executive Directo r5 • Jo hn Vitalo - No n-Executive Directo r

1 Resigned as Chairman with effec t fro m 11th November, 20 15 2 Appo inted as Chairman with effec t fro m 24th November, 20 15 3 Resigned with effec t fro m 10 th Octo ber, 20 15 4 Appo inted with effec t fro m 15th July, 20 15 5 Appo inted with effec t fro m 21st July, 20 15

Company SecretarySo muyiwa So nubi

B. Professional Advisors

Auditors KPMG Pro fessio nal Services KPMG Tower Bisho p Aboyade Co le Street Vic to ria Island, Lago s

Regist rar & Transfer Off ice GTL Registrars Limited (fo rmer Unio n Registrars Ltd) 2, Burma Ro ad Apapa Lago s

Board Appraiser DCSL Co rpo rate Services Limited 235, Iko ro du Ro ad Ilupeju Lago s

Registered Off ice Unio n Bank o f Nigeria Plc Stallio n Plaza 36 Marina Lago s

DIRECTORS, OFFICERS AND PROFESSIONAL ADVISORS



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C. Management Team

Emeka Emuwa Chief Executive Officer

Oyinkansade Adewale Chief Financ ial Officer

Omo lo la Cardo so Head, Gro up Co rpo rate Strategy

Luxhman Jayaratne Head, Operatio ns & Info rmatio n Techno lo gy

Kando lo Kaso ngo Chief Risk Officer

Ibrahim Kwargana Head, Public Secto r

Jo seph Mbulu Transfo rmatio n Directo r

Emeka Oko nkwo Head, Co rpo rate and Investment Banking

Adekunle So no la Head, Co mmerc ial Banking

Miyen Swo men Head, Human Reso urces

Carlo s Wanderley Head, Retail Banking

Olabo de Abikoye Head, AgriBusiness

Olanireti Abimbo la Head, Internal Co ntro l

Joyce Adekoya Head, Risk Governance

Taiwo Adeneye Head, Treasury Operatio ns

Oluwagbenga Adeoye Head, Financ ial Co ntro l

Sheahan Arasaratnam Head, Retail Pro ducts

Bulus Ayuba Head, Branch Operatio ns & Services, No rth

Olugbenga Babatunde Head, Info rmatio n Techno lo gy Operatio ns

Fatai Baruwa Head, Spec ial Pro jec ts

Lateef Dabiri Head o f Operatio ns

Ro semary David-Etim Reg io nal Co mmerc ial Executive, So uth So uth

Abigail Duo pama-Obo manu Head, Branch Co o rdinatio n

Olusegun Edun Head, Credit Risk Analysis (Co rpo rate)

Ogo chukwu Ekezie-Ekaidem Head, Co rpo rate Affairs & Co rpo rate Co mmunicatio n

Ikechukwuka Emero le Head, Treasury

Chidi Ileka Head, Transactio n Banking , Trade & Cash

David Isiavwe Chief Audit Executive

Abo lade Jegede Reg io nal Co mmerc ial Executive, Lago s Mainland

Adebanji Jimo h Head, Sales and Distributio n

Ali Kadiri Head, General Markets

Pearl Kanu Gro up Head, Co mmerc ial

Segun Lamidi Head, Head Office Operatio ns

Agatha Mbanefo Head, Custo mer Care

Magnus Nno ka Head, Business Suppo rt and Recovery

Ro seline Nwayo Deputy Chief Audit Executive

Gbo lahan Ogundipe Head, Fo reign Operatio ns

Mo bo lade Ojeahere Head, Cash Management

Mo renike Olabisi Head, Fast Moving Co nsumer Go o ds

Babatunde Olagbaju Head, Credit Po rtfo lio Management & Regulato ry Co mpliance

Biyi Olagbami Chief Credit Officer

Ayo dele Olaiya Head, Value Chain Banking

Uche Olowu Head, Energy Upstream/ Oil Services

Glo ria Omereo nye Gro up Head, Co mmerc ial

Ifeanyi Opara Head, Energy Downstream

Fo lo runsho Orimo loye Head, Alternative Channels

Oghenefovie Oyawiri Head, Operatio nal Risk Management

Mo rayo Oyeleke Head, Learning Academy

Kabir Sarkin-Pawa Reg io nal Co mmerc ial Executive, No rth

Rabiu Tata Head, Public Secto r Gro up, Abuja/ No rth

Imo h Udo h Gro up Head, Co mmerc ial

Maria Udo h Public Secto r Relatio nship Manager

Mo mo hjimo h Umar Reg io nal Co mmerc ial Executive, Lago s Island

Maurice Phido Managing Directo r, Unio n Bank UK Plc

Olufemi Okanlawo n Head, So uth Africa Representative Office



20

Cyril Odu - Chairman

Mr. Cyril Odu jo ined the Bo ard in 20 12 and was appo inted Chairman o f the Bo ard o f Direc to rs in November 20 15. Prio r to his appo intment as Chairman, Mr. Odu was the Chairman o f the Bank's Risk Management Co mmittee and served as a member o f the Finance and General Purpo se and Credit Co mmittees. Mr. Odu has nearly 45 years o f pro fessio nal, managerial and direc to r level experience. His 40 -year distinguished career at Exxo nMo bil saw him rise fro m Trainee to Vice Chairman o f the Bo ard o f Mo bil Pro duc ing Nigeria and Chief Financ ial Officer o f Exxo nMo bil Upstream Co mpanies in Nigeria, making him the highest ranking Nigerian in the o rganisatio n until his retirement in 20 12. In 20 0 8, he served o n a presidential co mmittee tasked with accelerating the expansio n o f Nigeria's power infrastructure. After his retirement fro m Exxo n Mo bil in 20 12, Mr. Odu jo ined African Capital Alliance and is currently Chief Executive Officer o f the firm.

Emeka Emuwa - Chief Executive Officer

Mr. Emeka Emuwa jo ined the Bank in November 20 12. He began his career with a stint in Ernst & Yo ung befo re jo ining Citibank where he grew thro ugh the ranks fro m Management Trainee to Managing Directo r, Citibank Nigeria Limited, and Citi Co untry Officer, Nigeria. At Citibank, he served as Citi Co untry Officer in Camero o n, Tanzania, Gabo n, Co ngo , Ghana and Niger and also wo rked in vario us po sitio ns within Nigeria. In 20 0 5, he became the first Nigerian to be appo inted as Chief Executive Officer and Managing Directo r o f Citibank Nigeria Limited. In the co urse o f his career, he has at vario us stages held po sitio ns as Directo r, Acc io n Micro finance Bank Nigeria; Chairman, Nigeria-Po rtugal Friendship and Business Asso c iatio n; Chairman, Junio r Achievement Nigeria; Direc to r, American Business Co unc il.

Oyinkansade Adewale - Executive Directo r and Chief Financ ial Officer

Mrs. Oyinkan Adewale jo ined the Bank as Executive Directo r/ Chief Financ ial Officer in Octo ber 20 12. She is a chartered acco untant and financ ial co ntro l expert with over 34 years o f experience in the audit, financ ial and banking sec to rs. She is a Fellow o f the Institute o f Chartered Acco untants o f Nigeria and has held several bo ard and executive po sitio ns thro ugho ut her career. In 20 0 9, the CBN appo inted her as an Executive Directo r and Chief Financ ial Officer o f Oceanic Bank Nigeria Limited with oversight o f all the bank's 13 subsidiaries, the Risk Management Gro up, Finance Gro up and Strateg ic Planning . She also served as Integratio n Manager in the merger between Oceanic and Eco bank Nigeria. Mrs. Adewale co -fo unded SIAO, a leading indigeno us acco unting firm in Nigeria and was pio neer Managing Directo r/ Chief Operating Officer o f Renaissance Gro up, Africa.

PROFILE OF BOARD MEMBERS



21

Mansur Ahmed - No n-Executive Directo r

Engr. Mansur Ahmed jo ined the Bo ard as a No n-Executive Directo r in Octo ber 20 07. Mansur Ahmed is a pro fessio nal with over 40 years o f experience that spans the manufacturing industry, co mmerce and develo pment financ ing . In the co urse o f his career he has served at Dunlo p Nigeria Industries Limited, Bagauda Textiles Limited, Kaduna Textiles Limited, the New Nigerian Develo pment Co mpany Limited and the Nigerian Natio nal Petro leum Co rpo ratio n all in direc to r-level capac ities. Passio nate abo ut go o d governance and a respo nsible private sec to r, he spearheaded, as the CEO o f the Nigerian Eco no mic Summit Gro up, a campaign fo r the improvement o f co rpo rate governance and co rpo rate so c ial respo nsibility in Nigeria.

Dr. Onikepo Akande CON (Mrs.) - No n-Executive Directo r

Dr. (Mrs.) Onikepo Akande jo ined the Bo ard as a No n-Executive Directo r in April 20 0 8. Dr. (Mrs.) Akande's career spans over 40 years in Financ ial Management and Business Administratio n. She was a Directo r o f the Nigeria Industrial Develo pment Bank (now the Bank o f Industry) and the Natio nal Insurance Co rpo ratio n o f Nigeria (NICON). She also served as a member o f the Bo ard o f Trustees o f the Natio nal Centre fo r Wo men Develo pment. She was the first female Minister o f Industry in Nigeria. She is a rec ipient o f the natio nal ho no ur, Co mmander o f the Order o f the Niger (CON) she was also Chairman, Internatio nal Develo pment Co mpany Limited, a Bo ard member o f the Harvard Business Scho o l Alumni Asso c iatio n o f Nigeria (HBSAN), a Directo r o f PZ Fo undatio n. She is currently the President o f the Lago s Chamber o f Co mmerce and Industry.

John Bot t s - No n-Executive Directo r

Mr. Jo hn Bo tts jo ined the Bo ard in 20 12. He is based in Lo ndo n and is a Senio r Adviser to Allen & Co mpany Adviso rs LLP and Co rsair Capital LLC, No n-Executive Chairman o f Euro mo ney Institutio nal Investo r Plc , Chairman o f The Ink Facto ry Films Limited, Direc to r o f Brait SE, Trustee o f the Tate Fo undatio n and Chairman o f Glyndebo urne Pro ductio ns Limited. Previo usly, he was Chief Executive o f Citico rp's Investment Bank in Euro pe, Middle East and Africa (and served as Chairman o f Citico rp's Venture Capital Investment Co mmittee in Euro pe); Chairman o f UBM Plc , Sylvania Lighting Internatio nal and Simplify Dig ital Limited; No n-Executive Directo r o f So ngbird Estates Plc , Stanho pe Plc ; Governo r o f the University o f the Arts and Trustee o f the Natio nal Theatre Fo undatio n. In 20 0 3, he was presented with an Ho no rary CBE (Co mmander o f the Order o f the British Empire).



22

Richard Burret t - No n-Executive Directo r

Mr. Richard Burrett jo ined the Bo ard in 20 13. He has a career o f over thirty years in internatio nal finance and banking . He is currently a partner at Earth Capital Partners, an investment management business that targets sustainable asset c lasses and a Fellow o f the University o f Cambridge Institute fo r Sustainability Leadership. He spent 20 years at ABN AMRO, where he develo ped vast experience in pro jec t and structured finance, spec ializing in the energy and infrastructure sec to rs. He was also instrumental to the creatio n o f the Equato r Princ iples, a market reco gnized standard fo r managing enviro nmental and so c ial risk issues in pro jec t financ ing . He has held a number o f bo ard level adviso ry ro les and has been Co -Chair o f the United Natio ns Enviro nment Pro gramme Finance Initiative.

Ian Clyne - No n-Executive Directo r

Mr. Ian Clyne jo ined the bo ard o f Unio n Bank o f Nigeria Plc in 20 14. His 37 year career began at the Natio nal Australia Bank Gro up in 1978. He has wo rked in vario us executive management po sitio ns in internatio nal co mpanies aro und the wo rld, inc luding the Papua New Guinea Banking Co rpo ratio n and the Calyo n Gro up (fo rmerly Banque Indo suez). In his immediate past ro le as the MD/ CEO o f Bank So uth Pac ific Limited, a public ly listed co mpany o n the Po rt Mo resby Sto ck Exchange, he oversaw a successful transfo rmatio n pro gramme. He ho lds a Bachelo r o f Business Management Studies fro m the University o f Techno lo gy, Perth, Australia.

Beat rice Hamza-Bassey (Mrs.) - No n-Executive Directo r

Mrs. Beatrice A. Hamza Bassey jo ined the Bo ard in 20 15. She is currently the General Co unsel and Chief Co mpliance Officer at Atlas Mara Limited. A lawyer o f great repute with extensive experience in co rpo rate governance and financ ial institutio ns, she is an autho rity in co mpliance and has represented c lients g lo bally in co mpliance and anti-co rruptio n matters. Beatrice interfaces with U.S. and internatio nal regulato rs, designs integrated co mpliance pro grammes, po lic ies and pro cedures tailo red to c lient spec ificatio n, internal investigatio ns and mo re. She is Fellow o f the David Ro ckefeller Fellows Pro gram. She has also served as Directo r, PowerPlay NYC, Self Help Africa, and the Nigerian Higher Educatio n Fo undatio n.



23

Kandolo Kasongo - Executive Directo r and Chief Risk Officer

Mr. Kando lo Kaso ngo jo ined the Bank as an Executive Directo r and Chief Risk Officer in 20 13. Prio r to jo ining the Bank, He served as Head o f Credit at Stanbic IBTC Ho ldings Plc . Mr. Kaso ngo has built a 30 year career in the banking industry. In the area o f risk management, he co mmenced with his ro le at Citibank as Head o f Risk and Senio r Credit Officer fo r East, West and No rth/ West Africa successively, based in Jo hannesburg , Abidjan/ Lago s and Cairo . After 27 years at Citigro up, he moved to Barc lays Bank as Risk Directo r fo r Glo bal Retail and Co mmerc ial Banking , where he had oversight fo r 14 African co untries, the Middle East, India, Pakistan, and Russia.

Richard Kramer (OFR) - No n-Executive Directo r

Mr. Richard Kramer jo ined the Bo ard as a No n-Executive Directo r in 20 12. He is the Chairman o f African Capital Alliance, an o rganizatio n that has pio neered the management o f private equity investments in high po tential sec to rs o f the Nigerian eco no my. A trained acco untant, he earned an MBA fro m Harvard Business Scho o l prio r to jo ining Arthur Andersen in 1958, where he wo rked in all reg io ns. He became the fo unding Managing Partner o f the firm in Nigeria in 1978. On his retirement in 1994, Mr. Dick Kramer remained in Nigeria to co nsult, invest and co ntinue co mmunity service ac tivities. He is a member o f the Lago s Business Scho o l Adviso ry Bo ard and the American Business Co unc il. He was the fo under and first Vice Chairman o f the Nigeria Eco no mic Summit Gro up; President, Harvard Business Scho o l Asso c iatio n o f Nigeria (HBSAN); Head, Technical Team and Member o f Visio n 20 10 Co mmittee. He is also a rec ipient o f the Zik Prize in Leadership.

Ib rahim Kwargana - Executive Directo r and Head o f Public Secto r

Mr. Ibrahim Abubakar Kwargana jo ined the Bank in 20 0 9 and is respo nsible fo r the Bank's Public Secto r Business. Mr. Kwargana has 35 years o f experience which spans perso nnel administratio n, industrial relatio ns, internal audit, banking o peratio ns, marketing and custo mer relatio nship management. He served as Deputy General Manager and Chief Audito r at First Bank o f Nigeria Plc . He was also the General Manager, Operatio ns and Reso urces, FBN (Merchant Bankers) Limited. At the Nigerian Internatio nal Bank Limited (a subsidiary o f the Citigro up) he held strateg ic ro les as the Deputy General Manager and Head o f Branch Operatio ns.



24

Arina MacDonald (Ms.) - No n-Executive Directo r

Ms. Arina McDo nald jo ined the Bo ard in 20 15. She is the Chief Financ ial Officer o f Atlas Mara Limited. Arina McDo nald has over 19 years o f experience in banking and financ ial services. She is a qualified Chartered Acco untant, began her career at Co o pers and Lybrand, and in 1998 jo ined the Lo ndo n o ffice o f Pricewaterho useCo o pers in the Banking and Capital Markets Tax Divisio n. She thereafter wo rked fo r Go ldman Sachs' Lo ndo n o ffice as Directo r: Euro pean Tax. In 20 0 2, she jo ined the Standard Bank o f So uth Africa Gro up, where she held vario us leadership po sitio ns inc luding as Head o f Tax, part o f the Investment Banking Acquisitio n and Debt Adviso ry Services team and the Co rpo rate Develo pment M&A team. Fro m 20 0 9, Arina was the CFO fo r the Standard Bank Gro up's 17-co untry African businesses, o utside o f So uth Africa. In 20 14 she became Head o f Gro up Central Finance befo re jo ining Atlas Mara Limited as CFO in November 20 14.

Emeka Okonkwo - Executive Directo r and Head o f Co rpo rate and Investment Banking

Mr. Emeka Oko nkwo jo ined the Bank in 20 13 as an Executive Directo r, heading the Bank's Co rpo rate and Investment Banking businesses. His career in the banking industry co mmenced 25 years ago as an o fficer in Citigro up Nigeria. It has spanned Co rpo rate Finance, Credit Risk Management, Marketing , Treasury and Strateg ic Management in Citigro up Nigeria and Lo ndo n. In 20 0 9, he was appo inted to the bo ard o f Citigro up Nigeria as an executive direc to r fo r Co mmerc ial Banking and Glo bal Subsidiaries. Prio r to jo ining Unio n Bank, he was head o f the Glo bal Banking Divisio n o f Citigro up Bangladesh and had respo nsibility fo r c lient relatio nships o f the co rpo rate, financ ial institutio ns, public sec to r and g lo bal subsidiaries in the co untry.

Dr. Adeyemi Osindero - No n-Executive Directo r

Dr. Adeyemi Osindero jo ined the Bo ard in 20 12 as a No n-Executive Directo r. He is the Managing Directo r and Head, West Africa Private Equity, Standard Chartered Private Equity Ltd. He began his career in the Investment Banking Divisio n at Go ldman Sachs, advising co mpanies o n mergers and acquisitio ns, IPOs and financ ing . He jo ined Virg in Management Limited as an Investment Manager, where he was respo nsible fo r financ ial adviso ry, strategy and new business initiatives fo r vario us co mpanies within the Virg in Gro up. Dr. Osindero was a fo under o f Virg in Nigeria Airways, and served as its Chief Operating Officer. He has also served o n the Bo ards o f Seven Energy Internatio nal, GZ Industries Nigeria and KANN (ho lding co mpany fo r Abuja Elec tric ity Distributio n Co mpany).



25

Adekunle Sonola - Executive Directo r and Head o f Co mmerc ial Banking

Mr. Adekunle So no la jo ined the Bank in 20 15 as an Executive Directo r in charge o f the Bank's Co mmerc ial Banking business. Prio r to jo ining the Bank, he wo rked at Guaranty Trust Bank Plc where ro se fro m member o f the Co rpo rate Finance Gro up to Divisio nal Head, Co rpo rate Banking . He left Guaranty Trust Bank Plc as pio neer Managing Directo r, East Africa, where he successfully ro lled o ut the franchise in Uganda, Rwanda and Kenya. He was prio r to that, Direc to r, Investment Banking Africa, Standard Bank o f So uth Africa. Adekunle has mo re than 24 years o f banking experience. He is an Alumnus o f the Durham University Business Scho o l, Durham United Kingdo m and ho lds a Bachelo r's Degree in English fro m Ogun State University, Ogun State, Nigeria, an LL.B in Law fro m Obafemi Awo lowo University, Ile Ife, Nigeria.

John Vit alo - No n-Executive Directo r

Mr. Jo hn Vitalo jo ined the Bo ard in 20 15. He has over 25 years' experience in the financ ial services industry. He is CEO o f Atlas Mara Limited, which he jo ined in 20 14 fro m Barc lays PLC where he was Chief Executive Officer, Middle East & No rth Africa since 20 0 9, respo nsible fo r all aspects o f the co mpany's ac tivities in the reg io n, inc luding wealth management, retail and business banking , investment and co rpo rate banking and infrastructure. His previo us ro les at the co mpany inc luded CEO o f Absa Capital – where he built Absa Capital into an award winning investment bank. Prio r to Barc lays, Jo hn was at Credit Suisse First Bo sto n, where he held a number o f senio r po sitio ns in Lo ndo n and New Yo rk. He also serves as a No n-Executive Directo r o n the bo ard o f African Banking Co rpo ratio n Ho ldings (ABCH) and is the No n-Executive Chairman o f Banque Po pulaire du Rwanda



26

Co rpo rate Governance practices in Unio n Bank o f Nigeria Plc (“UBN” o r “the Bank”) are as co dified in the Central Bank o f Nigeria's (“CBN”) Co de o f Co rpo rate Governance o f 20 14, the Securities and Exchange Co mmissio n (“SEC”) Co de o f Co rpo rate Governance o f 20 0 3, the Banks' and Other Financ ial Institutio ns Act o f 1991 (as amended) and o ther relevant statutes, which provide guidance fo r the governance o f the Bank, co mpliance with regulato ry requirements as well as, the co re values upo n which the Bank was fo unded. These co des and statutes are geared towards ensuring the acco untability o f the Bo ard o f Direc to rs (“the Bo ard”) and Management to the stakeho lders o f the Bank in particular and emphasize the need to meet and address the interests o f a range o f stakeho lders, to pro mo te the lo ng-term sustainability o f the Bank.

UBN is co mmitted to the best co rpo rate governance practices and believes that adherence and co mmitment to high governance princ iples and standards is the panacea fo r effec tive co ntro l and management o f the Bank. The princ iple o f go o d co rpo rate governance practices is an impo rtant ingredient in creating , pro tec ting , pro mo ting and sustaining shareho lders' interests, rights and values, as well as delivering excellent service to o ur custo mers. The Bank is co mmitted to the highest ethical standards and transparency in the co nduct o f its business.

In co mpliance with the requirements o f the CBN, the Bank undertakes internal reviews o f its co mpliance with defined co rpo rate governance practices and submits repo rts o n the Bank's co mpliance status to the CBN. An annual bo ard appraisal review is also co nducted by an independent co nsultant appo inted by the Bank, who se repo rt is submitted to the CBN and presented to shareho lders at the AGM o f the Bank, in co mpliance with the provisio ns o f the CBN Co de o f Co rpo rate Governance.

Securit ies Trad ing Policy

To further demo nstrate its co mmitment to transparency and ensure co mpliance with regulato ry requirements, the Bank has develo ped a Securities Trading Po licy in line with the Co des o f Co rpo rate Governance o f the CBN and SEC respectively, and Sectio n 14 o f the Amendment to the Listings Rules o f the Nigerian Sto ck Exchange. The Po licy restric ts the direc to rs, staff, shareho lders, key management perso nnel, third party service providers o r any o ther co nnected perso ns who have direc t o r indirec t access to the Bank's insider info rmatio n fro m dealing in the Bank's securities. It also pro hibits the trading o f the Bank's securities during 'c lo se' perio ds. The po licy is designed to ensure that its co mpliance is mo nito red o n an o ngo ing basis.

Complaint s Management Policy

The Bank's Co mplaints Management Po licy has been prepared pursuant to the Rules Relating to the Co mplaints Management Framewo rk o f the Nigerian Capital Market issued by the SEC o n 16th February, 20 15. The Po licy applies stric tly to the Bank's shareho lders and provides an avenue fo r them to make co mplaints regarding their shareho lding and relatio nship with the Bank.

The Co mplaints Management Po licy aims to pro mo te and safeguard the interest o f the Bank's shareho lders and investo rs, with its primary o bjec tive o f ensuring that the activities o f the bo ard and management are in the best interest o f the Bank and its shareho lders. The po licy sets o ut the pro cess and channels thro ugh which shareho lders can submit their co mplaints, and the pro cess fo r managing these co mplaints.

The Registrar and Co mpany Secretary are jo intly respo nsible fo r the implementatio n o f this po licy.

Remunerat ion Policy for Directors and Senior Management

The Bank's Remuneratio n Po licy fo r direc to rs and senio r management is geared towards attracting , retaining and mo tivating the best talent and enables the Bank achieve its financ ial, strateg ic and o peratio nal o bjec tives. The po licy sets o ut amo ngst o thers, the structure and co mpo nents o f the remuneratio n packages fo r Executive and No n-Executive Directo rs, and ensures that the remuneratio n packages are in co mpliance with the CBN and SEC co des o f co rpo rate governance.

In line with the provisio ns o f the extant regulatio ns and co des o f co rpo rate governance, the remuneratio n o f direc to rs and senio r management are set at levels which are fair and co mpetitive,

CORPORATE GOVERNANCE IN UNION BANK



27

and take into co nsideratio n the eco no mic realities in the financ ial services sec to r and the Bank's financ ial perfo rmance.

Governance St ructure

The Bank's governance bo dies, co mpo sitio n and their respective meeting attendance schedules are captured below:

A. The Board of Directors

The Bo ard o f Direc to rs (“the Bo ard”) oversees the management o f the Bank, and co mprises a No n-Executive Chairman, ten No n-Executive Directo rs, the Chief Executive Officer and five Executive Directo rs as listed below:

Responsib ilit ies of t he Board

The Bo ard, the highest dec isio n making bo dy approved by the shareho lders, met seven (7) times during the year to provide strateg ic direc tio n, po lic ies and leadership in attaining the o bjec tives o f the Bank.

The Bo ard mo nito rs the activities o f the Chief Executive Officer and Executive Directo rs and the acco mplishment o f set o bjec tives thro ugh repo rts at its meetings. In perfo rming its oversight functio n over the Bank's business, the Bo ard o perates thro ugh the fo llowing Bo ard and Management Co mmittees.

B. Stand ing Board Commit tees

The Bo ard o f Direc to rs has six standing co mmittees, which deal with spec ific o peratio ns o f the Bank, namely:

1. Bo ard Credit Co mmittee 2. Bo ard Finance & General Purpo se Co mmittee 3. Bo ard Establishment & Services Co mmittee 4 . Bo ard Risk Management Co mmittee 5. Bo ard Remuneratio n Co mmittee 6. Bo ard Audit Co mmittee

S/ NO NAME 24/ 0 2/ 20 15 21/ 0 4/ 20 15 16/ 0 6/ 20 15 16/ 0 6/ 20 15 14/ 0 7/ 20 15 22/ 0 9/ 20 15 24/ 11/ 20 15

1 1Udo Udo ma UDOMA

2 2Cyril ODU

3 Emeka EMUWA

4 3Adekunle ADEOSUN

5 Oyinkansade ADEWALE

6 Mansur AHMED

7 Onikepo AKANDE

8 Jo hn BOTTS

9 Richard BURRETT

10 Ian CLYNE

11 5Beatrice HAMZA-BASSEY

12 Kando lo KASONGO

13 Richard KRAMER

14 Ibrahim KWARGANA

15 5Arina MCDONALD

16 Emeka OKONKWO

17 Adeyemi OSINDERO

18 4Adekunle SONOLA

19 5Jo hn VITALO

Present

Absent

Present at AGM

Absent fro m AGM

No t applicable due to no n-membership at spec ified time



1 Resigned as Chairman with effec t fro m 11th November 20 15

2 Appo inted as Chairman with effec t fro m 24th November 20 15

3 Resigned with effec t fro m 10 th Octo ber 20 15

4 Appo inted with effec t fro m 15th July, 20 15

5 Appo inted with effec t fro m 21st July, 20 15

28

The co mpo sitio n o f the Bo ard co mmittees was reco nstituted in September, 20 15. In additio n to the co mmittees listed above, there is a Statuto ry Audit Co mmittee.

1. Board Cred it Commit tee

The Co mmittee met six (6) times during the year. It is co mprised o f the fo llowing members:

Its respo nsibilities inc lude the fo llowing , amo ngst o thers: • Co nsider and approve credits and o ther credit related matters within its set limit. • Review and reco mmend credits and o ther credit related matters above its limit to the

Bo ard fo r co nsideratio n and approval. • Review the credit po rtfo lio . • Serve as a catalyst fo r the Bank's c redit po licy changes fro m the Credit Co mmittee to

the Bo ard.

2. Board Finance and General Purpose Commit tee

The Co mmittee met seven (7) times during the year. It is co mprised o f the fo llowing members:

Its respo nsibilities inc lude the fo llowing , amo ngst o thers: • Review and repo rt to the Bo ard o n, the Bank's financ ial pro jec tio ns, capital and

o perating budgets, pro gress o f key initiatives, inc luding actual financ ial results against targets and pro jec tio ns.

S/ NO NAME 18/ 0 2/ 20 15 15/ 0 4/ 20 15 6/ 12/ 20 15 7/ 10 / 20 15 17/ 0 9/ 20 15 18/ 11/ 20 15

1 Adeyemi OSINDERO

2 1Cyril ODU

3 Emeka EMUWA

4 2Adekunle ADEOSUN

5 3Mansur AHMED

6 Jo hn BOTTS

7 3Richard BURRETT

8 Ian CLYNE

9 3Beatrice HAMZA-BASSEY

10 Kando lo KASONGO

11

12

13

14

4Ibrahim KWARGANA

Emeka OKONKWO3Adekunle SONOLA

3Jo hn VITALO

Present

Absent

No t Applicable due to no n-membership at spec ified time

S/ NO NAME

1

2

3

4

5

6

7

8

9

10

11

12

13

23/ 0 2/ 20 1518/ 0 3/ 20 15 20 / 0 4/ 20 1513/ 0 7/ 20 15 21/ 0 9/ 20 15 23/ 11/ 20 15 12/ 9/ 20 15

KRAMER, Richard

EMUWA, Emeka 1ODU, Cyril

2ADEOSUN, Adekunle

ADEWALE, Oyinkansade (Mrs)

AKANDE, Onikepo (Dr) Mrs

AHMED, Mansur3MCDONALD, Arina (Ms)

BURRETT, Richard

CLYNE, Ian

KASONGO, Kando lo4OKONKWO, Emeka

3KWARGANA, Ibrahim

Present

Absent




1 Appo inted as Chairman o f the Bo ard and therefo re Co mmittee membership

ceased with effec t fro m 24th November, 20 15


3 Appo inted to the Co mmittee with effec t fro m 22nd September, 20 15

4 Co mmittee membership ceased with effec t fro m 22nd September, 20 15


ceased with effec t fro m 24th November, 20 15

2 Resigned with effec t fro m 10 th Octo ber, 20 15

3 Appo inted with effec t fro m 22nd September, 20 15

4 Co mmittee membership ceased with effec t fro m 22nd September 20 15

29

• Review and reco mmend to the Bo ard, the Bank's capital structure, inc luding , but no t limited to , allo tment o f new capital, debt limits and any changes to the existing capital structure.

• Review and reco mmend to the Bo ard the Bank's annual plan fo r the allo catio n o f capital and material changes during the co urse o f the year.

• Fo rmulate guidelines fro m time to time o n co st co ntro l and reductio n, co nsistent with maximum effic iency, and make appro priate reco mmendatio ns to the Bo ard.

• Review majo r expense lines, as warranted, and approve expenditures within the Co mmittee's approved limits and review/ reco mmend fo r Bo ard approval any expenditure beyo nd the Co mmittee's approved limits.

• Review and repo rt to the Bo ard o n the Transfo rmatio n pro gramme against go als, inc luding timing , budget, quality o f delivery, and tradeo ffs between transfo rmatio n plans and business as-usual ( if required).

• Review and reco mmend fo r Bo ard approval, the Bank's Transfo rmatio n budget and any asso c iated expenditures beyo nd that delegated to management.

• Review and provide feedback to the Bo ard o n the develo pment o f the Bank's strateg ic planning pro cess and perfo rmance o bjec tives to ensure the achievement o f the financ ial targets expected by shareho lders.

• Review and repo rt to the Bo ard o n the effec tiveness o f the Bank's strateg ic planning and implementatio n mo nito ring pro cess.

• Review and provide feedback to the Bo ard o n high-impact initiatives no t o therwise managed by ano ther co mmittee that may have a material impact o n the Bank's finances, regulato ry relatio nships, custo mers and/ o r infrastructure.

• Review and reco mmend fo r Bo ard approval any transactio ns asso c iated with high- impact initiatives and any asso c iated expenditures beyo nd that delegated to management.

• Review and reco mmend fo r Bo ard approval any change to the delegatio n o f autho rities to management and management co mmittees o n financ ial matters.

• Review and reco mmend fo r Bo ard approval the Bank's dividend po licy, inc luding amo unt, nature and timing .

3. Board Estab lishment and Services Commit tee

The Co mmittee met seven (7) times during the year. It is co mprised o f the fo llowing members:

Its respo nsibilities inc lude the fo llowing , amo ngst o thers: • Co nsider and approve appo intments, pro mo tio ns and disc ipline o f Princ ipal Managers

and above; • Review and reco mmend appo intments, pro mo tio ns and disc ipline o f Assistant

General Managers and above to the Bo ard fo r co nsideratio n and approval. • Co nsider and reco mmend co mpensatio n increments fo r Princ ipal Managers and

above to the Bo ard fo r co nsideratio n and approval.

S/ NO NAME

1

2

3

4

5

6

7

8

9

10

11

12

2/ 18/ 20 15 23/ 0 2/ 20 1515/ 0 4/ 20 1515/ 0 6/ 20 15 7/ 8/ 20 15 18/ 0 9/ 20 15 18/ 11/ 20 15

AHMED, Mansur

EMUWA, Emeka1ADEOSUN, Adekunle

2ADEWALE, Oyinkansade (Mrs)

AKANDE, Onikepo (Dr) Mrs3MCDONALD, Arina (Ms)

3HAMZA-BASSEY Beatrice (Mrs)

BOTTS, Jo hn

BURRETT, Richard

KRAMER, Richard

KWARGANA, Ibrahim3SONOLA, Adekunle

Present

Absent






3 Appo inted with effec t fro m 22nd September 20 15

30

• Co nsider and review staff co mpensatio n, welfare and industrial relatio ns matters and make appro priate reco mmendatio ns to the Bo ard fro m time to time.

• Articulate and reco mmend strateg ic and successio n plans fo r the Bank, to the Bo ard fro m time to time.

• Review and repo rt to the Bo ard, annually, o n the bro ad key perfo rmance indicato rs set by executive management fo r staff gro ups below the executive management level (“Staff”) to achieve that year's business and financ ial go als.

• Review and repo rt to the Bo ard, o n the annual staff perfo rmance evaluatio n co nducted by management fo r the prio r year's perfo rmance and the overall o utco me o f the annual perfo rmance appraisal pro cess.

• Review and repo rt to the Bo ard annually o n the overall staff training po licy and pro gram, and any changes as they arise to achieve business and financ ial go als.

• Review and reco mmend to the Bo ard annually, approval o f staff remuneratio n po licy, annual quantum, structure, and distributio n o f co mpensatio n (inc luding base, overall annual bo nus po o l and awards, and benefits in kind) and changes thereto .

• Review and repo rt to the Bo ard annually, the to tal cash co mpensatio n package fo r Staff to ensure it will attract, retain and mo tivate key talent who add value to the Bank based o n individual and team co ntributio ns.

• Review and reco mmend fo r approval to the Bo ard annually, the severance po licy fo r Staff.

• Review and reco mmend fo r Bo ard approval annually, the Bank's o rganisatio nal structure, key human capital po lic ies and practices, inc luding tho se affec ting co mpensatio n, welfare, perfo rmance management, career management and transfer to ensure the o ptimal mix o f talent.

• Review and reco mmend fo r Bo ard approval, the Bank's staff o ptimisatio n plan and strategy.

• Review and reco mmend fo r Bo ard approval, revisio n o f staff salaries and service co nditio ns.

• Review and approve, o n an as needed basis, the recruitment, pro mo tio ns and terminatio n o f senio r o fficers o n Princ ipal Manager (PM) grade.

• Review and reco mmend fo r Bo ard approval, o n an as needed basis, the recruitment, pro mo tio ns and terminatio n o f senio r o fficers o n Assistant General Manager (“AGM”) grade and above.

• Review and reco mmend fo r Bo ard approval, the Bank's Successio n Plan fo r senio r o fficers o n Assistant General Manager grade and above and any pro po sed amendments.

• Review and reco mmend fo r Bo ard approval, any po lic ies no t o therwise co ntemplated herein relating to Staff and, as necessary and appro priate, inc luding engagement o f suppo rt staff.

• Review and reco mmend fo r Bo ard approval, the Bank's Culture Pro gram, inc luding missio n statements, co re values, and the incentives to align Staff towards the Bank's near and medium term strateg ic o bjec tives.

• Review and repo rt to the Bo ard annually, the pro gress o f the Culture Pro gram and its effec tiveness in driving the desired Staff behavio urs and perfo rmance.

• Review and reco mmend fo r Bo ard approval annually, and o n an as needed basis, the overall strateg ies o n staff unio ns and relatio nships with the Bank's Staff.

• Review and advise the Bo ard annually, the strategy fo r and engagement o f service providers suppo rting Staff, inc luding the overall co st, perfo rmance and effec tiveness o f o utso urce firms in delivering co st-effec tive, high quality service to the Bank's custo mers.

• Review and repo rt to the Bo ard annually, the pro gress o f o utso urc ing so lutio ns and their effec tiveness in delivering against the Banks' Transfo rmatio n strategy.



31

4 . Board Risk Management Commit tee

The Co mmittee met five (5) times during the year. It is co mprised o f the fo llowing members:

Its respo nsibilities inc lude the fo llowing , amo ngst o thers: • Develo p an o rganizatio n-wide risk management framewo rk. • Exerc ise a bo ard oversight functio n o n all risk related issues. • Ensure co mpliance with the bank's o rganizatio n-wide po lic ies and framewo rk

covering all risk types (c redit, market, assets and liabilities, strateg ic , legal, human reso urces etc) .

• Ensure co mpliance with all statuto ry and regulato ry requirements. • Co nsider departmental repo rts and advise management o n risks.

5. Board Remunerat ion Commit tee

The Co mmittee met five (5) times during the year. It is co mprised o f the fo llowing members:

The Co mmittee's respo nsibilities inc lude amo ngst o thers: • Co nsider and reco mmend the appo intment o f Executive Management and No n-

Executive Directo rs. • Co nsider, approve and reco mmend the perfo rmance parameters fo r Executive

Management. • Co nsider and reco mmend co mpensatio n fo r Executives and Executive Management. • Co nsider and review the perfo rmance o f the Chief Executive Officer.

S/ NO NAME

1

2

3

4

5

6

7

8

9

10

11

12

13

23/ 0 2/ 20 15 4/ 20 / 20 15 13/ 0 7/ 20 15 21/ 0 9/ 20 15 23/ 11/ 20 151ODU, Cyril

EMUWA, Emeka

ADEWALE, Oyinkansade (Mrs)


AHMED, Mansur2HAMZA-BASSEY, Beatrice (Mrs)

3BOTTS, Jo hn 2CLYNE, Ian

KANDOLO, Kaso ngo3OKONKWO, Emeka

2VITALO, Jo hn 3KWARGANA, Ibrahim

OSINDERO, Adeyemi

Present

Absent


S/ NO NAME

1

2

3

4

5

6

7

8

2/ 23/ 20 15 13/ 0 7/ 20 15 21/ 0 9/ 20 15 24/ 11/ 20 15

BOTTS, Jo hn1HAMZA-BASSEY, Beatrice (Mrs)

BURRETT, Richard

CLYNE, Ian1VITALO, Jo hn

2KRAMER, Richard

OSINDERO, Adeyemi3ODU, Cyril

20 / 0 4/ 20 15

Present

Absent





ceased with effec t fro m 24th November 20 15






ceased with effec t fro m 24th November 20 15

32

6. Board Audit Commit tee

The Co mmittee was co nstituted in September 20 15 and held its inaugural meeting in November, 20 15. The Co mmittee met o nce during the year. It is co mprised o f the fo llowing members:

The Co mmittee's respo nsibilities inc lude, amo ngst o thers: • Review the Bank's acco unting and financ ial repo rting functio ns. • Review the Bank's acco unting system. • Review the Bank's internal co ntro l structures. • Review the Bank's internal co ntro l systems and pro cesses. • Reco mmend the appo intment, remuneratio n and removal o f external audito rs to the

Bo ard. • Review and reco mmend the audited financ ial statements to the Bo ard fo r approval.

7. Statutory Audit Commit tee

The Co mmittee is co nstituted at the Bank's AGM. The Co mmittee met five (5) times during the year. It is co mprised o f the fo llowing members:

The Audit Co mmittee has respo nsibility fo r the fo llowing : • Oversight respo nsibility fo r the Bank's acco unting and financ ial repo rting functio ns. • Oversight respo nsibility fo r the Bank's acco unting systems. • Oversight respo nsibility fo r the Bank's internal co ntro l structures. • Reco mmending the appo intment, remuneratio n and removal o f external audito rs to

the Bo ard. • Reviewing and reco mmending the audited financ ial statements to the shareho lders

fo r approval.

C. Management Commit tees

The Bank has the fo llowing Management Co mmittees: 1. Executive Management Co mmittee 2 Transfo rmatio n Steering Co mmittee 3. Assets and Liabilities Co mmittee 4 . Info rmatio n Techno lo gy Steering Co mmittee 5. Credit Co mmittee 6. Stressed Assets Co mmittee 7. Risk Management Co mmittee

S/ NO NAME

1

2

3

4

5

6

7

23/ 11/ 20 151VITALO, Jo hn


AHMED, Mansur1MCDONALD, Arina (Ms)

CLYNE, Ian

KRAMER, Richard

OSINDERO, Yemi

Present

Absent


S/ NO NAME

1

2

3

4

5

6

19/ 0 3/ 20 15 22/ 0 7/ 20 15 18/ 11/ 20 15 16/ 12/ 20 15

BICHI, Musa Baba

OJINKA, Marcel

AKINLADE, Matthew

AKANDE, Onikepo (Dr) Mrs.

AHMED, Mansur

OSINDERO, Yemi

30 / 0 4/ 20 15

Present

Absent

No t Applicable due to no n-membership at spec ified time



1 Appo inted with effec t fro m 22nd September, 20 15

33

8. New Pro duct Co mmittee 9. Disc iplinary Co mmittee

1. Execut ive Management Commit tee

The Executive Management Co mmittee co mprises o f the Chief Executive Officer (Chairperso n), Chief Financ ial Officer, Chief Risk Officer, Head o f Operatio ns & Techno lo gy, Head o f Co rpo rate Banking , Head o f Co mmerc ial Banking , Head o f Retail Banking , Head, Public Secto r, Transfo rmatio n Directo r, Head, Human Reso urces, and Head, Gro up Co rpo rate Strategy.

The ro les and respo nsibilities o f the Co mmittee are as fo llows, amo ngst o thers: • Pro po se to the Bo ard o f Direc to rs po lic ies, o bjec tives and co rpo rate strateg ies o f the

Bank. • Drive and review financ ial perfo rmance o f the Bank. • Ensure effic ient deployment and management o f the Bank's reso urces. • Ensure co mpliance with applicable laws and regulatio ns and maintain the co rpo rate

governance structure o f the Bank. • Develo p, refine and cascade the human capital visio n, strategy and culture o f the Bank. • Oversee all aspects o f human capital management inc luding talent management

(recruitment, career pro gressio n and management, successio n planning), leadership develo pment and retentio n strategy fo r the Bank.

• Co nduct perio dic review o f the governance handbo o k, inc luding co mmittee charters. • Provide and discuss general business updates (provided by the vario us business and

functio n heads).

2. Transformat ion Steering Commit tee

The Transfo rmatio n Steering Co mmittee meets mo nthly, with interim updates as needed. It co mprises the Chief Executive Officer (Chairperso n), Chief Financ ial Officer, Chief Risk Officer, Head o f Operatio ns & Techno lo gy, Head o f Co rpo rate Banking , Head o f Co mmerc ial Banking , Head o f Retail Banking , Head o f Public Secto r, Transfo rmatio n Directo r, Head, Human Reso urces, Head, Gro up Co rpo rate Strategy and Head o f Co rpo rate Affairs & Co mmunicatio n.

The ro les and respo nsibilities o f the Co mmittee are as fo llows: • Mo nito r overall pro gress and health o f the Bank's Transfo rmatio n pro gramme. • Review pro gress by initiatives and wo rk streams, inc luding ro adblo cks, risk mitigatio n

and next steps. • Ensure pro mpt reso lutio n o f identified issues and risks to ensure o bjec tives are met. • Provide sign o ff and input into co ntent, as required.

3. Assets and Liab ilit ies Commit tee

The Assets and Liabilities Co mmittee meets mo nthly. It co mprises the Chief Executive Officer (Chairperso n), Chief Financ ial Officer, Chief Risk Officer, Head o f Co rpo rate Banking , Head o f Co mmerc ial Banking , Head o f Retail Banking , Head o f Public Secto r, Chief Credit Officer, Head o f Market Risk, Treasurer and Head o f Assets and Liabilities Management. In attendance are the Fro nt Office Unit Heads and the Chief Dealer.

The ro les and respo nsibilities o f the Co mmittee are as fo llows: • Establish, review and mo nito r the pro fitability plan o f the Bank's asset & liability

management and reco mmend the same fo r Bo ard approval. • Approve the Bank's market risk management strateg ies and po lic ies and pro cedures

fo r identifying , measuring , managing and repo rting o f market risk and liquidity risk. • Direct acquisitio n and allo catio n o f funds effec tively within the ambit o f the Bank's

liquidity strateg ies, liquidity ratio targets and funding so urce thresho lds. • Manage asset and liquidity vo lumes, maturity, mix, rates and yields to achieve desired

net interest marg in within the bo undaries o f regulato ry prescriptio ns and market dynamics.

• Approve risk co ntro l limits with regard to co unter-party, currency co ncentratio n, po sitio n, etc .



34

• Establish and ensure effec tive implementatio n o f liquidity strateg ies. • Review and mo nito r liquidity risk and interest rate risk in banking bo o k and fo reign

exchange risk in Bank's balance sheet. • Provide relevant input, as needed, into capital planning , mo nito r capital adequacy and

suggest strategy fo r capital augmentatio n. • Design, implement and mo nito r co ntingency funding plan (CFP) and reco mmend fo r

Bo ard approval. • Design metho do lo gy and implementatio n o f fund transfer pric ing (FTP), pro fitability

o f business units and create incentives fo r business units thro ugh FTP. • Establish appro priate pro cesses, reso urces and systems acro ss the Bank fo r effec tive

pric ing mechanism. • Determine a pro fitable and o ptimal risk-return pric ing fo r the Bank's financ ial

pro ducts.

4 . Informat ion Technology ( “ IT” ) Steering Commit tee

The IT Steering Co mmittee meets mo nthly. It co mprises the Head o f Operatio ns & Techno lo gy (Chairperso n), Chief Executive Officer, Chief Risk Officer, Chief Financ ial Officer, Chief Info rmatio n Officer, Head o f Co rpo rate Banking , Head o f Co mmerc ial Banking , Head o f Public Secto r, Head o f Operatio ns, Transfo rmatio n Directo r, Head, Gro up Co rpo rate Strategy, Head, Info rmatio n Techno lo gy and Chief Audit Executive. In attendance are the Head, Pro jec t Management, Head, E- Business and Head, Internal Co ntro l.

The ro les and respo nsibilities o f the Co mmittee are as fo llows: • Develo p and review regularly the Bank's IT Strategy. • Ensure the Bank is well po sitio ned fo r current and emerg ing IT issues. • Review all systems develo pment pro jec ts and set prio rities based o n reso urces

required, co st/ benefit, implementatio n schedule requirements o r limitatio ns. • Mo nito r pro gress o f key IT pro jec ts such as Flexcube Universal Banking So lutio n.

5. Cred it Commit tee

The Credit Co mmittee meets weekly. It co mprises the Chief Risk Officer (Chairperso n), Chief Executive Officer, Head o f Co rpo rate Banking , Head o f Co mmerc ial Banking , Head o f Retail Bank, Head o f Public Secto r Banking , Chief Credit Officer, o ne senio r member o f Co rpo rate Bank, o ne senio r member o f Co mmerc ial Bank. In attendance are the Head, Credit Administratio n, Head o f Risk Analysis (Co rpo rate Bank), Head o f Risk Analysis (Co mmerc ial Bank), Head o f Legal and Head o f Business Suppo rt and Recovery.

The ro les and respo nsibilities o f the Co mmittee are as fo llows: • Review and reco mmend fo r Bo ard Risk Co mmittee (BRC) review, the Bank's c redit risk

appetite and po rtfo lio strategy and ensure that bo th are in line with the overall co rpo rate strategy and risk appetite o f the Bank.

• Review and provide updates to the BRC o n the Bank's c redit po rtfo lio and related credit pro cesses thro ugh perio dic review, covering credit and asset quality trends and statistics, business lending activities, areas o f increasing / decreasing risk, etc .

• Approve credit fac ility requests and pro po sals within the Co mmittee's limits and review and reco mmend fo r the Bo ard Credit Co mmittee's (BCC) co nsideratio n o r approval, c redits beyo nd the Co mmittee's limits.

• Review, and update the BCC, annually o n the administratio n, effec tiveness and co mpliance with the Bank's c redit po lic ies.

6. St ressed Assets Commit tee

This Co mmittee meets mo nthly. It co mprises the Chief Risk Officer (Chairperso n), Chief Executive Officer, Head o f Co rpo rate Banking , Head o f Co mmerc ial Banking , Head o f Retail Banking , Head o f Public Secto r, Chief Credit Officer, o ne senio r member o f Co rpo rate Banking , o ne senio r member o f Co mmerc ial Banking . In attendance are the Head o f Credit Administratio n, Head o f Risk Analysis (Co rpo rate), Head o f Risk Analysis (Co mmerc ial) , Head o f Legal and Head o f Business Suppo rt and Recovery.



35

The ro les and respo nsibilities o f the Co mmittee are as fo llows: • Review and mo nito r strateg ies and actio ns being taken o n majo r acco unts

(N10 0 millio n and above) c lassified as no n-perfo rming o r with early warning signs. • Review c lassificatio n o f and provisio ns taken o n each acco unt since the previo us

meeting . • Review acco unts suitable fo r de-c lassificatio n o r upgrade to perfo rming status and

return to the line. • Review actio ns to be taken o r pro po sed to be taken o n large expo sures in Business

Suppo rt and Recovery Department po rtfo lio . • Where applicable, approve a different co urse o f ac tio n to that taken o r pro po sed to be

taken.

7. Risk Management Commit tee

This Co mmittee meets mo nthly o r as needed. It co mprises the Chief Risk Officer (Chairperso n), Head o f Operatio ns and Techno lo gy, Chief Audit Executive, Head, Co mpliance, Head, Legal Services, Head, Human Reso urces, Head, Gro up Co rpo rate Strategy, Head, Quality Assurance, Head, Info rmatio n Techno lo gy, Head, Operatio nal Risk Management, Head, Co rpo rate Affairs & Co mmunicatio n, Head, Operatio ns, Head, Internal Co ntro l, Head ,Branch Co -o rdinatio n, Head, Custo mer Care.

The ro les and respo nsibilities o f the Co mmittee are as fo llows: • Mo nito r and review day-to -day risk management functio ns and o peratio ns and service

delivery. • Design, implement and mo nito r Risk Adjusted Return On Capital (RAROC) framewo rk

and allo catio n o f capital to business units based o n RAROC framewo rk. • Design, implement and mo nito r risk based pric ing fo r pro ducts and services fo r

effic ient allo catio n o f reso urces. • Establish, review and mo nito r credit risk mo dels and risk parameter estimatio n; and

reco mmend fo r bo ard risk management co mmittee approval. • Ensure that market risk management unit has adequate systems, pro cedures,

metho do lo g ies fo r effec tive assessment o f risk. • Ensure that effec tive o peratio nal risk assessment pro cesses are carried o ut by all

majo r business units and results aggregated to identify and mo nito r ho t spo ts fo r effec tive remedial ac tio ns.

• Implement and review o peratio nal risk management to o ls and pro cesses. • Streamline pro cesses to address the issues identified with effec tive service delivery

fo r the Bank.

8. New Product Commit tee

This Co mmittee meets as required. It is co mpo sed o f the Chief Risk Officer (Chairperso n), Chief Audit Executive, Head, Co mpliance, Head, Legal Services, Head, Info rmatio n Techno lo gy, Head, Operatio nal Risk Management, Head, Financ ial Co ntro l, Head, Operatio ns, Head o f business unit o f the relevant pro duct, Head, Gro up Co rpo rate Strategy and Head , Co rpo rate Affairs.

The ro les and respo nsibilities o f the Co mmittee are as fo llows: • Set o ut po lic ies regarding the Bank's pro duct design, pric ing metho do lo g ies,

co mpetitive po sitio ning and risk-reward philo so phy. • Review and reco mmend/ approve (as applicable) new pro duct pro grams o r changes

to existing pro duct pro grams acro ss the Bank (e.g . depo sit pro grams, c redit pro grams, treasury pro grams).

• Review activities o f pro duct initiatio n teams and ensure ado ptio n o f suitable pro cesses, systems and perso nnel to suppo rt effec tive management o f the pro duct thro ugh its life-cyc le and asso c iated risks.

• Establish the provisio n o f adequate funding and o btain approvals fo r pric ing fro m ALCO.

• Obtain and review repo rts o n financ ials, regulato ry co mpliance and risk areas to ensure pro duct suitability.

• Ensure the po lic ies and pro cedures fo r managing pro duct risk are fo rmally endo rsed by the Bo ard and do cumented.



36

9. Discip linary Commit tee

This Co mmittee meets bi-weekly o r as required, depending o n cases fo r review. It is co mpo sed o f an EXCO member (Chairperso n), Chief Audit Executive, Head, Human Reso urces, Head, Legal Services, Head, Branch Co -o rdinatio n, Head, Operatio nal Risk, and Head, Employee and Industrial Relatio ns and head o f relevant business/ functio n.

The ro les and respo nsibilities o f the Co mmittee are as fo llows: • Investigate identified cases o f no n-co mpliance o f ac ts o r practices with laws, accepted

banking practices, ethical princ iples o r o thers (assisted by the Internal Audit Department, as required).

• Carry o ut appro priate administrative sanctio ns as set o ut in the Bank's approved sanctio n grid.

• Develo p and co mmunicate precautio nary measures with respect to ac ts and practices that may lead to the Bank's reputatio n and image being harmed in view o f laws, public o pinio n and custo mers.

• Ensure appro priate measures are taken by relevant departments to eliminate future o ccurrence o f identified fro m disc iplinary cases.



37

The Directo rs present their repo rt o n the affairs o f Unio n Bank o f Nigeria Plc ( “ t he Bank” ) and its subsidiaries ( “ t he Group” ) , to gether with the co nso lidated audited financ ial statements and the audito r's repo rt fo r the financ ial year ended 31 December 20 15.

A. Legal Form and Principal Act ivit y

The Bank co mmenced o peratio ns in Nigeria in 1917 as a branch o f Barc lays Bank Do minio n Co lo nial Overseas (DCO) and was inco rpo rated as a private co mpany limited by shares in Nigeria in 1969. It became a public co mpany limited by shares in 1970 with the Bank's shares quo ted o n the Nigerian Sto ck Exchange.

The princ ipal ac tivity o f the Bank is the provisio n o f banking and related financ ial services to co rpo rate and individual custo mers. Such services inc lude the granting o f lo ans and advances, acceptance o f depo sits and mo ney market ac tivities.

The Gro up financ ial statements co mprise the results o f Unio n Bank o f Nigeria Plc , Unio n Bank UK Plc and UBN Pro perty Co mpany Limited. Atlantic No minees Limited has been inc luded as “Asset c lassified as held fo r sale”.

B. Operat ing Result s

Highlights o f the Gro up's o perating results fo r the year are as fo llows:

DIRECTORS’ REPORTFo r the year ended 31 December 20 15

Group

Dec. 20 15N million

Group

Dec. 20 14N million

Bank

Dec. 20 15

N million

Bank

Dec. 20 14

N million

Gro ss earnings 117,211 135,898 118,366 10 9,821

Pro fit befo re taxatio n 14,548 27,70 8 18,141 20 ,691

Taxatio n (561) (883) (420 ) (20 5)

Pro fit after taxatio n 13,987 26,825 17,721 20 ,486

Other Comprehensive income:

Re-measurement o f defined benefit liability (4 ,10 8) (4 ,10 8)

Fo reign currency translatio n 1,770982 —

— —

—

Fair value gains/ ( lo sses) o n available-fo rsale investments 7,40 0 1,720 7,679 1,812

8,382 (618) 7,679 (2,296)

Total comprehensive income 22,369 26,20 7 25,40 0 18,190

Earnings per share (Basic and diluted) 83k 151k 10 5k 121k

To tal no n-perfo rming lo ans and advances 25,937 16,934 25,937 16,756

To tal no n-perfo rming lo ans to to tal gro ss lo ans and advances – IFRS6.67% 5.0 3% 6.99% 5.14%

C. Directors and Their Interest s

The direc t interests o f direc to rs in the issued share capital o f the Bank, as reco rded in the reg ister o f direc to rs' shareho lding and fo r the purpo ses o f Sectio ns 275 and 276 o f the Co mpanies and Allied Matters Act and the listing requirements o f the Nigerian Sto ck Exchange are as fo llows:



38

S/ NO NAME

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

Direct Holding

Dec. ‘15 Dec. ‘141Udo ma Udo Udo ma, CON 2,819,0 40 2,819,0 40

2Cyril Odu 2,661

—

—

—

—

—

9,656

—

—

—

—

—

—

—

—

2,661

—

—

—

—

—

9,656

—

—

—

—

—

—

—

—

Emeka Emuwa3Adekunle Adeo sun

Oyinkansade Adewale

Kando lo Kaso ngo

Ibrahim Kwargana

Emeka Oko nkwo 29,793 29,7934Adekunle So no la 2,514 NA

Mansur Ahmed

Onikepo Akande, CON 28,225 28,225

Jo hn Bo tts

Richard Burrett

Ian Clyne5Beatrice A. Hamza-Bassey

Richard Kramer 5Arina McDo nald

Adeyemi Osindero5Jo hn Vitalo

No direc to r has no tified the Bank o f any indirec t interests held in the shares o f the Bank.

D. Directors' Ret irement

The Directo rs who retire at this Annual General Meeting , being the first general meeting since their appo intment, are:

1. Beatrice Hamza-Bassey 2. Arina McDo nald 3. Adekunle So no la 4 . Jo hn Vitalo

The Directo rs who retire by ro tatio n and, being elig ible, o ffer themselves fo r re-elec tio n in acco rdance with Artic le 90 o f the Bank's Artic les o f Asso c iatio n are:

1. Oyinkansade Adewale 2. Mansur Ahmed 3. Ian Clyne 4 . Ibrahim Kwargana 5. Adeyemi Osindero

E. Directors' Interest in Cont ract s

In acco rdance with the provisio ns o f Sectio n 277 o f the Co mpanies and Allied Matters Act o f Nigeria, there were no co ntracts in which Directo rs had any direc t interests.

F. Propert y and Equipment

Info rmatio n relating to changes in pro perty and equipment is g iven in No tes 29(a) & 29(b) to the financ ial statements. In the Directo rs' o pinio n, the disc lo sures regarding the Gro up's pro perties are in line with the related statement o f acco unting po lic ies o f the Gro up.



1 Resigned as Chairman with effec t fro m 11th November, 20 152 Appo inted as Chairman with effec t fro m 24th November, 20 153 Resigned with effec t fro m 10 th Octo ber, 20 154 Appo inted with effec t fro m 15th July, 20 155 Appo inted with effec t fro m 21st July, 20 15

39

G. Share Capital History

YEARAUTHORISED (N) ISSUED AND PAID-UP (N)

INCREASE INCREASECUMULATIVE CUMULATIVECONSIDERATION

1969

1969

1969

1969

10 ,0 0 0 ,0 0 0

10 ,0 0 0 ,0 0 0

10 ,0 0 0 ,0 0 0 10 ,0 0 0 ,0 0 0

10 ,0 0 0 ,0 0 0

10 ,0 0 0 ,0 0 0 20 ,0 0 0 ,0 0 0

20 ,0 0 0 ,0 0 0

20 ,0 0 0 ,0 0 0

20 ,0 0 0 ,0 0 0

20 ,0 0 0 ,0 0 0

20 ,0 0 0 ,0 0 0

5,0 0 0 ,0 0 0

5,0 0 0 ,0 0 0

Assets

Assets

Assets

11,0 0 0 ,0 0 0

11,0 0 0 ,0 0 0

12,0 0 0 ,0 0 0

11,0 0 0 ,0 0 0

11,0 0 0 ,0 0 0

12,0 0 0 ,0 0 0

1970

1971

1971

1975

1976

Sto ck Split (N2 to N1)

Cash

Bo nus (1 fo r 5)

Bo nus (1 fo r 5)

Bo nus (1 fo r 2)

14,40 0 ,0 0 0

14,40 0 ,0 0 0 Bo nus (1 fo r 5)

Bo nus (1 fo r 4)

17,280 ,0 0 0

1977 20 ,0 0 0 ,0 0 0 30 ,0 0 0 ,0 0 0 17,280 ,0 0 0 21,60 0 ,0 0 0

30 ,240 ,0 0 0

36,288,0 0 0

Bo nus (2 fo r 5)21,60 0 ,0 0 0

30 ,240 ,0 0 0

50 ,0 0 0 ,0 0 0

50 ,0 0 0 ,0 0 0

30 ,0 0 0 ,0 0 01978

1979

54,432,0 0 036,288,0 0 010 0 ,0 0 0 ,0 0 050 ,0 0 0 ,0 0 01982

1987

1989

10 0 ,0 0 0 ,0 0 0

10 0 ,0 0 0 ,0 0 0

10 0 ,0 0 0 ,0 0 0 20 0 ,0 0 0 ,0 0 0

54,432,0 0 0 63,50 4,0 0 0

63,50 4,0 0 0

79,380 ,0 0 0

63,50 4,0 0 0

63,50 4,0 0 0

Bo nus (1 fo r 6)

Sto ck Split (N1 to N0 .25)

1991 Bo nus (1 fo r 4)

Bo nus (1 fo r 1)

250 ,0 0 0 ,0 0 020 0 ,0 0 0 ,0 0 01992

1994 250 ,0 0 0 ,0 0 0 50 0 ,0 0 0 ,0 0 0 79,380 ,0 0 0 158,760 ,0 0 0

Bo nus (1:4)198,450 ,0 0 0

198,450 ,0 0 0

158,760 ,0 0 0

158,760 ,0 0 0

50 0 ,0 0 0 ,0 0 0

50 0 ,0 0 0 ,0 0 0

1995

1996 Sto ck Co nso lidatio n (N0 .25 to N0 .50 )

396,90 0 ,0 0 0198,450 ,0 0 050 0 ,0 0 0 ,0 0 01996

1998

1998

50 0 ,0 0 0 ,0 0 0 1,0 0 0 ,0 0 0 ,0 0 0 396,90 0 ,0 0 0 529,0 0 0 ,0 0 0 Bo nus (1:3)

Bo nus (1:1)

Cash/ Public Offer - 50 millio n o rdinary shares o f N0 .50 )

629,20 0 ,0 0 0

629,20 0 ,0 0 0

629,20 0 ,0 0 0

529,0 0 0 ,0 0 01,0 0 0 ,0 0 0 ,0 0 0

1,0 0 0 ,0 0 0 ,0 0 0

1,0 0 0 ,0 0 0 ,0 0 0

1999

20 0 0

20 0 1 1,0 0 0 ,0 0 0 ,0 0 0 3,0 0 0 ,0 0 0 ,0 0 0

3,0 0 0 ,0 0 0 ,0 0 0

629,20 0 ,0 0 0 838,950 ,0 0 0

838,950 ,0 0 0

Bo nus (1:3)

20 0 1

20 0 2 3,0 0 0 ,0 0 0 ,0 0 0

3,0 0 0 ,0 0 0 ,0 0 0

419,475,0 0 0

419,475,0 0 0

1,258,425,0 0 0 Rights Issue (1 fo r 2)

Bo nus (1:3)1,677,90 0 ,0 0 020 0 3

20 0 4

20 0 5

3,0 0 0 ,0 0 0 ,0 0 0 5,0 0 0 ,0 0 0 ,0 0 0 559,30 0 ,0 0 0

745,715,50 0

2,237,20 0 ,0 0 0 Bo nus (1:3)

Bo nus (1:3)2,982,915,50 05,0 0 0 ,0 0 0 ,0 0 0

7,50 0 ,0 0 0 ,0 0 020 0 6

20 0 6

5,0 0 0 ,0 0 0 ,0 0 0 313,490 ,40 0 3,296,40 5,90 0 Bo nus (1:10 )

Public Offer/ Rights Issue4,672,913,5611,376,507,6617,50 0 ,0 0 0 ,0 0 0

7,50 0 ,0 0 0 ,0 0 020 0 6

20 07 7,50 0 ,0 0 0 ,0 0 0

152,0 30 ,0 90 4,824,943,651

4,824,943,651

Bank Acquisitio n

10 ,0 0 0 ,0 0 0 ,0 0 0

10 ,0 0 0 ,0 0 0 ,0 0 020 07 965,159,50 0 5,790 ,10 3,151 Bo nus (1:5)

Bo nus (1:6)

Capital Reo rganizatio n & Reductio n

6,755,10 3,151

6,755,10 3,151

6,755,10 3,151

965,0 0 0 ,40 0

965,0 0 0 ,40 0

965,0 0 0 ,40 0

15,0 0 0 ,0 0 0 ,0 0 0

15,0 0 0 ,0 0 0 ,0 0 0

15,0 0 0 ,0 0 0 ,0 0 0

10 ,0 0 0 ,0 0 0 ,0 0 020 0 8

20 0 9

20 10

20 11

20 12

20 13

20 14

20 15

15,0 0 0 ,0 0 0 ,0 0 0 9,511,562,50 0

9,511,562,50 0

9,511,562,50 0

9,511,562,50 0

9,511,562,50 0

8,467,90 3,235

8,467,90 3,235

8,467,90 3,235

8,467,90 3,235

8,467,90 3,235



40

Range

Number of Shareholders

Domestic shareholders

Shares heldPercentage of

shareholding (%)

1-1,0 0 0 310 ,799 10 8,365,40 4 0 .64

1,0 0 1- 5,0 0 0 114,591 247,70 4,952 1.46

5,0 0 1 - 10 ,0 0 0

10 ,0 0 1 -50 ,0 0 0

21,10 2 143,254,30 1 0 .85

50 ,0 0 1 - 10 0 ,0 0 0

14,693 286,698,127 1.69

10 0 ,0 0 1 – 50 0 ,0 0 0

1,40 2 97,0 56,90 9 0 .57

50 0 ,0 0 1 – 1,0 0 0 ,0 0 0

1,0 68 20 8,280 ,397 1.23

1,0 0 0 ,0 0 1 - 5,0 0 0 ,0 0 0

116 80 ,860 ,180 0 .48

5,0 0 0 ,0 0 1 – 10 0 ,0 0 0 ,0 0 0

10 3 229,257,239 1.35

10 0 ,0 0 0 ,0 0 1 – 50 0 ,0 0 0 ,0 0 0

34

1

783,853,543

20 4,576,0 0 2

4.63

1.21

463,90 9 2,389,90 7,0 54 14 .11

Foreign shareholders

50 0 ,0 0 0 ,0 0 1 and above 2* 14,545,899,417 85.89

463,911 16,935,80 6,471 10 0 .0 0Total

The shareho lding pattern o f the Bank as at 31 December 20 14 is as stated below:

Range

Number of

Shareholders

Domestic shareholders


shareholding (%)

1 - 1,0 0 0

1,0 0 1 - 5,0 0 0

5,0 0 1 - 10 ,0 0 0

10 ,0 0 1 - 50 ,0 0 0

50 ,0 0 1 - 10 0 ,0 0 0

10 0 ,0 0 1 - 1,0 0 0 ,0 0 0

1,0 0 0 ,0 0 1 - 5,0 0 0 ,0 0 0

5,0 0 0 ,0 0 1 - 10 ,0 0 0 ,0 0 0

10 ,0 0 0 ,0 0 1 - and above

Foreign shareholders

10 ,0 0 0 ,0 0 1 - and above

Total

312,248 10 8,976,540 0 .64

115,790 250 ,557,166 1.48

21,487 145,90 4,40 1 0 .86

15,0 66 293,997,544 1.74

1,449 10 0 ,188,613 0 .59

1,221 299,218,721 1.77

119 263,677,0 60 1.56

17 117,461,70 9 0 .69

25 80 9,925,30 0 4 .78

467,422 2,389,90 7,0 54 14 .11

3* 14,545,899,417 85.89

467,425 16,935,80 6,471 10 0 .0 0

* The number o f fo reign shareho lders within the last range was changed to 2 in the 20 15 repo rt because the shareho lding o f Standard Chartered Private Equity, which was earlier repo rted as a separate ho lding , fo rms a part o f the shareho lding o f Unio n Glo bal Partners Limited.


shareholding (%) Shares heldPercentage of

shareholding (%)

Dec. 20 15 Dec. 20 14

Shareholder

Atlas Mara Limited 3,537,625,211 20 .89 3,537,625,211 20 .89

Unio n Glo bal Partners Limited 11,0 0 8,274,20 6 65.0 0 10 ,396,70 3,40 5 61.39

* Given that the shareho lding o f Standard Chartered Private Equity fo rms a part o f the shareho lding o f Unio n Glo bal Partners Limited, the to tal shareho lding o f Unio n Glo bal Partners Limited is co mputed as 11,0 0 8,274,20 6, being 65% o f the Bank's issued share capital.

H. Sharehold ing Analysis

The shareho lding pattern o f the Bank as at 31 December 20 15 is as stated below:

I. Substant ial Interest in Shares

Acco rding to the reg ister o f members as at 31 December 20 15, no individual shareho lder held mo re than 5% o f the issued share capital o f the Bank except the fo llowing :



41

J. Corporate Social Responsib ilit y

So c ial respo nsibility is a key area o f fo cus fo r Unio n Bank. As part o f its o perating princ iples, Unio n Bank is co mmitted to being a respo nsible co rpo rate c itizen by po sitively impacting the individuals, co mmunities and the enviro nment in which it o perates. Fo r nearly a century, the Bank has o perated under the princ iples o f c reating value fo r stakeho lders and maintaining practices that enco mpass pro fessio nalism, respect fo r peo ple and the enviro nment, and ho nesty and integrity in business dec isio ns.

We have shown this co mmitment by making do natio ns and wo rking with no n-pro fit grassro o ts and internatio nal o rganizatio ns in vario us areas o f need acro ss Nigeria. In 20 14, the Bank redefined its Co rpo rate So c ial Respo nsibility strategy to streamline its so c ial investments to deliver significant impact in the fo llowing areas:

• Talent develo pment • Agriculture • Financ ial empowerment and mento ring • Humanitarian do natio ns • Employee engagement pro grammes

With fo cused engagement in these areas, Unio n Bank seeks eco no mic and so c ial pro gress fo r the so c iety by driving innovatio n, entrepreneurship and creative expressio n, so as to empower, build and suppo rt the develo pment o f Nigeria's large yo uth po pulatio n, agriculture and the Nigerian entrepreneurial spirit.

Talent Development : The Bank reco gnises talent develo pment as a key avenue to bo o st individual and co mmunity creativity. Thro ugh suppo rt fo r capac ity building initiatives and pro grammes that showcase creativity, the Bank seeks to pro mo te eco no mic empowerment and growth. Suppo rt in this area inc ludes but is no t limited to the creative arts, lo cal artisans, entertainment, and spo rts.

In line with this, the Bank has suppo rted the 5th Annual LasGidi Cultural Arts Exhibitio n, aimed at providing a platfo rm fo r emerg ing artists to showcase their wo rk; Spec ial Olympics Nigeria, thro ugh suppo rt fo r Team Nigeria at the 20 15 Wo rld Summer Games; W.TEC Girls' Techno lo gy Camp, a platfo rm fo r female seco ndary scho o l students to learn and practice skills in sc ience, techno lo gy, eng ineering and mathematics. In additio n, Beeta Universal Arts Fo undatio n Playwrights Co mpetitio n was identified as an avenue to suppo rt emerg ing playwrights, hence providing an avenue fo r alternative so urces o f inco me.

Agricult ure: The Greener Pastures Initiative is intended to be Unio n Bank's flagship agricultural initiative that will leverage and enhance the Bank's reputatio n as a leader in the field o f agriculture. Thro ugh suppo rt to small-ho lder farmers and co o peratives, fo cus in this area will harness relatio nships built thro ugh the Bank's lo ng-standing Agribusiness Department. A ro bust pro gramme in this area is currently being develo ped.

Financial Empowerment and Mentoring: By suppo rting great ideas and innovatio n thro ugh custo mised, partner-run pro grammes, Unio n Bank's fo cus in this area serves to enco urage and reward the Nigerian entrepreneurial spirit. Thro ugh mento ring , the Bank is dedicated to equipping and empowering yo ung peo ple, providing them with the suppo rt they need to beco me respo nsible individuals and co ntributing c itizens.

In this regard, the Bank was the lead spo nso r o f the Unio n Bank-LEAP Africa So c ial Innovato rs Pro gramme and Awards 20 15/ 16. Thro ugh a rigo ro us pro cess, the to p 20 So c ial Innovato rs were selec ted fro m applicants acro ss Nigeria and enro lled in a year-lo ng mento rship and develo pment pro gramme. Innovato rs were mento red and taught business, financ ial and o ther necessary skills, to enable them improve their existing enterprises. Vo lunteers fro m the Bank also co nducted sessio ns in strategy develo pment and financ ial literacy with the partic ipants. In co llabo ratio n with the Public Affairs Sectio n o f the U.S. Missio ns to Nigeria, the Bank also suppo rted the W.TEC Entrepreneurship & Techno lo gy Pro gramme fo r Wo men, providing mento rship and training fo r female business owners, teaching them how to utilize techno lo gy to their advantage.



42

Furthermo re, in line with its co mmitment to financ ial inc lusio n in Nigeria, the Bank launched the Financ ial Literacy Mento rship Pro gramme in Octo ber 20 14. Unio n Bank staff vo lunteers co nduct mo nthly teaching sessio ns at scho o ls in the Lago s area, and also ho st reg io nal training sessio ns annually. To date, over 80 0 students have been taught the basics o f financ ial literacy at St. Mary's Private Scho o l, Ajele Street, Lago s Island, Do dan Barracks Primary Scho o l and Army Children's Primary Scho o l, bo th lo cated at Do dan Barracks, Obalende, and Uyo High Scho o l, Oro n Ro ad, Uyo .

Humanitarian Donat ions: Thro ugh o ther humanitarian do natio ns, the Bank has co ntinually g iven financ ial assistance to vario us charity and humanitarian o rganisatio ns like the Sickle Cell Club, Wo men o f Glo bal Impact, Atunda Olu Scho o l ( fo r physically handicapped children), CCWA Internatio nal (christian care fo r widows, widowers, the aged and o rphans), Nigerian Red Cro ss So c iety Disaster Relief Trust, develo pmental centres fo r children with spec ial needs, and several o rphanages. The Bank has also made do natio ns to the Nigerian Po lice and security units o f vario us state governments, in an effo rt to increase overall safety and security in o ur co mmunities.

Employee Engagement Programmes: Unio n Bank has established and will co ntinue to suppo rt structures within the Bank o rganisatio n that allow employees to co ntribute meaningfully to so c iety. We enco urage all employees to discover avenues and suggest ideas thro ugh which they can po sitively impact their lo cal co mmunities so c ially, eco no mically and enviro nmentally.

The result o f engagement in these avenues o f co rpo rate so c ial invo lvement is a well-ro unded o rganizatio n that is maintaining trust amo ng stakeho lders, po sitively influenc ing the co mmunities we o perate in, and building a co mmunity o f so c ially co nsc io us individuals and employees. As we wo rk to build a simpler, smarter bank, Unio n Bank is co mmitted to pursuing po sitive so c ial change in o ur lo cal co mmunities.

K. Donat ions and Charit ab le Gif t s

In o rder to identify with the aspiratio ns o f the co mmunities and the enviro nment within which the Bank o perates, a to tal sum o f N57,433,494 was g iven o ut as do natio ns and charitable co ntributio ns during the year.

Details o f the do natio ns are as fo llows:



S/ NO

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

BENEFICIARY OF DONATION AMOUNT (N)

20

485,0 0 0 .0 0

5,320 ,0 0 0 .0 0

Health Peak Medical Centre

Office o f the Acco untant General o f the Federatio n (25 PCs and 10 Lapto ps)

21

Arrow o f Go d Orphanage 750 ,0 0 0 .0 0

Atunda Olu Scho o l ( fo r physically handicapped children) 750 ,0 0 0 .0 0

Care Organizatio n Public Enlightenment (COPE) 70 0 ,0 0 0 .0 0

CCWA Internatio nal (christian care fo r widows, widowers, the aged and o rphans) 750 ,0 0 0 .0 0

Child Life Line (Yaba & Iko ro du) 1,0 0 0 ,0 0 0 .0 0

Down Syndro me Fo undatio n, Nigeria 750 ,0 0 0 .0 0

Ento mo lo g ical So c iety o f Nigeria 250 ,0 0 0 .0 0

Hearts o f Go ld Children's Ho spice 750 ,0 0 0 .0 0

Media Trust Fund fo r Internally Displaced Perso ns 3,0 0 0 ,0 0 0 .0 0

Mo dupe Co le Memo rial Child Care & Treatment Ho me 1,0 0 0 ,0 0 0 .0 0

Natio nal Ortho pedic Spec ial Scho o l (Igbo bi) 70 0 ,0 0 0 .0 0

Pacelli Scho o l ( fo r the blind) 750 ,0 0 0 .0 0

Sickle Cell Club 70 0 ,0 0 0 .0 0

SOS Children's Village 750 ,0 0 0 .0 0

Spec ial Olympics 750 ,0 0 0 .0 0

St. Mary's Private Scho o l, Ajele, Lago s 5,528,494.0 0

Start Right Co nsulting 70 0 ,0 0 0 .0 0

State Security Do natio ns (4 Hilux vans fo r Security purpo ses) 27,80 0 ,0 0 0 .0 0

The Children's Develo pment Centre 1,0 0 0 ,0 0 0 .0 0

43

L. Human Resources

Employment of Disab led Persons: The Bank o perates a no n-discriminato ry po licy in the co nsideratio n o f applicatio ns fo r employment, inc luding tho se received fro m disabled perso ns. The Bank's po licy is that the mo st qualified and experienced perso ns are recruited fo r appro priate jo b levels, irrespective o f an applicant's state o f o rig in, ethnic ity, relig io n o r physical co nditio n.

In the event o f any employee beco ming disabled in the co urse o f employment, the Bank is in a po sitio n to arrange appro priate training to ensure the co ntinuo us employment o f such a perso n witho ut subjec ting him/ her to any disadvantage in his/ her career develo pment. Currently, the Bank has 4 perso ns (20 14: 4 perso ns) o n its staff list with physical disability.

Health, Safet y and Welfare of Employees: The Bank maintains business premises designed with a view to guaranteeing the safety and healthy living co nditio ns o f its employees and custo mers alike. Employees are adequately insured against o ccupatio nal and o ther hazards. In additio n, the Bank provides medical fac ilities to its employees and their immediate families at its expense. Fire preventio n and fire-fighting equipment are installed in strateg ic lo catio ns within the Bank's premises. The Bank o perates a Gro up Perso nal Acc ident Insurance scheme in acco rdance with the provisio ns o f the Employee Co mpensatio n Act fo r the benefit o f its employees and also o perates a co ntributo ry pensio n plan fo r the benefit o f its employees in line with the Pensio n Refo rm Act 20 0 4.

Diversit y: The Bank is an equal o ppo rtunity employer that is co mmitted to maintaining a po sitive wo rkfo rce that fac ilitates high level o f pro fessio nal effic iency at all times. The Bank's po licy pro hibits discriminatio n by gender, disability o r health status in the recruitment, training and career develo pment o f its employees.

( i) Perso ns with Disability The Bank co ntinues to maintain a po licy o f g iving fair co nsideratio n to applicatio ns

fo r employment made by disabled perso ns with due regard to their abilities and aptitude.



Wesley Scho o l 1 (fo r deaf children) 70 0 ,0 0 0 .0 0

22

23

24

26

25

Wesley Scho o l 2 (fo r deaf children)

Winiseph Care Ho me

Wo men o f Glo bal impact

70 0 ,0 0 0 .0 0

750 ,0 0 0 .0 0

350 ,0 0 0 .0 0

TOTAL 57,433,494 .0 0

The Samaritans Pro jec t 750 ,0 0 0 .0 0

44

( ii) Gender Diversity

20 15

Workforce

% Gender

Composition Workforce

% Gender

Composition

Total workforce:

Wo men 952 36% 1,0 95 37%

Men 1,677 64% 1,881 63%

2,629 10 0 % 2,976 10 0 %

Recruitment during the year:

Wo men 43 30 % 235 27%

Men 99 70 % 649 73%

142 10 0 % 884 10 0 %

Diversit y of Senior Management Assistant General Manager to General Manager:

Wo men 15 31% 16 30 %

Men 33 69% 37 70 %

48 10 0 % 53 10 0 %

Diversit y of Board Execut ives:

Wo men 1 17% 1 14%

Men 5 83% 6 86%

6 10 0 % 7 10 0 %

20 14

Diversit y of Board Members:

Wo men 4 24% 2 12%

Men 13 76% 15 88%

17 10 0 % 17 10 0 %

M. Employee Engagement

Unio n Bank is co mmitted to keeping employees aware o f its perfo rmance and pro gress. The Bank co nstantly seeks their o pinio n o n matters affec ting their career develo pment and welfare, thro ugh perio dic surveys, town hall meetings etc . It also reco gnizes and rewards individual and team perfo rmance thro ugh awards and vario us incentive schemes.

N. Employee Training and Development

The Bank places a high premium o n the develo pment o f its manpower. Training was carried o ut at vario us levels thro ugh in-ho use and external co urses, during the perio d under review.

O. Sustainab ilit y Report

Unio n Bank is co mmitted to pro mo ting a sustainable enviro nment thro ugh o ur business o peratio ns and engagement in co mmunities where we o perate.

As a provider o f financ ial services acro ss vario us sec to rs in Nigeria, we reco gnize that o ur business dec isio ns have the po tential to impact surro unding co mmunities and the enviro nment. We also acknowledge that balanc ing so c ial and enviro nmental issues with financ ial prio rities is fundamental to o perating successfully in the Nigerian eco no my. As a bank we make it a prio rity to place the interests o f o ur c lients, employees, the enviro nment and o ur immediate co mmunities at the very co re o f o ur sustainability fo cus. We aim to create the future we want to see and experience to day.

In 20 12, alo ngside o ther Nigerian Banks, Unio n Bank fo rmally ado pted the Nigerian Sustainable Banking Princ iples (“NSBPs”). Over the co urse o f the 20 15 financ ial year, we engaged in vario us initiatives and activities that demo nstrate o ur co mmitment to pro tec ting o ur immediate enviro nment and improving so c ial co nditio ns fo r o ur employees and o ur custo mers.



45

We have made a deliberate effo rt to c reate po lic ies aro und each NSBP and this year we co nso lidated tho se effo rts in the executio n o f a number o f ac tivities acro ss each NSBP area. A summary o f the NSBP po lices and o ur ac tivities in each area are o utlined below:

Princip le 1: Our Business Act ivit ies - Environmental and Social Risk Management

We are deliberate in how we co nduct business and make a co nsc io us effo rt to fac to r enviro nmental and so c ial co nsideratio ns into o ur business dec isio n-making pro cesses. In 20 15 the Bank suppo rted eco no mic growth by providing financ ial services to c lients engaged in pro mo ting sustainable energy. We further built o n c learly defined enviro nmental and so c ial pro cesses and pro cedures approved in 20 14 within o ur credit and risk management systems that pro mo ted respo nsible finance practices in o ur bank.

Princip le 2: Our Business Operat ions - Environmental and Social Footprint

We are co mmitted to the reductio n o f po llutio n, co mpliance with o ur enviro nmental regulato ry and o ther o bligatio ns and co ntinuo us improvement in o ur enviro nmental perfo rmance. In 20 15, we to o k spec ific steps to beco me mo re enviro nmentally friendly. We intro duced standardized recalibrated diesel tanks in o ur branches to improve o n diesel effic iency, we intro duced water treatment plants to reduce water waste and we ado pted the use o f mo re energy effic ient equipment such as energy effic ient light bulbs and air-co nditio ning systems. Furthermo re, we intro duced energy co nservatio n measures such as streamlining the use o f air-co nditio ning system and light in no n-critical areas during o ut-o f-o ffice ho urs.

Princip le 3: Human Rights

We are co mmitted to o ffering employment o ppo rtunities to peo ple fro m all walks o f life. Our employment practices address gender diversity, indigeno us employment; suppo rting perso ns with disabilities and providing relevant learning and develo pment o ppo rtunities fo r o ur peo ple. We co ntinue to provide a co nduc ive wo rking enviro nment fo r o ur employees, co ntinuo usly re-evaluating o ur po lic ies to ensure that the wo rking enviro nment enco urages bo th perfo rmance and learning . Furthermo re, o ur co rpo rate so c ial respo nsibility initiatives and pro jec ts have co ntributed to the develo pment o f the natio n in different ways by making do natio ns to and wo rking with no n-pro fit grassro o ts and internatio nal o rganizatio ns natio nwide.

Princip le 4 : Women's Economic Empowerment

We understand the critical ro le o f wo men in sustainable develo pment. That is why we are co mmitted to initiatives that empower wo men acro ss all sec to rs. In 20 15, we wo rked alo ngside numero us wo men's o rganizatio ns in a quest to spread knowledge and provide suppo rt. One o f such was a partnership with Wo men's Techno lo gy Empowerment Centre, Lady Mechanic Initiative and Wo men o f Glo bal Impact.

Princip le 5: Financial Inclusion

We are dedicated to the provisio n o f a bro ad range o f high quality pro ducts that are relevant, appro priate and affo rdable to the entire Nigerian po pulace particularly the under-banked. So me pro ducts to serve this segment inc lude Unio nSave, Unio nSaveMo re and Unio nKo rrect. In additio n, o ur extensive netwo rk o f over 325 banking centres and 720 ATMs and ro bust dig ital banking platfo rms have demo nstrated o ur co ntinued co mmitment to serve the Nigerian po pulace.

In 20 15, Unio n Bank partnered with the CBN, Junio r Achievement o f Nigeria and o ther Nigerian banks to co o rdinate the annual Financ ial Literacy Day activities during Glo bal Mo ney Week. This invo lved o rganizing teaching sessio ns in different scho o ls acro ss Nigeria, fo cused o n a financ ial literacy mo dule “Growing Yo ur Mo ney”.

To further financ ial inc lusio n, we co o rdinated public enlightenment campaigns fo r Bank Verificatio n Number acro ss print, televisio n, radio (Pidg in and English) and so c ial media, in co llabo ratio n with CBN and o ther banks. We were also invo lved in the crafting o f strateg ies fo r 3-tiered KYC pro cess.



46

Princip le 6: Environmental & Social Governance

We are dedicated to ensuring we have transparent governance practices espec ially in assessing the impact that o ur peo ple, ideas and capital can have o n suppo rting eco no mic growth, addressing so c ial challenges and pro mo ting enviro nmental sustainability. In 20 15, we created a structured appro ach to o ur internal E & S governance pro cess and are co mmitted to maintaining a fo cused and ro bust appro ach.

Princip le 7: Capacit y Build ing

Unio n Bank is co mmitted to co ntinuo us and iterative capac ity develo pment o f its employees. We ensure that relevant general and spec ialist skills are develo ped fo r and transferred to all employees o n an o ngo ing basis. In 20 15, 10 0 % o f Unio n Bank employees underto o k training pro grams either thro ugh c lass ro o m based learning , e-learning o r o n the jo b training pro grams.

We also suppo rt o ur immediate co mmunities thro ugh the provisio n o f capac ity building initiatives and the creatio n o f partnership vehic les with o rganizatio ns that have similar go als. In 20 15, we co llabo rated with a number o f no n-governmental o rganizatio ns, inc luding LEAP Africa where the Bank was the lead spo nso r o f the Unio n Bank-LEAP Africa So c ial Innovato rs Pro gramme and Awards 20 15/ 16. Thro ugh a rigo ro us pro cess, the to p 20 So c ial Innovato rs were selec ted fro m applicants acro ss Nigeria and enro lled in a year-lo ng mento rship and develo pment pro gramme. Innovato rs were mento red and taught business, financ ial and o ther necessary skills to enable them improve their existing enterprises. Vo lunteers fro m the Bank also co nducted sessio ns in strategy develo pment and financ ial literacy to the partic ipants.

Princip le 8: Collaborat ive Partnerships:

We are dedicated to fo rming alliances and partnerships at bo th institutio nal and sec to r level. We are also dedicated to fo stering internatio nal relatio nships with g lo bal entities that have similar enviro nmental and so c ial develo pment go als. In 20 15, Unio n Bank was active in several industry level initiatives and was a key co ntributo r in driving lasting change, espec ially in the banking industry, being at the fo re-fro nt o f the drive fo r increased penetratio n o f financ ial inc lusio n banking practices.

As a bank we had stro ng representatio n o n the fo llowing industry level co mmittees: Bankers' Co mmittee Sub-Co mmittees o n Financ ial Literacy and Public Enlightenment, Sustainability and Eco no mic Develo pment; Steering Co mmittee o n Nigerian Sustainability Banking Princ iples, and CBN Sustainability Champio ns Meeting .

Princip le 9: Report ing:

We are dedicated to repo rting o n o ur sustainability initiatives, fo stering improved transparency o n o ur ac tivities and managing o ur so c ial and enviro nmental impact. In 20 15, we repo rted regularly to bo th internal and external stakeho lders inc luding the CBN. These repo rts co ntained detailed info rmatio n o n o ur business practices and o peratio ns as a bank. Our co ntinued o bjec tive is to enhance o ur repo rting and ensure a mutually benefiting relatio nship between the Bank and the enviro nments we o perate in.

P. W hist leb low ing Procedures

In line with the Bank's co mmitment to instill the best co rpo rate governance practices, the Bank has established a whistle blowing pro cedure that ensures ano nymity. To this end, the Bank has two (2) ho tlines and a dedicated e-mail address. The ho tline numbers are 0 1 - 280 5791 and the email address is whistleblower@ unio nbankng .co m. Internally, the Bank has a direc t link o n its intranet fo r disseminatio n o f info rmatio n, to enable members o f staff repo rt all identified breaches o f the Bank's Co de o f Co rpo rate Governance.

Q. Compliance Plan w ith Cent ral Bank of Nigeria's Regulat ion on the Scope of Banking

Act ivit ies

Sectio n 6(1) o f the Central Bank o f Nigeria (“CBN”) Regulatio n o n the Sco pe o f Banking Activities and Anc illary Matters (“Regulatio n 3”) requires every bank o perating under a universal banking license to submit to the CBN, fo r approval, a co mpliance plan duly



47



approved by the Bo ard. Three bro ad alternative o ptio ns were available to banks to co mply with Regulatio n 3, inc lude retaining Po rtfo lio Co mpanies by restructuring into a ho lding co mpany structure, abso rptio n o f permissible ac tivities by the Bank o r full divestment fro m Po rtfo lio Co mpanies.

The Bank's Bo ard and shareho lders approved a Co mpliance Plan which invo lves the Bank divesting o f its interests in all its Po rtfo lio Co mpanies, with the exceptio n o f Unio n Bank (UK) Plc . and applying fo r an Internatio nal Co mmerc ial Banking license. The Bank received CBN's approval to pro ceed with its plans to co mply with the Regulatio n 3 (the “Co mpliance Plan”) in 20 13.

The Bank has successfully co mpleted its divestment o f the fo llowing subsidiaries: Unio n Capital Markets Limited, Unio n Assurance Co mpany Limited, UBN Insurance Bro kers Limited, Unio n Registrars Limited, Unio n Trustees Limited and Unio n Ho mes Savings and Lo ans Plc . Divestment o f UBN Pro perty Co mpany Limited is o ngo ing . Unio n Pensio n Custo dians Limited has been liquidated and regulato ry submissio ns to finalize the liquidatio n have been filed with the Co rpo rate Affairs Co mmissio n. The Gro up has reco gnised a receivable in respect o f its shares o f net assets in Unio n Pensio n Custo dians Limited as at 31 December 20 15. Also , in preparatio n fo r the liquidatio n o f the spec ial purpo se vehic le (SPV), Atlantic No minees Limited, the dispo sal o f the SPV asset is in pro gress.

R. Event af ter Report ing Date

There were no subsequent events which co uld have had material effec t o n the financ ial statements o f the Bank as at 31 December 20 15 and the pro fit fo r the year ended o n that date, which have no t been adequately provided fo r o r disc lo sed.

S. Auditors

KPMG Pro fessio nal Services has indicated its willingness to co ntinue in o ffice as audito rs to the Bank in acco rdance with Sectio n 357(2) o f the Co mpanies and Allied Matters Act o f Nigeria.

BY ORDER OF THE BOARD

So muyiwa Adedeji So nubiFRC/ 20 13/ NBA/ 0 0 0 0 0 0 0 20 61Co mpany SecretaryLago s Nigeria10 March, 20 16

48

STATEMENT OF DIRECTORS' RESPONSIBILITIES IN RELATION TO THE

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 20 15

The direc to rs accept respo nsibility fo r the preparatio n o f the annual repo rt set o ut o n pages 53 to 140 that g ive a true and fair view in acco rdance with Internatio nal Financ ial Repo rting Standards (“IFRS”) and in the manner required by the Co mpanies and Allied Matters Act o f Nigeria, the Financ ial Repo rting Co unc il o f Nigeria Act, 20 11, the Banks and Other Financ ial Institutio ns Act o f Nigeria and relevant Central Bank o f Nigeria c irculars.

The direc to rs further accept respo nsibility fo r maintaining adequate acco unting reco rds as required by the Co mpanies and Allied Matters Act o f Nigeria and fo r such internal co ntro l as the direc to rs determine is necessary to enable the preparatio n o f financ ial statements that are free fro m material misstatement whether due to fraud o r erro r.

The direc to rs have made an assessment o f the Bank's ability to co ntinue as a go ing co ncern and have no reaso n to believe that the Bank will no t remain a go ing co ncern in the year ahead.

SIGNED ON BEHALF OF THE BOARD OF DIRECTORS BY:

Emeka Emuwa Oyinkansade AdewaleChief Executive Officer Direc to r/ CFOFRC/ 20 13/ CIBN/ 0 0 0 0 0 0 0 1774 FRC/ 20 13/ ICAN/ 0 0 0 0 0 0 0 177510 March, 20 16 10 March, 20 16



49

REPORT OF THE AUDIT COMMITTEEFo r the year ended 31 December 20 15

To the members o f Union Bank of Nigeria Plc

In acco rdance with the provisio ns o f Sectio n 359 (6) o f the Co mpanies and Allied Matters Act o f Nigeria, the members o f the Audit Co mmittee o f Unio n Bank o f Nigeria Plc hereby repo rt as fo llows:

(i) We have exerc ised o ur statuto ry functio ns under Sectio n 359 (6) o f the Co mpanies and Allied Matters Act o f Nigeria and acknowledge the co -o peratio n o f management and staff in the co nduct o f these respo nsibilities.

( ii) We are o f the o pinio n that the acco unting and repo rting po lic ies o f the Bank and Gro up are in acco rdance with legal requirements and agreed ethical practices and that the sco pe and planning o f bo th the external and internal audits fo r the year ended 31 December 20 15 were satisfac to ry and reinfo rce the Gro up's internal co ntro l systems.

(iii) We are satisfied that the Bank has co mplied with the provisio ns o f Central Bank o f Nigeria Circular BSD/ 1/ 20 0 4 dated 18 February 20 0 4 o n “Disc lo sure o f insider related credits in the financ ial statements o f banks”. We hereby co nfirm that an aggregate amo unt o f N34.7 billio n (December 20 14: N12.85 billio n) was o utstanding as at 31 December 20 15 o f which N25 millio n (December 20 14: N7.67 billio n) was no n-perfo rming (see No te 46).

( iv) We have deliberated with the External Audito rs, who have co nfirmed that necessary co o peratio n was received fro m management in the co urse o f their statuto ry audit and we are satisfied with management's respo nses to the External Audito r's reco mmendatio ns o n acco unting and internal co ntro l matters and with the effec tiveness o f the Bank's system o f acco unting and internal co ntro l.

Mr. Matthew AkinladeFRC/ 20 13/ ICAN/ 0 0 0 0 0 0 0 211110 March, 20 16

Members o f the Audit Co mmittee are:Musa Bichi - Chairman Mansur Ahmed - Member Onikepo Olufunmike Akande, CON - Member

Matthew Akinlade - Member

Marcel Ojinka - Member 1Adeyemi Osindero - Member

1 Appo inted as a member o f the Audit Co mmittee o n 16th June, 20 15



50



53 to 140.

51



52



53

Consolidated and Separate Statements of Profit or Loss and Other

Comprehensive IncomeFo r the year ended 31 December 20 15

Notes

GroupDec. 20 15

GroupDec. 20 14

BankDec. 20 15

BankDec. 20 14

N million N million N million N million

Gross earnings 117,211 135,898 118,366 10 9,821

Continuing Operations:

Interest inco me 9 90 ,90 2 76,373 88,879 74,863

Interest expense 9 (35,219) (24,317) (35,0 97) (24,237)

Net interest inco me 55,683 52,0 56 53,782 50 ,626

Net impairment charge fo r c redit lo sses 14(a) (9,948) (4 ,828) (9,881) (3,307)

Net interest inco me after impairment charge fo r c redit lo sses

45,735 47,228 43,90 1 47,319

Net fee and co mmissio n inco me 10 7,697

5,231

1,820

11,419

26,167

71,90 2

70 4

(30 ,0 41)

(4 ,30 0 )

(23,823)

(552)

142

(36)

(9)

982

7,40 0

8,382

13,988

22,370

(1)

(1)

18

18

13,987

22,369

82

(561)

72,60 6

(58,164 )

14 ,442

13,890

10 6

97

14 ,548

13,987

22,369

10 ,153

2,154

31,832

44,139

91,367

(4 ,823)

(29,812)

(3,320 )

(26,287)

(434)

15,392

(14,80 3)

(449)

1,770

1,720

(618)

25,627

25,0 0 9

1,198

1,198

83

26,825

26,207

158

(883)

(4 ,10 8)

(6)

86,544

(59,419)

27,119

26,685

589

140

27,70 8

26,825

26,20 7

—

7,173

5,136

1,820

15,358

29,487

73,388

70 4

(28,755)

(4 ,145)

(23,0 51)

(420 )

(420 )

7,679

7,679

17,721

25,40 0

17,721

25,40 0

10 5

10 5

74 ,0 92

(55,951)

18,141

17,721

18,141

17,721

25,40 0

23,721

34,958

82,277

(4 ,364)

(28,754)

(3,244)

(25,224)

(20 5)

(20 5)

1,812

(2,296)

20 ,486

18,190

20 ,486

18,190

(4,10 8)

77,913

(57,222)

20 ,691

20 ,486

20 ,691

20 ,486

18,190

9,168

2,0 69

—

—

—

—

—

—

—

—

—

121

121

—

—

—

—

—

—

—

—

—

151

—

——

—

Net trading inco me 11

Net inco me fro m o ther financ ial instruments at fair value thro ugh pro fit o r lo ss

Other o perating inco me

No n interest inco me

12

13

Operating income

Net impairment gain / ( lo ss) o n o ther financ ial assets 14(b)

Net operating income after net impairment loss on

other financial assets

Perso nnel expenses 15

Deprec iatio n and amo rtisatio n

Other o perating expenses 16

Total expenses

Share o f pro fit o f equity acco unted investee

Profit before income tax from continuing operations

Inco me tax expense fro m co ntinuing o peratio ns 17

Profit for the year from continuing operations

Discontinued operations

Gro ss inco me fro m disco ntinued o peratio ns 39

Gro ss expense fro m disco ntinued o peratio ns 39

Profit/ (Loss) before tax from discontinued operations 39

Inco me tax expense fro m disco ntinued o peratio ns 39

Profit/ (Loss) for the year from discontinued operations 39

Continuing and discontinued operations:

Profit before tax

Inco me tax

Profit after tax

Other comprehensive income, net of income tax

Remeasurement o f defined benefit liability

Items that are o r may be rec lassified to pro fit o r lo ss

Fo reign currency translatio n differences fo r fo reign o peratio ns

Fair value gains/ ( lo sses) o n available-fo r-sale investments

Pro fit attributable to :

To tal co mprehensive inco me attributable to :

Earnings per share fo r pro fit fro m to tal o peratio ns

Equity ho lders o f the Bank

Equity ho lders o f the Bank

attributable to equity ho lders o f Bank

No n-co ntro lling interest


Basic and diluted (Ko bo)

Pro fit fo r the year

To tal co mprehensive inco me fo r the year

Earnings per share fo r pro fit fro m co ntinuing

o peratio ns attributable to equity ho lders o f bank

Basic and diluted (Ko bo)

Other co mprehensive inco me fo r the year

Total comprehensive income for the year

Restated Restated



54

Consolidated and Separate Statements of Financial Position

Notes

GroupDec. 20 15

GroupDec. 20 14

GroupJan. 20 14

BankJan. 20 14

BankDec. 20 15

BankDec. 20 14

N million N million N million N million N million N million

ASSETS

No n-pledged trading assets

Pledged assets

Derivative assets held fo r risk management

Lo ans and advances to custo mers

Investments in equity acco unted investee

Investment securities

Cash and cash equivalents

20

19 82,252

745

121,960

2,847

10 0 ,925

—— 745 2,847

54,451 58,457 53,141

21

22

84,728

1,820

366,721

24

215,137

83,935 65,167 84,728 83,935

30 2,372

65,167

210 ,11823

24

25

1,0 46,495

1,0 46,892

80 2,971

80 2,971

238,584

243,921

1,0 46,892

26

27

28

29

30

31

32

39(b)

22

34

35

36

33

37

38

40

41

39(c)

40 (d)

Restated Restated

Trading pro perties

Investment pro perties

Investment in subsidiaries

Pro perty and equipment

Intangible assets

Deferred tax assets

Other assets

Assets c lassified as held fo r sale

Derivative liabilities held fo r risk management

Depo sits fro m banks

Depo sits fro m custo mers

Current tax liabilities

Other liabilities

Employee benefit o bligatio ns

Other bo rrowed funds

Liabilities c lassified as held fo r sale

Share capital and share premium

Treasury shares

Retained defic it

Other reserves

Other reserves

TOTAL ASSETS

LIABILITIES

TOTAL LIABILITIES

EQUITY

EQUITY ATTRIBUTABLE TO EQUITY -

HOLDERS OF THE BANK

TOTAL LIABILITIES AND EQUITY

TOTAL EQUITY

3,177

4 ,546

49,772

3,749

95,883

138,686

397

44,0 91

570 ,639

382

107,533

4 ,267

76,0 59

40 0 ,10 9

(244,90 2)

83,377

5,337

—

—

— —

— — —

—

—

—

—

—

—

—

—

—

—

—

—

—

7

312,797

24

197,20 0

1,930

48,575

2,422

95,883

122,547

988,0 25

20 ,426

1,0 0 8,451

7

61,890

527,617

822

10 3,580

7,525

78,135

779,576

7,347

786,923

40 0 ,10 9

(35)

(243,675)

59,791

216,190

5,338

221,528

1,0 0 8,451

— —

—

—

229,542

25

289,353

4,747

16,413

44,581

80 8

95,889

10 0 ,0 69

950 ,366

51,684

46,794

1,0 0 2,0 50

482,70 6

534

143,80 3

22,864

45,280

741,981

61,432

80 3,413 767,469

40 0 ,10 9 40 0 ,10 9

(249,372)

40 0 ,10 9 40 0 ,10 9

(240 )

(275,577)

67,183

191,475

7,162

198,637

1,0 0 2,0 50

1,820

348,984

—

—

20 9,223

1,124

10 ,567

49,692

3,318

95,875

138,0 30

997,812

325

998,137

11,80 0

569,116

229

10 6,0 35

4,230

76,0 59

767,469

79,931

230 ,668

230 ,668

998,137

193,656

1,930

8,372

— —

48,482

2,071

95,875

121,810

917,70 5

2,525

920 ,230

18,0 55

507,431

635

10 3,181

7,525

78,135

714 ,962

714 ,962

(251,878)

57,0 37

20 5,268

20 5,268

920 ,230

16

290 ,377

1,930

12,892

44,40 5

685

95,875

10 1,564

879,0 17

2,374

881,391

3,20 0

479,956

472

142,586

22,819

45,280

694 ,313

694 ,313

(272,770 )

59,739

187,0 78

187,0 78

881,391

Signed on behalf of t he Board of Directors on 10 March, 20 16 by:

Emeka Emuwa

Gro up Managing Directo rFRC/ 20 13/ CIBN/ 0 0 0 0 0 0 0 1774

Oyinkansade Adewale

Directo r/ CFOFRC/ 20 13/ ICAN/ 0 0 0 0 0 0 0 1775

The no tes o n pages 59 to 140 are an integral part o f these co nso lidated financ ial statements.



55

Gro

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N m

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illi

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— — ————— ———

— — ————— ———

— — ————— ———

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— ————

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20

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8,4

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13,9

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13,9

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13,9

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(1

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2

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— —

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nsf

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(70

6)

(70

6)

1 98

,63

7

26

,82

5

1,7

70

7,16

219

1,4

75

(2

75

,57

7)

11,0

48

1,19

8

25

,62

7

25

,62

7

1,7

70

1,7

70

1,7

20

1,7

20

1,7

20

(4,10

8)

(4,10

8)

(4,10

8)

26

,20

7

1,19

8

25

,00

9

25

,62

7

(2,3

38

)—

1,7

20

— —

— —

— ——

—

— —

— —

— ——

Tra

nsf

er

be

twe

en

re

serv

es

Tra

nsf

er

to s

tatu

tory

re

serv

e

10,0

98

(5

,30

3)

1,2

77

(4

,85

9)

(1,2

13)

3,0

73

(3

,07

3)

— —

— —

——

—D

isp

osa

l o

f su

bsi

dia

rie

s

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co

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2

21,

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8

(3,0

22

)

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2,6

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(2

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15,2

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(1

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1,8

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(4,6

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(5,3

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20

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3

(25

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)2

05

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8

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17,7

21

Pro

fit

or

loss

—— — — — — — ——

Sh

are

c

ap

ita

l S

ha

rep

rem

ium

Tre

asu

ry

sh

are

sS

tatu

tory

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gu

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se

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Re

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d

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at

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20

14

Pri

or

ye

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ad

just

me

nt

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i))

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sta

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co

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ts

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39

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16,3

31

16,3

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30

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0

30

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0

3,7

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9,4

42

9,4

42

(27

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)

(70

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70

)

187,

78

4

187,

07

8

Pro

fit

or

loss

—— — — — — — ———

—— — — — — — ———

—— — —

—— —

——

——

— — — — —

—

——

——

—— ———

—— ——— —— —

—— —

— —— —

— — — —

— —

20

,48

6

20

,48

6

1,8

12

1,8

12

(4,10

8)

(4,10

8)

1,8

12

(4,10

8)

(2,2

96

)

1,8

12

(4,10

8)

20

,48

6

18,19

0

(4,8

59

)

(4,8

59

)

4,9

61

4,9

61

(3,5

81)

(3,5

81)

3,4

79

3,0

73

3,0

73

(3,0

73

)

40

6

8,4

68

3

91,

64

1 19

,40

4

27,2

13

8,6

67

1,

75

3

(25

1,8

78

)2

05

,26

8

Ba

nk

——

——

——

———— ——

———— ——

—— ——

————

———

——

—— —— ——

——

7,6

79

7,

67

9

25

,40

017

,72

1 7,

67

9

(12

,55

7)

15,2

09

15,2

09

(2,6

52

)

(2,6

52

)

(2,6

58

)

(15

,215

)

2,6

58

2,6

58

22

,06

2

32

,24

0

23

,87

6

1,7

53

(2

49

,37

2)

23

0,6

68

Co

nso

lid

ate

d a

nd

Se

pa

rate

Sta

tem

en

ts o

f C

ha

ng

es i

n E

qu

ity

Fo

r th

e y

ea

r e

nd

ed

31

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ce

mb

er

20

15

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nso

lid

ate

d a

nd

Se

pa

rate

Sta

tem

en

ts o

f C

ha

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es i

n E

qu

ity

for

the

ye

ar

en

de

d 3

1 D

ece

mb

er

20

14

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on



57

Group

Dec. 20 15

Group

Dec. 20 14Bank

Dec.20 15

Bank

Dec.20 14

N million

Cash flows from operating activities

Pro fit fo r the year 13,987

561

14,548

26,825 17,721

420

20 ,486

Inco me tax expense

Profit before tax

Adjustments fo r:

Impairment lo sses o n lo ans and advances

Recoveries o n lo ans and advances

(Reversal o f impairment)/ impairment lo ss o n o ther assets

Impairment lo ss o n o ther investments

Allowances o n o ther assets

Impairment o n pro perty and equipment 29(b)

49(i)

49(ii)

49(v)

49(iii)

49(iv)

49(v)

49(vi)

49(vii)

49(viii)

13

13Gain o n sale o f pro perty and equipment

Gain o n dispo sal o f available fo r sale - unquo ted equity 13

29

Gain o n sale o f trading pro perties 13

(Gain)/ lo ss o n sale o f subsidiaries

Deprec iatio n o f pro perty and equipment

Amo rtisatio n o f intangible assets 30

Dividend inco me fro m equity investment

Interest paid o n bo rrowings

13

Co ntributio ns to defined co ntributio n plans

Increase/ (decrease) in liability fo r defined benefit plans

9


15

Change in no n-pledged trading assets

15

Change in pledged assets

Change in derivative financ ial instruments-liabilities

(20 ,80 7) (126,839) 10 ,975 (125,60 0 )

Change in lo ans and advances to custo mers

Change in o ther assets

Change in derivative financ ial instruments-assets

Change in depo sits fro m banks

Change in depo sits fro m custo mers

Change in o ther liabilities

Payment fro m defined co ntributio n plan

Inco me tax paid

Payment fro m defined benefit plan

Cash flows fro m Disco ntinued o peratio ns

Net cash provided/ (used in) by operating activities

15,072

(5,124)

14(a)

14(a)

14(b)

14(b)

(2,80 1)

2,0 97

20 0

(1,660 )

(193)

(728)

332

3,519

—

—

—

—

—

—

— —

—

—

—

—

—

— —

— —

—

— —

—

—

—

—

772

(686)

8,683

644

4,347

39,0 22

745

(793)

(7)

(63,872)

(18,426)

(1,813)

(17,799)

43,0 22

8,414

(11,507)

(1,0 51)35

37(a)(i)

49(ix)

(623)

(7,626)

40 9

27,234

8,299

(3,471)

5,222

(15,689)

2,879

432

(40 8)

3,193

70 2

(120 )

6

28,279

2,10 2

(18,768)

(88,0 83)

(28,196)

15,0 96

44,911

(46,146)

(90 ,80 5)

(64)

(70 2)

(12,591)

(22,677)

18,141

15,0 0 5

(5,124)

(2,80 1)

2,0 97

20 0

(1,660 )

(193)

(728)

(3,591)

3,480

666

(686)

8,683

644

4,310

38,443

745

(793)

(56,493)

(18,317)

(1,820 )

(6,255)

61,685

2,854

20 ,0 49

(826)

(623)

(7,626)

20 5

20 ,691

6,778

(3,471)

16

4,763

(6,315)

2,854

389

(2,0 15)

3,193

70 2

(120 )

27,465

2,10 2

(18,768)

(95,561)

(23,736)

14,855

27,475

(46,0 97)

(112,265)

(42)

(70 2)

(12,591)

Consolidated and Separate Statements of Cash FlowsFo r the year ended 31 December 20 15

Notes

N million N million N million



58

(9,0 97)

(10 ,759)

Acquisitio n o f investment pro perties

Cash flows from investing activities

Net cash used in investing activities

Pro ceeds fro m sale o f investment pro perties

Pro ceed/ (acquisitio n) o f investment securities

Pro ceeds fro m sale o f trading pro perties

Pro ceeds fro m sale o f pro perty and equipment

Net pro ceed fro m dispo sal o f subsidiaries

Acquisitio n o f pro perty and equipment

Acquisitio n o f intangible assets

Dividend inco me received

Cash flows fro m disco ntinued o peratio ns

Inflow fro m o ther bo rrowings

Repayment o f bo rrowed funds

Cash flows from financing activities

Net cash from financing activities

Net increase/ (decrease) in cash and cash equivalents

Cash and cash equivalents at end of period/ year

Interest paid o n bo rrowings

Inflows fro m no n-co ntro lling interest

Cash flows fro m Disco ntinued o peratio ns

Cash and cash equivalents at beg inning o f year

Net change in cash and cash equivalent fro m disco ntinued o peratio n

Effec t o f exchange rate fluctuatio ns o n cash held

—

—

—

—

—

—

— —

— —

—

— —

— —

— —

— —

— —

27

27

49(xiii)

49(x)

49(xi)

49(xii)

29

30

13

49(xiv)

49(xiv)

9(b)

19

19

(7,543)

1,534

3,438

3,596

(6,677)

(2,078)

686

39,685

(41,761)

(8,683)

121,960

955

(40 ,663)

82,252

(39)

137

93,873

635

3

8,849

(6,520 )

(1,90 1)

40 8

25,830

121,276

35,0 87

(2,232) (2,232)

(3,193) (3,193)

495

(2,259)

27,898

22,334

10 0 ,925

(3,0 69)

1,770

121,960

(4 ,894)

1,534

3,438

3,596

(6,669)

(1,913)

686

(4 ,221)

39,685

(41,761)

(8,683)

(10 ,759) 29,662

(4 ,0 0 6)

58,457

54 ,451

98,533

3

8,849

(6,471)

(1,675)

2,0 15

10 1,254

35,0 87

5,316

53,141

58,457

The no tes o n pages 59 to 140 are an integral part o f these co nso lidated financ ial statements.



59

1 Report ing Ent it y

Unio n Bank o f Nigeria Plc (“the Bank”) is a co mpany do mic iled in Nigeria. The address o f the Bank's reg istered o ffice is Stallio n Plaza, 36 Marina, Lago s. The co nso lidated financ ial statements o f the Bank as at and fo r the year ended 31 December 20 15 co mprise the Bank and its subsidiaries (to gether referred to as the “Gro up” and individually as 'Gro up entities') . The Gro up is primarily invo lved in investment, co rpo rate, co mmerc ial and retail banking .

The bank co ntinues the divestment pro cess fro m all no n-banking businesses within the Gro up in line with the CBN Regulatio n o n the sco pe o f Banking Activities and Anc iliary Matters. Co nsequently, the Bank so ld Unio n Trustees Limited during the co urse o f the year. The pro po sed sale o f the Bank's ho ldings in UBN Pro perty Co mpany Limited has been put o n ho ld as a result o f shareho lder litigatio n initiated by two o f the subsidiary's shareho lders.

2 Basis of Preparat ion

(a) Statement of Compliance

The co nso lidated and separate financ ial statements have been prepared in acco rdance with Internatio nal Financ ial Repo rting Standards (IFRS).

They were autho rised fo r issue by the Bo ard o f Direc to rs o n 10 March 20 16.

(b) Funct ional and Presentat ion Currency

These co nso lidated and separate financ ial statements are presented in Nigerian Naira, which is the Bank's functio nal and presentatio n currency.

All amo unts have been ro unded to the nearest tho usand, except o therwise indicated.

(c) Basis of Measurement

These co nso lidated and separate financ ial statements are prepared o n the histo rical co st basis except fo r the fo llowing material items in the statement o f financ ial po sitio n:

• financ ial instruments at fair value thro ugh pro fit o r lo ss are measured at fair value; • available-fo r-sale financ ial assets are measured at fair value; • investment pro perty is measured at fair value; • the liability fo r defined benefit o bligatio ns is reco gnised as the present value o f the

defined benefit o bligatio n less the net to tal value o f the plan assets, plus unreco gnised actuarial gains, less unreco gnised past service co st and unreco gnised actuarial lo sses.

• the liability fo r staff no n-co ntributo ry pensio n is reco gnised as the present value o f the scheme less net to tal value o f the plan assets, plus unreco gnised actuarial gains, less unreco gnised past service co st and unreco gnised actuarial lo sses.

(d ) Use of Est imates and Judgements

The preparatio n o f financ ial statements in co nfo rmity with IFRS requires management to make judgements, estimates and assumptio ns that affec t the applicatio n o f acco unting po lic ies and the repo rted amo unts o f assets and liabilities, inco me and expenses.

The estimates and asso c iated assumptio ns are based o n histo rical experience and vario us o ther fac to rs that are believed to be reaso nable under the c ircumstances, the results o f which fo rm the basis o f making the judgements abo ut carrying values o f assets and liabilities that are no t readily apparent fro m o ther so urces. Actual results may differ fro m these estimates.

The estimates and underlying assumptio ns are reviewed o n an o ngo ing basis. Revisio ns to acco unting estimates are reco gnised in the year in which the estimate is revised, if the revisio n affec ts o nly that year, o r in the year o f the revisio n and future years, if the revisio n affec ts bo th current and future years.

Notes to the Consolidated Financial StatementsFo r the year ended 31 December 20 15



60

Info rmatio n abo ut significant areas o f estimatio n uncertainty and critical judgements in applying acco unting po lic ies that have the mo st significant effec t o n the amo unts reco gnised in these financ ial statements are inc luded in no te 6.

(e) Determinat ion of Regulatory Risk Reserves

Provisio ns under Prudential Guidelines are determined using the time based provisio ning reg ime prescribed by the Revised Central Bank o f Nigeria (CBN) Prudential Guidelines. This is at variance with the requirements o f the Internatio nal Financ ial Repo rting Standards. As a result o f the differences in the metho do lo gy/ provisio n reg ime, there may be variances in the impairment allowances required under the two metho do lo g ies.

Paragraph 12.4 o f the revised Prudential Guidelines fo r Depo sit Mo ney Banks in Nigeria stipulates that Banks wo uld be required to make provisio ns fo r lo ans and o ther financ ial assets as prescribed in the relevant IFRS standards when IFRS is ado pted. However, Banks wo uld be required to co mply with the fo llowing :

( i) Provisio ns fo r lo ans and o ther financ ial assets reco gnised in the inco me statement sho uld be determined based o n the requirements o f IFRS. However, the IFRS impairments sho uld be co mpared with provisio ns determined under Prudential Guidelines and the expected impact/ changes in general reserves sho uld be treated as fo llows:

• If Prudential provisio ns are greater than IFRS impairments, the resultant excess provisio n sho uld be transferred fro m the retained earnings acco unt to a "regulato ry risk reserve".

• If Prudential provisio ns are less than IFRS impairments; IFRS determined impairments are charged to the inco me statement. The cumulative balance in the regulato ry risk reserve is thereafter reversed to the retained earnings acco unt.

The Bank has co mplied with the requirements o f the Prudential Guidelines.

The Revised Central Bank o f Nigeria (CBN) Prudential Guidelines require that if the IFRS based impairment is lower than the CBN Prudential Guidelines provisio ns, the extent o f the difference sho uld be reco gnised as regulato ry risk reserve in the statement o f changes in equity.

The reco nc iliatio n o f the impairment based o n relevant IFRS standards and CBN Prudential Guidelines provisio n is shown in the statement below:

NotesBank

Dec.20 15Bank

Dec.20 14

N million N million

IFRS-based impairments:

Prudential provisio ns:

Statement of Prudential Adjustments

Spec ific impairment o n lo ans to custo mers 11,565 9,753

Po rtfo lio impairment o n lo ans to custo mers

Spec ific impairment o n investment securities

Spec ific impairment o n o ther assets

Spec ific provisio n o n lo ans to custo mers

General provisio n o n lo ans to custo mers

Interest in suspense

Spec ific provisio n o n investment securities

Spec ific impairment o n equity acco unted investee

Provisio n fo r c laims and co ntingenc ies

Spec ific provisio n o n o ther assets

Regulato ry risk reserve

36

23

23

32

Spec ific impairment o n equity acco unted investee

Provisio n fo r c laims and co ntingenc ies

25

24

10 ,40 0

4 ,0 58

91 91

1,844 2,236

6,197

34,547

13,623

4,072

183,510

212,893

27,846

4 ,968

13,0 27

4 ,0 58

91

2,236

6,197

58,423

23,876

24,0 34

2,931

5,078

4 ,072

91

1,844

183,510

221,560

8,667



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The movement in the Regulato ry risk reserve during the year is shown below:

Balance, beg inning o f the year

Transfer during the year

Balance, end o f the year

8,667

15,20 9

23,876

3,70 6

4 ,961

8,667

BankDec.20 15

BankDec.20 14

N million N million

3 Signif icant Account ing Policies

The acco unting po lic ies set o ut below have been co nsistently applied to all perio ds presented in these co nso lidated and separate financ ial statements.

The acco unting po lic ies have been applied co nsistently by Gro up entities.

(a) Basis of Consolidat ion

Business Co mbinatio n Business co mbinatio ns are acco unted fo r using the acquisitio n metho d as at the

acquisitio n date, that is, when co ntro l is transferred to the Gro up. Co nsideratio n transferred in the acquisitio n is generally measured at fair value, as are the identifiable net assets acquired. Transactio n co sts are expensed as incurred, except if they relate to the issue o f debt o r equity securities.

No n-Co ntro lling Interest No n-co ntro lling interests (NCI) are measured at their pro po rtio nate share o f the acquiree's

identifiable net assets at the acquisitio n date. Changes in the Gro up's interest in a subsidiary that do no t result in a lo ss o f co ntro l are acco unted fo r as equity transactio ns.

Subsidiaries Subsidiaries are investees co ntro lled by the Gro up. The Gro up co ntro ls an entity if it is

expo sed to , o r has rights to , variable returns fro m its invo lvement with the investee and has the ability to affec t tho se returns thro ugh its power over the investee. The financ ial statements o f subsidiaries are inc luded in the co nso lidated financ ial statements fro m the date o n which co ntro l co mmences until the date when co ntro l ceases.

Asso c iates Asso c iates are tho se entities in which the Gro up has significant influence, but no t co ntro l,

over the financ ial and o perating po lic ies. The co nso lidated financ ial statements inc lude the Gro up's share o f the to tal reco gnised gains and lo sses o f asso c iates o n an equity-acco unted basis fro m the date that significant influence co mmences until the date that significant influence ceases. When the Gro up's share o f lo sses exceeds its interest in an asso c iate, the Gro up's carrying amo unt is reduced to nil and reco gnitio n o f further lo sses is disco ntinued except to the extent that the Gro up has incurred legal o r co nstructive o bligatio ns o r made payments o n behalf o f an asso c iate.

Lo ss o f Co ntro l The Gro up assesses whether there is lo ss o f co ntro l in a variety o f ways which inc ludes: • sale o f all o r part o f its ownership interest in its subsidiary; • expiry o f a co ntractual agreement that gave co ntro l o f the subsidiary to the Gro up; • issue o f shares to third parties by the subsidiary, thereby reduc ing the Gro up's

ownership interest in the subsidiary so that it no lo nger has co ntro l o f the subsidiary; • distributio n o f its ownership interest in the subsidiary by the Gro up; • when the subsidiary beco mes subjec t to the co ntro l o f a government, co urt,

administrato r o r regulato r.

When the Gro up lo ses co ntro l over a subsidiary, it dereco gnises the assets and liabilities o f the subsidiary, and any related no n-co ntro lling interests and the o ther co mpo nents o f equity. Any interest retained in the fo rmer subsidiary is measured at fair value when co ntro l is lo st. Any resulting gain o r lo ss is reco gnised in pro fit o r lo ss.



62

The amo unt reco gnised in pro fit o r lo ss o n the lo ss o f co ntro l o f a subsidiary is measured as the difference between:

(a) The sum o f: • the fair value o f the co nsideratio n received, if any; • the reco gnised amo unt o f the distributio n o f shares, if applicable; • the fair value o f any retained no n-co ntro lling investment (NCI); and • the carrying amo unt o f the NCI in the fo rmer subsidiary, inc luding the accumulated

balance o f each c lass o f o ther co mprehensive inco me (OCI) attributable to the NCI

(b) The carrying amo unt o f the fo rmer subsidiary's net assets, to gether with any pro fit o r lo ss rec lassificatio ns.

Fro m the Gro up's perspective, the lo ss o f co ntro l o f a subsidiary results in dereco gnitio n o f the individual assets and liabilities o f the subsidiary. On dispo sal, co mpo nents o f OCI related to the subsidiary's assets and liabilities are acco unted fo r o n the same basis as wo uld be required if the individual assets and liabilities had been dispo sed o f direc tly. As a result, the fo llowing amo unts are rec lassified to pro fit o r lo ss:

• exchange differences that were reco gnised in OCI; • changes in the fair value o f available-fo r-sale financ ial assets previo usly reco gnised

in OCI; and • the effec tive po rtio n o f gains and lo sses o n hedging instruments in a cash flow

hedge previo usly reco gnised in OCI.

Transactio ns eliminated o n co nso lidatio n Intra-gro up balances, and any unrealised gains o r lo sses o r inco me and expenses arising

fro m intra-gro up transactio ns, are eliminated in preparing the co nso lidated financ ial statements. Unrealised gains arising fro m transactio ns with asso c iates are eliminated to the extent o f the Gro up's interest in the entity. Unrealised lo sses are eliminated in the same way as unrealised gains, but o nly to the extent that there is no evidence o f impairment.

(b) Foreign Currency Transact ions

Fo reign currency transactio ns Transactio ns in fo reign currenc ies are translated into the respective functio nal currency o f

Gro up entities at the spo t exchange rates at the date o f the transactio ns.

Mo netary assets and liabilities deno minated in fo reign currenc ies at the repo rting date are translated using the functio nal currency at the spo t exchange rate at that date. The fo reign currency gain o r lo ss o n mo netary items is the difference between the amo rtised co st in the functio nal currency at the beg inning o f the year, adjusted fo r effec tive interest and payments during the year, and the amo rtised co st in the fo reign currency translated at the spo t exchange rate at the end o f the year.

No n-mo netary assets and liabilities that are measured at fair value in a fo reign currency are translated into the functio nal currency at the spo t exchange rate at the date o n which the fair value is determined. No n-mo netary items that are measured based o n histo rical co st in a fo reign currency are translated using the spo t exchange rate at the date o f the transactio n.

Fo reign currency differences arising o n translatio n are generally reco gnised in pro fit o r lo ss. However, fo reign currency differences arising fro m the translatio n o f available fo r sale equity instruments are reco gnised in OCI.

Fo reign Operatio ns The assets and liabilities o f fo reign o peratio ns, inc luding go o dwill and fair value

adjustments arising o n acquisitio n, are translated into naira at spo t exchange rates at the repo rting date. The inco me and expenses o f fo reign o peratio ns are translated into naira at spo t exchange rates at the dates o f the transactio ns.



63

Fo reign exchange differences o n translatio n o f fo reign o peratio ns are reco gnised in o ther co mprehensive inco me, and presented in the currency translatio n reserve (translatio n reserve) in equity. However, if the fo reign o peratio n is a no n-who lly owned subsidiary, then the relevant pro po rtio n o f the translatio n differences is allo cated to no n-co ntro lling interests. When a fo reign o peratio n is dispo sed o f such that co ntro l is lo st, the cumulative amo unt in the translatio n reserve related to that fo reign o peratio n is rec lassified to pro fit o r lo ss as part o f the gain o r lo ss o n dispo sal. When the Gro up dispo ses o f o nly part o f its interest in a subsidiary that inc ludes a fo reign o peratio n while retaining co ntro l, the relevant pro po rtio n o f the cumulative amo unt is reattributed to no n-co ntro lling interests.

When the settlement o f a mo netary item receivable fro m o r payable to a fo reign o peratio n is neither planned no r likely in the fo rseeable future, fo reign currency gains and lo sses arising fro m such items are co nsidered to fo rm part o f a net investment in the fo reign o peratio n and are reco gnised in o ther co mprehensive inco me and presented in the translatio n reserve in equity.

(c) Interest

Interest inco me and expense are reco gnised in pro fit o r lo ss using the effec tive interest metho d. The effec tive interest rate is the rate that exactly disco unts the estimated future cash payments and receipts thro ugh the expected life o f the financ ial asset o r financ ial liability (o r, where appro priate, a sho rter perio d) to the carrying amo unt o f the financ ial liability. When calculating the effec tive interest rate, the gro up estimates future cash flow co nsidering all co ntractual terms o f the financ ial instrument, but no t future credit lo sses.

The calculatio n o f the effec tive interest rate inc ludes transactio n co sts and fees and po ints paid o r received that are an integral part o f the effec tive interest rate. Transactio n co sts inc lude incremental co sts that are direc tly attributable to the acquisitio n o r issue o f a financ ial asset o r financ ial liability.

Interest inco me and expense presented in the statement o f pro fit o r lo ss and OCI inc lude: • Interest o n financ ial asset and financ ial liabilities measured at amo rtised co st

calculated o n an effec tive interest basis; • Interest o n available-fo r-sale investment securities calculated o n an effec tive interest basis;

Interest inco me and expense o n all trading assets and liabilities are co nsidered to be inc idental to the gro up's trading o peratio ns and are presented to gether with all o ther changes in the fair value o f trading assets and liabilities in net trading inco me (see(e)) .

Fair value changes o n o ther derivatives held fo r risk management purpo se, and o ther financ ial assets and financ ial liabilities carried at fair value thro ugh pro fit o r lo ss are presented in net inco me fro m o ther financ ial instruments at fair value thro ugh pro fit o r lo ss in the statement o f pro fit o r lo ss and OCI.

(d) Fees and Commission

Fee and co mmissio n inco me and expenses that are integral to the effec tive interest rate o n a financ ial asset o r liability are inc luded in the measurement o f the effec tive interest rate. Other fee and co mmissio n inco me, inc luding acco unt servic ing fees, investment management and o ther fiduc iary activity fees, sales co mmissio n, placement fees and syndicatio n fees, are reco gnised as the related services are perfo rmed.

When a lo an co mmitment is no t expected to result in the draw-down o f a lo an, lo an co mmitment fees are reco gnised o n a straight-line basis over the co mmitment perio d.

Other fee and co mmissio n expense relates mainly to transactio n and service fees, which are expensed as the services are received.

(e) Net Trad ing Income

Net trading inco me co mprises gains less lo sses related to trading assets and liabilities and inc ludes all realised and unrealised fair value changes, interest, dividends and fo reign exchange differences.



64

( f ) Net Income from other Financial Inst ruments at Fair Value through Prof it or Loss

Net inco me fro m o ther financ ial instruments at fair value thro ugh pro fit o r lo ss relates to no n trading derivatives held fo r risk management purpo ses that do no t fo rm part o f qualifying hedge relatio nships and financ ial assets and financ ial liabilities designated at fair value thro ugh pro fit o r lo ss. It inc ludes all realised and unrealised fair value changes, interest, dividends and fo reign exchange differences.

(g) Dividends

Dividend inco me is reco gnised when the right to receive inco me is established. Dividends are reflec ted as a co mpo nent o f o ther o perating inco me and are reco gnised net o f withho lding tax.

(h) Lease Payments - Lessee

Payments made under o perating leases are reco gnised in pro fit o r lo ss o n a straight-line basis over the term o f the lease. Lease incentives received are reco gnised as an integral part o f the to tal lease expense, over the term o f the lease.

Minimum lease payments made under finance leases are appo rtio ned between the finance expense and the reductio n o f the o utstanding liability. The finance expense is allo cated to each perio d during the lease term so as to pro duce a co nstant perio dic rate o f return o n the remaining balance o f the liability.

Co ntingent lease payments are acco unted fo r by revising the minimum lease payments over the remaining term o f the lease when the lease adjustment is co nfirmed.

( i) Income Tax Expense

Inco me tax co mprises current and deferred taxes. Inco me tax expense is reco gnised in the inco me statement except to the extent that it relates to items reco gnised direc tly in equity, in which case it is reco gnised in equity. Current tax payable also inc ludes any tax liability arising fro m the dec laratio n o f dividends.

Current tax is the expected tax payable o n taxable inco me fo r the year, using tax rates enacted o r substantively enacted at the statement o f financ ial po sitio n date, and any adjustment to tax payable in respect o f previo us years.

Deferred tax is provided using the balance sheet liability metho d, providing fo r tempo rary differences between the carrying amo unts o f assets and liabilities fo r financ ial repo rting purpo ses and the amo unts used fo r taxatio n purpo ses. Deferred tax is no t reco gnised fo r the fo llowing tempo rary differences: the initial reco gnitio n o f go o dwill, the initial reco gnitio n o f assets o r liabilities in a transactio n that is no t a business co mbinatio n and that affec ts neither acco unting no r taxable pro fit, and differences relating to investments in subsidiaries to the extent that they pro bably will no t reverse in the fo reseeable future. Deferred taxes are measured at the tax rates that are expected to be applied to the tempo rary differences when they reverse, based o n laws that have been enacted o r substantively enacted by the repo rting date.

A deferred tax asset is reco gnised fo r unused tax lo sses, tax credits and deductible tempo rary differences o nly to the extent that it is pro bable that future taxable pro fits will be available against which the asset can be utilised. Deferred tax assets are reviewed at each repo rting date and are reduced to the extent that it is no lo nger pro bable that the related tax benefit will be realised.

Additio nal taxes that arise fro m the distributio n o f dividends are reco gnised at the same time as the liability to pay the related dividend is reco gnised.

( j) Financial Inst ruments

Recognit ion

A financ ial asset o r financ ial liability is measured initially at fair value plus, fo r an item no t at fair value thro ugh pro fit o r lo ss, transactio n co st that are direc tly attributable to its



65

acquisitio n o r issue. Lo ans and advances, depo sits and subo rdinated liabilities are reco gnised o n the date that they are o rig inated. All o ther financ ial assets and liabilities are initially reco gnised o n the trade date at which the Gro up beco mes a party to the co ntractual provisio ns o f the instrument.

Classif icat ion

The Gro up c lassifies its financ ial assets in the fo llowing catego ries: • lo ans and receivables; • held to maturity; • available fo r sale; o r • at fair value thro ugh pro fit o r lo ss and within the catego ry as held fo r trading o r

designated at fair value thro ugh pro fit o r lo ss.

( i) Lo ans and Receivables Lo ans and receivables are no n-derivative financ ial assets with fixed o r determinable

payments that are no t quo ted in an active market, and that the Gro up do es no t intend to sell immediately o r in the near term.

Lo ans and receivables are c lassified as lo ans and advances to custo mers and finance lease receivables.

Lo ans and advances to custo mers are initially measured at fair value plus incremental direc t transactio n co sts, and subsequently measured at their amo rtised co st using the effec tive interest metho d.

When the Gro up is the lesso r in a lease agreement that transfers substantially all o f the risks and rewards inc idental to ownership o f the asset to the lessee, the arrangement is c lassified as a finance lease and a receivable equal to the net investment in the lease is reco gnised and presented within lo ans and advances.

( ii) Held-to -Maturity Held-to -maturity investments are no n-derivative assets with fixed determinable

payments and fixed maturity that the Gro up has the po sitive intent and ability to ho ld to maturity, and which are no t designated as at fair value thro ugh pro fit o r lo ss o r as available fo r sale.

Held-to -maturity investments are carried at amo rtised co st, using the effec tive interest metho d, less any impairment lo sses. A sale o r rec lassificatio n o f a mo re than an insignificant amo unt o f held-to -maturity investments wo uld result in the rec lassificatio n o f all held-to -maturity investments as available fo r sale, and wo uld prevent the Gro up fro m c lassifying investment securities as held to maturity fo r the current and the fo llowing two financ ial years. However, sales and rec lassificatio ns in any o f the fo llowing c ircumstances wo uld no t trigger a rec lassificatio n:

(a) sales o r rec lassificatio ns that are so c lo se to maturity that changes in the market rate o f interest wo uld no t have a significant effec t o n the financ ial asset's fair value;

(b) sales o r rec lassificatio ns after the Gro up has co llec ted substantially all o f the asset's o rig inal princ ipal; and

(c ) sales o r rec lassificatio ns attributable to no n-recurring iso lated events beyo nd the Gro up's co ntro l that co uld no t have been reaso nably antic ipated.

( iii) Available-fo r-Sale Available-fo r-sale investments are no n-derivative investments that are designated as

available-fo r-sale o r are no t c lassified as ano ther catego ry o f financ ial assets. Available-fo r-sale investments co mprise equity securities and debt securities. Unquo ted equity securities who se fair value canno t reliably be measured are carried at co st. All o ther available-fo r-sale investments are carried at fair value.

Interest inco me is reco gnised in inco me statement using the effec tive interest metho d. Dividend inco me o n available fo r sale financ ial assets is reco gnised in pro fit o r lo ss



66

when the Gro up beco mes entitled to the dividend. Fo reign exchange gains o r lo sses o n available-fo r-sale debt security investment are reco gnised in inco me statement. Impairment lo sses are reco gnised in pro fit o r lo ss.

Other fair value changes, o ther than impairment lo sses, are reco gnised in o ther co mprehensive inco me and presented in the fair value reserve in equity. When the investment is so ld, the gain o r lo ss accumulated in equity is rec lassified to inco me statement.

A no n-derivative financ ial asset may be rec lassified fro m the available-fo r-sale catego ry to the lo ans and receivable catego ry if it o therwise wo uld have met the definitio n o f lo ans and receivables and if the Gro up has the intentio n and ability to ho ld that financ ial asset fo r the fo reseeable future o r until maturity.

( iv) Fair Value thro ugh Pro fit o r Lo ss This catego ry co mprises two sub-catego ries: a) financ ial assets c lassified as held fo r trading ;

b) financ ial assets designated by the Gro up as fair value thro ugh pro fit o r lo ss upo n initial reco gnitio n (the "fair value o ptio n").

A financ ial asset is c lassified as held fo r trading if it is acquired o r incurred princ ipally fo r the purpo se o f selling o r repurchasing it in the near term o r if it is part o f a po rtfo lio o f identified financ ial instruments that are managed to gether and fo r which there is evidence o f a recent ac tual pattern o f sho rt-term pro fit-taking . Derivatives are also catego rised as held fo r trading unless they are designated and effec tive as hedging instruments. Financ ial assets held fo r trading co nsist o f debt instruments, inc luding mo ney-market paper, traded co rpo rate and bank lo ans, and equity instruments, as well as financ ial assets with embedded derivatives.

Financ ial instruments inc luded in this catego ry are reco gnised initially at fair value; transactio n co sts are taken direc tly to pro fit o r lo ss. Gains and lo sses arising fro m changes in fair value are inc luded direc tly in the inco me statement and are repo rted as 'Net trading inco me'.

The instruments are dereco gnised when the rights to receive cash flows have expired o r the Gro up has transferred substantially all the risks and rewards o f ownership and the transfer qualifies fo r dereco gnising .

The Gro up designates so me investment securities at fair value, with fair value changes reco gnised immediately in pro fit o r lo ss.

Financ ial liabilities are subsequently stated at amo rtised co st using the effec tive interest metho d; any differences between pro ceeds (net o f transactio n co sts) and the redemptio n value is reco gnised in the statement o f pro fit o r lo ss over the perio d o f the transactio n.

Fair Value Measurement

Fair value is the price that wo uld be received to sell an asset o r paid to transfer a liability in an o rderly transactio n between market partic ipant at the measurement date in the princ ipal o r, in its absence, the mo st advantageo us market to which the Gro up has access at that date. The fair value o f a liability reflec ts its no n-perfo rmance risk.

When available, the Gro up measures the fair value o f an instrument using the quo ted price in an active market fo r that instrument. A market is regarded as ac tive if transactio ns fo r the asset o r liability take place with suffic ient frequency and vo lume to provide pric ing info rmatio n o n an o ngo ing basis.

If there is no quo ted price in an active market, then the Gro up uses valuatio n techniques that maximise the use o f relevant o bservable inputs and minimise the use o f uno bservable inputs. The cho sen valuatio n techniques inco rpo rate all o f the fac to rs that market partic ipants wo uld take into acco unt in pric ing a transactio n.



67

The best evidence o f fair value o f a financ ial instrument at initial reco gnitio n is no rmally the transactio n price - i.e the fair value o f the co nsideratio n g iven o r received. If the Gro up determines that the fair value at initial reco gnitio n differs fro m the transactio n price and the fair value is evidenced by neither by a quo ted price in an active market fo r an identical asset o r liability no r based o n a valuatio n techniques that uses o nly data fro m o bservable markets, then the financ ial instrument is initially measured at fair value, adjusted to defer the difference between the fair value at initial reco gnitio n and the transactio n price, Subsequently, that difference is reco gnised in pro fit o r lo ss o n an appro priate basis over the life o f the instrument but no later than when the valuatio n is who lly suppo rted by o bservable market data o r the transactio n is c lo sed o ut.

If an asset o r a liability measured at fair value has a bid and ask price, then the Gro up measures assets, lo ng po sitio ns, liabilities and sho rt po sitio ns at a mid price which is the average o f the ask and bid prices.

Po rtfo lio s o f financ ial assets and financ ial liabilities that are expo sed to market risk and credit risk that are managed by the Gro up o n the basis o f the net expo sure to either market o r c redit risk are measured by the Gro up o n the basis o f the price that wo uld be received to sell a net lo ng po sitio n (o r paid to transfer a net sho rt po sitio n) fo r a particular risk expo sure. Tho se po rtfo lio -level adjustments are allo cated to the individual assets and liabilities o n the basis o f the relative risk adjustment o f each o f the individual instruments in the po rtfo lio .

The fair value o f a demand depo sit is no t less that the amo unt payable o n demand, disco unted fro m the first date o n which that amo unt co uld be required to be paid.

The Gro up reco gnises transfers between levels o f the fair value hierarchy as o f the end o f the repo rting perio d during which the change has o ccurred.

Impairment of Financial Assets

( i) Assets Carried at Amo rtised Co st The Gro up assesses at each repo rting date whether there is o bjec tive evidence that a

financ ial asset o r gro up o f financ ial assets is impaired. A financ ial asset o r a gro up o f financ ial assets is impaired and impairment lo sses are incurred if, and o nly if, there is o bjec tive evidence o f impairment as a result o f o ne o r mo re events that o ccurred after the initial reco gnitio n o f the assets (a 'lo ss event') , and that lo ss event (o r events) has an impact o n the estimated future cash flows o f the financ ial asset o r gro up o f financ ial assets that can be reliably estimated.

The fo llowing fac to rs are co nsidered in assessing o bjec tive evidence o f impairment: • whether the custo mer's o bligatio n is mo re than 90 days past due; • the Gro up co nsents to a restructuring o f the o bligatio n, resulting in a diminished

financ ial o bligatio n, demo nstrated by a material fo rg iveness o f debt o r po stpo nement o f scheduled payments; o r

• there is o bservable data indicating that there is a measurable decrease in the estimated future cash flows o f a gro up o f financ ial assets, altho ugh the decrease canno t yet be identified with spec ific individual financ ial assets.

The Gro up first assesses whether o bjec tive evidence o f impairment exists individually fo r financ ial assets that are individually significant, and individually o r co llec tively fo r financ ial assets that are no t individually significant.

If the Gro up determines that no o bjec tive evidence o f impairment exists fo r an individually assessed financ ial asset, whether significant o r no t, it inc ludes the asset in a gro up o f financ ial assets with similar credit risk characteristics and co llec tively assesses them fo r impairment. Assets that are individually assessed fo r impairment and fo r which an impairment lo ss is o r co ntinues to be reco gnised, are no t inc luded in a co llec tive assessment o f impairment.



68

If there is o bjec tive evidence that an impairment lo ss o n a lo an and receivable o r a held-to -maturity asset has been incurred, the amo unt o f the lo ss is measured as the difference between the asset's carrying amo unt and the present value o f estimated future cash flows (exc luding future credit lo sses that have no t been incurred), disco unted at the asset's o rig inal effec tive interest rate. The carrying amo unt o f the asset is reduced thro ugh the use o f an allowance acco unt and the amo unt o f the lo ss is reco gnised in inco me statement. Such allowance is referred to as spec ific impairment.

The calculatio n o f the present value o f the estimated future cash flows o f a co llateralised financ ial asset reflec ts the cash flows that may result fro m fo rec lo sure, less co sts fo r o btaining and selling the co llateral, whether o r no t fo rec lo sure is pro bable. Fo r the purpo ses o f a co llec tive evaluatio n o f impairment, financ ial assets are gro uped o n the basis o f similar credit risk characteristics ( i.e. o n the basis o f the Gro up's grading pro cess which co nsiders asset type, industry, geo graphic lo catio n, co llateral type, past-due status and o ther relevant fac to rs) . These characteristics are relevant to the estimatio n o f future cash flows fo r gro ups o f such assets being indicative o f the debto r's ability to pay all amo unts due acco rding to the co ntractual terms o f the assets being evaluated.

Future cash flows in a gro up o f financ ial assets that are co llec tively evaluated fo r impairment are estimated o n the basis o f the histo rical lo ss experience fo r assets with credit risk characteristics similar to tho se in the gro up. Histo rical lo ss experience is adjusted o n the basis o f current o bservable data to reflec t the effec ts o f current co nditio ns that did no t affec t the perio d o n which the histo rical lo ss experience is based, and to remove the effec ts o f co nditio ns in the histo rical perio d that do no t exist currently.

To the extent a lo an is irrecoverable, it is written o ff against the related allowance fo r lo an impairment. Such lo ans are written o ff after all the necessary pro cedures have been co mpleted and the amo unt o f the lo ss has been determined. Subsequent recoveries o f amo unts previo usly written o ff decrease the amo unt o f the allowance fo r lo an impairment in inco me statement. If, in a subsequent perio d, the amo unt o f the impairment lo ss decreases and the decrease can be related o bjec tively to an event o ccurring after the impairment was reco gnised (such as an improvement in the debto r's c redit rating), the previo usly reco gnised impairment lo ss is reversed by adjusting the allowance acco unt. The amo unt o f the reversal is reco gnised in inco me statement.

( ii) Available-fo r-Sale Financ ial Assets Available-fo r-sale financ ial assets are impaired if there is o bjec tive evidence o f

impairment, resulting fro m o ne o r mo re lo ss events that o ccurred after initial reco gnitio n but befo re the balance sheet date, that have an impact o n the future cash flows o f the asset. In additio n, an available-fo r-sale equity instrument is generally co nsidered impaired if a significant o r pro lo nged dec line in the fair value o f the instrument below its co st has o ccurred. Where an available-fo r-sale asset, which has been remeasured to fair value direc tly thro ugh equity, is impaired, the impairment lo ss is reco gnised in inco me statement. If any lo ss o n the financ ial asset was previo usly reco gnised direc tly in equity as a reductio n in fair value, the cumulative net lo ss that had been reco gnised in equity is transferred to inco me statement and is reco gnised as part o f the impairment lo ss. The amo unt o f the lo ss reco gnised in pro fit o r lo ss is the difference between the acquisitio n co st and the current fair value, less any previo usly reco gnised impairment lo ss.

If, in a subsequent perio d, the amo unt relating to an impairment lo ss decreases and the decrease can be linked o bjec tively to an event o ccurring after the impairment lo ss was reco gnised in the inco me statement, where the instrument is a debt instrument, the impairment lo ss is reversed thro ugh pro fit o r lo ss. An impairment lo ss in respect o f an equity instrument c lassified as available-fo r-sale is no t reversed thro ugh pro fit o r lo ss but acco unted fo r direc tly in equity.



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Offset t ing Financial Inst ruments

Financ ial assets and liabilities are set o ff and the net amo unt presented in the statement o f financ ial po sitio n when, and o nly when, the Gro up has a legal right to set o ff the amo unts and intends either to settle o n a net basis o r to realise the asset and settle the liability simultaneo usly.

Inco me and expenses are presented o n a net basis o nly when permitted by acco unting standards, o r fo r gains and lo sses arising fro m a gro up o f similar transactio ns such as in the Gro up's trading activity.

Sale and Repurchase Agreements

Securities so ld subjec t to linked repurchase agreements are rec lassified in the co nso lidated financ ial statements as pledged assets when the transferee has the right by co ntract o r custo m to sell o r repledge the co llateral. The liability to the co unter-party is inc luded in depo sit fro m banks, o r o ther depo sits, as appro priate.

Derecognit ion of Financial Inst ruments

The Gro up dereco gnises a financ ial asset when the co ntractual rights to the cash flows fro m the asset expire, o r it transfers the rights to receive the co ntractual cash flows o n the financ ial asset in a transactio n in which substantially all the risks and rewards o f ownership o f the financ ial asset are transferred.

Any interest in such transferred financ ial assets that qualify fo r dereco gnitio n is c reated o r retained by the Gro up is reco gnised as a separate asset o r liability. On dereco gnitio n o f a financ ial asset, the difference between the carrying amo unt o f the asset (o r the carrying amo unt allo cated to the po rtio n o f the asset transferred), and the sum o f:

( i) the co nsideratio n received (inc luding and new asset o btained less any new liability assumed); and

( ii) any cumulative gain o r lo ss that had been reco gnised in o ther co mprehensive inco me is reco gnised in pro fit o r lo ss.

The Gro up enters into transactio ns whereby it transfers assets reco gnised o n its balance sheet, but retains either all risks and rewards o f the transferred assets o r a po rtio n o f them. If all o r substantially all risks and rewards are retained, then the transferred assets are no t dereco gnised fro m the statement o f financ ial po sitio n. In transactio ns where the Gro up neither retains no r transfers substantially all the risks and rewards o f ownership o f a financ ial asset, it dereco gnises the asset if co ntro l over the asset is lo st.

The rights and o bligatio ns retained in the transfer are reco gnised separately as assets and liabilities as appro priate. In transfers where co ntro l over the asset is retained, the Gro up co ntinues to reco gnise the asset to the extent o f its co ntinuing invo lvement, determined by the extent to which it is expo sed to changes in the value o f the transferred asset.

(k) Cash and Cash Equivalents

Cash and cash equivalents inc lude no tes and co ins in hand, unrestric ted balances held with central banks and highly liquid financ ial assets with o rig inal maturities o f three mo nths o r less fro m the acquisitio n date, which are subjec t to insignificant risk o f changes in their fair value, and are used by the Gro up in the management o f its sho rt-term co mmitments.

Cash and cash equivalents are carried at amo rtised co st in the statement o f financ ial po sitio n.

( l) Trad ing Assets and Liab ilit ies

Trading assets and liabilities are tho se assets and liabilities that the Gro up acquires o r incurs princ ipally fo r the purpo se o f selling o r repurchasing in the near term, o r ho lds as part o f a po rtfo lio that is managed to gether fo r sho rt term pro fit o r po sitio n taking .

Trading assets and liabilities are initially reco gnised and subsequently measured at fair value in the statement o f financ ial po sitio n, with transactio n co sts reco gnised in pro fit o r



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lo ss. All changes in fair value are reco gnised as part o f net trading inco me in pro fit o r lo ss. Trading assets and liabilities are no t rec lassified subsequent to their initial reco gnitio n, except that no n-derivative trading assets, o ther than tho se designated at fair value thro ugh pro fit o r lo ss o n initial reco gnitio n, may be rec lassified o ut o f the fair value thro ugh pro fit o r lo ss - i.e. trading catego ry - if they are no lo nger held fo r the purpo ses o f being so ld o r repurchased in the near term and the fo llowing co nditio ns are met:

( i) if the financ ial asset wo uld have met the definitio n o f lo ans and receivables ( if the financ ial asset had no t been required to be c lassified as held fo r trading at initial reco gnitio n), then it may be rec lassified if the Gro up has the intentio n and ability to ho ld the financ ial asset fo r the fo rseeable future o r until maturity.

( ii) if the financ ial asset wo uld no t have met the definitio n o f lo ans and receivables, then it may be rec lassified o ut o f the trading catego ry o nly in rare c ircumstances.

(m) Derivat ives held for Risk Management Purposes

Derivatives held fo r risk management purpo ses inc lude all derivative assets and liabilities that are no t c lassified as trading assets o r liabilities. Derivatives are reco gnised initially at fair value in the statement o f financ ial po sitio n; attributable transactio n co sts are reco gnised in inco me statement when incurred. Subsequent to initial reco gnitio n, derivatives are measured at fair value with changes in fair value reco gnised in inco me statement.

(n) Propert y and Equipment

Recognit ion and Measurement

Pro perty and equipment are carried at co st less accumulated deprec iatio n and impairment lo sses. Co st inc ludes expenditures that are direc tly attributable to the acquisitio n o f the asset. The co st o f self-co nstructed assets inc ludes the fo llowing :

(a) the co st o f materials and direc t labo ur; (b) any o ther co sts direc tly attributable to bring ing the assets to wo rking co nditio n fo r

their intended use; (c ) when the Gro up has an o bligatio n to remove the asset o r resto re the site, an estimate o f

the co sts o f dismantling and removing the items and resto ring the site o n which they are lo cated; and

(d) capitalised bo rrowing co sts.

Purchased so ftware that is integral to the functio nality o f the related equipment is capitalised as part o f that equipment. When parts o f an item o f pro perty o r equipment have different useful lives, they are acco unted fo r as separate items (majo r co mpo nents) o f pro perty and equipment.

Any gain o r lo ss o n dispo sal o f an item o f pro perty and equipment (calculated as the difference between the net pro ceeds fro m dispo sal and the carrying amo unt o f the item) is reco gnised within o ther inco me in inco me statement.

Subsequent Costs

The co st o f replac ing part o f an item o f pro perty o r equipment is reco gnised in the carrying amo unt o f the item if it is pro bable that the future eco no mic benefits embo died within the part will flow to the Gro up and its co st can be measured reliably. The co sts o f the day-to -day servic ing o f pro perty and equipment are reco gnised in inco me statement as incurred.

Items o f pro perty and equipment are deprec iated fro m the date they are available fo r use o r, in respect o f self-co nstructed assets, fro m the date that the assets are co mpleted and ready fo r use. Deprec iatio n is calculated to write o ff the co st o f items o f pro perty and equipment less their estimated residual values using the straight-line basis over their estimated lives. Leased assets are deprec iated over the sho rter o f the lease term and their useful lives. Deprec iatio n beg ins when an asset is available fo r use and ceases at the earlier o f the date that the asset is dereco gnised o r c lassified as held fo r sale in acco rdance with IFRS 5 - No n-current Assets Held fo r Sale and Disco ntinued Operatio ns.

Deprec iatio n is reco gnised in inco me statement.



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The estimated useful lives fo r the current and co mparative perio d are as fo llows: Leaseho ld land Over the lease perio d Buildings 50 years Fixtures and fittings 10 years Leaseho ld improvements Over the unexpired lease term Furniture and o ffice equipments 5 years Co mputer hardware 4 years Mo to r vehic les 4 years Capital wo rk-in-pro gress No t deprec iated

Deprec iatio n metho ds, useful lives and residual values are reassessed at each repo rting date.

De-Recognit ion

An item o f pro perty and equipment is dereco gnised o n dispo sal o r when no future eco no mic benefits are expected fro m its use o r dispo sal. Any gain o r lo ss arising o n de-reco gnitio n o f the asset (calculated as the difference between the net dispo sal pro ceeds and the carrying amo unt o f the asset) is inc luded in inco me statement in the year the asset is dereco gnised.

(o) Investment Propert y

Investment pro perty is pro perty held either to earn rental inco me o r fo r capital apprec iatio n o r fo r bo th, but no t fo r sale in the o rdinary co urse o f business, use in the pro ductio n o f go o ds and services o r fo r administrative purpo ses. Investment pro perty is initially measured at co st and subsequently at fair value with any change therein reco gnised in inco me statement in o ther inco me.

Co st inc ludes expenditure that is direc tly attributable to the acquisitio n o f the investment pro perty.

Any gain o r lo ss o n dispo sal o f an investment pro perty (calculated as the difference between the net pro ceeds fro m dispo sal and the carrying amo unt o f the item) is reco gnised in inco me statement. When an investment pro perty that was previo usly c lassified as pro perty, plant and equipment is so ld, any related amo unt inc luded in the revaluatio n reserve is transferred to retained earnings.

When the use o f a pro perty changes such that it is rec lassified as pro perty and equipment, its fair value at the date o f rec lassificatio n beco mes its co st fo r subsequent acco unting .

(p) Trad ing Propert ies

Trading pro perties represent invento ries held by the gro up which are designated fo r resale to custo mers. Trading pro perties are measured at the lower o f co st and net realisable value. The co st inc ludes expenditure incurred in acquiring the trading pro perties, pro ductio n o r co nversio n co sts and o ther co sts incurred in bring ing them to their existing lo catio n.

Net realisable value is the estimated selling price in the o rdinary co urse o f business, less the estimated co sts o f co mpletio n and selling expenses.

(q) Intang ib le Assets

Software

So ftware acquired by the Gro up is stated at co st less accumulated amo rtisatio n and accumulated impairment lo sses.

Expenditure o n internally develo ped so ftware is reco gnised as an asset when the Gro up is able to demo nstrate its intentio n and ability to co mplete the develo pment and use the so ftware in a manner that will generate future eco no mic benefits, and can reliably measure the co sts to co mplete the develo pment. The capitalised co sts o f internally develo ped so ftware inc lude all co sts direc tly attributable to develo ping the so ftware, and are amo rtised over its useful life. Internally develo ped so ftware is stated at capitalised co st less accumulated amo rtisatio n and impairment.



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Subsequent expenditure o n so ftware assets is capitalised o nly when it increases the future eco no mic benefits embo died in the spec ific asset to which it relates. All o ther expenditure is expensed as incurred.

Amo rtisatio n is reco gnised in pro fit o r lo ss o n a straight-line basis over the estimated useful life o f the so ftware, fro m the date that it is available fo r use. The estimated useful life o f so ftware is five years. This is reassessed annually.

( r) Non-Current Assets Classif ied as held for Sale and Discont inued Operat ions

No n-current assets, o r dispo sal gro ups co mprising assets and liabilities, are c lassified as held-fo r-sale if it is highly pro bable that they will be recovered primarily thro ugh sale rather than thro ugh co ntinuing use.

Such assets, o r dispo sal gro ups, are generally measured at the lower o f their carrying amo unt and fair value less co sts to sell. Any impairment lo ss o n a dispo sal gro up is allo cated first to go o dwill, and then to the remaining assets and liabilities o n a pro rata basis, except that no lo ss is allo cated invento ries, financ ial assets, deferred tax assets, employee benefit analysis o r investment pro perty, which co ntinue to be measured in acco rdance with the Gro up's o ther acco unting po lic ies. Impairment lo sses o n initial c lassificatio n as held-fo r-sale o r held-fo r-distributio n and subsequent gains and lo sses o n remeasurement are reco gnised in pro fit o r lo ss.

Once c lassified as held-fo r-sale, intangible assets and pro perty, plant and equipment are no lo nger amo rtised o r deprec iated, and any equity acco unted investee is no lo nger equity acco unted

Classificatio n as a disco ntinued o peratio n o ccurs o n dispo sal o r when the o peratio n meets the criteria to be c lassified as held fo r sale.

When an o peratio n is c lassified as a disco ntinued o peratio n, the co mparative inco me statement is re-presented as if the o peratio n had been disco ntinued fro m the start o f the co mparative year.

(s) Leased Assets - Lessee

Leases in terms o f which the Gro up assumes substantially all the risks and rewards inc idental to ownership are c lassified as finance leases. Upo n initial reco gnitio n, the leased asset is measured at an amo unt equal to the lower o f its fair value and the present value o f the minimum lease payments disco unted at incremental rate o f bo rrowing . Subsequent to initial reco gnitio n, the asset is acco unted fo r in acco rdance with the acco unting po licy applicable to that asset.

Other leases are o perating leases and are no t reco gnised o n the Gro up's statement o f financ ial po sitio n.

( t ) Impairment of Non-Financial Assets

The carrying amo unts o f the Gro up's no n-financ ial assets o ther than deferred tax assets, are reviewed at each repo rting date to determine whether there is any indicatio n o f impairment. If any such indicatio n exists then the asset's recoverable amo unt is estimated.

An impairment lo ss is reco gnised if the carrying amo unt o f an asset o r its cash-generating unit exceeds its recoverable amo unt. A Cash-generating unit is the smallest identifiable asset gro up that generates cash flows that largely are independent fro m o ther assets and gro ups. Impairment lo sses are reco gnised in pro fit o r lo ss. Impairment lo sses reco gnised in respect o f cash-generating units are allo cated first to reduce the carrying amo unt o f any go o dwill allo cated to the units and then to reduce the carrying amo unt o f the o ther assets in the unit (gro up o f units) o n a pro rata basis.

The recoverable amo unt o f an asset o r cash-generating unit is the greater o f its value in use and its fair value less co sts to sell. In assessing value in use, the estimated pre-tax future



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cash flows are disco unted to their present value using a pre-tax disco unt rate that reflec ts current market assessments o f the time value o f mo ney and the risks spec ific to the asset o r cash generating unit.

An impairment lo ss in respect o f go o dwill is no t reversed. In respect o f o ther assets, impairment lo sses reco gnised in prio r perio ds are assessed at each repo rting date fo r any indicatio ns that the lo ss has decreased o r no lo nger exists. An impairment lo ss is reversed o nly to the extent that the asset's carrying amo unt do es no t exceed the carrying amo unt that wo uld have been determined, net o f deprec iatio n o r amo rtisatio n, if no impairment lo ss had been reco gnised. Reversals o f impairment lo sses are reco gnised in inco me statement.

(u) Deposit s, Debt Securit ies Issued and Surbord inated Liab ilit ies

Depo sits, debt securities issued and subo rdinated liabilities are Gro up's so urces o f debt funding .

When the Gro up sells a financ ial asset and simultaneo usly enters into an agreement to repurchase the asset (o r similar asset) at a fixed price o n a future date) repo o r sto ck lending), the arrangement is acco unted fo r as a depo sit, and the underlying asset co ntinues to be reco gnised in the Gro up's financ ial statements.

The Gro up c lassifies capital instruments as financ ial liabilities o r equity instruments in acco rdance with the substance o f the co ntractual terms o f the instruments. The Gro up's redeemable preference shares bear no n-discretio nary co upo ns and are redeemable by the ho lder, and are therefo re inc luded with subo rdinated liabilities.

Depo sits, debt securities issued and subo rdinated liabilities are initially measured at fair value minus incremental direc t transactio n co sts, and subsequently measured at their amo rtised co st using the effec tive metho d, except where the Gro up designates liabilities at fair value thro ugh pro fit o r lo ss.

(v) Provisions

A provisio n is reco gnised if, as a result o f a past event, the Gro up has a present legal o r co nstructive o bligatio n that can be estimated reliably, and it is pro bable that an o utflow o f eco no mic benefits will be required to settle the o bligatio n. Provisio ns are determined by disco unting the expected future cash flows at a pre-tax rate that reflec ts current market assessments o f the time value o f mo ney and, where appro priate, the risks spec ific to the liability. The unwinding o f the disco unt is reco gnised as finance co st.

A provisio n fo r restructuring is reco gnised when the Gro up has approved a detailed and fo rmal restructuring plan, and the restructuring either has co mmenced o r has been anno unced public ly. Future o perating lo sses are no t provided fo r.

A provisio n fo r o nero us co ntracts is reco gnised when the expected benefits to be derived by the Gro up fro m a co ntract are lower than the unavo idable co st o f meeting its o bligatio ns under the co ntract. The provisio n is measured at the present value o f the lower o f the expected co st o f terminating the co ntract and the expected net co st o f co ntinuing with the co ntract. Befo re a provisio n is established, the Gro up reco gnises any impairment lo ss o n the assets asso c iated with that co ntract.

(w ) Financial Guarantee Cont ract s

Financ ial guarantee co ntracts are co ntracts that require the Gro up (issuer) to make spec ified payments to reimburse the ho lder fo r a lo ss it incurs because a spec ified debto r fails to make payment when due in acco rdance with the o rig inal o r mo dified terms o f a debt instrument.

Financ ial guarantee liabilities are initially reco gnised at their fair value, which is the premium received, and then amo rtised over the life o f the financ ial guarantee. Subsequent to initial reco gnitio n, the financ ial guarantee liability is measured at the higher o f the



74

present value o f any expected payment, when a payment under the guarantee has beco me pro bable, and the unamo rtised premium. Financ ial guarantees are inc luded within o ther liabilities.

(x) Employee Benef it s

Post -Employment Benef it s

Defined Co ntributio n Plans A defined co ntributio n plan is a po st-employment benefit plan under which an entity pays

fixed co ntributio ns o f into a separate entity and has no legal o r co nstructive o bligatio n to pay any further amo unt(s) . Obligatio ns fo r co ntributio ns to defined co ntributio n plans are reco gnised as perso nnel expenses in inco me statement in the perio ds during which related services are rendered. The Gro up and its employees make respective co ntributio ns o f 10 % and 8% o f basic salary, ho using and transpo rt allowance to each employee's retirement savings acco unt maintained with employees' no minated Pensio n Fund Administrato rs.

Defined Benefit Plans The Gro up's net o bligatio n in respect o f defined benefit plans is calculated separately fo r

each plan by estimating the amo unt o f future benefit that employees have earned in return fo r their service in the current and prio r perio ds; that benefit is disco unted to determine its present value, and any unreco gnised past service co sts and the fair value o f any plan assets are deducted.

The disco unt rate is the yield at the repo rting date o n government bo nds that have maturity dates approximating the terms o f the Gro up's o bligatio ns. The calculatio n is perfo rmed annually by a qualified actuary using the pro jec ted unit c redit metho d. When the calculatio n results in a benefit to the Gro up, the reco gnised asset is limited to the net to tal o f any unreco gnised past service co sts and the present value o f any future refunds fro m the plan o r reductio n in future co ntributio ns to the plan.

Remeasurements o f the net defined benefit liability, which co mprise ac tuarial gains and lo sses, the return o n plan assets (exc luding interest) and the effec t o f the asset ceiling (if any, exc luding interest) , are reco gnised immediately in OCI. The Gro up determines the net interest expense (inco me) o n the net defined benefit liability (asset) fo r the perio d by applying the disco unt rate used to measure the defined benefit o bligatio n at the beg inning o f the annual perio d to the then-net defined benefit liability (asset) , taking into acco unt any changes in the net defined benefit liability (asset) during the perio d as a result o f co ntributio ns and benefit payments.

Net interest expense and o ther expenses related to defined benefit plans are reco gnised in perso nnel expenses in pro fit o r lo ss.

When the benefits o f a plan are changed o r when a plan is curtailed, the resulting change in benefit that relates to past service o r the gain o r lo ss o n curtailment is reco gnised immediately in pro fit o r lo ss. The Gro up reco gnises gains and lo sses o n the settlement o f a defined benefit plan when the settlement o ccurs.

When the benefits o f a plan are improved, the po rtio n o f the increased benefit relating to past service by employees is reco gnised in inco me statement o n a straight-line basis over the average perio d until the benefits beco me vested. To the extent that the benefits vest immediately, the expense is reco gnised immediately in inco me statement.

When the calculatio n above results in a benefit to the Gro up, the reco gnised asset is limited to the net to tal o f any cumulative unreco gnised actuarial lo sses and past service co sts and the present value o f any eco no mic benefit available in the fo rm o f any refunds fro m the plan o r reductio ns in future co ntributio n to the plan. An eco no mic benefit is available to the Gro up if it is realisable during the life o f the plan o r o n settlement o f the plan liabilities.



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Terminat ion Benef it s

Terminatio n benefits are reco gnised as an expense when the Gro up is demo nstrably co mmitted, witho ut realistic po ssibility o f withdrawal, to a fo rmal detailed plan to either terminate employment befo re the no rmal retirement date, o r to provide terminatio n benefit as a result o f an o ffer made to enco urage vo luntary redundancy. Terminatio n benefits fo r vo luntary redundanc ies are treated as an expense if the Gro up has made an o ffer o f vo luntary redundancy, it is pro bable that the o ffer will be accepted, and the number o f acceptance can be estimated reliably. If benefits are payable mo re than 12 mo nths after the repo rting date, then they are disco unted to their present value.

Short -Term Benef it s

Sho rt-term employee benefit o bligatio ns are measured o n an undisco unted basis and are expensed as the related service is provided.

A provisio n is reco gnised fo r the amo unt expected to be paid under sho rt-term cash bo nus o r pro fit-sharing plans if the Gro up has a present legal o r co nstructive o bligatio n to pay this amo unt as a result o f past service provided by the employee and the o bligatio n can be estimated reliably.

Other Long-Term Employee Benef it s

The Gro up's net o bligatio n in respect o f lo ng-term employee benefits o ther than pensio n plans is the amo unt o f future benefit that employees have earned in return fo r their service in the current and prio r perio ds; that benefit is disco unted to determine its present value, and the fair value o f any related assets is deducted. The disco unt rate is the yield at the repo rting date o n government bo nds that have maturity dates approximating the terms o f the Gro up's o bligatio ns where relevant. The calculatio n is perfo rmed using the pro jec ted unit c redit metho d. Any actuarial gains o r lo sses are reco gnised in pro fit o r lo ss in the perio d in which they arise.

(y) Share Capital and Reserves

Share Issue Costs

Incremental co sts direc tly attributable to the issue o f an equity instrument are deducted fro m the initial measurement o f the equity instruments.

Dividend on Ord inary Shares

Dividends o n the Bank's o rdinary shares are reco gnised in equity in the perio d in which they are paid o r, if earlier, approved by the Bank's shareho lders.

Treasury Shares

Where the Bank o r any member o f the Gro up purchases the Bank's share capital, the co nsideratio n paid is deducted fro m the shareho lders' equity as treasury shares until they are cancelled. Where such shares are subsequently so ld o r reissued, any co nsideratio n received is inc luded in shareho lders' equity. Gains and lo sses o n sales o r redemptio n o f own shares are credited o r charged to reserves.

(z) Earnings Per Share

The Gro up presents basic and diluted earnings per share (EPS) data fo r its o rdinary shares. Basic EPS is calculated by dividing the pro fit o r lo ss attributable to o rdinary shareho lders o f the Bank by the weighted average number o f o rdinary shares o utstanding during the perio d.

Diluted EPS is determined by adjusting the pro fit o r lo ss attributable to o rdinary shareho lders and the weighted average number o f o rdinary shares o utstanding fo r the effec ts o f all dilutive po tential o rdinary shares.

(aa) Segment Report ing

An o perating segment is a co mpo nent o f the Gro up that engages in business ac tivities fro m which it may earn revenues and incur expenses, inc luding revenues and expenses that relate to transactio ns with any o f the Gro up's o ther co mpo nents, who se o perating results



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are reviewed regularly by the Bo ard o f Direc to rs (being the chief o perating dec isio n maker) to make dec isio ns abo ut reso urces allo cated to each segment and assess its perfo rmance and fo r which discrete financ ial info rmatio n is available. Segment results inc lude items direc tly attributable to a segment as well as tho se that can be allo cated o n a reaso nable basis.

(ab) Borrow ings

Bo rrowings are reco gnised initially at fair value, net o f transactio n co sts incurred. Bo rrowings are subsequently stated at amo rtised co st using the effec tive interest metho d; any differences between pro ceeds (net o f transactio n co sts) and the redemptio n value is reco gnised in the inco me statement over the perio d o f the bo rrowings.

(ac) New Standards Issued but not yet Effect ive

A number o f new standards, amendments to standards and interpretatio ns are effec tive fo r annual perio ds beg inning after 1 January 20 15 and earlier applicatio n is permitted; however, the gro up has no t o pted fo r the early applicatio n o f the fo llowing new o r amended standards in preparing these co nso lidated financ ial statements.

• IFRS 9: Financ ial Instruments: IFRS 9, published in July 20 14, replaces the existing guidance in IAS 39 Financ ial

Instruments: Reco gnitio n and Measurement. IFRS 9 inc ludes revised guidance o n the c lassificatio n and measurement o f financ ial instruments, inc luding a new expected credit lo ss mo del fo r calculating impairment o n financ ial assets, and the new general hedge acco unting requirements. It also carries fo rward the guidance o n reco gnitio n and dereco gnitio n o f financ ial instruments fro m IAS 39.

IFRS 9 is effec tive fo r annual perio ds beg inning o n o r after 1 January 20 18 with early ado ptio n permitted.

The Gro up is assessing the po tential impact o n its co nso lidated financ ial statements resulting fro m the applicatio n o f IFRS 9. Given the nature o f the Gro up's o peratio ns, this standard is expected to have a pervasive impact o n the Gro up's financ ial statements.

• IFRS 15 - Revenue fro m co ntracts with custo mers IFRS 15 establishes a co mprehensive framewo rk fo r determining whether, how much

and when revenue is reco gnised. It replaces the existing revenue reco gnitio n guidance, inc luding IAS 18 Revenue, IAS 11 Co nstructio n Co ntracts and IFRIC 13 Custo mer Loyalty Pro grammes.

IFRS 15 is effec tive fo r annual repo rting perio ds beg inning o n o r after 1 January 20 18, with early ado ptio n permitted.

The Gro up is assessing the po tential impact o n its co nso lidated financ ial statements resulting fro m the applicatio n o f IFRS 15. This standard is no t expected to have significant impact o n the Gro up's o peratio ns.

The fo llowing new o r amended standards are no t expected to have a significant impact o f the Gro up's co nso lidated financ ial statements.

i) . IFRS 14 Regulato ry Deferral Acco unts - effec tive 1 January 20 16. ii) . Acco unting fo r acquisitio ns o f interests in Jo int Operatio ns (Amendments to IFRS

11) - effec tive 1 January 20 16. iii) . Clarificatio n o f Acceptable Metho ds o f Deprec iatio n and Amo rtisatio n

(Amendments to IAS 16 and IAS 38)- effec tive 1 January 20 16. iv) . Equity Metho d in Separate Financ ial Statements (Amendments to IAS 27) -

effec tive 1 January 20 16.



77

4 Changes in Account ing Policies and Correct ion of Prior Period Errors

( i) Change in Account ing Policy

Except fo r the change below, the Gro up has co nsistently applied the acco unting po lic ies set o ut in No te 3 to all perio ds presented in these co nso lidated financ ial statements.

The Gro up has ado pted the fo llowing new standard/ amendments that are required to be ado pted in annual perio ds beg inning o n 1 January 20 15.

(a) Defined Benefit Plans: Employee Co ntributio ns (Amendments to IAS 19) - Effec tive date: 1 July 20 14

The Gro up has no transactio ns that wo uld be affec ted by this amendment as defined benefit plan has been disco ntinued by the Gro up

( ii) Prior Period Restatements

(a) In the year under review, it was discovered that a pro perty carried in the bo o ks o f the Bank was also being carried in the bo o ks o f the Bank's subsidiary, UBN Pro perty Co mpany Limited. The Bank had therefo re inadvertently overstated pro perty and equipment in prio r years.

As this erro r was made in a repo rting perio d prio r to the co mparative perio d and is co nsidered material, certain balances o n the statement o f financ ial po sitio n have been restated as fo llows:

• Propert y and equipment was decreased by N946,237,732 to dereco gnise the land and building that were previo usly reco rded in the Bank's statement o f financ ial po sitio n. This decrease was effec ted as fo llows:

Co st - land and building : decreased by N1,10 0 ,346,541 Accumulated deprec iatio n - land and building : decreased by N154,10 8,80 9

• Other assets (acco unt receivables) was increased by N240 ,0 0 0 ,0 0 0 (a receivable o n the same asset in the subsidiary)

• Retained def icit was increased by N70 6,237,732 which was made up as fo llows: Net bo o k value o f land and building - N946,237,732 (increase) Other assets (receivable fro m Unio n Pro perties Co mpany Limited) -

N240 ,0 0 0 ,0 0 0 (decrease)

(b) The Bank also rec lassified fro m o ther liabilities to employee benefit o bligatio ns, the balance o f N6,680 ,460 ,950 (1 January 20 14: N12,60 3,266,420 ) relating to the net liabilities o n po st employment defined benefit o bligatio n in respect o f pre-20 0 6 employees o f the Bank . This has now been acco unted fo r and disc lo sed in line with IAS 19 - Employee Benefits. In prio r years, the balance was inadvertently misc lassified as part o f o ther liabilities. This has now been co rrected by restating the affec ted financ ial statement line items fo r prio r years.



78

Dec. 20 14Restated

Dec. 20 14

N million N million N million N million N million N millionASSETS


Pledged assets





Cash and cash equivalents 121,960 121,960 58,457 58,457

786,923 786,923

1,0 0 9,157 1,0 0 8,451 920 ,936

Trading pro perties



Intangible assets

Deferred tax assets

Other assets






Other liabilities

Retirement benefit o bligatio ns



TOTAL ASSETS

LIABILITIES

TOTAL LIABILITIES

—

— —

— —

— —

— — ——

—

— —

— — —

— —

— —

— ——

— —

— —

— —

— — ——

— —

— —

— —

— —

— —

— — ——

— —

Group Bank

Dec. 20 14Restated

Dec. 20 14

745

83,935

7

312,797

24

197,20 0

1,930

49,521

2,422

95,883

122,307

988,731

20 ,426

7

61,890

527,617

822

110 ,260

845

78,135

779,576

7,347 7,347

(946) (946)

240 240

(70 6) (70 6)

(70 6) (70 6)

(6,680 ) (6,680 )

6,680 6,680

745 745

83,935 83,935

30 2,372

193,656

7

312,797

24

197,20 0

1,930

48,575

2,422

95,883

122,547

988,0 25

20 ,426

7

61,890

527,617

822

10 3,580

7,525

78,135

779,576

1,930

8,372

49,428

2,071 2,071

95,875 95,875

121,810121,570

918,411

2,525

18,0 55 18,0 55

507,431 507,431

635 635

10 9,861

845

78,135

714,962 714,962

714 ,962 714 ,962

745

83,935

30 2,372

193,656

1,930

8,372

48,482

917,70 5

2,525

920 ,230

10 3,181

7,525

78,135

1,0 0 9,157


Treasury shares

Retained defic it

Other reserves


EQUITY


HOLDERS OF THE BANK


TOTAL EQUITY

— —

— — ——

— — —

——

—

(70 6) (70 6)

(70 6) (70 6)

1,0 0 8,451

221,528

920 ,936 920 ,230

40 0 ,10 9 40 0 ,10 9 40 0 ,10 9 40 0 ,10 9

(251,878)(251,172)

57,0 37

(35) (35)

(242,969) (243,675)

59,791 59,791

216,896

5,338 5,338

222,234

(70 6) (70 6)

(70 6) (70 6)216,190 20 5,974

20 5,974

57,0 37

20 5,268

20 5,268

Restatement of Financial Statements as a Result of Correction of ErrorsStatement o f Financ ial Po sitio n as at 31 Dec 20 14

Correction

of prior

period error

Correction

of prior

period error



79

ASSETS


Pledged assets





Cash and cash equivalents 10 0 ,925 10 0 ,925 53,141 53,141

1,0 0 2,756 1,0 0 2,0 50 882,0 97

Trading pro perties




Intangible assets

Deferred tax assets

Other assets






Other liabilities

Employee benefit o bligatio ns

TOTAL ASSETS

LIABILITIES

—

—

—

2,847 2,847 2,847 2,847

65,167 65,167 65,167 65,167

210 ,118 210 ,118229,542 229,542

25 25

289,353 289,353

4 ,747 4 ,747

16,413 16,413

44,581 45,527

80 8 80 8

95,889 95,889

10 0 ,0 69 99,829

951,072

51,684

46,794 46,794

482,70 6 482,70 6

534 534

143,80 3 156,40 6

10 ,261

(946) (946)

240 240

— —

— —

— —

— — —— —

— —

— —

— —

— —

— — ——

— ——

— —

— —

— —

— — —— —

— —

— —

— —

(70 6) (70 6)

(12,60 3) (12,60 3)

(70 6) (70 6) 881,391

12,60 3 12,60 3

950 ,366

51,684

22,864

16 16

290 ,377 290 ,377

1,930 1,930

12,892 12,892

44,40 545,351

685 685

95,875 95,875

10 1,564

879,0 17

10 1,324

879,723

2,374 2,374

3,20 0

479,956

472

155,189

10 ,216

80 3,413 80 3,413 694 ,313 694 ,313



TOTAL LIABILITIES

45,280 45,280

741,981 741,981

61,432 61,432

— —

— —

— — ——

— —

45,280 45,280

694,313 694,313

3,20 0

479,956

472

142,586

22,819

Statement of Financial Position as at 0 1 Jan 20 14

Jan. 20 14

Restated

Jan. 20 14


Group Bank

Jan. 20 14

Correction of prior

period errorRestated

Jan. 20 14

Correction of prior

period error

1,0 0 2,756


Treasury shares

Retained defic it

Other reserves


EQUITY


HOLDERS OF THE BANK


TOTAL EQUITY (70 6) (70 6)

(70 6) (70 6)1,0 0 2,0 50

198,637

882,0 97

187,784

881,391

40 0 ,10 9 40 0 ,10 9

(240 ) (240 )

(274,871)

67,183

192,181

7,162

199,343

— —

— — —

— —

—

— —

— — ——

(70 6) (70 6)

(70 6) (70 6)

(275,577)

67,183

191,475

7,162

40 0 ,10 9 40 0 ,10 9

(272,770 )(272,0 64)

59,739 59,739

187,078187,784

187,0 78



80

5 Financial Risk Management

(a) Int roduct ion and Overview

Unio n Bank o f Nigeria Plc and its subsidiary co mpanies (”the Bank” o r “the Gro up”) have expo sures to the fo llowing risks fro m financ ial instruments:

• credit risk • liquidity risk • market risk • o peratio nal risk

This no te presents info rmatio n abo ut the Gro up's expo sure to each o f the above risks, the Gro up's o bjec tives, po lic ies and pro cesses fo r measuring and managing risk, and the Gro up's management o f capital. Further quantitative disc lo sures are inc luded thro ugho ut these co nso lidated financ ial statements.

(b) Cred it Risk

Credit risk is the current o r po tential risk to earnings and capital arising fro m the failure o f an o bligo r o f the Gro up to repay princ ipal o r interest at the stipulated time o r failure o therwise to perfo rm as agreed. This risk is co mpo unded if the assigned co llateral o nly partly covers the c laims made to the bo rrower, o r if its valuatio n is expo sed to frequent changes due to changing market co nditio ns (i.e. market risk). Credit risk arises anytime the Gro up co mmits its funds with the result that capital o r earnings are dependent o n bo rrower's perfo rmance.

The Bank's Risk Management philo so phy is that mo derate and guarded risk attitude will ensure sustainable growth in shareho lder value and reputatio n. Extensio n o f c redit in the Bank is guided by its Credit Risk and Po rtfo lio Management Plan, which sets o ut spec ific rules fo r risk o rig inatio n and management o f the lo an po rtfo lio . The Plan also sets o ut the ro les and respo nsibilities o f different individuals and co mmittees invo lved in the credit pro cess.

We reco gnize the fac t that lo an assets co nstitute a significant po rtio n o f assets o n the statement o f financ ial po sitio n. Therefo re, we actively safeguard and strive to co ntinually improve the health o f o ur lo an po rtfo lio . We scrutinize all applicatio ns and weed o ut po tential pro blem lo ans during the lo an applicatio n phase, as well as co nstantly mo nito r existing lo an po rtfo lio .

The go al o f the Gro up is to apply so phisticated but realistic c redit mo dels and systems to mo nito r and manage credit risk. Ultimately these credit mo dels and systems are the fo undatio n fo r the applicatio n o f internal rating-based appro ach to calculatio n o f capital requirements. The develo pment, implementatio n and applicatio n o f these mo dels are guided by the Gro up's Basel II strategy.

The pric ing o f each credit granted reflec ts the level o f risks inherent in the credit. Subjec t to co mpetitive fo rces, the Gro up implements a co nsistent pric ing mo del fo r lo ans to its different target markets. The c lient's interest is guarded at all times, and co llateral quality is never the so le reaso n fo r a po sitive credit dec isio n.

The Gro up's c redit pro cess requires rigo ro us pro active and perio dic review o f the quality o f the lo an po rtfo lio . This helps us to identify and remediate credit issues pro actively.

The Stressed Assets Co mmittee (SAC) perfo rms a review o f lo ans with emerg ing signs o f weakness and also c lassified assets. The Management Credit Co mmittee (CRECO), Bo ard Credit Co mmittee and the Bo ard Risk Co mmittee also perfo rm reviews o f the quality o f o ur lo an po rtfo lio o n a weekly/ mo nthly / quarterly basis respectively. These are in additio n to daily reviews perfo rmed by o ur Credit Risk Management department.



81

Principal Cred it Policies

The fo llowing are the princ ipal c redit po lic ies o f the Gro up: ( i) Extension of cred it : Every extensio n o f c redit must be approved by at least three o fficers;

two fro m the Credit Risk functio n and o ne fro m the Business Unit, who must be the Spo nso ring Officer o f the Credit. A credit o fficer fro m the credit risk functio n must provide the Covering Limit.

( ii) Special Approvals: Extensio n o f c redit to certain sec to rs may require spec ial approvals o r pro hibited alto gether.

( iii) Annual Review of facilit ies: All extensio n o f c redits must be reviewed at least o nce every 12 mo nths.

( iv) Indust ry Limit s: The Gro up utilizes industry limits to maintain a diversified po rtfo lio o f risk assets.

(v) Tenor Limit s: The Gro up also utilizes teno r limits to ensure improvement in quality o f risk assets

(vi) Prob lem Recognit ion: There are unifo rm and co nsistent standards fo r reco gnitio n o f c redit migratio n and remediatio n acro ss the Gro up.

Credit Process

The Bank's c redit pro cess starts with po rtfo lio planning and target market identificatio n. There is preliminary screening o f c redit fac ility requests against the Bank's target market and risk acceptance criteria. Screening is the respo nsibility o f the relevant relatio nship manager. The pro po sed credits are subjec ted to review and approvals by applicable credit approval autho rities which inc lude the credit analysts. Further to appro priate approvals, lo ans are disbursed to benefic iaries after do cumentatio n review by Credit Risk Management. On-go ing management and mo nito ring o f lo ans is undertaken by bo th relatio nship management teams and o ur Credit Risk Management Gro up. The pro cess is applied at the Head Office and the Subsidiary.

If a preliminary analysis o f a lo an request by the acco unt manager indicates that it merits further scrutiny, it is then analyzed in greater detail by the credit analyst. If the lo an applicatio n passes their detailed analysis it is then submitted to the appro priate approval autho rity fo r the size o f fac ilities.

The standard credit evaluatio n pro cess is based bo th o n quantitative figures fro m the financ ial statements and o n an array o f qualitative fac to rs. Factual info rmatio n o n the bo rrower is co llec ted as well as pertinent macro eco no mic data, such as an o utlo o k fo r the relevant sec to r, etc . These subjec tive fac to rs are assessed by the analyst and all individuals invo lved in the credit approval pro cess, relying no t o nly o n quantitative fac to rs but also o n extensive knowledge o f the co mpany in questio n, its industry and its management.

1 Cred it Risk Measurement

Risk Rat ing Methodology

The credit rating o f the co unter-party plays a fundamental ro le in final c redit dec isio ns as well as in the terms o ffered fo r successful lo an applicatio ns. The Gro up employs a ro bust credit rating system based o n internatio nal best practices ( inc luding Basel II reco mmendatio ns) in the determinatio n o f the Obligo r and Fac ility risks and thus allows the Bank to maintain its asset quality at a desired level.

The Bank shall assign credit risk ratings fo r all c redit ac tivities, inc luding co nsumer credits availed under existing credit pro grams,. Credit risk ratings shall be based o n a two tier system o f: i) Obligo r Risk Rating (ORR) which represents a grade that deno tes the Pro bability o f Default (PD) o f a bo rrower o r gro up o f bo rrowers in repaying its o bligatio n over a o ne-year perio d, ii) Fac ility Risk Rating (FRR) which represents a grade that deno tes the Lo ss Given Default (LGD) o f a g iven credit fac ility. This takes into acco unt transactio n spec ific fac to rs and co llateral enhancement in place fo r a g iven fac ility.

The Risk rating po licy inco rpo rates credit risk rating mo dels which estimate risk o f o bligo r default and fac ility risks (covering bo th recovery as well as Expo sure risk). These mo dels are currently based o n expert judgment fo r Retail and No n-Retail Expo sures. Our lo ng-



82

term go al is to ado pt the Internal Rating Based (“IRB”) appro ach. The data required to fac ilitate the IRB appro ach is being gathered.

Credit Risk Rat ing Models

An Obligo r Risk Rating (ORR) mo del has been develo ped by the Gro up fo r co rpo rate and co mmerc ial custo mers:

Risk Rat ing Process

In the Gro up, all businesses must have a do cumented and approved Risk Rating pro cess fo r deriving risk ratings fo r all o bligo rs ( inc luding tho se covered under Credit Pro grams). The Risk Rating pro cess is the end-to -end pro cess fo r deriving ORRs and inc ludes mo dels, guidelines, pro cess co ntro ls, as well as any o ther defined pro cesses that a business undertakes in o rder to arrive at ORRs. Risk rating pro cess o f each business must be in co mpliance with the Gro up's Risk Rating Po licy and deviatio ns must be explic itly approved.

Establishing the Risk Rating pro cess is the respo nsibility o f the Credit Risk functio n and the pro cess must be do cumented and approved by the CRO.

The Risk Rating pro cess fo r each business must be reviewed and approved every three years, unless mo re frequent review is spec ified as a co nditio n o f the approvals. Interim material changes to the Risk Rating pro cess, as determined by the Credit Risk functio n, must be re-approved.

Responsib ilit y of Cred it Risk Management

In the Gro up, Credit Risk Management has the respo nsibility fo r the overall accuracy o f risk ratings assigned to o bligo rs.

Credit Risk Management is respo nsible fo r reviewing and ensuring the co rrectness o f the ORR assigned to a bo rrower. This review inc ludes ensuring the o ngo ing co nsistency o f the Risk Rating pro cess with the Gro up's Risk Rating Po licy; o ngo ing appro priate applicatio n o f the Risk Rating pro cess and to o ls; review o f judgmental and qualitative inputs into the Risk Rating pro cess; ensuring the timeliness and tho ro ughness o f risk rating reviews; and ensuring that the do cumentatio n o f the Risk Rating pro cess is co mplete and current.

Risk Rating Scale and external rating equivalent The Gro up o perates a 10 -grade numeric risk rating scale. The risk rating scale runs fro m 1 to

10 . Rating 1 represents the best o bligo rs and fac ilities and rating 9/ 10 represents the wo rst o bligo rs and fac ilities.

The risk rating scale and the external rating equivalent is detailed below

2 Cred it Risk Cont rol & Mit igat ion Policy

Authorit y Limit s on Cred it The highest c redit approval autho rity is the Bo ard o f Direc to rs, suppo rted by the Bo ard

Credit Co mmittee and further by the Management Credit Co mmittee (CRECO). The princ iple o f central management o f risk and dec isio n autho rity is maintained by the Gro up. This structure g ives the Gro up the po ssibility to inco rpo rate much needed lo cal expertise, but at the same time manage risk o n a g lo bal level. The Gro up has assigned to credit analysts, c redit approval limits in line with the Gro up's c riteria fo r such delegatio n as set o ut in its c redit po licy manual.

No n Investment Grade

Investment Grade

1

2

3

4

5

6

7

8

9/ 10

BB

B

CCC

CC

C/ D

AAA

AA

A

BBB

Standard Grade

Group Risk Rat ing Equivalent Grade



83

The credit approval limits o f the princ ipal o fficers o f the Gro up are shown in the table below:

Collateral Policies

It is the Gro up's po licy that all c redit expo sures are adequately co llateralized. Credit risk mitigatio n is an activity o f reduc ing credit risk in an expo sure o r transferring it to a co unter-party, at fac ility level, by a safety net o f tangible and realizable securities inc luding approved third-party guarantees/ insurance.

In the Gro up, strateg ies fo r risk reductio n at the transactio n level differ fro m that at the po rtfo lio level. At transactio n level, the mo st co mmo n technique used by the Gro up is the co llateralizatio n o f the expo sures, by first prio rity c laims o r o btaining a third party guarantee.

However primary co nsideratio n when approving credits is always the o bligo r's financ ial strength and debt-servic ing capac ity. The guidelines relating to risk mitigant are to be taken into co nsideratio n while using a credit risk mitigant to co ntro l c redit risk.

The range o f co llaterals acceptable to the Gro up inc lude: ( i) Cash / Depo sit (do mestic and fo reign currency) with the Gro up, inc luding certificates

o f depo sit o r co mparable instruments issued by the Gro up ( ii) Certificates o f Depo sit fro m o ther banks ( iii) Co mmo dities. ( iv) Debt securities issued by sovereigns and public -sec to r enterprises. (v) Equities - Sto cks / Share Certificates o f quo ted blue chip co mpanies (vi) Irrevo cable Standing Payment Order (ISPO) (vii) Bank Guarantee (viii) Mo rtgage o n landed Pro perty ( ix) Asset-backed securities (x) Charge o n assets (Fixed and/ o r Flo ating) - premises/ invento ry/ receivables/

merchandise/ plant/ machinery etc . (xi) Negative Pledges (xii) Lien o n Asset being financed (xiii) Sto ck Hypo thecatio n (xiv) Shipping Do cuments (fo r impo rts) (xv) Bankers Acceptance (xvi) Life Assurance Po lic ies

Master Net t ing Arrangements

It is the Gro up's po licy that all c redit expo sures are adequately co llateralized. No twithstanding , o ur acco unt o pening do cumentatio n allows the Bank to net o ff custo mers' depo sits against their expo sure to the Bank. Generally, transactio ns are allowed to run o n a gro ss basis. However, in cases o f unfavo rable credit migratio n, the Bank may elec t to invo ke the netting agreement.

Credit Analyst Up to N250 ,0 0 0 ,0 0 0

Business Executive Directo r & CCO/ CRO

Bo ard Credit Co mmittee

Management Credit Co mmittee

Chief Executive Officer & CCO/ CRO

N2,50 0 ,0 0 0 ,0 0 1 - N5,0 0 0 ,0 0 0 ,0 0 0

N1,0 0 0 ,0 0 0 ,0 0 1 - N2,50 0 ,0 0 0 ,0 0 0

N50 0 ,0 0 0 ,0 0 1 - N1,0 0 0 ,0 0 0 ,0 0 0

N250 ,0 0 0 ,0 0 1 - N50 0 ,0 0 0 ,0 0 0

N2,50 0 ,0 0 0 ,0 1 - N5,0 0 0 ,0 0 0 ,0 0 0

N1,0 0 0 ,0 0 0 ,0 1 - N2,50 0 ,0 0 0 ,0 0 0

N50 0 ,0 0 0 ,0 1 - N1,0 0 0 ,0 0 0 ,0 0 0

N250 ,0 0 0 ,0 1 - N50 0 ,0 0 0 ,0 0 0

Up to N250 ,0 0 0 ,0 0 0

Authority

Bo ard o f Direc to rs Above N5bn Above N5bn

Approval Limit

Dec . 20 15 Dec . 20 14



84

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d— — — — — — — — — — — — —

——

— — — —

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85

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86

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87

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89

Co

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ntr

ati

on

s o

f c

red

it r

isk

Th

e G

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p m

on

ito

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ntr

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s o

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n a

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m l

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an

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the

re

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:

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c.

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f th

e s

ec

uri

ty.

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ay

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ise

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k a

t th

e t

ime

of

sett

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en

t o

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nt

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91

(c) Liquid it y Risk

Unio n Bank's Asset and Liability Management Po licy defines Liquidity Risk as the risk that arises due to inability o f the bank to meet its o bligatio ns and fund its asset growth witho ut incurring unacceptable co st arising fro m bo rrowing at above market co st and asset sale at o ff-market prices. The bank is princ ipally expo sed to liquidity risk due to mismatch in fund inflows and o utflows arising fro m its bo rrowing and lending activities and market o peratio ns. Key elements o f the bank's liquidity risk management framewo rk inc lude:

Identificatio n o f Liquidity Risk The bank's liquidity management framewo rk reco gnises two majo r so urces o f liquidity risk:

( i) Funding liquidity Risk and (ii) Market Liquidity Risk.

The risk that Unio n Bank will be unable to meet its o bligatio ns as they beco me due because o f the inability to liquidate assets o r o btain adequate funding is viewed as the bank's funding risk. This risk is structural in nature and lies in the mismatches in assets and liabilities o f bank’s balance sheet.

Market liquidity risk however, is the risk that Unio n bank will be unable to meet its o bligatio ns as they beco me due because it canno t easily unwind o r o ffset spec ific expo sures witho ut significantly lowering market prices due to lack o f market depth o r market disruptio ns. This risk co uld arise due to illiquidity o f its assets and weak standing in market to raise fund. Market liquidity risk co mes to play in stressed market co nditio ns.

Liquidity Risk Appetite The bank views its expo sure limits fo r liquidity risk as an essential co mpo nent fo r a prudent

liquidity risk management. Co nsequently, Limits fo r liquidity risk are maintained under the fo llowing catego ries: Maturity mismatches, Liquidity ratio s ( regulato ry and internal) , prudent po rtfo lio limits o n the mix o f balance sheet assets (e.g . lo ans by credit catego ry, financ ial instruments, etc .) and co ncentratio n limits fro m funding so urces.

Liquidity Risk Measurement, Mo nito ring and Repo rting The Bank's Market and Liquidity Risk Management Department is respo nsible fo r ac tive

management o f Unio n Bank's liquidity risk, guided by the Bo ard approved liquidity risk framewo rk. The Department uses vario us to o ls to assess the bank's liquidity risk, capturing info rmatio n related to balance sheet structure, cash inflows and o utflows, o ff-balance sheet ac tivities and market o peratio ns. Co ntractual maturity repo rt, Structural liquidity repo rts, co ncentratio n in funding , liquidity ratio repo rts, liquidity risk stress test repo rts, etc are prepared in assessing its liquidity risk po sitio n and taking risk mitigatio n measures. All limits are mo nito red at defined intervals with exceptio ns escalated at the bank's ALCO and Bo ard Risk Co mmittees meetings which ho ld mo nthly and quarterly respectively.

Co ntingency Funding Plan The Bank reco gnizes the impo rtance o f liquidity in the day-to -day o peratio ns o f its

business as a stand-alo ne bank and also as a parent entity, hence, it believes that it is c ruc ial to have a plan fo r addressing liquidity in times o f c risis. The Bank has a co ntingency funding plan in place which c learly defines the Key Risk Indicato rs (KRIs) to mo nito r the market co nditio ns and measure its impact o n the Bank’s liquidity po sitio n and funding strateg ies and It also addresses the repo rting , co mmunicatio ns and co nfidence management in the unlikely event o f a liquidity crisis caused by unstable market.

Expo sure to Liquidity Risk Details o f the repo rted Gro up ratio o f net liquid assets to depo sits fro m custo mers at the

repo rting date and during the repo rting year were as fo llows:

20 15 20 14 At 31 December Average fo r the year 45% 61% Maximum fo r the year 54% 71% Minimum fo r the year 38% 55%



92

As at 31 December 20 15, the Gro up's ratio o f net liquid assets to depo sits fro m custo mers is 130 0 basis po ints above the required 30 % benchmark.

The fo llowing table shows the undisco unted cash flows o n the Gro up's financ ial assets and

liabilities and o n the basis o f their earliest po ssible co ntractual maturity. The Gro ss no minal inflow / (o utflow) disc lo sed in the table is the co ntractual, undisco unted cash flow o n the financ ial liability o r co mmitment.

Group

31 December 20 15N million N million N millionNote

Carrying

amount

Gross nominal inf low/

(out f low)

Less than

3 month

3 - 6

months

6 - 12

months 1 - 5 years

More than

5 years

No n-derivative assets:

Cash and cash equivalents 19 82,252

84,728

366,721

215,137

135,0 63 135,0 63 135,0 63

230 ,279

84,833

82,252 82,252

8,225Pledged assets 21

Lo ans and advances to custo mers23

Investment securities 25

Other receivables^ 32

22

Derivative assets:

Held fo r Risk Management

No n-derivative liabilities

Depo sits fro m banks 33

Depo sits fro m custo mers 34

Other financ ial liabilities 36

Other bo rrowed funds 38

Gap (asset - liabilities)

Cumulative liquidity gap

31 December 20 14


Cash and cash equivalents 121,960

745

83,935

312,797

197,20 0

121,960 121,960


19

Pledged assets

20


21


23

Other receivables

25


Derivative assets:




32


33

Other financ ial liabilities

34



38

36

Derivative liabilities:



—

—

—

—

—

—

—

Group

Note

Carrying

amount


(out f low)

Less than

3 month

3 - 6

months

6 - 12

months 1 - 5 yearsMore than

5 years

—

—

—

—

—

—

—

—

—

—

—

——

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

883,90 1

1,820 1,820

90 3,396

885,721

(44,0 91) (44,0 91) (44,0 91)

(555,119)

90 5,216

(570 ,639) (570 ,639)

(54,471) (54,471) (54,471)

(76,0 59)

(745,260 )

140 ,461 159,956

159,956

(745,260 )

(76,0 59)

370 ,968 10 2,235

112,513

440 ,289

1,820

440 ,289

(26,172)

(679,853)

(239,564)

(239,564)

(238,938)

626

(33,249)

(20 ,968)

(12,282)

33,876

32,0 56

4,557

17,623

9,876 8,874

24,910

33,715

67,499

67,499

(3,166)

(12,0 34)

(15,20 0 )

52,299

(186,639) 34.90 3

221,542

(10 ,885)

(10 ,812)

(73)

232,427

232,427

50 ,830

139,90 9

41,688 16,170

86,291

28,664

131,126

131,126

(6,073)

(6,073)

125,0 52

159,956

—

—

—

—

—

—

—

—

—

745 745

114,233 114,233

830 ,870

7 7

830 ,877

(61,890 ) (61,890 )

(527,617) (527,617)

(62,748) (62,748)

(78,135) (78,135)

(7)

(730 ,390 ) (730 ,390 )

(730 ,397)

10 0 ,480

207,411

207,411

(730 ,397)

(7)

937,80 8

937,80 1

248,829

335,853

116,181 16,340

10 5,0 0 9

28,932

114,233

387,219

7

387,226

(61,512)

(515,0 23)

(62,748)

(13,915)

(653,198)

(7)

(653,20 5)

(265,979)

(265,979) (20 1,383)

64,597

(17,0 39)

(17,0 39)

(5,0 54)

(11,60 8)

(378)

81,636

81,636

47,371

24,745

9,520 3,418

29,661

13,50 4

46,583

46,583

(917)

(17,429)

(18,346)

(18,346)

28,238

(173,145) 76,70 3

249,848

(38,826)

(38,826)

(38,757)

(69)

288,674

288,674

110 ,981

125,139

52,554 34,348

51,299

48,0 42

133,689

133,689

(2,980 )

(2,980 )

(2,980 )

130 ,70 9

207,411

Residual Cont ractual Maturit ies of Financial Assets and Liab ilit ies

T̂he Gro up’s o ther receivables exc lude prepayment (N3,623 millio n) which is no t a financ ial asset.




N million N million N million N million N million N million N million

93

Bank

31 December 20 15N million N million N millionNote

Carrying

amount


(out f low)

Less than

3 month

3 - 6

months

6 - 12

months 1 - 5 yearsMore than

5 years



Pledged assets 21




22

Derivative assets:







Derivative liabilities:




31 December 20 14


Cash and cash equivalents 58,457 58,457 58,457

745

83,935

30 2,372

193,656


19

Pledged assets

20


21


23

Other receivables

25



32


33


34


36



—

—

—

—

Bank

Note

Carrying

amount


(out f low)

Less than

3 month

3 - 6

months

6 - 12

months 1 - 5 years

More than

5 years

—

—

—

—

—

—

—

—

———

—

—

—

—

—

—

—

—

—

—

—

——

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

9,876 8,874 41,688 16,170

83,490

745 745

114,233 114,233

753,398

(18,0 55) (18,0 55)

(507,431) (507,431)

(62,748) (62,748)

(78,135) (78,135)

(666,369) (666,369)

87,0 29

193,961

193,961

860 ,330

245,286

325,428

116,181 16,340

98,820

28,932

114,233

317,527

(17,677)

(498,955)

(62,748)

(13,915)

(593,295)

(275,769)

(275,769) (20 9,717)

66,0 52

(12,984)

(5,0 54)

(7,552)

(378)

79,0 36

45,512

24,0 0 4

9,520 3,418

29,661

13,50 4

46,583

(917)

(17,429)

(18,346)

28,238

(181,479) 63,340

244,819

(38,763)

(38,757)

(7)

283,583

10 9,297

125,139

52,554 34,348

51,211

48,0 42

133,60 1

(2,980 )

(2,980 )

130 ,621

193,961

54,451 54,451

84,728

348,984

84,833 8,225

10 0 ,0 61

20 9,223

134,569 134,569 134,569

831,955

1,820 1,820 1,820

857,60 2

833,775 859,422

(11,80 0 ) (11,80 0 ) (11,80 0 )

(569,116)

(54,469) (54,469) (54,469)

(569,116)

(76,0 59) (76,0 59)

(711,444)

(711,444)

112,331 147,978

147,978

(711,444)

(711,444)

224,365

359,384

111,779

40 9,0 85

40 9,0 85

(557,714)

(26,172)

(650 ,155)

(650 ,155)

(241,0 69)

(241,0 69) (236,389)

4,680

(29,194)

(29,194)

(20 ,968)

(8,227)

33,874

32,0 54

4,557

17,621 24,899

30 ,0 35

63,80 8

63,80 8

(3,166)

(12,0 34)

(15,20 0 )

(15,20 0 )

48,60 9

(187,780 ) 26,828

214,60 8

(10 ,823)

(10 ,823)

(10 ,812)

(10 )

225,431

225,431

50 ,430

133,313

27,564

127,224

127,224

(6,073)

(6,073)

(6,073)

121,151

147,978

(d) Market Risk

The Bank’s ability to effec tively identify, assess, mo nito r and manage market risks invo lved in its ac tivities is c ritical to its so undness and pro fitability. The bank's expo sure to market risk is thro ugh pro prietary investments and asset and liability management activities which have direc t expo sure to adverse movements in market risk fac to rs such as fo reign exchange rates and interest rates.

Interest Rate Risk Management and Cont rol

Interest rate risk is the po tential lo ss to the inco me and/ o r eco no mic value o f equity o f the bank as a result o f adverse movement in interest rates. The Bank is expo sed to three do minant interest rate risks; re-pric ing risk, basis risk and yield curve risk due to its primary functio n o f bo rrowing and lending and taking pro prietary po sitio ns, as part o f strategy, to improve earnings.

Re-pric ing risk is caused by changes in interest rates at different times due to re-pric ing maturities o f assets, liabilities and o ff-balance sheet instruments. Yield curve risk arises due to movement o f yields (parallel and no n-parallel shifts o f yield curve) at different times. The re-pric ing mismatches o f assets and liabilities expo se the bank to lo ss in revenue

T̂he Bank’s o ther receivables exc lude prepayment (N3,461 millio n) which is no t a financ ial asset.




N million N million N million N million N million N million N million

94

and eco no mic value due to unantic ipated changes in interest rates. Basis risk arises fro m imperfec t co rrelatio ns between interest rate benchmarks leading to changes in rates earned and paid o n different instrument o therwise with similar re-pric ing maturities.

One o f the integral elements o f the Bank's interest rate risk management framewo rk is an articulated appetite fo r interest rate risk sensitive expo sures. Interest rate risk limits are set fo r Price value per basis po int (PV0 1), value at risk (VaR), sto p lo ss, management actio n triggers and eco no mic value o f equity (EVE). The bank's Market Risk Department is respo nsible fo r measuring , mo nito ring , repo rting actual po sitio ns against set limits and carrying o ut stress tests at defined intervals.

The table below summarizes the Gro up's interest rate gap po sitio ns. Using the re-pric ing gap, the Bank is able to measure interest rate risks arising fro m yield curve, basis and re-pric ing risks in its balance sheet using the Eco no mic value o f equity mo del.

GroupThe table below summarizes the Gro up's interest rate gap po sitio ns:

N million

N million

N million

N million

N million

N million

Note

Carrying

amount

Less than

3 month 6 months 12 months 5 years

More than

5 years

—

—

—

—

—

—

—

—

—

——

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

In millio ns o f Naira

31 December 20 15


84,728

42,943 42,943

No n-pledged trading assets 20

Pledged assets


21

22

7,10 5

18,785

16,170








Total interest re-pricing gap

Total amount

sensit ive to Rate

Re-pricing year

—

—

—

—

—

—

—

1,820 1,820 1,820

366,721

215,137

135,0 63

885,721

(44,0 91)

(570 ,639)

(54,471)

(76,0 59) (76,0 59)

(745,260 ) (487,229)

140 ,461 20 6,817 (21,311)

(367,079)

(44,0 91) (44,0 91)

694,0 46

183,749

388,439

77,0 95 6,795

363,287

4,368

417,393

(352,976)

(41,637) (15,644)

(438,70 4) (25,327)

4 ,972

(9,683)

30 ,299

16,214

4 ,828 7

68,0 18

75,131

(4,343)

(4 ,343) (77)

70 ,788 99,771

(77)

99,848

58,729

1,532

39,588

36,419

71,374

(18,778)

(18,778)

52,596

Note

Less than


More than

5 years

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

In millio ns o f Naira

31 December 20 14

Cash and cash equivalents 19 121,960 60 ,395 60 ,395

No n-pledged trading assets 20 745 745 745

Pledged assets 21 83,935 117,228 17,387 9,520 3,418 52,554 34 ,348



22

23

7

312,797

7

290 ,0 27

7

271,664 1,681 4,318 12,276 88

Investment securities 25 197,20 0 174,0 20 17,230 43,129 7,625 85,364 20 ,672

Other receivables 32 114,233

830 ,877 642,422 367,428 54,331 15,361 150 ,194 55,107



33 (61,890 ) (61,890 ) (61,890 )

Depo sits fro m custo mers 34 (527,617) (30 5,437) (292,843) (11,60 8) (917) (69)

Other financ ial liabilities 36 (62,748)

Other bo rrowed funds 38 (78,135) (78,135) (13,915) (5,0 54) (17,429) (38,757) (2,980 )

(730 ,390 ) (445,462) (368,648) (16,662) (18,346) (38,826) (2,980 )

Total interest re-pricing gap 10 0 ,487 196,960 (1,221) 37,669 (2,984) 111,369 52,127

Re-pricing year

7,438

T̂he Gro up’s o ther receivables exc lude prepayment (N3,623 millio n) which is no t a financ ial asset.



Total amount

sensit ive to Rate

Carrying

amount

N million

N million

N million

N million

N million

N million

N million

N million

95

Bank

31 December 20 15 Note

In millio ns o f NairaCarrying

amount

Less than


More than

5 years

Re-pricing year

Cash and cash equivalents 19 54,451 7,50 4 7,50 4

Pledged assets 21

18,778

16,170



22

23







Total interest re-pricing gap 122,331 192,443 (26,831) 13,493 75,944 97,90 5 51,489

—

—

—

—

—

—

—

—

—

—

—

—

——

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

84,728

1,820 1,820 1,820

6,795

348,984

20 9,223

134,569

833,775

(11,80 0 ) (11,80 0 ) (11,80 0 )

(569,116)

(54,469)

(76,0 59)

(711,444) (442,497)

(76,0 59)

(354,638)

634,940

177,834

370 ,686

77,0 95 7,10 5

349,173

3,634

369,841

(343,235)

(41,637)

(396,672) (23,871)

(15,644)

(8,227)

37,364

16,214

2,735

7,438

64,338

79,110

(3,166)

(3,166)

(10 )

(10 )

97,916

58,328

39,588

35,319

70 ,267

(18,778)

(18,778)

Bank


In millio ns o f NairaCarrying

amount

Less than


More than

5 years

Re-pricing year

Cash and cash equivalents 19 58,457 7,50 2 7,50 2

No n-pledged trading assets 20 745 745 745

Pledged assets 21 83,935 113,283 16,512 6,450 3,418 52,554 34 ,348



22

23 30 2,372 279,60 1 265,474 940 4 ,318 8,869

Investment securities 25 193,656 170 ,477 17,230 41,270 7,625 85,364 18,988


753,398 571,60 8 307,464 48,660 15,362 146,787 53,335

Depo sits fro m banks 33 (18,0 55) (18,0 55) (17,677) (378)

Depo sits fro m custo mers 34 (507,431) (298,822) (290 ,346) (7,552) (917) (7)

Other financ ial liabilities 36 (62,748)

Other bo rrowed funds 38 (78,135) (53,465) (53,465)

(666,369) (370 ,342) (361,488) (7,930 ) (917) (7)

Total interest re-pricing gap 87,0 29 20 1,266 (54 ,0 25) 40 ,730 14 ,444 146,781 53,335

—

—

—

—

—

—

—

—

—

—

—

—

—

—

— — — — — —

—

——

—

—

—

—

—

—

—

—

—

—

—

—

—

—

To co mplement the re-pric ing gap, the Gro up ado pted the value at risk mo del during the year which was pro spectively applied, fo r measuring interest rate risk inherent in any trading po sitio n o r po rtfo lio . The value at risk (VaR) o f a po sitio n o r po rtfo lio is the lo ss o r change in value that is no t expected to be exceeded with a g iven degree o f co nfidence (99%) over a spec ified time year. VaR is therefo re a statistical measure o f variability in the value o f a po rtfo lio o f po sitio ns o r earnings fro m eco no mic ac tivity arising fro m the changes in the market prices o f the co mmo dities o r o ther variables underlying the po rtfo lio o r ac tivity. Value at Risk measurement is mo st appro priate fo r marked-to -market po rtfo lio s.

The Bank do es no t have a trading po rtfo lio with inherent risk as at December 31, 20 15, therefo re no value at risk (VaR) exists.

Security Po sitio n VaR 1-Day VaR 10 -Day

Treasury Bills 40 4 0 1 0

FGN Bo nds 30 0 3 9 3

Diversified VaR 1-Day

In millions of naira

31 December ,20 14

T̂he Bank’s o ther receivables exc lude prepayment (N3,461 millio n) which is no t a financ ial asset.



Total amount

sensit ive to Rate

Total amount

sensit ive to Rate

96

Foreign Currency Risk

As a licensed fo reign exchange dealer and member o f the Interbank fo reign exchange market, the Bank is expo sed to fo reign exchange risk, hence the need to effec tively identify, assess, mo nito r and manage fo reign exchange rate risk as part o f its overall market risk management pro cess.

Foreign Exchange Rate Risk Management and Cont rol

In line with the Bank's overall market risk management framewo rk, an articulated appetite fo r fo reign exchange rate risk is approved by the Bo ard. Limits are set fo r Fo reign exchange net o pen po sitio ns (NOPL) in line with regulatio n, value at risk (VaR), sto p lo ss and management actio n triggers. The Bank's Market Risk Department is respo nsible fo r measuring , mo nito ring , repo rting actual po sitio ns against set limits and carrying o ut stress tests at defined intervals.

The table below summarizes the Gro up's fo reign exchange balance sheet as at December 31, 20 15:

Note

Group Total US Dollar Euro Pound Naira Others

31 December 20 15

Cash and cash equivalents 19 82,252 40 ,635

4,195

956 814 39,695 152

Pledged assets


21

22

Lo ans and advances to custo mers 23


Other receivables 32

To tal financ ial assets


Depo sit fro m custo mers 34


38Other bo rrowed funds

To tal financ ial liabilities

Net o n-balance sheet po sitio n

84,728 80 ,533

1,820 1,820

33,443

366,721

215,137

135,0 63 135,0 63

885,721

(44,0 91)

(570 ,639)

(76,0 59)

(54,471)

(745,260 )

140 ,461

(186,330 )

(50 ,983)

(57,281)

(33,975)

(44,0 91)

219,773

173,124 658

1,614

(2,793)

(2,793)

(1,179) (2,0 34)

(4 ,537)

(4 ,537)

2,50 3

1,689 191,20 0

215,137

661,629

(529,178)

(18,778)

(3,488)

(551,444)

110 ,184 47

(155)

(155)

20 2

50

Note

Total US Dollar Euro Pound Naira Others

31 December 20 14

Cash and cash equivalents 19 121,960 79,498 6,482 8,507 27,281 192

No n-pledged assets 20 745 745

Pledged assets 21 83,935 4,695 79,240



22

23

1,820

312,797 143,795 658 1,689 166,60 5 50

Investment securities 25 197,20 0 3,543 193,657

Other receivables 32 114,233 114,233

To tal financ ial assets 832,690 231,531 7,140 10 ,196 581,760 242

Depo sits fro m banks 33 (61,890 ) (43,835) (18,0 55)

Depo sit fro m custo mers 34 (527,617) (32,780 ) (1,631) (7,0 36) (486,0 14) (155)

Other financ ial liabilities 36 (62,748) (62,748)

Other bo rrowed funds 38 (78,135) (53,465) (24,670 )


(54,469)

(784,859)

(50 ,983)

(181,0 63) (1,631) (7,0 36)

(3,486)

(594,973) (155)


47,831 50 ,468 5,50 9 3,160 (13,213) 87

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

The Gro up's expo sure to fo reign currency risk is largely co ncentrated in the US Do llar. Movement in exchange rate between the US Do llar and the Nigeria Naira affec ts repo rted earnings thro ugh revaluatio n gain o r lo ss thro ugh increase o r decrease in the revalued amo unts o f assets and liabilities deno minated in fo reign currency.



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

97

Note


31 December 20 15

Bank


84,728

16,0 98

4,195

956 814 36,539 44

43

Pledged assets 21



23


Other receivables 32

To tal financ ial assets


Depo sit fro m custo mers 34




Net o n-balance sheet po sitio n

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

(2,185)

(2,999)

1,820

156,0 97348,984

178,210

(143,735)

34,475

20 9,223

134,569 134,569

833,775

1,820

956

(552)

40 4

(552)

(2,999)

814

80 ,533

192,887

20 9,223

653,752

(541,894)

(3,486)

(18,778)

(564,158)

89,594

(1)

(1)

44

(57,281)

(50 ,983)

(23,671)

(11,80 0 )(11,80 0 )

(569,116)

(54,469)

(76,0 59)

(711,444)

122,331

Note


31 December 20 14

— — — —

Bank

Cash and cash equivalents 19 58,457 30 ,580 1,785 2,493 23,515 84

No n-pledged assets 20 745 745

Pledged assets 21 83,935 4,695 79,240

Lo ans and advances to custo mers23 30 2,372 126,768 44 175,560

Investment securities 25 193,656 193,656

Other receivables 32 114,233 114,233

To tal financ ial assets 753,398 162,0 43 1,829 2,493 586,949 84

Depo sits fro m banks 33 (18,0 55) (18,0 55)

Depo sit fro m custo mers 34 (507,431) (24,866) (1,714) (50 0 ) (480 ,351) (1)

Other financ ial liabilities 36 (62,748) (62,748)

Other bo rrowed funds 38 (78,135) (53,465) (24,670 )

To tal financ ial liabilities (666,369) (96,386) (1,714) (50 0 ) (567,769) (1)

Net o n-balance sheet po sitio n 87,0 29 65,657 115 1,994 19,180 83

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

The Bank's expo sure to fo reign currency risk is largely co ncentrated in the US Do llar. Movement in exchange rate between the US Do llar and the Nigeria Naira affec ts repo rted earnings thro ugh revaluatio n gain o r lo ss thro ugh increase o r decrease in the revalued amo unts o f assets and liabilities deno minated in fo reign currency.

Sensit ivit y of Foreign Exchange Rate on Net Balance Sheet and Prof it before Tax

At 31 December 20 15, if the Naira had weakened/ strengthened by ± 20 % against the Do llar, Euro and Po unds with all o ther variables held co nstant the pre-tax pro fit fo r the year wo uld have increased/ (decreased) as set o ut in the table below mainly as a result o f fo reign exchange gains o r lo sses o n the translatio n.

199.30 216.84 294.98

US Dollar Euro Pound

Exchange rate as at 31 December 20 15

239.16

159.44

260 .21

173.47

353.98

235.99

Exchange rate increased by 20 %

Exchange rate decreased by 20 %


Net o n-balance sheet po sitio n at 20 % increase in exchange rate

116,883 28,729 337 (1,821) 89,594

89,594

44

44Net o n-balance sheet po sitio n at 20 % decrease in exchange rate

130 ,50 5 43,0 94 50 5 (2,731)

Total US Dollar Euro Pound

Impact o f 20 % increase in exchange rate o n balance sheet po sitio n and Pro fit befo re tax

5,449 5,746 67 (364)

Impact o f 20 % decrease in exchange rate o n balance sheet po sitio n and Pro fit befo re tax

(8,174) (8,619) (10 1) 546



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million N million N million

N million

N million

N million

N million

N million

N million

N million

98

(e) Operat ional Risk Management The Gro up has ado pted the Basel II definitio n o f Operatio nal Risk as the risk o f lo ss

resulting fro m inadequate o r failed internal pro cesses, peo ple, o r fro m external events. This definitio n inc ludes legal risk but exc ludes strateg ic and reputatio nal risk.

Our overall o bjec tive fo r managing Operatio nal Risk in the Bank is to establish and maintain a so und system which adequately identifies, measures, assesses, mo nito rs, repo rts, co ntro ls and reviews Operatio nal Risks acro ss the Bank.

Effec tive implementatio n o f o ur Operatio nal Risk Management pro gram guarantees: • A mo re risk awareness culture amo ngst staff; • Better understanding o f the Bank's o peratio nal risk pro file; • Significant reductio n in o peratio nal lo sses, hence improved pro fitability; • Improved pro cesses and systems in the Bank; and • Improved business resilience, which wo uld guarantee enhanced respo nses to business

disruptio ns.

( f ) Cap it al Management

The Gro up's o bjec tives when managing capital, which is a bro ader co ncept than the 'equity' o n the face o f the statement o f financ ial po sitio n, are:

( i) To co mply with the capital requirements set by the regulato rs o f the banking markets where the entities within the Gro up o perate;

( ii) To safeguard the Gro up's ability to co ntinue as a go ing co ncern so that it can co ntinue to provide returns fo r shareho lders and benefits fo r o ther stakeho lders; and

( iii) To maintain a stro ng capital base to suppo rt the develo pment o f its business.

Capital adequacy and the use o f regulato ry capital are mo nito red by the Gro up's management, employing techniques based o n the guidelines develo ped by the Central Bank o f Nigeria (CBN), fo r superviso ry purpo ses. The required info rmatio n is filed with the CBN o n a mo nthly basis.

The CBN requires each internatio nal bank to : ( i) Ho ld the minimum level o f regulato ry capital o f N25 billio n, and ( ii) Maintain a ratio o f to tal regulato ry capital to the risk-weighted asset at a minimum o f 15%.

In additio n, tho se individual banking subsidiaries o r similar financ ial institutio ns no t inco rpo rated in Nigeria are 'direc tly regulated and supervised by their lo cal banking superviso r; as such, capital requirements may differ fro m co untry to co untry.

The Gro up's regulato ry capital as managed by its Financ ial Co ntro l is divided into two tiers: (a) Tier 1 capital: share capital, retained earnings and reserves created by appro priatio ns o f

retained earnings. The bo o k value o f go o dwill and intangible assets is deducted in arriving at Tier 1 capital; and

(b) Tier 2 capital: preference shares, no n-co ntro lling interests arising o n co nso lidatio n, qualifying debt sto ck, fixed assets revaluatio n reserves, fo reign currency revaluatio n reserves, general provisio ns subjec t to maximum o f 1.25% o f risk assets and hybrid instruments – co nvertible bo nds.

As direc ted by the CBN, the Bank cro ssed over to the Basel II capital measurement standard by December, 20 14, replac ing the Basel I Capital Adequacy Ratio (CAR) co mputatio n with the Basel II Standardised Appro ach (Currently, CBN requires all depo sit mo ney banks in Nigeria to ado pt the Standardised Appro ach fo r the co mputatio n o f Capital Adequacy Ratio under Pillar 1)

In line with the CBN guideline fo r the Standardised Appro ach, the Risk Weighted Assets (RWA) are derived using the CBN spec ified risk weigths (RW) fo r the different asset c lasses:

• 0 % fo r Expo sures to Central Governments and Central Banks • 10 0 % fo r Expo sures to No n Central Government Public Secto r Entities • Expo sures to State Governments and Lo cal Autho rities;



99

- 20 % fo r State Government bo nds that meet the CBN elig ibility criteria fo r c lassificatio n as liquid assets

- 10 0 % fo r o ther State and Lo cal Government bo nds and expo sures • State and Lo cal Governments o f o ther jurisdic tio ns are assigned the Sovereign RW

o f tho se jurisdic tio ns. - 0 % fo r Expo sures to Multilateral Develo pment Banks (MDBs) • Expo sures to Supervised Institutio ns - 20 % fo r Sho rt- term expo sures to supervised institutio ns in Nigeria with an

o rig inal maturity o f three mo nths o r less - 10 0 % fo r lo ng term expo sures to supervised institutio ns in Nigeria with an

o rig inal maturity o f three mo nths o r less - 10 0 % fo r Expo sures to Co rpo rate and Other Perso ns • 75% fo r Regulato ry Retail Po rtfo lio . However, to qualify, such expo sures must

meet the fo llowing criteria:

i) Orientatio n criterio n – the expo sure is to an individual perso n o r perso ns o r to a small business.

ii) Pro duct criterio n - the expo sure takes the fo rm o f any o f the fo llowing : revo lving credits and lines o f c redit ( inc luding credit cards and overdrafts) , perso nal term lo ans and o ther term lo ans (fo r example installment lo ans, auto financ ing lo ans, student and educatio nal lo ans, perso nal finance) and small business fac ilities. Investment in debt and equity securities, whether listed o r no t, are exc luded fro m this po rtfo lio . Mo rtgage lo ans are also exc luded to the extent that they qualify fo r treatment as expo sures secured by residential pro perty.

iii) Granularity criterio n - the aggregate expo sure to o ne co unterpart canno t exceed 0 .2% o f the overall regulato ry retail po rtfo lio ;

iv) Low value o f individual expo sures - the aggregate retail expo sure to o ne co unterparty canno t exceed an abso lute thresho ld o f N10 0 millio n.

• 10 0 % fo r Expo sures secured by Mo rtgages o n Residential Pro perty. • 10 0 % fo r Expo sures secured by Mo rtgages o n Co mmerc ial Real Estate. • Qualifying residential mo rtgage lo ans that are past due: i) 10 0 % when spec ific provisio ns are less than 20 % o f the o utstanding

amo unt o f the expo sure; and ii) 50 % when spec ific provisio ns are 20 % o r mo re o f the o utstanding

amo unt o f the expo sure. • Other unsecured Past Due Expo sures (exc luding past due residential

mo rtgages): i) 150 % risk weight when spec ific provisio ns are less than 20 % o f the

o utstanding amo unt o f the expo sure; ii) 10 0 % risk weight when spec ific provisio ns are no less than 20 % o f the

o utstanding amo unt o f the expo sure.

Other Assets: i) Cash in hand and equivalent cash items shall be assigned a 0 % risk weight. ii) Cheques and Cash items in transit shall be assigned a 20 % risk weight. • 10 0 % risk weight fo r the fo llowing : fixed assets; prepayments;

investments in equity o r regulato ry capital instruments (unless deducted fro m capital) ; co llec tive investment schemes; real estate; bank lending to subsidiaries in the same gro up (but to be deducted fro m capital where lo an is no t fully secured).

• Off-Balance Sheet Expo sures are first co nverted to credit equivalent amo unt by multiplying the expo sures by the related co nversio n fac to rs (CCF). The Capital requirement is then derived by multiplying the credit equivalent by the risk weight o f the co unterparty.

Capital Adequacy Rat io

The Bank's Basel II capital adequacy ratio was 15.3% as at 31 December 20 15, which is above the CBN minimum requirement o f 15%, as co mputed below. The Basel II rule fo r co mputatio n o f Capital Adequacy Ratio o nly came into fo rce in the year under review and has been pro spectively applied.



10 0

Regulato ry risk reserves o f N23.87billio n (20 14: N8.67billio n) are exc luded fro m capital adequacy ratio co mputatio n

NoteBank

— —

— —

— —

Dec. 20 15 Dec. 20 14

Tier 1 Capital

Ordinary share capital 8,468 8,468

Share premium 391,641 391,641

Retained defic it (249,372) (251,172)

Statuto ry reserve 22,0 62 19,40 4

Other reserves 1,753 1,753

174,552 170 ,0 94

Less:

Investment in subsidiaries (50 %) 28 (5,284) (4 ,186)

Investment in equity acco unted investee (50 %) 24

Deferred tax assets 31 (95,875) (95,875)

Intangible assets 30 (3,318) (2,071)

Total qualifying Tier 1 Capital 70 ,075 67,962

Tier 2 Capital

Fair value reserves 25,120 27,213

Investment in subsidiaries (50 %) (5,284) (4 ,186)

Investment in equity acco unted investee (50 %)

Co llec tive allowances fo r impairment

Total qualifying Tier 2 Capital 19,836 23,0 27

To tal regulato ry capital 89,911 90 ,989

Risk weighted assets

Risk-weighted Amo unt fo r Credit Risk 451,594 439,655

Risk-weighted Amo unt fo r Operatio nal Risk 116,973 10 5,550

Risk-weighted Amo unt fo r Market Risk 18,948 9,992

To tal weighted risk assets 587,515 555,197

Risk weighted Capital Adequacy Ratio (CAR) 15.3% 16.4%

6 Use of Est imates and Judgements

The preparatio n o f the co nso lidated financ ial statements in co nfo rmity with IFRS requires management to make judgments, estimates and assumptio ns that affec t the applicatio n o f acco unting po lic ies and the repo rted amo unts o f assets, liabilities, inco me and expenses.

Actual results may differ fro m these estimates.

Estimates and underlying assumptio ns are reviewed o n an o ngo ing basis. Revisio ns to acco unting estimates are reco gnized in the year in which the estimates are revised and in any future years affec ted.

Management discusses with the Gro up Audit Co mmittee the develo pment, selec tio n and disc lo sure o f the Gro up's c ritical acco unting po lic ies and their applicatio n, and assumptio ns made relating to majo r estimatio n uncertainties. Info rmatio n abo ut assumptio ns and estimatio n uncertainties that have a significant risk o f resulting in a material adjustment within the next financ ial year and abo ut critical judgments in applying acco unting po lic ies that have the mo st significant effec t o n the amo unts reco gnized in the co nso lidated financ ial statements is disc lo sed below.

These disc lo sures supplement the co mmentary o n financ ial risk management (see no te 5).



N million N million

10 1

Impairment Assets acco unted fo r at amo rtised co st are evaluated fo r impairment o n a basis described in

the acco unting po licy in no te 3( j) .

The spec ific co unterparty co mpo nent o f the to tal allowances fo r impairment applies to c laims evaluated individually fo r impairment and is based upo n management's best estimate o f the present value o f the cash flows that are expected to be received. In estimating these cash flows, management makes judgements abo ut a co unter party's financ ial situatio n and the net realisable value o f any underlying co llateral. Each impaired asset is assessed o n its merits, and the wo rko ut strategy and estimate o f cash flows co nsidered recoverable are independently reviewed by the Credit Risk functio n.

Co llec tively assessed impairment allowances cover credit lo sses inherent in po rtfo lio s o f lo ans and advances and held to maturity investment securities with similar eco no mic characteristics when there is o bjec tive evidence to suggest that they co ntain impaired lo ans and advances and held to maturity investment securities, but the individual impaired items canno t yet be identified. A co mpo nent o f co llec tively assessed allowances is fo r co untry risks. In assessing the need fo r co llec tive lo an lo ss allowances, management co nsiders fac to rs such as credit quality, po rtfo lio size, co ncentratio ns, and eco no mic fac to rs. In o rder to estimate the required allowance, assumptio ns are made to define the way inherent lo sses are mo delled and to determine the required input parameters, based o n histo rical experience and current eco no mic co nditio ns. The accuracy o f the allowances depends o n how well future cash flows fo r spec ific co unterparty allowances and the mo del assumptio ns and parameters used in determining co llec tive allowances are estimated.

Investments in equity securities were evaluated fo r impairment o n the basis described in no te 3( j) . Fo r an investment in an equity security, a significant o r pro lo nged dec line in its fair value below its co st was o bjec tive evidence o f impairment. In this respect, the Gro up regarded a dec line in fair value in excess o f 20 percent to be significant and a dec line in a quo ted market price that persisted fo r nine mo nths o r lo nger to be pro lo nged.

Determining Co ntro l over an Investee The Gro up's evaluatio n o f whether it has co ntro l over an investee was do ne o n the basis

described in no te 3(a). Info rmatio n abo ut judgment made in determining whether the Gro up has co ntro l over its subsidiaries is inc luded in No te 28 (a).

Reco gnitio n o f Deferred Assets Deferred tax assets were reco gnised o n the basis described in no te 3(i) . Info rmatio n abo ut

assumptio ns made in the reco gnitio n o f deferred tax assets and availability o f future taxable pro fit against which tax lo sses carried fo rward can be used is inc luded in No te 31.

Determining Fair Values The fair value o f financ ial assets and liabilities that are traded in ac tive markets are based o n

quo ted market prices o r dealer price quo tatio ns. Fo r all o ther financ ial instruments, the Gro up determines fair values using o ther valuatio n techniques.

Fo r financ ial instruments that traded infrequently and have little price transparency, fair value is less o bjec tive, and requires varying degrees o f judgement depending o n liquidity, co ncentratio n, uncertainty o f market fac to rs, pric ing assumptio ns and o ther risks affec ting the spec ific instrument.

Financ ial Asset and Liability Classificatio n The Gro up's acco unting po lic ies provide sco pe fo r assets and liabilities to be designated o n

inceptio n into different acco unting catego ries in certain c ircumstances:

(a) In c lassifying financ ial assets o r liabilities as “trading”, the Gro up has determined that it meets the descriptio n o f trading assets and liabilities set o ut in the acco unting po licy in no te 3( j) .

(b) In designating financ ial assets o r liabilities as available fo r sale, the Gro up has determined that it has met o ne o f the criteria fo r this designatio n set o ut in the acco unting po licy in 3( j) .



10 2

(c ) In c lassifying financ ial assets as held-to -maturity, the Gro up has determined that it has bo th the po sitive intentio n and ability to ho ld the assets until their maturity date as required by the acco unting po licy in no te 3( j) .

Details o f the Gro up's c lassificatio n o f financ ial assets and liabilities are g iven in no te 7.

Deprec iatio n and carrying value o f pro perty and equipment The estimatio n o f the useful lives o f assets is based o n management's judgement. Any material

adjustment to the estimated useful lives o f items o f pro perty and equipment will have an impact o n the carrying value o f these items.

Determinatio n o f impairment o f pro perty and equipment, and intangible assets Management is required to make judgements co ncerning the cause, timing and amo unt o f

impairment. In the identificatio n o f impairment indicato rs, management co nsiders the impact o f changes in current co mpetitive co nditio ns, co st o f capital, availability o f funding , techno lo g ical o bso lescence, disco ntinuance o f services and o ther c ircumstances that co uld indicate that impairment exists. The Gro up applies the impairment assessment to its separate cash generating units. This requires management to make significant judgements and estimates co ncerning the existence o f impairment indicato rs, separate cash generating units, remaining useful lives o f assets, pro jec ted cash flows and net realisable values. Management's judgement is also required when assessing whether a previo usly reco gnised impairment lo ss sho uld be reversed.

Valuatio n o f financ ial instruments The Gro up's acco unting po licy o n fair value measurements is discussed in no te 3( j)

The Gro up measures fair values using the fo llowing fair value hierarchy, which reflec ts the significance o f the imputs used in making the measurements.

( i) Level 1: Inputs that are quo ted market prices (unadjusted) in an active market fo r identical instruments.

( ii) Level 2: Inputs o ther than quo ted prices unc luded within Level 1 that are o bservable either ( i.e. as prices) o r indirec tly ( i.e. derived fro m prices). This catego ry inc ludes instruments valued using : quo ted market prices in ac tive markets fo r similar instruments; quo ted prices fo r identical o r similar instruments in markets that are co nsidered less than active; o r o ther valuatio n techniques where all significant inputs are direc tly o r indirec tly o bservable fro m market data.

( iii) Level 3: inputs that are uno bservable.This catego ry inc ludes instruments fo r which the valuatio n technique inc ludes inputs no t based o n o bservable data and the uno bservable inputs have a significant effec t o n the instrument's valuatio n. This catego ry inc ludes instruments that are valued based o nquo ted prices fo r similar instruments fo r which significant uno bservable adjustments o r assumptio ns are required to reflec t differences between the instruments.

The table below analyses financ ial instruments measured at fair value at the end o f the repo rting year, by the level in the fair value hierarchy into which the fair value measurement is catego rised. The amo unts are based o n the value reco gnised in the statement o f financ ial po sitio n.

Note

—

—

—

—

Level 1 Level 2 Level 3 Total

31 December 20 15

Pledged assets 14,620

Derivative assets held fo r risk management 22

Investment securities 25 10 4,972

119,592



No n pledged trading assets 20 348 397


Derivative assets held fo r risk management 22

25

68,615

68,267

397

—

7,70 6

——

1,820

7

7,359

7,699

9,179

76,718

14,620

745

1,820

7

112,331

75,966

128,771




— —

—


10 3

Fair values o f financ ial assets and financ ial liabilities that are traded in ac tive markets are based o n quo ted market prices o r dealer price quo tatio ns. Fo r all o ther financ ial instruments the Gro up determines fair values using valuatio n techniques. Valuatio n techniques inc lude net present value and disco unted cash flow mo dels, co mpariso n to similar instruments fo r which market o bservable prices exist and o ther valuatio n mo dels. Assumptio ns and inputs used in valuatio n techniques inc lude risk-free interest rates, c redit spreads and o ther inputs used in estimating disco unt rates, bo nds and equity prices. The o bjec tive o f valuatio n techniques is to arrive at a fair value determinatio n that reflec ts the price o f the financ ial instrument at the repo rting date that wo uld have been determined by market partic ipants ac ting at arm's length.

The Gro up uses widely reco gnised valuatio n mo dels fo r determining the fair value o f co mmo n and mo re simple financ ial instruments, like interest rate and currency swaps that use o nly o bservable market data and require little management judgement and estimatio n. Observable prices and mo del inputs are usually available in the market fo r listed debt and equity securities, exchange traded derivatives and simple over the co unter derivatives like interest rate swaps. Availability o f o bservable market prices and mo del inputs reduces the need fo r management judgement and estimatio n and also reduces the uncertainty asso c iated with the determinatio n o f fair values. Availability o f o bservable market prices and inputs varies depending o n the pro ducts and markets and is pro ne to changes based o n spec ific events and general co nditio ns in the financ ial markets.

Level 3 Fair Value Measurements

(a) Reconciliat ion

The fo llowing table shows a reco nc iliatio n fro m the beg inning balances to the ending balances fo r fair value measurements in Level 3 o f the fair value hierarchy fo r the gro up.

Financial Inst ruments not Measured at Fair Value

The fo llowing table sets o ut the fair values o f financ ial instruments no t measured at fair value and analyses them by the level in the fair value hierarchy into which each fair value measurement is catego rised.

31 December 20 15 Investment Securities

Derivative Assets To tal

Balance at 1 January 20 15 7,699 7,699

340 340

1,820 1,820

7,359 1,820 9,179

To tal gains reco gnised in OCI

Balance at 31 December 20 15

Purchases

In millio ns o f naira

—

—

—

Note

—

—

—

—

—


Assets

31 December 20 15

Cash and Cash equivalent 19 82,252 82,252

Pledged assets 67,1434,195

Lo ans and advances to custo mers 353,189

Investment securities 25 211,145


841,342

Liab ilit ies

Depo sits fro m banks 33 44,0 91 44,0 91

Depo sits fro m custo mers 34 570 ,639570 ,639

Other financ ial liabilities 36 54,47154,471

Other bo rrowed funds 38 76,0 5976,0 59

745,260745,260

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

62,948

145,20 0

353,189

211,145

127,613

696,142

Group




10 4

Note

—

—

—

—

—

—


Assets

31 December 20 14


Pledged assets 745 745

Lo ans and advances to custo mers 294,838294,838

Investment securities 25 173,234173,234

Other receivables 32 113,376113,376

581,448122,70 5 70 4,153

Liab ilit ies

Depo sits fro m banks 33 61,890 61,890

Depo sits fro m custo mers 34 527,617 527,617

Other financ ial liabilities 36 62,748 62,748

Other bo rrowed funds 38 78,135 78,135

730 ,390 730 ,390

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

Note

—

—

—

—

—


Assets

31 December 20 15


Pledged assets 67,1434,195

Lo ans and advances to custo mers 335,344

Investment securities 25 92,90 0


677,451

Liab ilit ies

Depo sits fro m banks 33 11,80 011,80 0



Other bo rrowed funds 38 76,0 5976,0 59

711,444711,444

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

62,948

117,399

335,344

92,90 0

127,613

560 ,0 52

Bank

Note

—

—

—

—

—

—


Assets

31 December 20 14


Pledged assets 55,553 55,553

Lo ans and advances to custo mers 284,413284,413


21

93,72493,724

Other receivables 32 113,376113,376

491,513114,0 10 60 5,523

Liab ilit ies

Depo sits fro m banks 33 18,0 55 18,0 55



Other bo rrowed funds 38 78,135 78,135

666,369 666,369

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

23



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

10 5

7 Operat ing Segments

The Gro up has the fo llowing strateg ic business segments, which are its repo rtable segments. ( i) Retail Bank (ii) Co mmerc ial Bank (iii) Co rpo rate Bank (iv) Treasury

Retail Bank This segment provides innovative pro ducts and so lutio ns to mass market and mass affluent

custo mers as well as small & medium enterprises with a turnover below N250 millio n per annum. Clients o fferings inc lude depo sit pro ducts, co mplementary white label and payro ll driven asset pro ducts.

Co mmerc ial Bank This segment caters to the banking needs o f lo cal co rpo rates, usually with a turnover between

N50 0 millio n - N5 billio n in such sec to rs as General Co mmerce, Co nstructio n, Oil & Gas, Manufacturing , Agriculture, Educatio n, Health and Public Secto r. Pro ducts and services o ffered within this segment inc ludes lo ans and advances, equipment leasing , lo cal purchase o rder financ ing , value chain pro ducts, trade financ ing and cash management so lutio ns.

Co rpo rate Bank This segment provides services to large co rpo rates with a turnover above N5 billio n in sec to rs

such as Oil & Gas, Teleco ms, Manufacturing , FMCG, General Co mmerce, Agriculture, Aviatio n and Maritime. Pro ducts and services o ffered inc lude transactio nal banking pro ducts, cash management so lutio ns, trade, wo rking capital finance, investment management, overdrafts and lo ans and advances.

Treasury Treasury suppo rts c lients in all segments o f the bank such as affluent and high netwo rth

individuals, co mmerc ial c lients, co rpo rates and no n-banking financ ial institutio ns. Client o ffering is co mpo sed o f a diversified po rtfo lio o f pro ducts and services inc luding issuance o f sho rt term no tes, investment management (mo ney market pro ducts) , fixed inco me sales and trading .

31 December 20 15

Retail

banking

Commercial

banking

Corporate

banking

Treasury &

investment

banking Total

Revenue:

Derived fro m external custo mers 11,767 14,427 49,322 41,694 117,211

—Derived fro m o ther business segments

To tal Revenue

Interest expenses

(Lo ss)/ pro fit befo re inco me tax

Inco me tax expense (561)

Pro fit after tax

Assets and liab ilit ies:

Repo rtable segment assets

Repo rtable segment liabilities

Net Assets/ (Liabilities)

24,259

36,0 26

(48,395)

(12,568)

138,713

(387,762)

(249,0 49) 50 ,374

(141,10 0 )

191,475

(996)

(19,951)

13,119

1,30 8 (10 ,998)

38,324

(16,076)

15,343

294,982

(193,143)

10 1,839 340 ,757

(80 ,575)

421,331

12,769

(14,962)

29,741

(11,953)

117,211

(93,383)

14,548

13,987

1,0 46,50 1

(80 2,580 )

243,921



N million N million N million N million N million

10 6

31 December 20 14

Retail

banking

Commercial

banking

Corporate

banking

Treasury &

investment

banking Total

Revenue:

Derived fro m external custo mers 10 ,917 24,768 27,658 72,553 135,897

Derived fro m o ther business segments

To tal Revenue

Interest expenses

(Lo ss)/ pro fit befo re inco me tax

Inco me tax expense (40 9)

Pro fit after tax


Repo rtable segment assets

Repo rtable segment liabilities

Net Assets/ (Liabilities)

33,549

44,466

(13,951)

1,076

10 8,486

(321,426)

(212,940 ) 63,741

(155,746)

219,487

6,287

(2,641)

27,530

2,762 (8,476)

19,182

(961)

6,923

282,946

(66,517)

216,429 154,299

(243,234)

397,533

12,684

(6,764)

44,719

(27,835)

135,897

(24,317)

26,971

26,562

1,0 0 8,451

(786,923)

221,528

The Gro up's business is also o rganized alo ng two (2) main geo graphical areas: ( i) Nigeria ( ii) United Kingdo m

Transactio ns between the business segments are o n no rmal co mmerc ial terms and co nditio ns.

Funds are o rdinarily allo cated between segments, resulting in funding co st transfers disc lo sed in o perating inco me. Interest charged o n these funds is based o n the Gro up's co st o f capital. There are no o ther material items o f inco me o r expense between the business segments.

Internal charges and transfer pric ing adjustments have been reflec ted in the perfo rmance o f each segment. Revenue sharing agreements are used to allo cate external custo mer revenues to a segment o n a reaso nable basis.



33%

20%14%

33%

Revenue per segment

31 Dec 2014

Retail banking

Commercial banking

Corporate banking

Treasury and

investment banking

31%

18%28%

23%

Revenue per segment

31 Dec 2015

Retail banking

Commercial banking

Corporate banking

Treasury and

investment banking

N million N million N million N million N million

10 7

31 December 20 15

—

—

—

—

—

—

TotalNigeria Europe

Derived fro m external custo mers 114,430

114,430

2,781

2,781

117,211

117,211

Derived fro m o ther segments

To tal revenues

Interest and similar expenses

Operating inco me


Operating expenses

Net impairment lo ss o n financ ial assets

(Lo ss)/ pro fit befo re taxatio n

Inco me tax expense

(Lo ss)/ pro fit after taxatio n


To tal assets 59,90 5 1,0 46,892

To tal liabilities (9,870 ) (80 2,971)

Net assets 50 ,0 35 243,921

(35,0 0 1) (254)

2,527

2,527

(35,255)

81,956

81,956

79,429

79,429

(55,929)

(9,177)

(2,235)

(67)

225

(131)

94

(58,164)

(9,244)

14,548

(561)

13,987

14,323

13,90 2

986,987

(421)

(793,10 1)

193,886

31 December 20 14

——

—

—

TotalNigeria Europe

Derived fro m external custo mers 117,599 2,070 119,669

Derived fro m o ther segments

To tal revenues 117,599 2,070 119,669

Interest and similar expenses (24,135) (182) (24,317)

Share o f pro fit o f equity acco unted investee (6) (6)

93,457 1,889 95,346

Operating expenses (57,175) (1,549) (58,724)

Net impairment lo ss o n financ ial assets (9,682) 31 (9,651)

(Lo ss)/ pro fit befo re taxatio n 26,60 0 371 26,971

Inco me tax expense (355) (54) (40 9)

(Lo ss)/ pro fit after taxatio n 26,245 317 26,562


To tal assets 928,186 80 ,265 1,0 0 8,451

To tal liabilities (796,211) 9,288 (786,923)

Net assets 131,975 89,553 221,528



N million

N million

N million

N million

N million

N million

Nigeria

98%

Europe

2%

Revenue by Location

31 Dec 2014

Nigeria Europe

Nigeria

98%

Europe

2%

Revenue by Location

31 Dec 2015

Nigeria Europe

Segment Report by Geographical Locat ion:

10 8

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—— — — — ——————

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— — — — ——————

— — — — —————

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Se

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N1,

46

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n f

or

the

Gro

up

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N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

N m

illi

on

110

9 Net Interest IncomeGroup Group Bank Bank

Dec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

Interest income

Cash and cash equivalents 1,573 1,0 69 1,120 1,0 69

Lo ans and advances to custo mers (see no te (a) below)


To tal interest inco me

Interest expense


Other bo rrowed funds (see no te (b) below)

To tal interest expense

Net interest income 55,683 52,0 56 53,782 50 ,626

60 ,835

28,494

90 ,90 2

26,536

8,683

35,219 24,317

3,193

21,124

76,373

35,970

39,334 59,686

28,073

88,879

26,414

8,683

35,0 97 24,237

3,193

21,0 44

74,863

35,676

38,118

Interest expense o n financ ial liabilities no t measured at fair value thro ugh pro fit o r lo ss amo unted to N35,219 millio n (Gro up) and N35,0 97 millio n (Bank) fo r the year ended 31 December 20 15 (31 December 20 14: N24,317 millio n (Gro up); N24,237 millio n (Bank)).

Group Group Bank BankDec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

Interest o n fo reign currency fac ilities

(a) Interest inco me o n lo ans and advances to custo mers co nsists o f:

12,255 8,0 30 11,10 6 6,814

Interest o n lo cal currency fac ilities 48,333

60 ,588 39,334

31,30 4 48,333

59,439 38,118

31,30 4


27 2711 11BOI/ CACS o n-lending fac ilities

(b) Interest o n o ther bo rrowed funds co mprises interest o n:

FCY medium term bo rrowings

Interbank takings FCY

Interbank takings LCY

AMCON Clawback Rights Agreement (See No te 43b)

Open-Buy-Back transactio ns

2,253 2,253

2,224 2,224

1,736 1,736

955 955

1,488 1,488

8,683 8,6833,193 3,193

1,078 1,078

40 8 40 8

31 31

299 299

1,366 1,366

10 Net Fee and Commission Income


Credit-related fees and co mmissio ns inco me 4,265 4,2654,953 4,953

Co mmissio n o n turnover

E-business fee inco me (See no te (b) )

Co mmissio n o n o ff balance sheet transactio ns

Other fees and co mmissio n

1,198 1,198

715 715

995 995

524

7,697 10 ,153

996 11

1,639 1,639

30 5 30 5

2,260 2,260

7,173 9,168

—

(a) Credit related fees and co mmissio ns relate to fees charged to co rpo rate custo mers o ther than fees inc luded in determining the effec tive interest rates relating to lo ans and advances carried at amo rtised co st.

(b) E-business fee inco me/ charge


ATM o n-us 40 6 40 6262 262

POS

E-card maintenance

80 80

715 71530 5 30 5

66 66

(23) (23)

228 228



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

111

11 Net Trad ing Income/ (Loss)Group Group Bank Bank

Dec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

Gain o n dispo sal o f fixed inco me securities 3,171 3,171

Mark to market gain/ (lo ss) o n fixed inco me securities

Fo reign exchange trading gain

(7) (7)

2,0 67

5,231 2,154

2,120

34 34

1,972

5,136 2,0 69

2,0 35

— —

Net trading (lo ss) / inco me inc ludes the gains and lo sses arising bo th o n the purchase and sale o f trading instruments and fro m changes in fair value.

12 Net Income from other Financial Inst ruments at Fair Value through Pro?t or Loss


Derivatives held fo r risk management purpo ses:

Fo reign exchange swap co ntracts 1,820 1,820

1,820 1,820— —

— —

13 Other Operat ing Income


Gains o n dispo sal o f pro perty and equipment

Dividend inco me 686

1,660 1,660

40 8 686 2,0 15

Gains o n dispo sal o f trading pro perties

Gain o n dispo sal o f available fo r sale investments - unquo ted equity (see (a) below)

Revaluatio n gain o n 'fair value thro ugh pro fit o r lo ss

Fo reign exchange revaluatio n gain

(Lo ss)/ gain o n dispo sal o f subsidiaries (see (b) below)

Rental inco me

Provisio n no lo nger required (see (c ) below)

Sundry inco me (see no te (d) below)

11,419 31,832 15,358 23,721

728 728

193 193

(332)

124 124

397 397

7,30 6 7,30 6

657 653 3,2443,561

8,166 8,166

40 6 40 6

3,575 3,575

15,689

27

3,591 6,315

———

——

——

——

(a) In the co urse o f the year, the Gro up dispo sed o f its investment in an available fo r sale unquo ted equity (Central Securities Clearing Systems Limited). The gain o n dispo sal is analysed below:

Gain o n dispo sal o f investments in unquo ted equity


Sales Pro ceeds 212 212

Co st o f investment in Central Securities Clearing System

Gain o n dispo sal o f unquo ted equities

(19) (19)

193 193

—

— —

— —

—

(b) Gain o n dispo sal o f investments in subsidiaries


Unio n Assurance Coy Ltd

Unio n Registrars Limited 4,149

877

10 ,688

(143)

5,807

Unio n Ho mes Savings Lo ans Plc

Unio n Capital Markets Ltd

Unio n Insurance Bro kers Ltd

Unio n Trustees Limited (332)

(332) 15,689

118

3,591

3,591

6,315

—

——

—

— —

— —

—— —

— — 40 0

(10 )

118



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

112

The gain o r lo ss o n dispo sal o f subsidiaries fo r the Gro up fo r the year ended 31 December 20 15 is arrived at as shown below:

Union Trustees

Net assets

Sales pro ceeds 3,649

(3,899)

Fair value reserves

Co st incurred o n dispo sal

Other net asset adjustment

(5)

(53)

(24)

(332)

The gain o r lo ss o n dispo sal o f subsidiaries fo r the Bank fo r the year ended 31 December 20 15 is arrived at as shown below:

Union Trustees

Co st incurred o n dispo sal

Sales pro ceeds 3,649

(53)

Co st o f investment (5)

3,591

The gain o r lo ss o n dispo sal o f subsidiaries fo r the Gro up fo r the year ended 31 December 20 14 is arrived at as shown below:

Union

Regist rars

Limited

Union

Assurance

Coy Ltd

Union Homes

Savings

Loans

Union

Capital

Markets Ltd Total

Union

Insurance

Brokers

Sales pro ceeds 6,0 0 0 1,923 80 6 8,849 119

Net Assets (2,198) (2,0 27) 16,425 (939) 11,262

No n Co ntro lling Interest 391 1,0 0 6 (5,210 )

Fair value reserves 34 49 (527)

Co st incurred o n dispo sal (79) (75) (11) (166)

(444)

(2)

4 ,149 877 10 ,688 (143) 15,689 118

—

—

—

—

—

—

—

(3,812)

The gain o r lo ss o n dispo sal o f subsidiaries fo r the Bank fo r the year ended 31 December 20 14 is arrived at as shown below:

Union

Regist rars

Limited

Union

Assurance

Coy Ltd

Union Homes

Savings

Loans

Union

Capital

Markets Ltd Total

Union

Insurance

Brokers

Sales pro ceeds 6,0 0 0 1,923 8,849 80 6 119

Co st o f investment (114) (1,449) (2,369)

(79) (75)Co st incurred o n dispo sal

5,807 40 0 6,315(10 ) 118

—

—

—

— —

(165)

(80 6)

(11) (2)

(c ) Provisio n no lo nger required (see (c ) below) These amo unts represent the credit balances no lo nger required that were released to

inco me during the year after co nfirmatio n that they do no t represent liabilities to any third parties. The amo unt was determined based o n the co mpletio n o f reco nc iliatio n and c lean-up o f legacy balances in the general ledger prio r to the migratio n to the Bank's new co re banking applicatio n.

(d) Sundry inco me


Fraud recoveries

Cash handling fees 169 16986 86

10 1082 82

2,928 2,692 489 50 5

3,561 3,244657 673

Bo nd auctio n inco me



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

113

14 Net Impairment Loss on Financial Assets

(a) Net Impairment Charge for Cred it Losses: Group Group Bank BankDec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

- spec ific impairment (see no te 23 below)

Net impairment charge fo r c redit lo sses:

18,228 18,228 4,750

- po rtfo lio impairment (see no te 23 below)

To tal impairment charge o n lo ans and advances

Recoveries o n lo ans and advances (see no te 23 below)

9,948 4 ,828 9,881 3,30 7

(3,156) (3,223) 2,0 28

15,072

(5,124)

15,0 0 5 6,778

(3,471)

8,299

2,0 28

6,271

(5,124) (3,471)

(b) Net Impairment Loss on other Financial Assets:

Allowance no lo nger required o n o ther assets

Impairment lo ss o n o ther assets

(2,80 1) (2,80 1)

2,0 97 2,0 97

(399)

4,763

To tal impairment (gain)/ charge o n o ther assets

Total net impairment loss on f inancial assets 9,244 9,651 9,177 7,671

(70 4) (70 4) 4,3644,823

(399)

5,222

15 Personnel Expenses


Co ntributio ns to defined co ntributio n plans

Wages and salaries

644

28,336

644

27,0 50

70 2

26,655

Increase/ (decrease) in liability fo r defined benefit plans

Terminatio n benefits

1,0 61 1,0 61 (120 )

30 ,0 41

1,517

29,812

1,517

(120 )

70 2

27,713

28,755 28,754

16 Other Operat ing ExpensesGroup Group Bank Bank

Dec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

NDIC Premium

Audito rs' remuneratio n 161

2,395

127 131 98

Rents and Rates

Acco mmo datio n and travel

Fleet management and vehic le related expenses

Transfo rmatio n Expense

Repair and maintenance

Pro fessio nal fees

Advertising and pro mo tio n expenses

Security expense

Expenses o n so ftware

Do natio ns and Subscriptio ns

General administrative expenses (see no te (a) below)

Insurance

AMCON surcharge (see no te (b) below)

23,823 26,287 23,0 51 25,224

1,0 68

723

696

1,314

737

716

1,144

1,10 1

2,232

327

6,239

365

4,60 5

2,466

972

789

668

1,516

1,756

1,877

566

1,464

2,107

434

6,874

261

4,410

2,395

994

691

696

1,165

737

630

1,144

1,10 1

2,232

327

5,863

340

4,60 5

2,466

972

789

668

1,516

1,756

1,868

566

1,464

2,107

434

5,849

261

4,410

(a) General Administ rat ive ExpensesGroup Group Bank Bank

Dec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

Cash movement expense

Office c leaning 490 629 487 629

Entertainment

Directo rs fees and allowances

Diesel and power

Spo rts pro mo tio n

Statio nery, printing , po stage and telepho ne

Penalties

Restitutio n and o ther charges

Gro up restructuring expenses

Debt recovery expenses

Expense o n Bulk SMS

Business meetings and co nferences

Fixed assets related expenses

Annual General Meeting expenses

Bank charges

Other expenses

6,239 6,874 5,863 5,849

1,110

92

358

1,896

622

55

67

459

142

176

80

15

28

55

293

30 0

1,145

172

310

1,921

757

44

83

852

117

12

10 5

26

237

464

1,110

87

358

1,638

622

55

67

459

142

176

80

15

28

55

293

190

1,145

172

310

1,323

757

44

83

852

117

12

10 5

26

237

37



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

—

—

—

—

—

—

114

(b) AMCON surcharge represents the Bank's co ntributio n to the Banking Secto r Stabilisatio n Fund fo r the year ended 31 December 20 15. The applicable rate is 0 .5% o f to tal assets plus ano ther 0 .5% o f 33% o f the bank's o ff balance sheet items, calculated o n a preceeding year basis.

17 Income Tax Expense

(a) Recognised in t he prof it or lossGroup Group Bank Bank

Dec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

Co mpany Inco me Tax

Current t ax expense

107

Educatio n tax

Capital Gains tax

NITDA Levy

To tal inco me tax expense

240

20 5

552

20 4

230

434

240

180

420

20 5

20 5

——

—— — —

——

In line with the Co mpany Inco me Tax Act, 1990 , as amended, the Bank is no t liable to pay inco me tax as the Bank reco rded a tax lo ss fo r the year. The Bank is exempted fro m paying minimum tax under the Act, as it has impo rted share capital o f over 25%. No educatio n tax was charged because the Bank has no assessable pro fit fo r the year.

(b) Reconciliat ion of ef fect ive t ax rate

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

Group Group Bank Bank

Dec. 20 15 Dec. 20 14 Dec. 20 15 Dec. 20 14

Pro fit/ ( lo ss) befo re inco me tax 14,442 27,119 18,141 20 ,691

Inco me tax using the do mestic co rpo ratio n tax rate 30 % 4,333 30 % 8,136 0 % 0 %

Inco me tax based o n minimum tax co mputatio n 0 % 0 % 0 % 0 %

Effec t o f tax rates in fo reign jurisdic tio ns 0 % 19 0 % 113 0 % 0 %

Educatio n tax levy 0 % 0 % 0 % 0 %

Capital gains tax 2% 0 % 1% 0 %

NITDA levy 1% 20 5 1% 230 1% 180

240

1% 20 5

Tax lo sses (utilised)/ unutilised -29% (4,245) -33% (8,913) 0 % 0 %

To tal inco me tax expense in co mprehensive inco me 4% 552 2% 434 2% 420 1% 20 5

240

The effec tive inco me tax rate fo r 31 December 20 15 is 4% (December 20 14:2%) 18 Earnings Per Share

(a) Basic earnings per share Earnings/ (lo ss) per share has been co mputed based o n pro fit after taxatio n attributable to

the Gro up o rdinary shareho lders and the weighted average number o f shares in issue during the year is as fo llows.

Weighted average number o f o rdinary shares


Weighted effec t o f shares issued during the year

Issued o rdinary shares at beg inning o f the year

16,936

16,936

16,936 16,936 16,936

16,936 16,936 16,936

(b) Pro?t at t ributab le to ord inary shareholders In millions of Nigerian Naira


Basic earnings/ (lo ss) per share (in ko bo)

Pro fit/ (Lo ss) fo r the year attributable to equity ho lders

83

13,890 26,685

13,988

Pro fit fro m co ntinuing o peratio ns attributable to equity ho lders o f bank

Basic earnings/ (lo ss) per share (in ko bo) 82 158

151 10 5

10 5

121

121

25,627 17,721 20 ,486

20 ,48617,721

(c) Diluted earnings per share

The Gro up do es no t have any dilutive po tential o rdinary shares, therefo re, Basic EPS and Diluted EPS are the same fo r the Gro up.



N million

N millionN millionN millionN million

N millionN millionN million

N million

N million

N million

N million

N million

N million

N million

N million

115

19 Cash and Cash EquivalentsGroup Group Bank Bank

Dec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

Cash and balances with banks 34,189

14,185 Unrestric ted balances with central bank

Mo ney market placements 33,878

82,252

52,661

8,90 4

121,960

7,50 4 7,50 2

54,451 58,457

60 ,395

32,762 42,0 51

14,185 8,90 4

20 Non-Pledged Assets (Held for Trad ing)


Federal Government o f Nigeria Bo nds — —

— —

— —

Federal Government o f Nigeria Treasury bills

348

397

745

348

397

745

21 Pledged assets

Financ ial assets that may be repledged o r reso ld by co unterparties


Federal Government o f Nigeria Treasury bills 14,620

65,913Federal Government o f Nigeria Bo nds

Placement with financ ial institutio n 4,195 4,195

84,728 84,728

17,0 34 17,0 34

62,20 6 62,20 6

83,935 83,935

4,695 4,695

14,620

65,913

a) Assets pledged as co llateral relate to assets pledged to the Federal Inland Revenue Service (FIRS), Central Bank o f Nigeria (CBN) Clearing , Bank o f Industry (BOI), Unified Payment Systems, Interswitch Nigeria Limited and E-Tranzact fo r co llec tio ns and o ther transactio ns.

b) Assets were also pledged as co llateral as part o f securities bo rrowing under terms that are usual and custo mary fo r such activities.

The co unterparties with who m assets have been pledged fo r inter-bank takings and bo rrowings inc lude Standard Chartered Bank UK, Eco Bank Plc , Zenith Bank Plc , and Fidelity Bank Plc .

c ) Assets pledged as co llateral are based o n prices in an active market.

22 Derivat ive Financial Inst ruments

Dec. 20 15 Dec. 20 14

Assets Assets Liab ilit ies Liab ilit ies

Instrument Type:

Fo reign exchange 1,820 7 7 —

—1,820 7 7

Group

Dec. 20 15 Dec. 20 14

Assets Assets Liab ilit ies Liab ilit ies

Instrument Type:

Fo reign exchange 1,820 — — —

— — —1,820

Bank

The Gro up uses derivatives no t designated in a qualifying hedge relatio nship, to manage its expo sure to fo reign currency risks. The instruments used inc lude fo rward co ntracts and cro ss currency linked fo rward co ntracts.



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

116

23 Loans and Advances to Customers at Amort ised Cost

(a)Group Group Bank Bank

Dec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

Spec ific impairment

Gro ss amo unt

(11,565) (11,565) (9,753)

388,794

Po rtfo lio impairment

To tal impairment

Carrying amo unt

(22,073)

366,721

(9,931)

(13,664)

336,392

312,797

(21,965) (23,376)

370 ,949 325,748

348,984 30 2,372

(10 ,50 8)

(23,595)

(10 ,40 0 ) (13,623)

At 31 December 20 15 N232.2 millio n (20 14: N153,381millio n) o f the Gro up's lo an and advances to custo mers are expected to be recovered mo re than 12 mo nths after the repo rting date.

(b) Impairment allowance on loans and advances to customers



Specif ic impairment

Port fo lio impairment

Impairment lo ss fo r the year:

- Charge fo r the year (See no te 14(a))

- Recoveries (See no te 14(a))

Effec t o f fo reign currency movements

Net impairment fo r the year/ year

Provisio n re-instated during the year

Write-o ffs

Impairment transferred to disco ntinued o peratio ns

Balance, end o f year


Impairment credit/ lo ss fo r the year/ year:

Net Impairment fo r the year: (see no te 14(a)

Net impairment fo r the year/ year

Effec t o f fo reign currency movements

Rec lassificatio n

Impairment transferred to disco ntinued o peratio ns

Balance, end o f the year 10 ,50 8 13,664 10 ,40 0 13,623

9,932

18,228 18,228

8,897

6,271

9,753 9,929

(5,124) (5,124)

13,10 4 13,10 4

(179)

1,40 5 1,40 5

(12,697)

—

— — —

— —

— —

—

—

—

—

—

—

—

(12,697)

11,565 11,565

13,664

(3,156)

(3,156)

(3,471) (3,471)

2,80 0

(310 )

7,549 7,549

1,279

(9,0 0 4) (9,0 0 4)

9,932

10 ,70 9

2,0 28 2,0 28

10 ,673

2,0 28 2,0 28

4

923 923

13,623

(3,223)

(3,223)

9,753

4,750

24 Investment in Equit y Accounted Investee This represents the Gro up's equity investment in Unique Venture Capital Management

Co mpany Limited (40 %). The movement in investment in equity acco unted investee as at 31 December 20 15 is as fo llows:



Co st

Share o f current year result

Dispo sal o f subsidiaries


(Impairments) / increase in value

115

115 115

10 0

(6)

21

91 91

91

(91) (91)

24 —

——

——

—

—

—

91

(91)

24

(91)

25 Investment Securit iesGroup Group Bank Bank

Dec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

Treasury bills

(a) Available-fo r-sale investment securities co mprise:

Equity: Quo ted

Unquo ted

Bo nds

Less: spec ific impairment allowance

57,257 50 ,988 52,843 49,128

See No te 25(a)(i)

See No te 25(a)(ii)

2,195 2,195 2,195 2,195

21,371 21,371

41,480

122,30 3

(4,0 58) (4 ,0 58)

118,245

20 ,0 67 20 ,0 67

10 ,332

83,582

(4,072) (4 ,072)

79,510

39,980

116,389

112,331 75,966

80 ,0 38

8,648



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

117

( i) Investment in quoted equit ies


Investment in REIT 2,195 2,195 2,195 2,195


Unified Payment Services Plc

Africa Finance Co rpo ratio n

Central Securities Clearing System Limited

Nigeria Auto mated Clearing System (NAC)

Interswitch Nigeria Ltd

AfreximBank

CRC Credit Bureau Limited

Nigerian Superswitch Infrastructure

Afprint Nigeria Plc

Neimeth Internatio nal Pharmaceuticals Plc .

Banque Internatio nale de Benin

Africa Investment Bank Co to no u

Investment in Small and Medium Scale Enterprises

To tal investment in available fo r sale equity securities

Less: spec ific impairment allowance

Net investment in available fo r sale equity securities

(b) Held to maturity investment securities co mprise:

Treasury bills

Federal Government o f Nigeria -Bo nds

State Government o f Nigeria -Bo nds

Co rpo rate Bo nds


15,844

126

42

15,844 14,791

—

—

—

—

—

—

—

—

14,791

( ii) Investment in unquoted equit ies

126

19

126 126

19

42 42 42

2

50

30 5

10

50

21

50 50

2 2 2

30 5 21

10

3

10 10

3

11 11

1152 1152 1152 1152

122

3,718

21,371

23,566

(4,0 58)

19,50 8

48,273

31,70 2

16,917

96,892

215,137

31,70 2

16,917

96,892

20 9,223

48,273

19,50 8

(4,0 58)

23,566

21,371

122 122 122

3,718

20 ,0 67

22,262

(4,072)

18,190

9,197

57,747

33,978

16,768

117,690

197,20 0

33,978

16,768

117,690

193,656

57,747

18,190

(4 ,072)

22,262

20 ,0 67

3,718 3,718

9,197

Specif ic allowance for impairment on availab le-for-sale investment securit ies:


Allowance no lo nger required


Write-o ffs


4,072 4 ,072

(14) (14)

4,0 58 4,0 58

4,0 83

— —

— —

4,542

(11) (470 )

4,072 4 ,072

26 Trad ing Propert ies

This represents the co st o f real estate pro perties held by the Gro up which are designated fo r resale. The movement o n the trading pro perties acco unt during the year was as fo llows:


Rec lassificatio n fro m disco ntinued o peratio ns

Balance, beg inning o f year

Dispo sal

Transfer to assets held fo r sale


1,930

2,0 53

1,930

(80 6) (80 6)

3,177 1,124

4,747

— —

—

—

—

—

1,930

(635)

(2,182)

1,930 1,930

—

27 Investment Propert ies These investment pro perties were last revalued during the year ended 31 December 20 13 by

Messrs. Bo de Adediji Partnership, a firm o f estate surveyo rs and valuers, using the o pen market basis o f valuatio n, and their repo rts were dated 16 December 20 13 fo r UBN Pro perty Co mpany Limited. As at 31 December 20 15, the Directo rs are o f the o pinio n that there were no material fluc tuatio ns in the value o f the Bank's investment pro perties since the last valuatio n.



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

118


Additio ns


Dispo sal

Revaluatio n gains/ ( lo sses)

De-reco gnitio n o f subsidiaries


Rec lassificatio n fro m/ (to) assets held fo r sale

16,413

— — —

— — ——

— — —

— —

— — —

— — —

— — —39

(137)

4,546

4,546

(4,712)

(11,60 3)

28 Investment in Subsid iaries

UBN Pro perty Co mpany Limited (See no te (a) ( ii) )

Unio n Trustees Limited (See no te (a) ( i) )

Unio n Bank UK Plc (See no te (a) ( iii) )

Atlantic No minees Limited (See no te (a) ( iv))

Rec lassificatio n to assets c lassified as held fo r sale

Bank BankDec.20 15 Dec.20 14

—

—

—

Cost

2,195 2,195

5

8,372

10 ,567

8,372

325

(2,525)

8,372

The subsidiary co mpanies, co untry o f inco rpo ratio n, nature o f business and percentage equity ho lding are detailed below:

Count ry

Incorporat ion

Direct ownership interest

Company Name Nature of business Year end Dec. 20 14 Dec.20 13

Status/ % Status/ %

Unio n Trustees Limited ( i) Nigeria Trusteeship 31 December

31 December

31 December

31 December

31 December

10 0

10 010 0

10 010 0

10 010 0

Unio n Bank UK Plc ( iii)

UBN Pro perty Co mpany Limited ( ii)

Nigeria

Nigeria

Licensed UK Bank

39 39

Atlantic No minees Limited (iv) Nigeria Real Estate

Unio n Pensio n Limited (in liquidatio n) Nigeria Pensio n

Dispo sed

Pro perty Develo pment

( i) Union Trustees Limited (Registered Off ice at 131, Broad St reet , Lagos)

In line with the CBN Regulatio n 3 o n the Sco pe o f Banking Activities and Anc illary Matters, the Bank divested its interest in Unio n Trustees Limited in 20 15.

( ii) UBN Propert y Company Limited (Registered off ice at 36, Marina, Lagos)

The Co mpany has 5,626,416,0 51 o rdinary shares o f N1.0 0 each o f which 39.0 1% (December 20 14 - 39.0 1%) is held by the Bank. In line with IFRS 10 - Co nso lidated Financ ial Statement, Unio n Bank o f Nigeria Plc has co ntro l over this entity as it has the power, expo sure to variability o f returns and a stro ng link between power and variability o f returns. The Bank also governs the financ ial and o perating po lic ies o f UBN Pro perty Co mpany Limited. The carrying value o f the investment in UBN Pro perty Co mpany Limited was inc luded in 'assets c lassified as held fo r sale' in 20 14.

Upo n reassessment o f the investment in UBN pro perty Limited as at 31 December 20 15, the management o f the Bank co nc luded that the investment no lo nger qualifies as being held fo r sale in line with IFRS 5 as there are litigatio ns preventing the sale o f the investment. In line with this develo pment, the Bank has rec lassified UBN Pro perty Co mpany Limited fro m disco ntinued o peratio ns to co ntinued o peratio ns and has co nso lidated its investment in this subsidiary in line with IFRS 10 .

( iii) Union Bank UK Plc (Registered Off ice at 14 -18 Copthal Avenue, London EC2R 7BN)

The Bank direc tly ho lds 10 0 % ho lding o f Unio n Bank UK's 60 ,0 0 0 ,0 0 0 o rdinary shares and 99% o f its 50 ,0 0 0 deferred shares o f GBP1 each and 1% indirec t ho lding thro ugh Williams Street Trustees Limited, the no minee co mpany fo r Unio n Bank o f Nigeria Plc . Unio n Bank UK Plc was inco rpo rated in December, 20 0 4 as an autho rised United Kingdo m subsidiary to carry o ut the business fo rmerly co nducted by the Lo ndo n Branch o f Unio n Bank o f Nigeria Plc .



N million

N million

N million

N million

N millionN million

119

( iv) At lant ic Nominees Limited

The co mpany is a Spec ial Purpo se Vehic le (SPV) set up by the defunct Universal Trust Bank Plc (UTB), thro ugh UTB Savings and Lo ans Limited, to ho ld UTB's interest in landed pro perty lo cated in Lekki, Lago s. UTB was acquired by the Bank in December 20 0 5 (the transactio n received co urt sanctio n in May, 20 10 ), alo ng with all its assets, inc luding the SPV. The Bank ho lds approx. 10 0 % o ut o f 50 ,0 0 0 o rdinary shares o f N1 each in UTB. The carrying value o f the investment in Atlantic No minees Limited is inc luded in 'assets c lassified as held fo r sale' (see No te 39(b)) . On co mpletio n o f the o n-go ing sale o f the landed pro perty, the SPV will be wo und up.

(b) Co ndensed results o f co nso lidated entities ( i) The co ndensed financ ial data o f the co ntinuing o peratio ns as at 31 December 20 15, are

as fo llows

Condensed statement of comprehensive income

Condensed Statement of f inancial posit ion

Statement of Comprehensive income

Group

balances Total Bank

UBN

Propert y

Company

Ltd

UBN

Propert y

Company

Ltd

Union

Pension Union

Bank UK

Union

Bank UK

Operat ing income 81,850

72,60 6

(3,946) 85,796 83,269

74,0 92

448 2,079

Net operat ing income after net

impairment loss

Operating Expenses


Share o f pro fit o f equity acco unted investees

Prof it before income tax 14 ,442 (3,990 ) 18,432 18,140 10 5 187

162(2)

Taxatio n

Prof it af ter income tax 13,890 17,880 17,720

——

—

——

—

—

—

—

—

—— —— —

—

—— —

—

—

—

—

—

— —

— —

— —

—

——

———

— —

—

— —

—

— —

— —

—

—

—

—

—

—

—

—

—

—

—————

—

—

Group

balances Total Bank

Union

Pension

Cash and cash equivalents 82,252 (10 ,917) 93,169 54,451 35,454

Pledged assets

Derivative financ ial instrument


Investments in equity-acco unted investee


Assets held fo r sale

Trading pro perties




Intangible assets

Deferred tax assets

Other assets 434

Total assets 1,0 46,891 (21,484) 1,0 68,375 998,136

138,0 31

434 59,90 3

289

9

431

69

5,914

17,737

Financed by:

Derivative financ ial instruments


Liability o n investment co ntract

44,0 91 44,0 91 11,80 0


Liability o n insurance co ntract

(10 ,920 )

(80 )


Other liabilities




Equity and reserves 8,730

37

Total liab ilit ies 1,0 46,891 (21,485)

(10 ,484)

1,0 68,376 998,137 9,90 2

—

—

—

—

—

—

—

—

—

—

434

434

32,291

59,90 3

Consolidat ion

ent ries

Consolidat ion

ent ries

—

——

——

—

—

——

—

—

—

——

——

—

—

——

——

28

9,90 1

(58,164)

(9,244)

(552)

(4 ,0 13)

23

(67)

(1) (551)

(3,990 )

76,619

(58,187)

(9,177)

(55,952)

(9,177)

(420 )

448

(343)

(107)

2,079

(1,892)

(25)

84,728

1,820 1,820 1,820

366,720 366,720

24 24

215,137 215,137

325 325397 72

(10 ,567)

(95)

3,177 3,177

4,546 4,546 4,546

1049,771 49,771

3,749 3,749

95,883 95,883

138,781138,686

84,728 84,728

10 ,567 10 ,567

1,124 2,0 53

95,874

3,318

49,692

20 9,223

348,983

3,264

—

570 ,638

382

—

—

107,533

4,267 4,267

76,0 59

243,921 254,40 5 230 ,668

76,0 59 76,0 59

107,613

382

581,558 569,116

229

10 6,0 35

4,230

972

163

12,442

(10 )

60 5

14,574

—

—

—



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

120


Operat ing income

Operating Expenses


Share o f pro fit o f equity acco unted investees

Prof it before income tax

Taxatio n

Prof it af ter income tax

—

—

—

—

—

—

—

—

—

—

— —

— —

—

——

—

—

—

—

— —

—

— —

—

—

—

—

— —

—

Union

Pension

—

—

—

—

—

—

—

—

Cash and cash equivalents 121,960 (1,960 ) 123,920 58,457 65,463

Pledged assets


Derivative financ ial instrument


Investments in equity-acco unted investee


Assets held fo r sale

Trading pro perties



Intangible assets

Deferred tax assets

Other assets 434

Total assets 1,0 0 8,451 7,516 1,0 0 0 ,934 920 ,230

121,810

434 80 ,271

380

8

351

94

3,543

10 ,425

Financed by:

Derivative financ ial instruments

Depo sits fro m banks 61,890 61,890

7 7

18,0 55

Depo sits fro m custo mers (1,960 )

(70 )

149Current tax liabilities

Other liabilities




Equity and reserves

Total liab ilit ies 1,0 0 8,451 7,516

2,0 51

7,346

1,0 0 0 ,934 920 ,230

—

—

—

——

——

——

—

—

434

434 80 ,271

—

——

—

—

—

—

—

—

—

—

—

—

——

—

——

—

—

—

—

—

—

——

Group

balances

96,194

86,544

27,118

26,684

(59,420 )

(9,650 )

(6)

(434)

7,879

5,915

—

Consolidat ion

ent ries

10 2

46

(2,0 11)

(150 )

5,765

Total

88,315

21,20 3

20 ,944

(6)

(259)

80 ,675

(59,466)

(7,640 )

Bank

85,583

77,913

20 ,691

20 ,486

—

(57,222)

(7,671)

(20 5)

UBN

Propert y

Company

Ltd

843

147

122

—

—

843

(695)

(25)

Union

Bank UK

1,889

371

317

—

1,919

(1,549)

31

(54)

83,935 83,935 83,935

745

7 7 7

745 745

312,797 312,797

24 24

197,20 0 197,199

2,525 2,52520 ,426 17,90 1

(8,372)

(77)

1,930 1,930 1,930

48,575 48,575

2,422 2,422

95,883 95,883

122,624122,547

8,372 8,372

95,875

2,071

48,482

193,656

30 2,372

527,617

822

110 ,260

845 845 845

78,135 78,135 78,135

221,528

7,347

219,476 20 5,268

110 ,331

673

529,577 507,431

635

10 9,861

22,146

38

470

13,775

—

—

—

(b) Co ndensed results o f co nso lidated entities ( ii) The co ndensed financ ial data o f the co ntinuing o peratio ns as at 31 December 20 14, are

as fo llows

—

—

7

43,835

Condensed Statement of f inancial posit ion



Net operat ing income after net

impairment loss

Union

Pension

RestatedGroup

balances

Consolidat ion

ent ries Total

UBN

Propert y

Company

Ltd

Union

Bank UK

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

Restated

balances

Bank

121

29 Propert y and Equipment

(a) Group:

The movement in these acco unts during the year was as fo llows:

—

—— —

——

—

—

——— —

—

—

— ———

— ——

————

———

—

—

—

—— —

—

—

—

—— —

—

— —

— —— —

———

—

——

Leasehold

land and

build ings

Fixtures

& f it t ingsFurnit ure &

equipmentMotor

vehicles

Capital

work in

progress Total

i. Cost

Restated balance at 1st January, 20 15 48,834 14,145 3,755 1,361 70 ,70 8

Exchange difference

Additio ns

Dispo sals


Balance as at 31 December 20 15

Balance at 1st January, 20 14

2,613

3,0 52

50 ,220

Exchange difference

Restated balance at 1st January, 20 14

Prio r year adjustment (See no te 4)

Additio ns

Dispo sals

Rec lassificatio n to o ther assets

Transfers

Assets c lassified as disco ntinued o peratio ns

Restated balance as at 31 December 20 14

ii. Depreciat ion and impairment losses

Restated Balance at 1st January, 20 15

Exchange difference

Charge fo r the year

Dispo sals

Impairment lo ss (See (iv) below)





Exchange difference



Dispo sals

Impairment lo ss


Assets c lassified as held fo r sale and disco ntinued

o peratio ns


( iii) Net Book Value



Restated balance as at 1 January 20 14

14

2,0 32

(2,233)

48,647

(69)

50 8

13

3,272

(1,790 )

25 25

15,665

2,613

1,167

965

1,885

3,230

1,160

(596)

45

1

820

2,181

1,361

159

159

159

159

159

2,0 22

72,775

50

(4,688)

6,677

28

65,997

(1,10 0 )

64,897

54

6,520

(40 )

647

(116)

(1,255)

70 ,70 8

23,0 0 3

20 ,470

(972)

525

990

818

81811,676

11,676

26

4,252

(6)

(935)

366

(1,234)

14,145

7,90 4

490

2,123

2,123

1,160

2

39

(34)

2,60 8

(20 )

3,755

(1,10 0 )

49,120

26

749

(1,551)

490

48,834

9,554

10

955

(50 8)

20 0 20 0

10 ,211

10 ,781

(59)

261

965

8

2,20 0

(1,752)

19

8,379

7,90 9

3,0 87

21

(591)

10 3

1

3,552

40

(2,910 )

3,519

19

22,134

(154) (154)

20 ,316 10 ,627

24

940

(1,687)

(351)

9,554

38,436

216

749

749

7,90 9

16

1,613

(5)

(849)

(780 )

7,90 4

7,286

3,552

143

(13)

2,615

(32)

110

872

872

40

2,879

(37)

79

(1,143)

22,134

49,772

39,280

38,493

1,648

1,374

6,242

3,767

20 2

288

1,20 2

659

48,575

44,581

( iv) In the co urse o f the year, the Gro up recovered a landed pro perty at plo t 595, Adeto kunbo Ademo la Street, Wuse II, Abuja. The pro perty was therefo re reco gnised in the bo o ks at the initial co st o f purchase and subsequently fully impaired as there are litigatio ns o n the pro perty.

(v) In the o pinio n o f the direc to rs, the market value o f the Gro up's pro perties is no t less than the value shown in the financ ial statements.

(vi) Exchange difference relates to the co nversio n o f pro perty and equipments acquired in the overseas subsidiary at the rate o f exchange ruling at the end o f the year.

(vii) Capital wo rk in pro gress represents co nstructio n co sts in respect o f new o ffices. On co mpletio n o f co nstructio n, the related amo unts are transferred to appro priate catego ries o f pro perty and equipment.

(viii) There were no capitalised bo rrowing co sts related to the acquisitio n o f pro perty and equipment during the year (December 20 14: nil)




122

(b) Bank: The movement in these acco unts during the year was as fo llows:

—— —

——

—

—

— —— —

—

Leasehold

land and

build ings

Fixtures

and f it t ingsFurnit ure &

equipmentMotor

vehicles

Capital

work in

progress Total

( i) Cost

Restated balance at 1st January, 20 15 48,638 13,952 3,737 1,361 70 ,30 1

Additio ns

Dispo sals



2,613

3,0 52

50 ,0 59



Additio ns

Dispo sals


Transfers


2,0 32

(2,233)

48,437

(69)

50 8 3,264

(1,790 )

15,426

2,613

3,186

1,124

(596)

45 820

2,181

1,361

72,282

(4,688)

6,669

64,439

(1,10 0 )

63,339

6,471

(40 )

531

70 ,30 1

(972)

525

990

818

81810 ,315

10 ,315

4 ,212

(6)

(1,0 51)

482

13,952

490

2,123

2,123

1,124

39

(34)

2,60 8

3,737

(1,10 0 )

48,959

740

(1,551)

490

48,638

—— —

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

( ii) Accumulated depreciat ion and impairment losses

Restated balance at 1st January, 20 15 9,724 7,594 3,536 21,819


Impairment lo ss (See (iv) below)

Dispo sals



965

1,167

10 ,648




Dispo sals



936

20 0 20 0

(50 8)

10 ,352

(59)

261 2,180

(1,752)

8,0 22

965

3,0 49

846

(591)

10 3

3,536

22,590

(2,910 )

3,480

19,0 88

(154)

18,934

2,854

(37)

68

21,819

2,60 9

6,845

6,845

1,60 5

(5)

(851)

7,594

216

749

749

846

113

(32)

(154)

10 ,494

920

(1,690 )

9,724

( iii) Net Book Value



Restated balance as at 1 January 20 14

1,885 2,181 38,0 85 7,40 4 137 49,692

38,914

38,465

1,648

1,374

6,358

3,470

20 1

278

1,361

818

48,482

44,40 5

( iv) In the co urse o f the year, the Bank recovered a landed pro perty at plo t 595, Adeto kunbo Ademo la Street, Wuse II, Abuja. The pro perty was therefo re reco gnised in the bo o ks at the initial co st o f purchase and subsequently fully impaired as there are litigatio ns o n the pro perty.

(v) In the o pinio n o f the direc to rs, the market value o f the Bank's pro perties is no t less than the value shown in the financ ial statements.

(vi) Capital wo rk in pro gress represents co nstructio n co sts in respect o f new o ffices. On co mpletio n o f co nstructio n, the related amo unts are transferred to appro priate catego ries o f pro perty and equipment.

(vii) There were no capitalised bo rrowing co sts related to the acquisitio n o f pro perty and equipment during the year (December 20 14: nil)




123

30 Intang ib le Assets



Cost

4,263 2,134 3,40 1 1,610

Additio ns

Transfer fro m wo rk-in-pro gress

Exchange translatio n difference



Rec lassificatio n


Amo rtisatio n fo r the year

Exchange translatio n difference

Balance as at 1 January

Carrying amounts as at year end

Amort izat ion and impairment losses

2,078

54

6,395

1,841

772

33

2,646

3,749

2,422 80 8

2,422

1,841

67

16 16

432

1,326

4 ,263

112

1161,90 1 1,913

5,314

1,330

666

1,996

3,318

2,072 685

2,071

1,330

389

925

3,40 1

116

1,675

— —

— —

— —

— —

( i) In the o pinio n o f the direc to rs, the market value o f the Gro up's so ftware is no t less than the value shown in the financ ial statements.

( ii) There were no capitalised bo rrowing co sts related to the acquisitio n o f so ftware during the year (December 20 14 : nil)

31 Deferred Tax Assets and Liab ilit ies Recognised deferred tax assets and liab ilit ies Deferred tax assets and liabilities are attributable to the fo llowing :

Group

31 December 20 15

Assets Liab ilit ies Net

Pro perty, equipment, and so ftware 6,847(1) (6,848)

Allowances fo r lo an lo sses 192 (192)

Fo reign exchange gains 573 573

Tax lo ss carry fo rward 10 0 ,638 10 0 ,638

Others 1,711 1,711

Net tax assets ( liabilities) 10 2,921 7,0 39 95,882

—

—

—

—

Group

31 December 20 14


Pro perty, equipment, and so ftware 6,847 (6,847)




Others 1,711 1,711


—

—

—

—

—

N million N million N million31 December 20 15


—

—

—

—

—

Bank





Others 1,711 1,711


N million N million N million31 December 20 14


—

—

—

—

—

Bank





Others 1,711 1,711





N million

N million

N million

N million

N million

N million

124

Deferred tax assets and liab ilit ies

Movement on the net deferred tax assets/ ( liab ilit ies) account during the year:


Credit fo r the year

Balance, beg inning o f the year 95,883 95,889

Net assets/ ( liabilities) o f disco ntinued o peratio ns

Net deferred tax assets/ ( liabilities)

Made up o f

Deferred tax liabilities

Deferred tax assets

95,883

10 2,921

(7,0 39) (7,0 39) (7,0 39) (7,0 39)

10 2,922

95,883

10

(16)

95,875

95,875

—

—

—

—

—

—

10 2,914 10 2,914

95,875

95,875

Recognised and unrecognised deferred tax assets

Reco gnitio n o f deferred tax assets o f N95,883 (December 20 14: 95,883) is based o n management's pro fit fo recasts (which are based o n the available evidence, inc luding histo rical levels o f pro fitability) , which indicate that it is pro bable that the Gro up's enities will have taxable pro fits against which these assets can be utilized. As at year end, the Bank and Gro up have unreco gnised deferred tax assets o f N72 billio n (20 14: N56 billio n).

Additio nal deferred tax assets have no t been reco gnised because it is no t pro bable that future taxable pro fit will be available against which the Gro up can use the benefits.

32 Other Assets

Other assets:

Cash Reserve Requirement (see ( i) ) 113,376127,613 72,971

Clearing

Legacy Sundry assets (see no te ( iii) below)

Acco unts receivable

Other Sundry assets (see no te ( iv))

Prepayments

Receivable fro m AMCON

Impairment o n o ther assets (see no te ( ii) )

Net o ther assets

127,613 113,376 72,971

GroupGroup Group Bank Bank BankDec.20 14Dec.20 15 Dec.20 15 Dec.20 14 0 1 Jan.20 14

RestatedRestatedRestatedRestated

0 1 Jan.20 14

758

3,30 4

3,623

—

—

— —

—

—

9,585

17,270

(6,197)

11,073

138,686 122,547

9,171

(183,510 )

192,681

8,415

178,075

2,922

2,412

857 148

2,610

2,20 4

7,447

186,837

7,885

207,131

(180 ,0 33)

27,0 98

10 0 ,0 69 138,0 30

10 ,417

(6,197)

16,614

9,151

3,461

3,244

758 857

2,227

2,80 4

178,075

7,981

191,944

(183,510 )

8,434

121,810 10 1,564

28,593

(178,968)

207,561

8,411

186,837

7,447

2,10 4

2,614

148

( i) The Bank had restric ted balances o f N127.613 billio n (Dec . 20 14: N113.376 billio n) with the Central Bank o f Nigeria (CBN) as at 31 December 20 15, representing the cash reserve requirement (CRR). The CRR is a mandato ry cash depo sit which sho uld be held with the Central Bank o f Nigeria as a regulato ry requirement. The CRR is no n interest bearing and is no t available fo r use in the Gro up's day-to -day o peratio ns. As at the end o f 20 15, the CRR in fo rce was Public Secto r Depo sits 20 % (Dec 20 14: 75%) and Private Secto r Depo sits 20 % (Dec 20 14: 20 %).

( ii) Movement in impairment on other assets:


Balance, beg inning o f the year 180 ,0 33

5,222

183,510 183,510

2,0 97 2,0 97

154,680

4,911

Allowance written o ff (see ( iii) below)


Rec lassificatio n

Allowance no lo nger required


178,967

4 ,763

151,0 94

3,845

GroupGroup Group Bank Bank BankDec.20 14Dec.20 15 Dec.20 15 Dec.20 14 0 1 Jan.20 140 1 Jan.20 14

(176,799) (176,799)

190 190

(2,80 1) (2,80 1)

183,510 183,510

(399) (399)

1,0 21 1,0 21

(1,30 1) (10 )

24,0 39

(3,587)

180 ,0 33

(842)

178,968

24,0 39

(10 )

6,197 6,197

(1,0 66) ———

—

—

—

( iii) During the year, at the end o f a three-year reco nc iliatio n pro jec t, legacy sundry assets to talling N176.80 billio n were written o ff against provisio ns o f same amo unt.




N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

125

33 Deposit s f rom BanksGroup Group Bank Bank

Dec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

Mo ney market depo sits (See no te ( i) below) 11,80 0 18,0 55 11,80 0

—

———

—

—

18,0 55

Other depo sits fro m banks

FCY inter bank takings

LCY inter bank takings

( i) Money market deposit s

32,291

44,0 91

11,80 0

11,80 0 18,0 55

18,0 55

61,890

43,835

11,80 0

11,80 0

11,80 0 18,0 55

18,0 55

18,0 55

34 Deposit s f rom CustomersGroup Group Bank Bank

Dec.20 15 Dec.20 14 Dec.20 15 Dec.20 14

Term depo sits 210 ,0 0 6 167,388 20 8,20 5 160 ,773

Current depo sits

Savings

214,20 0

146,433 146,433

570 ,639 527,617

138,0 49 138,0 49

222,180 214,478

569,116 507,431

20 8,60 9

35 Current Tax Liab ilit ies


Balance, beg inning o f year 822 534 635 472

Fo reign exchange translatio n difference



Transfer to assets held fo r sale

3

552

(1,0 51)

56

382 822

434 420

229 635

20 5

Payments during the year

(82)

(64) (826) (42)

—

—

—

—

—

36 Other Liab ilit ies

Due to fo reign co rrespo ndent banks (See no te (a) below)

Provisio n fo r c laims and co ntingenc ies (see no te (c )) below

Depo sits fo r fo reign currency 36,879

—

—

—

—

—

—

—

—

36,87920 ,560 20 ,56040 ,633 40 ,633

PAYE and o ther statuto ry deductio ns

Unearned inco me

Draft and bills payable

Acco unts payable

Sundry credito rs

Credito rs and accruals (see no te (b)) below

Provisio ns fo r Ex-staff c laims

Electro nic co llec tio ns and o ther e-payment liabilities

Insurance premium payable

Other credit balances


1,121 1,121

30 ,0 96 30 ,0 96

8,279 8,279

719

2,236

3,488

4,629 4 ,629

4 ,221

654 654

7,224

107,533 10 3,580

984 585

4,629 4 ,629

1,435 1,435

5,566 5,566

1,844 1,844

3,517 3,517

4,777 4 ,777

27,949 27,949

15,526 15,526

474 4741,937

23,278 23,278

21,791

1,841

21,774

26,641

3,0 69 3,0 69

1,643 1,643

5,7406,10 6

4,629 4,629

8,758 8,758

5,335 5,227

143,80 3 10 6,0 35 10 3,181

5,727

4 ,221

3,486

720

23,979

327

2,236

23,979

327

25,977

142,586

(a) Due to fo reign co rrespo ndent banks represents debit balances in No stro acco unts, N7.93bn (December 20 14: Nil) , and o bligatio ns to a fo reign co rrespo ndent bank in respect o f letters o f c redit, N21.9bn (December 20 14: Nil) . The letter o f c redit o bligatio ns have been transferred to the Bank's custo mers and bo o ked as sto cking term fac ilities as at 31 December 20 15. The co rrespo nding custo mers' o bligatio ns to the Bank are therefo re part o f repo rted lo ans and advances to custo mers.

( iv) Other Sundry Assets

Interbranch suspense

Fraud and lo sses 2,2411,620 1,62070 5

4,539

1,0 47

Advance payments fo r PPE

ATM receivable

Receivable fro m Unio n Ho mes

Pro perty under dispute

Mastercard Elec tro nic Settlement

Garnishee Order

Other acco unt balances

Balance, end of year

2,241 70 5

4,539


1,222 1,222

1,927 1,927

1,0 47

1,183 1,183

1,0 47

479 479

521

8,415

87

7,981

1,0 47 1,0 47 1,0 47

1,30 0 1,30 0

1960

863 863

731

7,885

1,960

1,257

8,411

668 668

51

1,867

9,585

51

1,433

9,151

866 866 —



—

—

—

—

——

—

—

———

—

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

126

(b) Credito rs and accruals is as analysed below:

Accruals fo r pro fessio nal and co nsultancy fees

Provisio n fo r restitutio n (see no te (45))

Accrual fo r IT co nsumables 561 561

27,949 27,949

274 274381 381

Accrual fo r Industrial Training Fund Levy

Accrual fo r staff related allowances

Accrual fo r statuto ry audit fees

AMCON provisio n

Accrual fo r transfo rmatio n expenses

Accrual fo r Advertisement

Other accruals and provisio ns

GroupGroup Group Bank Bank BankDec.20 14Dec.20 15 Dec.20 15 Dec.20 140 1 Jan.20 14 0 1 Jan.20 14

569 569

235 235

131 131

131 131

3,0 57 3,0 57

5,632 5,632

13,0 22 13,0 22

927 927

23,979 23,979

839 839

12,667 12,667

9,269 9,269

3,0 82 3,0 82

193 193

346 346

82 82

293 293

617 6171,0 49 1,0 49

229 229

88 88

943 943

153 153

7,497 7,497

2,578 2,578

10 ,0 89 10 ,0 89

3,635 2,971

26,641 25,977

(c ) The movement o n provisio n fo r c laims and co ntingenc ies during the year was as fo llows

Charge/ reversal during the year

Balance, beg inning o f year 5,441 1,6431,844 1,8444,70 1 4,70 1

Rec lassificatio n



392 392

2,236 2,2361,844 1,844

——

—

——

—

(3,597) 20 1(1,879) (1,879)

(1,179) (1,179)

1,643 1,643

37 Employee Bene?t Obligat ions

Other lo ng-term employee benefits (see (b) below)

Po st employment benefit o bligatio n (see (a) below) 6,811 6,8113,566 3,52912,734 12,734


70 1 70 1

4,267 4,2307,525 7,525

714 71410 ,130 10 ,0 85

22,864 22,819

(a) Po st employment bene? t o bligatio n

Defined benefit o bligatio n (See (ii) below)

Defined co ntributio n scheme (See (i) below) 131 131152 152131 131


3,414 3,377

3,566 3,5296,811 6,811

6,680 6,68012,60 3 12,60 3

12,734 12,734

( i) De? ned Co ntributio n Scheme

Charge during the year (See no te 15)

Balance, beg inning o f year/ year 131 131131 13130 4 247

Rec lassificatio n to disco ntinued o peratio ns

Rec lassificatio n to defined benefit o bligatio n

Co ntributio n remitted during the year

Balance, end o f year/ year


644 644

(623) (623)

152 152131 131

(70 2) (70 2)

70 2 70 21,613 1,613

(5)

(43)

(1,738) (1,729)

131 131

— — — — —

— — — — —

The Gro up and its employees make respective co ntributio ns o f 10 % and 8% o f basic salary, ho using and transpo rt allowance to each employee's retirement savings acco unt maintained with employees' no minated Pensio n Fund Administrato rs.

( ii) Defined benefit o bligatio n The Gro up also has a Legacy defined benefits pensio n scheme fo r its staff, prio r to passage

o f the Pensio n Refo rm Act. Under the scheme, terminal benefits were determined with reference to the employees' salaries upo n disengagement. The Gro up has successfully transferred all such benefits to the Retirement Savings Acco unts (RSA) o f the affec ted employees and is being funded by a plan asset. Obligatio ns to affec ted employees is being actuarially determined annually to determine if the plan assets are adequate to cover the o bligatio ns. Funds are transferred to the Pensio n Fund Administrato rs o f employees where the plan asset is determined to be inadequate.



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

127

The Bank has rec lassified fro m o ther liabilities to employee benefit o bligatio ns, the balance o f N6.680 billio n (1 January 20 14: N12.60 2billio n) relating to the net liabilities o n po st employment defined benefit o bligatio n in respect o f pre-20 0 6 employees o f the Bank. This has now been acco unted fo r and disc lo sed in line with IAS 19 - Employee Benefits. In prio r years, the balance was inadvertently misc lassified as part o f o ther liabilities. This has now been co rrected by restating the affec ted financ ial statement line items fo r prio r years.

( iii) The fo llowing table shows a reco nc iliatio n fro m o pening balances to the c lo sing balances fo r net defined benefit (asset) liability and its co mpo nents.

Included in prof it or loss

Included in OCI

Benefits paid by the plan

Balance, beg inning o f the year 6,680 12,60 2

Current service co sts and interest



Change in fair value o f plan assets

Remeasurement o f defined benefit o bligatio n

Liquidatio n o f assets

GroupGross def ined benef it liab ilit y

Dec.20 15Dec.20 15

Fair value of p lan assets Net def ined Benef it (asset ) liab ilit y

Others

37

3,283

(4,254)

988

988

(7,574)

3,414 6,680

(5,922)

(5,922)


Included in OCI

Benefits paid by the plan


Current service co sts and interest


Change in fair value o f plan assets


Liquidatio n o f assets

Bank

Others

— —

19,197

Dec.20 15

2,572

2,572

(7,574)

37

14,232

(7,537)

—

—

— — —

—

—

(12,193)

(12,517)

Dec.20 14

(324)

(324)

—

—

—

—

—

—

(12,517)

Dec.20 15

(1,584)

(1,584)

3,283

3,283

(10 ,818)

—

—

—

—

—

—

(12,193)

(12,517)

324

(324)

—

—

—

—

—

19,197

2,572

2,572

(7,574)

14,195

(7,574)

—

—

—

(12,517)

(1,584)

(1,584)

3,283

3,283

(10 ,818)

—

—

—

6,680

3,283

(4,291)

988

988

(7,574)

3,377

—

—

12,60 2

6,680

(5,922)

(5,922)

—

—

—

—

—

24,795

19,197

Dec.20 14

(5,922)

(5,922)

324

324

—

—

—

—

24,795

19,197

(5,922)

(5,922)

324

324

—

—

—

Quo ted entities

Cash and bank balances 4,117 4,117378 3783,477 3,477

Mo ney market investment

Private equity

Treasury bills

Real Estate

GroupGroup Group Bank Bank BankDec.20 14 Dec.20 15 Dec.20 140 1 Dec.20 14 0 1 Dec.20 14

2,590 2,590

442 442

493 493

6,534 6,534

380 380

10 ,818 10 ,81812,517 12,517

2,90 9 2,90 92,90 9 2,90 9

38 38

380 380

1,230 1,230

3,843 3,8434,779 4,779

1,0 28 1,0 28

12,193 12,193

— —

— —

iv. Plan assets fo r funded o bligatio ns co nsist o f the fo llowing

(b) Other long-term employee benef it s

Other lo ng-term employee benefit represents liability in respect o f lo ng service award.

The basis o f determining the benefit due to an employee is as stated below: ( i) Less than 5 years o f service: 12 weeks to tal emo lument fo r each co mpleted year o f service. ( ii) 5 years but less than 15 years o f service: 14 weeks to tal emo lument fo r each co mpleted year

o f service. ( iii) 15 years o f service and above: 16 weeks to tal emo lument fo r each co mpleted year o f

service.

The to tal emo lument is defined as basic salary, ho using and transpo rt allowance and lunch subsidy.



Gross def ined benef it liab ilit y

Dec.20 15Dec.20 15

Fair value of p lan assets Net def ined Benef it (asset ) liab ilit y

Dec.20 15 Dec.20 14Dec.20 15Dec.20 14

N million

N million


N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

Dec.20 15

128

( i) The amo unts reco gnised in the statement o f financ ial po sitio n in respect o f lo ng service award are as fo llows:


Present value o f unfunded o bligatio n 70 1

— — — —

— — — —

70 1

70 1 70 1

70 1 70 1

70 1 70 1

714 714

714 714

714 714

714 714

Present value o f funded o bligatio n

To tal present value o f the o bligatio n

Fair value o f plan assets

Reco gnized liability fo r defined benefit o bligatio ns

Present value o f net o bligatio n


Balance, beg inning o f the year 714 714

— —

——

——

20 9 20 9

(184) (184)

25 25

14 14

(52) (52)

(52) (52)

70 1 70 1

10 ,130 10 ,0 85

373 373

(120 ) (120 )

4,10 8 4,10 8

(493) (493)

(13,40 4)

714

(12,591) (12,591)

(813)


Included in OCI

Others

Inc luded in pro fit o r lo ss

Curtailment


Rec lassificatio n to o ther liabilities

Benefits paid by lo ng service award plan


Benefits paid by defined benefit o bligatio n plan

(769)

(13,360 )

713

( iii) Current service co sts and interest The above expense is reco gnised as perso nned expenses, see no te 15.

38 Other Borrowed Funds


Due to CAC ( see (a)) 10 ,938 10 ,938

57,281 57,281

7,840 7,840

76,0 59 76,0 59

14,488 14,488

10 ,182 10 ,182

53,465 53,465

78,135 78,135

Other bo rrowings ( see (c ))

BOI o n-lending fac ilities (see no te (b) below)

(a) This represents the o utstanding balance o n an unsecured fac ility o f N18,167,0 0 0 ,0 0 0 disbursed by the Central Bank o f Nigeria (CBN), as part o f its develo pmental ro le, in co llabo ratio n with the Federal Government o f Nigeria represented by the Federal Ministry o f Agriculture and Water Reso urces which established the Co mmerc ial Agriculture Credit Scheme fo r pro mo ting agricultural enterprises in Nigeria. The funds are made available to partic ipating banks at zero co st, fo r o n lending to co mmerc ial agricultural enterprises at a maximum rate o f 9.0 0 % p.a.

(b) This represents the o utstanding balance o f an interventio n credit granted to the Bank by the Bank o f Industry (BOI), a co mpany inco rpo rated in Nigeria fo r the purpo se o f refinanc ing / o r restructuring existing lo ans to Small and Medium Scale Enterprises (SMEs) and manufacturing co mpanies. The to tal fac ility is secured by Federal Government o f Nigeria securities wo rth N18.4 billio n (Dec . 20 14: N18.4 billio n) and has a 15-year teno r and repayable quarterly.

A management fee o f 1% , deductible at so urce, is paid by the Bank to BOI under the o n-lending agreement and the Bank is under o bligatio n to o n-lend to custo mers at an all-in interest rate o f 7% per annum. Tho ugh the fac ility is meant fo r o n-lending to bo rrowers in spec ified sec to rs, the Bank remains the primary o bligo r to the BOI and therefo re assumes the risk o f default o f custo mers.



N million

N million

N million

N million

N million

N million

N million

N million

129

(c ) Other bo rrowings co nsist o f the fo llowing fo reign currency deno minated fac ilities:

Bank BankDec.20 15 Dec.20 14

Standard Chartered Bank 25,20 4

—

—

—

—

—

—

—

20,073

1,0 0 0

5,60 8

3,993

1,40 3

57,281

38,415

7,353

7,697

Co mmerzbank

Citi Gro up Glo bal Market Limited

Afreximbank

Eco bank EBISA

Mashreq Bank

Diamo nd Bank (UK) Ltd

UBA New Yo rk

53,465

39 Discont inued Operat ions

(a) Prof it for t he year f rom d iscont inued operat ions

Pro fit fo r the year fro m disco ntinued o peratio ns represents the o perating results o f subsidiaries held fo r sale in line with the Bank's Regulatio n 3 co mpliance plan to divest fro m no n-banking subsidiaries. Inc luded in disco ntinued o peratio ns fo r the year ended 31 December 20 15 are the results and balances o f Unio n Trustees Limited and Atlantic No minees Limited.

The pro fit fo r the year fro m disco ntinued o peratio ns co mprises:

142 15,392

Group GroupDec.20 15 Dec.20 14

Gross income

Gross expense

Operat ing Income

Prof it before t ax from d iscont inued operat ions

Prof it f rom d iscont inued operat ions (net of t ax)

(36) (14 ,80 3)

97

10 ,939

(2,894)

Interest Inco me

Net trading inco me

Perso nnel expenses

Interest Expense


Deprec iatio n and amo rtizatio n

Net interest inco me

Underwriting pro fit

Other o perating expenses



To tal no n-interest inco me

Impairment charge fo r c redit lo sses

To tal o perating inco me

Net fee and co mmissio n inco me

Net o perating inco me after net impairment lo ss o n o ther financ ial assets

Inco me tax expense

140

77

77

77

64

8,0 45

8,0 45

863

238

2,6801

65

65

142

672

4,453

4,453

(7,383)

5,115

(1,411)

(8)

134

(15)

—

—

—

—

—

—

(13)

12,498

(443)

(2,672)

(28) (4 ,526)

10 6 589

(449)(9)



N million

N million

N million

N million

130

(b) Assets classi?ed as held for sale


Investments in subsidiaries

Cash and cash equivalents

188

— — —

— —

— — —

20 9

137

8,342

2,182

3,848



Trading pro perties


Impairment allowance


Deferred tax assets

Other assets

4,712

25

13

1,167

397 20 ,426

397 20 ,426 325

325

325

2,525

2,525

2,525

— — —

— — —

— — —

— — —

— — —

— —

— —

—

(c) Liab ilit ies for assets classi?ed as held for sale


Deferred tax liabilities

Current tax liabilities — — —

—

— —

—

—

—

6,947

1

10 6

7,347

293

Other liabilities

Retirement benefit o bligatio ns — — —

— — —

In the o pinio n o f the Directo rs, assets held fo r sale have been reco gnised at the lower o f their carrying amo unt and fair value less co sts to sell.



N million

N million

N million

N million

N million

N million

N million

N million

131

DISCONTINUED OPERATIONS

Statements of Comprehensive Income

For t he year ended 31 December 20 15

(d) Condensed result s of d iscont inued operat ions

The co ndensed ? nanc ial data o f the disco ntinued o peratio ns as at 31 December 20 15, are as fo llows

At lant ic Nominee

Interest inco me


—

— — —

—

— — —

—

—

— — —

—

— — —

—

—

—

—

—

— — —

—

—

— — —

—

—

—

77 77

Interest expense

Net trading (lo ss) / inco me

Deprec iatio n and amo rtisatio n

Net interest inco me


Other o perating expenses

Underwriting pro fit

To tal expenses



Impairment charge fo r c redit lo sses

Net impairment lo ss o n o ther financ ial assets

Inco me tax

Net fee and co mmissio n inco me

Perso nnel expenses

Prof it / ( loss) for t he year

Operat ing income

Net operat ing income after net impairment loss on other f inancial assets

Prof it / ( loss) before income tax

77 77

77

64

1

65

142

65

1

77

64

Union Trustees

Group Total

142

(8) (8)

134 134

(15)

(13)

(15)

(13)

(28)

10 6

(9)

(28)

10 6

(9)

97 97

At lant ic Nominee


Statement of f inancial posit ion

—

—

—

188 188

20 9 20 9Other assets

397 397

Union Trustees

Group Total

Condensed statement of ?nancial posit ion for d iscont inued operat ions

ASSETS

TOTAL ASSETS



N million

N million

N million

N million

N million

N million

132

40 Capital and Reserves


(a) Authorised :

19,0 23,125,0 0 0 Ordinary shares o f 50 ko bo each 9,512 9,512 9,512 9,512

Share cap it al


(b) Issued and fully paid -

16,935,80 6,472 Ordinary shares o f 50 ko bo each 8,468 8,468 8,468 8,468



Balance, end o f year 8,468

8,468

8,468

8,468

8,468

8,468

8,468

8,468

(c) Share premium

Share premium is the excess paid by shareho lders over the no minal value fo r their shares.



Balance, end o f year 391,641 391,641 391,641 391,641

391,641 391,641 391,641 391,641

Share cap it al and share premium 40 0 ,10 9 40 0 ,10 9 40 0 ,10 9 40 0 ,10 9

(d) Other reserves

The o ther reserves inc lude Statuto ry reserves, Fair value reserve, Regulato ry risk reserves, Small and Medium Scale Industries Reserve (SMEEIS) and Capital reserve.


Statuto ry reserves (See no te ( i) below) 22,0 62 22,0 6219,40 4 19,40 4

32,240 27,213Fair value reserve (See no te ( ii) below)

Regulato ry risk reserve (See no te ( iii) below)

Other reserves:

- Excess c lawback reserves (See no te (v) below)

- Translatio n reserve (See no te ( iv) below)

- SMEEIES reserve (See no te (vi) below)

- Equity co mpo nent o f employee benefit remeasurement (See no te (vii) below)

- Capital reserve (See no te (vii) below)

83,377 59,791 79,931 57,0 37

33,0 50

23,876 23,876

1,895 1,8954,431

(14,918) (14,918) (14,918)(14,918)

6,774 6,774 6,7746,774

5,589 5,489 5,4895,589

2,513 2,513 2,513

1,753 1,753

2,513

4,389

28,313

8,667 8,667

3,449

3,407

( i) Statutory reserves

Nigerian banking regulatio ns require the Bank to make an annual appro priatio n to a statuto ry reserve. As stipulated by S.16(1) o f the Banks and Other Financ ial Institutio n Act o f Nigeria, an appro priatio n o f 30 % o f pro fit after tax is made if the statuto ry reserve is less than paid-up share capital and 15% o f pro fit after tax if the statuto ry reserve is greater than the paid up share capital. The Bank made a transfer o f N2.54bn to statuto ry reseves during the year ended 31 Dec 20 15 (20 14 N3.07bn).

( ii) Fair value reserve

The fair value reserve inc ludes the net cumulative change in the fair value o f available-fo r-sale investments securities reco gnised in o ther co mprehensive inco me.

( iii) Regulatory risk reserve The regulato ry risk reserve wareho uses the difference between the impairment o n lo ans

and advances co mputed under Nigeria GAAP based o n the Central Bank o f Nigeria prudential guidelines and provisio ns spec ified by the central banks o f fo reign subsidiaries, co mpared with the incurred lo ss mo del used in calculating the impairment under IFRSs.



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

133

( iv) Translat ion reserve

Translatio n reserve co mprises all fo reign exchange differences arising fro m translatio n o f the financ ial statements o f fo reign o peratio ns.

(v) Excess Capital Clawback

Under the recapitalisatio n plan o f the Bank executed in 20 11, the Asset Management Co rpo ratio n o f Nigeria (AMCON) provided Financ ial Acco mmo datio n to bring the Bank's Co mpletio n Net Assets Value (NAV) to zero .

The Financ ial Acco mmo datio n provided by AMCON exceeded the Bank's Co mpletio n NAV o f zero , calculated as at 31 December 20 11, by N14.918 billio n. This excess amo unt was refunded to AMCON during the year ended 31st December, 20 12 and charged to reserves.

(vi) Small and Medium Scale Indust ries Reserve (SMEEIS):

The SMEEIS reserve is maintained to co mply with the Central Bank o f Nigeria (CBN) requirement that all licensed banks set aside a po rtio n o f the pro fit after tax in a fund to be used to finance equity investment in qualifying small and medium scale enterprises. Under the terms o f the guideline (amended by CBN letter dated 11 July 20 0 6), the co ntributio n was 10 % o f pro fit after tax fo r the first 5 years , and thereafter reduced to 5% o f pro fit after tax. However, this is no lo nger mandato ry and therefo re no reserve was made during the year ended 31 Dec 20 15. The reserve is no n-distributable.

(vii) Cap it al reserve

Capital reserve wareho uses the no minal value o f shares cancelled during the capital reco nstructio n exerc ise that o ccurred during the financ ial year ended April 20 15.

(viii) Equit y component of employee benef it remeasurement

This reserve wareho uses the equity co mpo nent o f remesurement o f defined benefit liability/ (assets)

(e) Retained def icit

Retained defic it represents the carried fo rward inco me net o f expenses plus current year pro fit attributable to Gro up's shareho lders.

41 Non-Cont rolling Interest

42 Events af ter t he Balance Sheet Date

There were no events subsequent to the financ ial po sitio n date which require adjustment to , o r disc lo sure in these financ ial statements.

43 Cont ingencies

(a) Lit igat ions and claims

( i) The Gro up in the o rdinary co urse o f business is currently invo lved in 760 litigatio n cases (December 20 14: 726 cases). The to tal amo unt c laimed in the cases against the Bank is estimated at N297.0 3 billio n (December 20 14: 226.65 billio n) while the to tal amo unt c laimed in cases instituted by the Bank is N10 .26 billio n (December 20 14: N1.9 billio n). A to tal provisio n amo unting to N2.23 billio n (December 20 14: N1.8 billio n) has been made based o n the advice o f pro fessio nal legal co unsel. The actio ns are being

Group GroupDec.20 15 Dec.20 14


Movement in the no n co ntro lling interest

5,338 7,162

Pro fit/ ( lo ss) fo r the year

Increase/ (diminutio n) in no n co ntro lling interest


(1)

—

5,337 5,338

(3,0 22)

1,198



N million N million

134

vigo ro usly co ntested and the Directo rs are o f the o pinio n that no significant liability will arise therefro m in excess o f the provisio n that have been made in the financ ial statements.

( ii) There are fo ur (4) cases with to tal c laims o f N2.840 trillio n o f which judgment was awarded against the Bank and provisio ns were no t reco gnised in the financ ial statements. Management is o f the view that a high level o f success is expected at the Co urt o f Appeal based o n pro fessio nal legal advice and that the likeliho o d o f o utflow o f eco no mic reso urce is co nsidered remo te.

The Directo rs are o f the o pinio n that no ne o f the afo rementio ned cases is likely to have a material adverse effec t o n the Bank and are no t aware o f any o ther pending o r threatened c laims and litigatio ns besides tho se inc luded in the above number.

(b) Provision Clawback

Under a Clawback Rights Agreement (CRA) executed amo ng the Bank, Unio n Glo bal Partners Limited (UGPL) and Asset Management Co rpo ratio n o f Nigeria (AMCON) as part o f the recapitalisatio n pro gram o f the Bank, where spec ified provisio ns that were in the bo o ks o f the Bank as at 31 December 20 11 do no t c rystalise and/ o r are no t utilised in settlement o f intended o bligatio ns within 5 years fro m December 20 11, the extent o f the provisio ns which do no t c rystalise and/ o r are no t utilised shall be refunded to AMCON. The refund is o n the gro und that the Financ ial Acco mo datio n provided by AMCON to bring the Bank's Co mpletio n Net Assets Value (NAV) to zero funded tho se provisio ns. As at 31 December 20 15, the o utstanding balance o f the retained excess provisio n is N6,155,644,268 (December 20 14: N7,40 8,942,412). During the year, the Bank reco gnised a to tal interest expense o f N955,347,887.20 (December 20 14: N1,078,539,653.87) o n the retained excess provisio n. (See No te 9(b))

44 Acceptances, Bonds, Guarantees and other Obligat ions for t he Account of Customers

In co mmo n with o ther banks, the Gro up co nducts business invo lving acceptances, perfo rmance bo nds and indemnities. The majo rity o f these fac ilities are o ffset by co rrespo nding o bligatio ns o f third parties. Co ntingent liabilities and co mmitments co mprise perfo rmance bo nds, acceptances, guarantees and letters o f c redit.

In the no rmal co urse o f business, the Gro up is a party to financ ial instruments with o ff-balance sheet risks. These instruments are issued to meet the credit and o ther financ ial requirements o f custo mers. The to tal o ff-balance sheet assets fo r the Gro up was N133.90 billio n (December 20 14: N130 .54 billio n).

The fo llowing tables summarise the no minal princ ipal amo unt o f co ntingent liabilities and co mmitments with o ff-financ ial po sitio n risk:


Perfo rmance bo nds and guarantees 46,60 8 46,60 837,891 37,891

Letters o f c redit

Fx-So ld Spo t

55,0 14 55,0 14

32,279 32,279

133,90 1 133,90 1130 ,535 130 ,535

23,312 23,312

69,332 69,332




135



45. Customers' Complaint s The Bank in its o rdinary co urse o f business received 24,984 co mplaints (20 14: 34,517) as at

December 31, 20 15. The details o f the co mplaints are illustrated in the table below:

The to tal amo unt reso lved was N4,662,90 2,499.99 (20 14: N4,242,30 3,675.19) while the to tal disputed amo unt in cases which remain unreso lved sto o d at N422,661,892.73 (20 14: N2,843,764,238.96). No co mplaints were referred to the Central Bank o f Nigeria (CBN) fo r interventio n during the year (20 14: nil) .

The Directo rs are o f the o pinio n that these o utstanding co mplaints will be ultimately reso lved. The Bank has a to tal provisio n o f N5.63 billio n (20 14: N9.27 billio n) fo r these co mplaints. (see no te36(b))

Dec.20 15 Dec.20 14

Pending co mplaints bro ught fo rward

Descrip t ion

10 0 154

Co mplaints received

Co mplaints reso lved

Unreso lved co mplaints escalated to CBN

Unreso lved co mplaints carried fo rward

24,984

24,860

— —

224 10 0

34,571

34,517

136

46 Related Part y Transact ions

A number o f transactio ns are entered into with related parties in the no rmal co urse o f business. These inc lude lo ans, depo sits, placements and o ff balance sheet transactio ns. The vo lumes o f related-party transactio ns, o utstanding balances at the year-end was as fo llows:

( i) Parent

The parent co mpany, which is also the ultimate parent co mpany, is Unio n Bank Plc o f Nigeria.

( ii) Subsid iaries

Transactio ns between Unio n Bank o f Nigeria Plc and its subsidiaries also meet the definitio n o f related party transactio ns. Where these are eliminated o n co nso lidatio n, they are no t disc lo sed in the co nso lidated financ ial statements. Transactio ns with the subsidiary co mpanies were as fo llows:

( iii) Transact ions w ith key management personnel

The Gro up's key management perso nnel, and perso ns co nnected with them, are also co nsidered to be related parties fo r disc lo sure purpo ses. The definitio n o f key management perso nnel inc ludes c lo se members o f family o f key perso nnel and any entity over which key management perso nnel exerc ises co ntro l. The key management perso nnel have been identified as the executive and no n-executive direc to rs o f the Gro up and o ther relevant senio r management perso nnel. Clo se members o f family are tho se family members who may be expected to influence, o r be influenced by that individual in their dealings with the Bank and its subsidiaries.

Key management perso nnel and their immediate relatives engaged in the fo llowing transactio ns with the Gro up during the year:

Lo ans and advances: Dec.20 15 Dec.20 14

Lo ans and advances (see no te (a) below) 34,70 8 12,850

Total loans and advances 34 ,70 8 12,850

The status o f perfo rmance o f each fac ility is as shown below:

(a) Secured loans and advances

Perfo rming

Perfo rming

Perfo rming

Perfo rming

Perfo rming

No n perfo rming

Perfo rming

Perfo rming Perfo rming

No n perfo rming 25

Perfo rming

Perfo rming

316

8,079

3,074

10 ,587

2

25

33

43

—

10 ,178

Borrower Relat ionship Facilit y Type Amount AmountStatus Status

Accugas Limited

PNG Gas Ltd

Kepco Energy Reso urce Ltd

Sahara Energy Co Ltd

Sailand Nig . Ltd

So no la Banko le Adekunle

Adewale Oyinkansade

Fo rmer Directo r - Co smas Udo fo t

Executive Directo r

Executive Directo r

Chairman - Cyril Odu

No n-Executive Directo rs

No n-Executive Directo rs

No to re Chemicals Industries Ltd



Fcy Term Lo an

Fcy Term Lo an

Overdraft

Term Lo an

Term Lo an

Fcy Term Lo an

Overdraft

Overdraft

Term Lo an

Mo rtgage Lo an

No n-Executive Directo rs- Adeyemi Osindero

Fo rmer Directo r - Onajite Oko lo ko



6,463 No n perfo rming

1,185 No n perfo rming

Dec. 20 14Dec. 20 15

—

—

—

—

—

—

54

Perfo rming Perfo rming 2,0 96 Swift Netwo rks Ltd No n-Executive Directo rs - Richard Kramer Term Lo an 3,525

Perfo rming Perfo rming —Swift Netwo rks Ltd No n-Executive Directo rs - Richard Kramer 1,322 Financ ial Guarantee

Perfo rming Perfo rming Swift Netwo rks Ltd No n-Executive Directo rs - Richard Kramer Overdraft 275 276

34,70 8 12,850



Dec.20 15 Dec.20 14

UBN Pro perty Co mpany Limited 3,451 1,694

Unio n Bank UK Plc 4,951 —

Depo sit placements

Letters o f c redit financ ing

Name o f entities Nature o f transactio ns Outstanding balance

N million

N million

N million

N million

N millionN million

137

Group Group Bank BankDec 20 15 Dec 20 14 Dec 20 15 Dec 20 14

Fees as direc to rs 270 290 270 290

20

310

20

310

88

358

88

358

Directors' Remunerat ion( i) Direc to rs' remuneratio n exc luding pensio n co ntributio n and certain benefits was provided as fo llows:

542 542

983 852 983 852

625 625

Other allowance and benefits

Executive co mpensatio n

Chairman

Group Group Bank BankDec 20 15 Dec 20 14 Dec 20 15 Dec 20 14

27 30 27 30

153 15320 8 20 8

( ii) The direc to rs' remuneratio n shown above inc ludes

Highest paid direc to r

N20 ,0 0 0 ,0 0 0 - N30 ,0 0 0 ,0 0 0

N30 ,0 0 0 ,0 0 1 - N40 ,0 0 0 ,0 0 0

N40 ,0 0 0 ,0 0 1 - N50 ,0 0 0 ,0 0 0

N50 ,0 0 0 ,0 0 1 - N10 0 ,0 0 0 ,0 0 0

N10 0 ,0 0 0 ,0 0 1 - N20 0 ,0 0 0 ,0 0 0

( iii)The number o f direc to rs who received fees and o ther emo luments (exc luding pensio n co ntributio ns) in the fo llowing ranges were:

N20 0 ,0 0 0 ,0 0 1 - N40 0 ,0 0 0 ,0 0 0

Bank BankDec 20 15 Dec 20 14

12 12

852

5

11

7

1820

—

—

—

—

—

—

Management

No n-management


48 53

2,581

2,629 2,976

2,923

EmployeesThe average number o f perso ns employed during the year was as fo llows:

N million N million


N1,0 0 0 ,0 0 0 - N1,50 0 ,0 0 0 7 18

N1,50 0 ,0 0 1 - N2,0 0 0 ,0 0 0

N2,0 0 0 ,0 0 1 - N2,50 0 ,0 0 0

The number o f employees o f the Gro up, o ther than direc to rs, who received emo luments in the fo llowing ranges (exc luding pensio n co ntributio ns and o ther benefits) were:

4

—

10

—

852

N2,50 0 ,0 0 1 - N3,0 0 0 ,0 0 0

N3,0 0 0 ,0 0 1 - N3,50 0 ,0 0 0

N3,50 0 ,0 0 1 - N4,0 0 0 ,0 0 0

N4,0 0 0 ,0 0 1 - N4,50 0 ,0 0 0

720

—

—

1,0 07

—

—

852

2,976 2,629

N4,50 0 ,0 0 1 - N5,0 0 0 ,0 0 0

Above N5,0 0 0 ,0 0 0 1112

786 743

1,198

— —





N million N million

N million N million

138

47 Compliance w ith Banking Regulat ions

Details o f the banking regulatio ns which the Bank co ntravened during the year and penalties paid were as fo llows: (31 December 20 14: N9 millio n)

N million

Regulator/ Banking Leg islat ion Nature of t ransact ion Penalt ies

(a) CBN - BSD/ BCS/ CON/ UBN/ 0 3/ 0 57No n-co mpliance with CBN guidelines fo r

(b) 18.00 CBN - BSD/ GBB/ CON/ CRR/ 0 1/ 0 30Spo t check o n Public Secto r depo sits as at

(c ) 0.28

(d) CBN - FPR/ CIR/ GEN/ 0 4/ 0 12 2.00

2.00

2.00

2.00

Failure to designate Co mpliance Officers in line with

CBN advised structure fo r Co mpliance Officers in banks

Co rpo rate Affairs Co mmissio n No n- Display o f Regulato ry Item at Awka Branch

14.00 appo intments o f staff to to p management po sitio ns

August 29, 20 14

(e)

(f)

(g )

(h)

CBN - Treasury Sing le Acco unt Co mpliance

CBN - DIR/ BSD/ MEG/ UNION/AML/

GEN/ VOL.0 1/ 0 46.00

46.28

Late refund o f depo sit by a fo rmer subsidiary

Granting o f New Lo ans Witho ut the BVN

Late TSA remittance

AMLS/ CFT repo rting infractio n

CBN - CPD/ CMD/ CON/ UBN/ 0 1/ 0 99

CBN - BPS/ DPD/ GEN/ UBN/ 0 1/ 0 10



48 The fo llowing table shows the analysis o f the Gro up's financ ial assets and liabilities and o n the basis o f their current/ no n-current c lassificatio n.

Group

31 December 20 15 31 December 20 14

Note

Carrying

amount

Carrying

amount Current Current

Non-

current

Non-

current

ASSETS

Cash and cash equivalents 19 82,252 82,252 121,960 121,960

No n-pledged trading assets 20 745 745

Pledged assets 21 84,728 26,975 57,753 83,935 29,279 54,656

Derivative assets held fo r risk management22 1,820 1,820

Lo ans and advances to custo mers 23 366,721 144,768 221,953 312,797 159,416 153,381

Investments in equity acco unted investee24 24 24 24 24

Investment securities 25 215,137 150 ,785 64,352 197,20 0 89,80 6 107,394

Trading pro perties 26 3,177 3,177 1,930 1,930

Pro perty and equipment 29 49,772 3,519 46,253 48,575 2,879 45,697

Intangible assets 30 3,749 772 2,977 2,422 432 1,990

Deferred tax assets 31 95,883 95,883 95,883 95,883

Other assets 32 138,686 11,073 127,613 122,547 8,931 113,859

— —

—

—

—

—

———

7

—

—

—

7

1,0 46,495 421,964 624 ,531 988,0 25 413,454 574 ,814

Assets classif ied as held for sale (b) 397 397 20 ,426 20 ,426

TOTAL ASSETS 1,0 46,892 422,361 624 ,531 1,0 0 8,451 433,880 574 ,814

— —

—

—

LIABILITIES


33 61,890

7

61,890

7


Depo sits fro m custo mers 34 570 ,639 570 ,566 73 527,617 527,548 69

Current tax liabilities 35 382 382

Other liabilities 36 107,533 84,446 23,0 87 110 ,260 10 5,483 4 ,777

37 4,267 70 1 845 714



38 76,0 59

80 2,971

59,173

762,225

16,886

40 ,746

78,135

779,576

36,398

732,279

41,737

47,297

3,566

—

—

—

44,0 91

—

44,0 91

—

822

131

822

Liab ilit ies classif ied as held for sale39(c) 7,347 7,347

TOTAL LIABILITIES 80 2,971 786,923 739,626 47,297

——— —

—

—

—

762,225 40 ,746


139

LIABILITIES

33 18,0 55 18,0 55 Depo sits fro m banks

Depo sits fro m custo mers 34 569,116 569,10 6 10 507,431 507,424 7

Current tax liabilities 35 229 229

Other liabilities 36 10 6,0 35 84,444 21,591 10 3,181 10 5,0 84 4 ,777

37 4,230 70 1 7,525 714



38 76,0 59

767,469

59,173

728,282

16,886

39,187

78,135

714 ,962

36,398

667,727

41,737

47,235

3,529

—

—11,80 0 11,80 0

635

131

635 —

—



Bank

31 December 20 15 31 December 20 14

Note

Carrying

amount

Carrying

amount Current Current

Non-

current

Non-

current

ASSETS

19 58,457 58,457 Cash and cash equivalents

No n-pledged trading assets 20 745

Pledged assets 21 84,728 61,890

Derivative assets held fo r risk management22 1,820 1,820

23 348,984 20 6,40 2 30 2,372 149,887



24

Investment securities 25 20 9,223 62,852 193,656 10 5,70 9

Trading pro perties 26 1,124 1,124 1,930

Investment in subsidiaries 28 10 ,567 10 ,567 8,372

Pro perty and equipment 29 49,692 49,692 48,482 45,628

Intangible assets 30 3,318 389 2,929 2,071 389 1,682

—

142,582

146,371

22,838

—

—

— —

—

—

—

—

—

—

— —

745—

—

—

—

—

—

—

54,451 54,451

83,935

2,854

152,485

87,947

29,279

32 138,0 30 8,434 121,810 8,194

1,0 46,892 380 ,0 85 666,80 7 1,0 0 8,451 433,880 574 ,814

129,596 113,376

54,656

—

—

Assets classif ied as held for sale (b) 325 325 2,525 2,525

TOTAL ASSETS

TOTAL LIABILITIES

998,137 414 ,442 920 ,230 342,875 577,115

— —

Deferred tax assets

Other assets

31 95,875 95,875 95,875 95,875 — —

997,812 414 ,117 917,70 5 340 ,350 583,695

583,695

577,115


Group Group Bank Bank31 Dec 20 15 31 Dec 20 14 31 Dec 20 15 31 Dec 20 14

( i) Change in non-p ledged t rad ing assets

Opening balance fo r the year 745 2,847 745 2,847

Clo sing balance fo r the year

Total changes in non-p ledged t rad ing assets

(745) (745)

745 2,10 2 745 2,10 2

49 Reconciliat ion Notes to Consolidated and Separate

Statement of Cashf lows

— —

( ii) Change in p ledged assets

Opening balance fo r the year 83,935 65,167 83,935 65,167


Total changes in p ledged assets

(83,935) (83,935)

(793) (18,768) (793) (18,768)

(84,728) (84,728)

( iii) Change in loans and advances to customers

Opening balance fo r the year 312,797 229,542 30 2,372 210 ,118

Spec ific impairment charge during the year (see no te 23)

Net po rtfo lio impairment writeback (see no te 23 )

(6,271) (4 ,750 )

3,156 (2,0 28) 3,223 (2,0 28)

(18,228) (18,228)

Recoveries o n lo ans and advances 5,124 3,471 5,124 3,471

Clo sing balance fo r the year (312,797) (30 2,372)(366,721) (348,984)

Total changes in loans and advances to customers (63,872) (88,0 83) (56,493) (95,561)

( iv) Change in other assets

Opening balance fo r the year 122,547 10 0 ,0 69 121,810 10 1,564

Impairment charges reco gnised in pro fit o r lo ss (no te 14(b))

Rec lassificatio n o f pro perty and equipments

(5,222) (4 ,763)

(570 ) (579)

(2,0 97) (2,0 97)

Rec lassificatio n o f intangible assets 16 16

Rec lassificatio n o f disco ntinued o peratio n (no te 33b(ii) )

Other no n-cash adjustments

111

(53)

(190 )

Total changes in other assets (18,426) (28,196) (18,317) (23,736)

—

—

—

—

—

—

—

—

1,836

Clo sing balance fo r the year (138,686) (122,547) (138,0 30 ) (121,810 )

N millionN millionN millionN million

140

(v) Change in derivat ive f inancial inst ruments - assets

Opening balance fo r the year 7

Clo sing balance fo r the year (1,820 )

(1,813)

(1,820 )

(1,820 )

—

—

—

— —

—

—Changes o n derivative instruments - assets

Change in derivat ive f inancial inst ruments - liab ilit ies

Opening balance fo r the year (7)


(7)

—

——

—

—

—

—

—

—

—Changes o n derivative instruments - assets

(vi) Change in deposit s f rom banks

Opening balance fo r the year (61,890 ) (46,794) (18,0 55) (3,20 0 )


Total changes in deposit s f rom banks

61,890 18,0 55

(17,799) 15,0 96 (6,255) 14 ,855

44,0 91 11,80 0

(vii) Change in deposit s f rom customers

Opening balance fo r the year (527,617) (482,70 6) (507,431) (479,956)


Total changes in deposit s f rom customers

527,617 507,431

43,0 22 44 ,911 61,685 27,475

570 ,639 569,116

(viii) Change in other liab ilit ies

Opening balance fo r the year (10 3,580 ) (143,80 3) (10 3,181) (142,586)

Adjustment fo r no n-cash items


(5,923) (6,692)4,461

107,533 10 3,580 10 6,0 35 10 3,181

Total changes in other liab ilit ies 8,414 (46,146) 2,854 (46,0 97)

—

( ix) Payment f rom def ined benef it p lan

Benefits paid o n defined benefit o bligatio ns (see no te 37) (7,574) (12,591) (7,574) (12,591)

Benefits paid o n lo ng service award o bligatio n (see no te 37)

Total changes in deposit s f rom customers (7,626) (12,591) (7,626) (12,591)

(52) (52)— —

(x) Proceeds from sale of t rad ing propert ies

Gain o n dispo sal o f trading pro perties (See No te 13) 728 728

Co st o f trading pro perties dispo sed (No te 26)

Proceeds from sale of t rad ing propert ies 1,534 635 1,534

80 6 80 6635

—

—

—

—

(xi) Proceeds from sale of propert y and equipment

Gain o n dispo sal o f pro perty and equipment (See No te 13) 1,660 1,660

Co st o f PPE dispo sed (No te 29)

Accumulated deprec iatio n o f PPE dispo sed (No te 29)

4,688

(2,910 ) 3 (2,910 ) 3

Proceeds from sale of propert y and equipment 3,438 3 3,438 3

4,688

—

—

—

—

(xii) Net proceed from d isposal of subsid iaries

Sales pro ceed fro m dispo sal o f subsidiaries (See no te 13b) 3,649 3,649

Co st incurred o n dispo sal (See no te 13b)

Net proceed from d isposal of subsid iaries 3,596 8,849 3,596

(53) (53)

8,849

—

8,849

8,849

—

(xiii) Proceed/ (acquisit ion) of investment securit ies

Opening balance fo r the year 197,20 0 289,353 193,656 290 ,377

Fair value gain o n available fo r sale investment

No n-cash related adjustments

1,720 1,812

2,80 1 2,80 1

7,40 0 7,679

Gain o n investment dispo sed during the year 193 193

Total changes in loans and advances to customers 215,137 197,20 0 20 9,223 193,656

Pro ceeds/ (acquisitio n) o f investment securities

—

—

—

—

7,543 (93,873) 4,894 (98,533)

(xiv) Movements in borrow ings

Opening balance fo r the year 78,135 78,135

To tal cash inflows fro m bo rrowings

To tal repayments o f bo rrowed funds

39,685

(41,761) (2,232) (41,761) (2,232)

Closing balance for t he year (See Note 38) 76,0 59 78,135 76,0 59 78,135

39,685

45,280

35,0 87

45,280

35,0 87



Other Nat ional Disclosures

142



VALUE ADDED STATEMENTFo r the year ended 31 December 20 15

Group:Dec.20 15 Dec.20 14

% %

Gro ss earnings 117,211 135,90 4

Gro up share o f asso c iate's pro fit (6)

Interest expenses (35,219) (27,211)

81,992 10 8,687

Net impairment lo ss o n financ ial assets (9,252) (17,0 34)

72,740 91,653

Bo ught in materials and services (23,851) (30 ,813)

Value added 48,889 10 0 60 ,840 10 0

Dist ribut ion:

Employee

- Employees as perso nnel expenses 30 ,0 41 61 29,812 49

Government

- Taxatio n 561 1 883 1

Retained in t he Group

- Fo r replacement o f pro perty and equipment and intangible assets 4,30 0 9 3,320 5

- Pro fit fo r the year ( inc luding no n co ntro lling interests) 13,987 29 26,825 44

48,889 10 0 60 ,840 10 0

Dec.20 15 Dec.20 14

% %Bank:

Gro ss earnings 118,366 10 9,821

Interest expenses (35,0 97) (24,237)

(35,0 97) (24,237)

Net impairment lo ss o n financ ial assets (9,177) (7,671)

74,0 92 77,913

Bo ught in materials and services (23,0 51) (25,224)

Value added 51,0 41 10 0 52,689 10 0

Dist ribut ion:

Employee

- Employees as perso nnel expenses 28,755 56 28,754 55

Government

- Taxatio n 420 1 20 5 0

Retained in t he Group

- Fo r replacement o f pro perty and equipment and intangible assets 4,145 8 3,244 6

- Pro fit fo r the year 17,721 35 20 ,486 39

51,0 41 10 0 52,689 10 0

—

N million

N million

N million

N million

143



FINANCIAL SUMMARYFo r the year ended 31 December 20 15

—

—

—

7

—

— —

——

— 61,432 —

—

6,971

78

—

—

—

—

RestatedRestated RestatedRestated

STATEMENT OF FINANCIAL POSITION Dec. 20 15

Dec. 20 15

Dec. 20 14

Dec. 20 14

Dec. 20 13

Dec. 20 13

Dec. 20 12

Dec. 20 12

Dec. 20 11

Dec. 20 11

ASSETS

Cash and cash equivalents 82,252 121,960 10 0 ,925 20 0 ,260 239,0 13

No n-pledged trading assets 745 2,847 1,895 5,863

Pledged assets 84,728 83,935 65,167 44,50 3 69,694

Derivative assets held fo r risk management 1,820 —

Lo ans and advances to custo mers 366,721 312,797 229,542 156,375 166,172

Investments in equity-acco unted investee 24 24 25 5,557 75

Investment securities 215,137 197,20 0 289,353 313,754 269,666

Trading pro perties 3,177 1,930 4,747

Investment pro perties 16,413 19,296 29,133

Pro perty and equipment 49,772 44,581 48,466 50 ,533

Intangible assets 3,749 2,422 80 8 921 60 0

Deferred tax assets 95,883 95,883 95,889 95,349 95,349

Other assets 138,686 122,547 10 0 ,0 69 121,297 120 ,364

Assets c lassified as held fo r sale 397 20 ,426 51,684 84 807

1,0 46,892 1,0 0 8,451 1,0 0 2,0 50 1,0 14 ,80 6 1,0 47,269

EQUITY AND LIABILITIES

Share capital 8,468 8,468 8,468 8,468 8,468

Share premium 391,641 391,641 391,641 391,641 391,641

Reserves (161,525) (183,919) (20 8,634) (226,762) (219,790 )

No n-co ntro lling interest 5,337 5,338

7

7,162 4 ,979 5,346

Derivative financ ial instrument 78

Depo sits fro m banks 44,0 91 61,890 46,794 45,112 62,214

Depo sits fro m custo mers 570 ,639 527,617 482,70 6 522,443 50 0 ,973

Liability o n investment co ntract 80 3 569

Liability o n insurance co ntract 2,691 2,644

Current tax liabilities 382 822 534 2,317 2,668

Other liabilities 107,533 10 3,580 143,80 3 178,587 20 6,20 0

Retirement benefit o bligatio ns 4 ,267 7,525 22,864 49,886 59,386

Other bo rrowed funds 76,0 59 78,135 45,280 34,564 26,950

Liabilities inc luded in disco ntinued o peratio ns 7,347

1,0 46,892 1,0 0 8,451 1,0 0 2,0 50 1,0 14 ,80 6 1,0 47,269

STATEMENT OF COMPREHENSIVE INCOME

Net o perating inco me 81,850 96,195 79,662 79,079 50 ,789

Gro up share o f asso c iates' pro fits (6) (4) 34 952

Impairment lo sses o n financ ial assets (9,244) (9,651) (15,736) (1,767) (69,528)

72,60 6 86,538 63,922 77,346 (17,787)

Operating expenses (58,164)

(552)

97

(1)

83k

(59,419)

(434)

140

1,198

151k

(58,593)

933

(2,426)

(1,621)

32k

(73,0 0 4)

(391)

(2,764)

(2,947)

24k

(89,897)

25,133

Prof it before t ax 14 ,442

13,890

13,987

13,988

27,119

26,685

26,825

25,627

5,329

6,262

3,836

5,457

4 ,342

3,951

1,187

4 ,134

(10 7,684)

(82,551)

(82,551)

(77,668)

Taxatio n

Prof it af ter t ax

Pro fit fo r the year fro m disco ntinued o peratio ns

Prof it for t he year


Prof it at t ributab le to equit y holders

Earnings/ (Lo ss) per share (basic)

Earnings/ (Lo ss) per share (adjusted) 82k 158k 32k 24k (1266)k

Gro up

4,546

—

48,575

—

(4,883)

(1266)k

N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

—

144

—

—

—

RestatedRestated RestatedRestated

STATEMENT OF FINANCIAL POSITION Dec. 20 15 Dec. 20 14 Dec. 20 13 Dec. 20 12 Dec. 20 11

ASSETS

Cash and cash equivalents 54,451 58,457 53,141 142,938 84,658

No n-pledged trading assets 745 2,847 867 2,851

Pledged assets 84,728 83,935 65,167 44,50 3 69,694

Derivative assets held fo r risk management 1,820 —

—

—

—

—

—

——

—

Lo ans and advances to custo mers 348,984 30 2,372 210 ,118 136,982 144,358

Investments in equity-acco unted investee 16 91 75



Trading pro perties




Intangible assets

Deferred tax assets

20 9,223

10 ,567

49,692

3,318

95,875

138,0 30

325

1,124

193,656

8,372

48,482

2,071

95,875

121,810

2,525

1,930

290 ,377

12,892

45,351

685

95,875

10 1,324

2,374

1,930

280 ,449

17,445

45,137

522

95,875

119,293

84

2,282

246,725

19,279

46,567

10 9

95,875

116,155

807

Bank

—

998,137 920 ,230 882,0 97 886,468 827,153

Other assets

7,525

78,135

4,230 10 ,216

45,280 76,0 59

EQUITY AND LIABILITIES

Share capital 8,468 8,468 8,468 8,468 8,468

Share premium 391,641 391,641 391,641 391,641 391,641

Reserves (169,441) (194,841) (212,326) (228,438) (221,207)

11,80 0

569,116

18,0 55

507,431

3,20 0

479,956

3,50 0

482,0 0 5

1,580

399,775


229 635 472 495 1,358


10 6,0 35 10 3,181 155,189 145,478 159,960

49,368 58,628

33,951 26,950


Other liabilities



998,137 920 ,230 882,0 97 886,468 827,153

(9,177) (7,671) (18,420 ) 470

Dec. 20 15 Dec. 20 14 Dec. 20 13 Dec. 20 12 Dec. 20 11 STATEMENT OF COMPREHENSIVE INCOME

Net o perating inco me 83,269 85,584 79,307 73,867 39,942

(69,367)Impairment lo sses o n financ ial assets

74,0 92

(55,951)

(420 )

10 5k

10 5k

77,913

(57,222)

(20 5)

121k

121k

60 ,887

(56,686)

920

30 k

30 k

74,337

(70 ,899)

(268)

19k

19k

(29,425)

(73,20 8)

25,922

(1251)k

(1251)k

Operating expenses

Prof it before t ax 18,141

17,721

20 ,691

20 ,486

4 ,20 1

5,121

3,438

3,170

(10 2,633)

(76,711)

Taxatio n

Prof it af ter t ax

Earnings/ (Lo ss) per share (basic)

Earnings/ (Lo ss) per share (adjusted)



N million

N million

N million

N million

N million

N million

N million

N million

N million

N million

145



146



UNION BANK IN NIGERIA –

LIST OF SALES AND SERVICE CENTRES ACROSS NIGERIA

ABIA STATE

1. Aba-Factory Road Branch 1, Facto ry Ro ad P.M.B. 710 6, Aba Tel: 070 19914247-50

2. Aba-Market Road Branch 58 Azikiwe Ro ad P.M.B. 7127, Aba Tel: 070 19914261-4

3. Aba-Main Branch 17, Po rt Harco urt Ro ad, Aba Tel: 070 19914275-6

4 . Abayi Branch Merchandise Ho use 121 Aba-Owerri Ro ad P.M.B. 7359, Aba Tel: 070 19914255-6

5. Ariaria Market Branch 228, Faulks Rd. Ariaria Market Ariara - Aba P.M.B. 7515, Aba Tel: 070 19914271-2

6. Arochukwu Branch

Barracks Ro ad, Aro chukwu P.M.B. 542, Aro chukwu Tel: 070 19914273-4

7. Ngwa-Road Branch 49a Ngwa Ro ad, Aba P.M.B. 7552, Aba Tel: 070 19914257-8

8. Ohafia Branch

Presbyterian Missio n Hillto p Aro chuckwu/ Ohafia Ro ad Elu, Ohafia Tel: 070 19914265-6

9. Umuahia Branch No 10 Library Avenue P.M.B. 1195, Umuahia Tel: 070 19914267-70

10 . Umudike Branch Natio nal Ro o t Cro p Research Institute Premises Umuahia-Iko t Ekpene Ro ad Umudike-Ikwuano LGA P.M.B. 70 81, Umuahia Tel: 070 19914245-6

11. Umuocham Branch

Merchandise Ho use 121 Aba-Owerri Ro ad P.M.B. 7359, Aba Tel: 070 19914253-4

ADAMAWA STATE

12. Demsa Cash Center Yo la Ro ad, Demsa P.M.B. 0 0 32, Demsa Tel: 070 19914619-20

13. Guyuk Cash Center Ghakawo Ro ad P.M.B. 10 4, Guyuk, Adamawa Tel: 070 19914625-6

14 . Gyawana Cash Center Off Numan Go mbe Ro ad Gyawana Tel: 070 19914627-8

15. Mayo-Belwa Branch Alo ng Zing Ro ad Mayo -Belwa P.O. Box 5, Jalingo Rd, Adamawa State Tel: 070 19914623-4

16. Michika Branch

Bama Ro ad o ppo site Nitel Office P.M.B. 10 22 Michika, Adamawa State Tel: 070 19914621-2

17. Mubi Branch

Ahmadu Bello Way P.M.B. 27, Mubi Adamawa Tel: 070 19914617-8

18. NBC Cash Center, Yola

Mo hammed Mustapha Way Yo la Tel: 070 19914613-6

19. Yola Main Branch

2, Galadima Aminu Way P.M.B. 20 0 5 Jimeta, Yo la Tel: 070 19914613-6

AKWA IBOM STATE

20 . 2nd Uyo Branch Plo t Banking Estate Udo Udo ma Avenue Oppo site AKS Ho use o f Assembly, Uyo Tel: 070 19914110 -11

21. Abak Branch

28 Ho spital Ro ad P.M.B. 1145 Abak Tel: 070 19914116-7

22. Eket Branch

1, Grace Bill Ro ad P.M.B. 31, Eket Tel: 070 1991410 0 -0 3

23. Enema Shopping ATM Center Enema Sho pping Co mplex, Uyo

24 . Ete Branch 1 Iko t Abasi Ro ad Ete Junctio n, P.M.B. 0 49 Iko t Abasi Tel: 070 199140 96-7

25. Ikot-Abasi Branch 1, Ibekwe Ro ad P.M.B. 10 46 Iko t Abasi Tel: 070 199140 98-9

26. Ikot-Edibon Branch Nsit Ubium L.G.A. C/ o P.M.B. 10 65, Iko t Edibo n, Eket Tel: 070 19914112-3,

27. Ikot-Ekpene Branch Plo t B, Bank Layo ut, Opp. Old Stadium Rd. Iko t Ekpene Tel: 070 19914114-5

28. Ikot-Ekpene Cash Center

1 Uyo ro ad, Iko t Ekpene Tel: 070 19914114-5

29. Okopedi Branch

Uyo / Oro n Rd. Oko bo Lo cal Govt. Area Tel: 070 1991410 8-9

30 . Qua Iboe Terminal Branch

Exxo n Mo bil Terminal Ibeno P.M.B. 10 90 , Ibeno Tel: 070 19914118-9

31. Timber Market Cash Center

Ifa Iko t Okpo n Timber Building Material Market Uyo Tel: 070 19914110 -11

32. Uyo Branch 15 Abak Ro ad P.M.B. 10 84, Uyo Tel 070 1991410 4-7

ANAMBRA STATE

33. Abagana Branch Oro fia Village/ Olympic Facto ry Premises P.O.Box 20 0 5 Umudum Village, Abagana Tel: 070 19914186-7

34 . Ajalli Branch Umunze ro ad P.M.B. 10 10 , Ajalli Orumba No rth L.G.A. Tel: 070 19914188-9

35. Atani Road, Onitsha Branch 3, Atani Ro ad Onitsha Tel: 070 19914228-9

147



36. Awka Branch Old Enugu Onitsha Ro ad P.M.B. 50 0 , Awka Tel: 070 199190 -93

37. Bright Street Branch 1, Bright Street P.M.B. 1520 , Onitsha Tel: 070 19914222-3

38. Igbo Ukwu Branch Ekwulo bi/ Nnewi Ro ad P M B 2, Igbo Ukwu Tel: 070 1991420 4-5

39. Ihiala Cash Center Oppo site To tal filling Statio n, beside FBN, Onitsha Owerri ro ad, Nnewi Tel: 070 19914196-9

40 . Jagua Plaza Cash Center 9 Jo hnso n Street, GBO ho use, Onitsha

41. New Market Rd, Nkpor Branch

34 , New Market Ro ad, Nkpo r Anambra State Tel: 070 19914224-5

42. New Market, Onitsha Branch 18, New Market Ro ad P.M.B. 150 0 , Onitsha Tel: 070 19914218-9

43. New Tyre Market Cash Center

New Tyre Market Nkpo r Anambra State Tel: 070 19914224-5

44 . Niger Bridgehead Branch

32, Po rt Harco urt Street, Onitsha, Anambra State Tel: 070 19914226-7

45. Nkpor Junction Branch

33, New Market Ro ad, Nkpo r P.M.B. 1807 Onitsha Tel: 070 19914230 -31

46. Nnewi Main Branch

Edo Ezennewi Rd, P.M.B. 4 , Nnewi Tel: 070 19914196-9

47. Obosi Cash Centre

New Electrical Market, Km 2 Onitsha Owerri Ro ad, Onitsha Tel: 070 19914218-9

48. Ogidi Branch

Building Materials Market Ogidi Tel: 070 19914232-3

49. Oko Branch* Ekwulo bia-Umunze Ro ad Ezio ko Village, P.M.B. 20 Aguata Tel: 070 19914194-5

50 . Oraifite Cash Center 138, Nkwo Market Nnewi Tel: 070 1991420 0 -0 1

51. Umunze Cash Center Ekwulo bia Ro ad, Umunze Ro undabo ut Tel: 070 19914188-9

52. Upper Iweka Cash Center By Nigerian Po lice Officers Wives Market POWA Plaza, Onitsha Tel: 070 19914236-7

BAUCHI STATE

53. Bauchi Commercial Ave 18, Co mmerc ial Ro ad Tel: 070 19914672-5

54 . Misau Branch

Kano -Kari ro ad, Misau, Bauchi Tel: 070 19914684-5

55. Yandoka Branch Yando ka By-Pass, Bauchi Tel: 070 19914682-3

BAYELSA STATE

56. Ovom Branch

70 , Mbiama/ Yenago a Ro ad Yenego a Tel: 070 199140 0 6-07

57. Yenagoa Main Branch

20 4 Mbia-ma Yenago a Ro ad P.M.B. 68, Yenago a Tel: 070 199140 0 2-0 5

BENUE STATE

58. Aliade Cash Center

Gbo ko ro ad, Aliade (Gwer LGA) Aliade Tel: 070 19914732-3

59. Bank Road Branch

Oppo site Ministry o f Wo rks, Makurdi Tel: 070 19914728-9

60 . Gboko Branch Market Ro ad Gbo ko P.M.B. 21, Gbo ko Tel: 070 19914726-7

61. Makurdi Main Branch Oturkpo Ro ad, Makurdi Tel: 070 19914722-25

62. Ogiri Oko Branch 3A, Ogiri-Oko Ro ad, Opp. Po lice Hq. Makurdi Tel: 070 19914740 -41

63. Oju Branch Secretariat Ro ad Oju Tel: 070 19914730 -31

BORNO STATE

64 . Baga Branch Lawanti Ro ad, Baga Kukawa Lo cal Govt Area, P.M.B. 10 0 6, Bo rno Tel: 070 19914658-9

65. Gamboru-Ngala Branch Gambo ru- Ngala Ngala Lo cal Govt Area Maiduguri, Bo rno Tel: 070 19914656-7

66. Kwaya-Kusar Branch Go mbe Ro ad, Maiduguri Tel: 070 19914660 -61

67. Maiduguri Branch

Sir Kashim Ibrahim Ro ad P.M.B. 10 0 6, Maiduguri Tel: 070 19914646-9

68. Maiduguri NBC Plant Cash Center

Ngazargamu Ro ad, Off Jo s Kano Ro ad Maiduguri Tel: 070 19914646-9

69. University Of Maidiguri Cash Center

University o f Maiduguri Maiduguri Tel: 070 19914646-9

CROSS RIVER STATE

70 . Akamkpa Branch

Calabar – Iko m Highway Akamkpa, Cro ss River State P.M.B. 10 12, Calabar Tel: 070 19914138-9

71. Calabar Main Branch

12 Calabar ro ad Calabar, Cro ss River Tel: 070 19914134-7

72. Ogoja Branch 25A Missio n Ro ad Igo li Ogo ja, Calabar Tel: 070 19914128-9

73. Tinapa Branch

Tinapa Business Reso rt, Calabar Tel: 070 19914130 -31

* Branch to be relo cated in 20 16

148

DELTA STATE

74 . Agbor Branch 124 Old Lago s/Asaba Ro ad Agbo r Tel: 070 199140 44-5

75. Asaba Main Branch 119 Nnebisi Ro ad P.M.B. 10 0 3, Asaba Tel: 070 199140 36-9

76. Chevron Cash Center KM 4 Npa express way Ekpan Warri Tel: 070 199140 16-9

77. Effurun Main Branch 35 Effurun/ Sapele Ro ad P.M.B. 5, Effurun Tel, 070 199140 20 -21

78. Ibusa Branch 137, Umejei Ro ad, P.M.B. 10 0 2, Ibusa Tel: 070 199140 46-7

79. Multiline ATM Center

Multiline Transpo rtatio n Co mplex, Warri

80 . Nnebisi Asaba Branch 318/ 319, Nnebisi Ro ad Tel: 070 199140 40 -43

81. Oghara Branch

111 Oghara/Ajagbo dudu Ro ad P.O. Box 120 , Oghara Tel: 070 199140 28-9

82. Ogwashi-Uku Branch 2, Lo cal Government Ro ad P M B 10 31 Tel: 070 199140 48-9

83. Oleh Branch

111 Emo re Ro ad Iso ko So uth LGA P.M.B. 15, Oleh Tel: 070 199140 34-5

84 . Ovwian-Aladja Branch

34 Udu Ro ad Ovwian Aladja Tel: 070 199140 32-3

85. Ozoro Cash Center Delta State Po lytechnic , Km 24 Ozo ro /Asaba Ro ad Iso ko No rth LGA Tel: 070 199140 16-9

86. Sapele Main Branch* 84 , Yo ruba Ro ad P.M.B. 40 0 3, Sapele Tel: 070 199140 24-5

87. Ughelli Branch

Patani Ro ad P.M.B. 9, Ughelli Tel: 070 199140 22-3

88. Warri Main Branch Oppo site Naval Base, Warri-Sapele Ro ad, P.O. Box 422, Warri Tel: 070 199140 16-9

89. Warri-Airport Road Branch 60 , Airpo rt Ro ad Warri Tel: 070 199140 26-7

EBONYI STATE

90 . Abakaliki Branch 1, Ogo ja Ro ad P.M.B. 12, Abakaliki Tel: 070 19914150 -53

91. Uburu-Ohaozara Branch Okpo si Rd.Ohaozara Lo cal Govt Area Ebo nyi State Tel: 070 19914174-5

EDO STATE

92. Agbor Road Branch 60 , Agbo r Ro ad P.M.B. 18, Benin City Tel: 070 199140 44-5

93. Airport Road Branch

74 , Airpo rt Ro ad P.M.B. 1215, Benin City Tel: 070 199140 86-7

94 . Akpakpava Main Branch

96, Akpakpava Street P.M.B. 1114, Benin City Tel: 070 199140 68-71

95. Auchi Branch

2, Po lytechnic Ro ad P.M.B. 18, Auchi Tel: 070 19914074-5

96. Benin-Lagos Road Branch 224, Ugbowo -Lago s Ro ad P.M.B. 0 0 5, Benin City Tel: 070 19914072-3

97. Ekpoma Branch 7, Royal Market Ro ad P.M.B. 29, Ekpo ma Tel: 070 199140 82-3

98. Igueben Branch

1, Ralph Obo h Ro ad P.M.B. 1, Igueben Tel: 070 199140 80 -81

99. Iguobazuwa Branch 7, Fo restry Ro ad P.M.B. 10 19 Benin City Tel: 070 199140 84-5

10 0 . Mission Road Branch

5/ 7 Missio n Ro ad P.M.B. 10 19, Bein City Tel: 070 199140 58-61

10 1. Prestige Hotel ATM Center Prestige Ho tel Benin Edo State

10 2. Uromi Branch 13, Unity Ro ad, Uro mi P.M.B. 6, Uro mi Tel: 070 19914076-7

EKITI STATE

10 3. Ado-Ekiti Branch 8, Ijigbo Street P.M.B. 5310 , Ado -Ekiti Tel: 070 19914874-7

10 4 . Afe Babalola Uni. ATM Center Afe Babalo la University Campus Ado Ekiti

10 5. Crown Poly ATM Cente Crown Po lytechnic Campus Ilawe-Ekiti

10 6. Federal Poly ATM Center Federal Po ly Campus Ado Ekiti

10 7. Igede-Ekiti Branch

King Street, Ado -Ekiti Ro ad P.M.B. 0 3, Igede-Ekiti Tel: 070 19914888-9

10 8. Ilawe-Ekiti Branch 1, Iro Street, P.M.B. 7, Ilawe Ekiti Tel: 070 19914890 -91

10 9. Iyin Microfinance Bank ATM Center

Iyin Micro finance Bank, Iyin-Ekiti,

ENUGU STATE

110 . Agbani Branch

Akpugo Rd P.O. Box 98, Agbani Tel: 070 19914454-5

111. Emene Branch

39, Abiriba Street Emene Industrial Layo ut P.M.B. 10 0 1, Emene Tel: 070 19914156-7

112. Emene Filling Station ATM

Emene Filling Statio n, Emene

113. Enugu-Ukwu Branch Umueze Awo bu Village Old Enugu/ Onitsha Ro P.M.B. 30 0 5, Enugu-Ukw Tel: 070 1991420 2-3

114 . Garden Avenue Branch 3, Garden Avenue P.M.B. 1711, Enugu Tel: 070 19914146-9




149

115. 9th Mile Corner Ngwo Branch Enugu Ro ad 9th Mile Ngwo P.M.B. 1, Ngwo Tel: 070 19914168-9

116. Ituku Cash Center University o f Nigeria Teaching Ho spital Enugu Tel: 070 19914146-9

117. Nsukka Branch UC Building Oppo site UNN Main gate, Nsukka LGA Tel: 070 19914176-7

118. Ogbede Branch Igbo Etiti Lo cal Govt Area Secretariat P.M.B. 50 0 3, Ogbede Tel: 070 19914172-3

119. Ogbete Market Enugu Branch Ogbete Main Market Enugu P.M.B. 1492 Enugu Tel: 070 19914158-9

120 . Okpara Avenue Branch

8 Okpara Avenue, Enugu Okpara Avenue, P.M.B. 1119 Enugu Tel: 070 19914162-5

121. Ogui Road Branch

21 Ogui-Ro ad P.M.B. 10 10 , Enugu Tel: 070 19914160 -61

122. Zik Avenue Branch

58, Zik Avenue Near Kenyatta Market Uwani – Enugu Tel: 070 19914170 -71

FEDERAL CAPITAL TERRITORY

123. Abuja Main Branch 1 Hadejia Clo se Area 3, Garki P.M.B. 35, Abuja FCT Tel: 070 19914745-8

124 . Abuja UAC Branch

UAC Building , Plo t 272/ 273 Central Business Distric t Abuja Tel: 070 19914779-82

125. Area 8, Abuja Branch 6, Ogbo mo sho Street Area 8, Garki, Abuja Tel: 070 19914760 -1

126. Asokoro ATM Center

IBB go lf c lub, Aso ko ro

127. Asokoro II ATM Center Office o f the Sec to the Government Aso ko ro

128. Dei Dei Branch Building Material Int'l Market Dei-Dei, Abuja Tel: 070 19914789-90

129. Federal Secretariat Abuja Branch Phase 2, Bullet Building Federal Secretariat, Abuja Tel: 070 19914772-3

130 . General Hospital ATM Center Maitama General Ho spital Abuja

131. Head Office Annex Branch Plo t 787, Bank Ro ad Off Tafawa Balewa Ro ad Central Business Distric t, Abuja Tel: 070 19914764-5

132. Kubwa ATM Center NYSC Orientatio n Camp, Kubwa

133. Maitama Branch 8, Zambezi Crescent Maitama Distric t, Abuja Tel: 070 19914758-9

134 . NASS Branch

White Ho use, Natio nal Assembly Annex 3 Arm Zo ne, Abuja Tel: 070 19914762-3

135. PHCN ATM Center

PHCN H/ Quarters, Maitama

136. Silverbird Galleria E-center

Plo t 1161, Memo rial drive Central Business Distric t FCT, Abuja

137. Wuse II Branch Plo t 1259 Aminu Kano Crescent Wuse II, Abuja Tel: 070 19914787-8

GOMBE STATE

138. Bajoga Cash Center

Go mbe-Po tiskum Ro ad, Bago ja P.M.B. 0 3 Tel: 070 19914680 -81

139. Gombe Branch

Biu Ro ad P.M.B. 2 Go mbe Tel: 070 19914678-9

140 . Talasse Branch Tula ro ad, Tallase Go mbe Tel: 070 19914686-7

IMO STATE

141. 2nd Owerri Branch 23 Po rt Harco urt Ro ad P.M.B. 1181 Owerri Tel: 070 19914294-5

142. Aboh-Mbaise Branch Ogbo r Obo ama Ezinihitte, Mbaise Tel: 070 19914292-3

143. Anara Branch Anara Town, Orlu Ro ad Anara, Isiala Mbano LGA Tel: 070 1991430 0 -0 1

144 . Okigwe Branch 10 6 Owerri Ro ad, Okigwe Tel: 070 1991430 2-3

145. Okigwe Rd Branch Plo t 19b, Ikenegbu Layo ut Owerri Tel: 070 19914288-9

146. Orlu Branch 4 , Bank Ro ad P.M.B. 12, Orlu Tel: 070 19914290 -91

147. Owerri Branch 77 Do uglas Ro ad P.M.B. 10 31, Owerri Tel: 070 19914284-7

JIGAWA STATE

148. Dutse Branch Yadi Dutse P.M.B. 70 0 2, Dutse Tel: 070 1991460 0 -0 3

149. Hadejia Cash Center 2, Ring im Ro ad P.M.B. 0 0 18, Hadejia Tel: 070 1991460 4-5

KADUNA STATE

150 . Ahmadu Bello Way Branch

7/ 8 Ahmadu Bello Way P.M.B. 20 94, Kaduna Tel: 070 19914520 -21

151. Jaji Cash Center ICS Quarters Jaji Military Canto nment Tel: 070 19914526-7

152. Kaduna South Branch Kachia Ro ad, Kakuri P.M.B. 2112, Kaduna Tel: 070 1991450 6-9

153. KRPC Kaduna Cash Center

Kaduna Refinery & Petro chemical Co mpany Kaduna Tel: 070 1991450 6-9

154 . KWOI Cash Center Alo ng secretariat ro ad, Kaduna Tel: 070 1991450 6-9

155. Mogadishu Cash Center Plo t C8, Mo gadishu Layo ut Kaduna Tel: 070 19914524-5



150

156. M. Buhari Way Branch 4 Muhammadu Buhari Way NNIL Building Kaduna Tel: 070 19914518-9

157. Samaru Branch 1 So ko to Ro ad, Opp. ABU main gate P.M.B. 10 0 1, Samaru Tel: 070 19914516-7

158. Yakubu Gowon Way Branch Yakubu Gowo n way, Opp. CBN P.M.B. 20 81, Kaduna Tel: 070 19914510 -13 159. Zaria Main Branch 2 Circular Ro ad, PZ GRA P.M.B. 10 0 1, Zaria Tel: 070 19914514-5

KANO STATE

160 . Ado Bayero Road Branch 48E Ado Bayero Ro ad P.M.B. 30 33, Kano Tel: 070 19914572-5

161. Bank Road Branch

4 Bank Ro ad P.M.B. 30 07, Kano Tel: 070 19914568-71

162. Bello Road Branch 14s, Bello Ro ad, P.M.B. 3476, Kano Tel: 070 1991460 6-7

163. Challawa Cash Center

Industrial Layo ut P.M.B. 3564, Kano Tel: 070 19914596-7

164 . Doguwar Giginya Cash Center

2 Bank Ro ad, Do guwa L.G.A Kano Tel: 070 19914580 -81

165. Hotoro Branch

40 , Maiduguri Ro ad Oppo site NNPC Depo t Kano Tel: 070 19914582-3

166. Murtala Mohammed Way Branch

71, Murtala Mo hammed Way Yankura Area P.M.B. 12755 Kano Tel: 070 19914578-9

167. NBC Challawa ATM NBC depo t Challawa Kano

168. Sharada Branch Industrial Estate

Phase 1 Sharada P.M.B. 3296 Kano Tel: 070 19914592-3

169. Zoo Road Branch 7B, Zo o Ro ad P.M.B. 3075, Kano Tel: 070 19914576-7

KATSINA STATE

170 . Federal University ATM Center Federal University Campus, Dutsinma Rd, Dutsin-Ma

171. Funtua Branch Katsina Ro ad, Oppo site Upper Sharia Co urt o f Appeal, GRA Funtua town, P.M.B. 60 0 1 Funtua Tel: 070 19914489-90

172. Jibia Branch Kaura Namo da/Jibia Ro ad P.M.B. 20 44 Katsina Tel: 070 19914491-2

173. Katsina Main Branch 18 Trading Area, Nago go Ro ad P.M.B. 20 12, Katsina Tel: 070 19914495-6

174 . Katsina-Yahaya Madaki Way Branch*

Magudu Ho use Annex Yahaya Madaki P.M.B. 2167, Katsina Tel: 070 19914493-4

KEBBI STATE

175. Bagudo Branch

Oppo site Mo to r Garage Bagudo , Kebbi Tel: 070 19914558-9

176. Birnin Kebbi Branch

Haliru Abdul Way Oppo site General Ho spital P.M.B. 10 10 , Birnin Kebbi Tel: 070 19914546-9

177. Federal Medical Center ATM Center

Federal Medical Center, Birnin Kebbi

178. Jega Branch 4 , Mo hammed Dado Street P.M.B. 90 0 4, Jega, Kebbi Tel: 070 19914552-3

179. Yelwa Branch

Bank Ro ad P.M.B. 10 0 2, Yelwa-Yauri Yauri, Kebbi Tel: 070 19914550 -51

KOGI STATE

180 . Ajaokuta Branch

Ro ad 6, Geregu Campus Ajao kuta Tel: 070 19914854-5

181. Egume Cash Center Egume Town Ro ad, Oppo site Onu Palace P.M.B. 10 0 3, Egume, Ko gi State Tel: 070 19914876-7

182. Idah Branch 99 Ayegba Oma Ido ko Rd. Idah P.M.B. 0 07, Idah, Ko gi Tel: 070 19914848-9

183. Lokoja Branch Murtala Mo hammed Way Opp. Obasanjo Sqr. P.M.B. 14, Lo ko ja Tel: 070 19914850 -53

184 . Okene Branch 22, Lafia Street Okene, Ko gi Tel: 070 19914860 -61

KWARA STATE

185. Bode Saadu Cash Center Sabo Area, P.M.B 0 0 4 Bo de Saadu Tel: 070 19914834-5

186. Bovina Hotel ATM Center

Bovina Ho tel, Premises, Ilo rin

187. Federal Polytechnic ATM Center Federal Po lytechnic Campus Offa

188. Ilorin Market Branch

173 Abdul Azeez Attah Ro ad, Surulere P.M.B. 1533, Ilo rin Tel: 070 19914820 -21

189. Kaiama Cash Centre

Kishi-ilo rin ro ad, near Kaima Ilo rin Tel: 070 19914820 -21

190 . Lafiagi Branch Emir's Ro ad P.M.B. 85, Lafiag i Tel: 070 19914830 -31

191. M. M. Way Ilorin Branch 67 Murtala Mo hammed Way P.M.B. 1347 Ilo rin Tel: 070 19914818-9

192. Offa Branch Olo fa Way, Offa P.M.B. 40 1 Offa-Kwara State Tel: 070 19914824-5

193. Omu Aran Branch Aperan Way P.M.B. 10 10 , Omu Aran Tel: 070 19914826-7




151

20 7. Alausa Branch Alfa Ho use Plo t 166, Obafemi Awo lowo Way Agidingbi Junctio n, Ikeja Tel: 070 19914471-2

20 8. Allen Avenue Branch 39, Allen Avenue P.M.B. 21779, Ikeja Tel: 070 19914469-70

20 9. Amuwo Odofin Branch 1A Old Ojo Ro ad Maza Maza Amuwo Odo fin P.M.B. 0 0 6 Festac Town Tel: 070 19913912-3

210 . Apapa-Creek Road Branch 16, Burma Ro ad, Apapa Tel: 070 19913916-9

211. Apapa-Yinka Folawiyo Avenue 27, Yinka Fo lawiyo Avenue P.M.B. 1166, Apapa Tel: 070 19913896-9

212. Ascon Complex Atm Center

Asco n Co mplex, Badagry Express Way, Badagry

213. Aspamda Main Gate Branch

Asso c iatio n o f pro gressive traders o f Nigeria (APT) Pro gressive Market Lago s Internatio nal Trade Fair Tel:070 19913939-40

214 . Atiku Abubakar Branch Atiku Abubakar Hall, Trade Fair Co mplex (BBA) Lago s Badagry Expressway Tel: 070 19913949-50

215. Awolowo Road, Ikoyi Branch 77, Awo lowo Ro ad P.O. Box 2, Ikoyi Tel: 070 19914312-5

216. Badagry Branch 42 African Church Street P.M.B. 10 0 2 Badagry Tel: 070 19913931-2

217. Balogun Square Branch 34 Balo gun Street P.M.B. 2356, Lago s Tel: 070 19914347-4

218. Chevron ATM Center Chevro n Premises, Lekki

219. Dopemu Branch 26, Shasha Ro ad, Akowo njo Do pemu Tel: 070 19914410 -11

220 . Ebute Metta Mainland Ho tel Building P.M.B. 10 07 Ebute Metta Tel: 070 19914437-40

221. Egbe 64 , Iso lo / Iko tun Ro ad Egbe, Lago s Tel: 070 19914430 -31

222. Eko Club ATM Center Eko Club Premises Bo de Tho mas, Surulere

223. Eleganza Plaza 1, Co mmerc ial Ro ad, Apapa Tel: 070 19913914-5

224 . Falomo- Marble House Branch 1, Alfred Rewane Ro ad, Marble Ho use, Falo mo Ro und-abo ut, Lago s Tel: 070 19914316-19

225. Festac Town Branch

Plo t 1327B, 32 Ro ad 3rd Avenue, Festac Tel: 070 19913943-4

226. Foreshore Towers Branch

Fo resho re Towers 2A, Osbo rne Ro ad Ikoyi Tel: 070 19914334-5

227. Guardian Newspapers

ATM Center

Rutam Ho use, Iso lo , Lago s Iso lo

228. Head Office Branch - Marina 1st Flo o r Stallio n Plaza 36 Marina, P.M.B. 20 27 GPO Marina, Lago s Tel: 070 19914393-4, 070 19914970 -71

229. Idi-Araba Branch

Lago s University Teaching Ho spital Co mpo und Idi-Araba P.M.B. 1127, Mushin Tel: 070 1991440 6-9

230 . Idimu Branch 40 , Iko tun/ Idimu Rd, Iko tun Tel: 070 1991440 4-5

231. Idumota-Docemo Branch 50 , Do cemo Street, Idumo ta Tel: 070 19914387-8

232. Iganmu Branch 22, Eric Mo o re Ro ad, Iganmu P.M.B. 30 0 6, Surulere Tel: 070 1991390 6-9

233. Ijanikin ATM Center Co llege Of Educatio n, Ijanikin, Oto -Awo ri

194 . Oro Branch Oyelagbawo Ro ad, Oke Ola P.M.B. 30 8, Oro Tel: 070 19914828-9

195. Unilorin Branch 254 Umar Saro Ro ad Sawmill Area P.M.B. 1347 Ilo rin Tel: 070 19914822-3

196. Unilorin Cash Center Unilo rin Permanent Site Ilo rin Tel: 070 19914822-3

197. Pategi Cash Center New Market Ro ad c / o P.M.B. 10 6, Bac ita Tel: 070 19914832-3

LAGOS STATE

198. 131 Broad Street Bro ad Street, Lago s P.M.B. 20 0 2 Lago s Tel: 070 19914369-72

199. Adeniji Adele Branch

183B, Adeniji Adele Ro ad Lago s Tel: 070 19914363-4

20 0 . Adeola Odeku Branch Plo t 97, Ahmadu Bello Way, Vic to ria Island Tel: 070 19914322-3

20 1. Adeyemo Alakija Branch

29, Adeyemo Alakija Street Off Idowu Taylo r Street Vic to ria Island, Lago s Tel: 070 19914340 -41

20 2. Agege Branch 118 Ipaja Ro ad, Sho funde P.M.B. 210 84, Agege Tel: 070 1991440 0 -0 3

20 3. Ajah Branch Sho ps H119-122, H155-158 Iko ta Sho pping Co mplex Lekki – Epe Express Ro ad Ajah Tel: 070 19914346-7

20 4 . Ajose Adeogun Branch* 275, Ajo se Adeo gun Street P.M.B 80 0 22; Vic to ria Island Tel: 070 19914338-9

20 5. Alaba Int. Market Branch

14 , Afisi Ro ad Alaba, Lago s Tel: 070 19913941-2

20 6. New Alaba Market Branch Sho p F453 Alaba Internatio nal Market Alaba, Lago s Tel: 070 19913945-6




152

234 . Ijesha-Tedo Branch 62, Adesina Street, Ijesha-Tedo Surulere, Lago s Tel: 070 19914412-3

235. Ijora Branch 6 Causeway, Ijo ra P.M.B. 50 53, Lago s Tel: 070 1991390 0 -0 1

236. Iju Branch 169 Iju Ro ad, Fagba P.M.B. 210 81, Agege, Lago s Tel: 070 19914414-5

237. Ikeja ATM Center Co mputer village Ikeja

238. Ikorodu Branch 62, Lago s Ro ad Tel: 070 19914457-8

239. Ikorodu ATM Center KT Filling Statio n Iko ro du

240 . Ikoyi Club ATM Center

Ikoyi Club Premises Ikoyi

241. Ilupeju Branch

25, Ilupeju Industrial Avenue Ilupeju Industrial Estate P.M.B. 210 91, Ikeja Tel: 070 19914453-6

242. Isolo Branch

Plo t 8, Blo ck K Iso lo Industrial Estate Apapa Osho di Express Way P.M.B. 1123, Mushin Tel: 070 19914461-2 070 19914472-3

243. Kakawa Branch 21/ 23 Kakawa Street P.M.B. 12076, Lago s Tel: 070 19914365-8

244 . Ketu Branch

549 Iko ro du Ro ad Ketu, Lago s Tel: 070 19914426-7

245. Ladipo Branch 90 , Ladipo Ro ad, Mato ri P.M.B. 1170 , Mushin Tel: 070 19914418-9

246. Lagoon Restaurant ATM Center

Lago o n Restaurant Premises Ozumba Mbadiwe Ave Vic to ria Island

247. LASU E-Center Lago s State University Campus Lago s-Badagry Ro ad Lago s

248. Lawanson Branch 123 Itire Ro ad Surulere, Lago s Tel: 0 1070 19914459-60

249. Lewis Street 61 Lewis Street, Lago s Tel: 070 19914320 -21

250 . Luth, Idi-Araba ATM Center Lago s University Teaching Ho spital Co mpo und Idi-Araba Mushin

251. Magodo ATM Center CMD premises, CMD ro ad, Mago do

252. MMA2 E-Center Murtala Muhammed Airpo rt Ikeja, Lago s Tel: 070 19913666

253. Moloney Branch 6, Mo lo ney Street Obalende P.O. Box 3425, Lago s Tel: 070 19914377-80

254 . Mushin Branch

223a, Agege Mo to r Ro ad P.M.B 10 14, Mushin Tel: 070 19914420 -21

255. NCR Compound Cash Center

Nigeria Railway Co mpo und Ebute-Metta Tel: 070 19914437-40

256. Oba Akra Ikeja Branch

Plo t 16, Oba Akran Avenue P.M.B. 210 6 Ikeja Tel: 070 19914481-3

257. Obalende Branch 13/ 15, No jeem Maiyegun Ro ad Obalende, Lago s Tel: 070 19914336-7

258. Obun-Eko Branch

6/ 8 Obun Eko Street Idumo ta P.O. Box 20 0 8, Lago s Tel: 070 19914375-6

259. Ogba Branch

Acme Ro ad Rales, Glass Ho use Ogba P.M.B. 2159, Ikeja Ogba Industrial Estate P.M.B. 21559, Ikeja Tel: 070 19914463-4

260 . Ogudu Branch

47, Ogudu Ro ad Ojo ta Ogudu GRA, Ojo ta Tel: 070 19914422-3

261. Oil Estate, Lekki Branch 2 Chevro n Drive, Lekki Pennisula Km 20 , Lago s/ Epe Express Way P.M.B. 80 0 32, Vic to ria Island Tel: 070 19914348-51

262. Ojomu Branch By Eti-Osa Lo cal Govt. Co unc il Lekki/ Epe Expressway P.M.B. 80 0 32, Lekki Tel: 070 19914352-3

263. Ojuwoye Cash Center 23, Abio dun Street, Mushin Tel: 070 19914420 -21

264 . Oke-Arin Branch Lago s Island Sho pping Co mplex 34, Jo hn Street, Lago s Tel: 070 19914385-6

265. Okokomaiko Branch 40 5 Lago s/ Badagry Expressway Oppo site PPL B/ Sto p Oko ko maiko , Lago s P.M.B. 0 20 1 Festac Po st Office, Lago s Tel: 070 19913933-4

266. Oregun Branch

Plo t G, Iko si Ro ad P.M.B. 21455, Ikeja Tel: 070 19914465

267. Orile Branch

36B, Co ker Street Awaye Ho use Odunade Bus-sto p Badagry Expressway Orile Iganmu, Lago s Tel: 070 19913920 -21

268. Oshodi Branch

18A, Osho di-Apapa Expressway Osho di, Lago s Tel: 070 19914424-5

269. Owode–Onirin Cash Center Line 10 , Owo de Onirin Market Owo de Bus Sto p, Iko ro du Ro ad Mile 13 Tel: 070 19914426-7

270 . Oyin Jolayemi Branch 1668B, Oyin Jo layemi Street Vic to ria Island, Lago s Tel: 070 19914330 -33

271. Pen Cinema Branch 4 , Iju Ro ad, Pen Cinema Agege Lago s Tel: 070 19914428-9

272. Piccadilly Hotel ATM Center

3, Piccadilly Street, Agungi Epe, Lekki, Lago s

273. Seme Cash Center

Bank Ro ad, Seme Tel: 070 19913935-6



153

274 . Shasha ATM Center Nigeria Airfo rce base, Shasha Do pemu

275. Sheriffyt Hotel ATM Center 95/ 97 Shagamu Ro ad Odo gunyan Beside Lago s State Po lytechnic Iko ro du

276. Shomolu Branch Adebowale Ho use 150 Iko ro du Ro ad, Onipanu P.M.B. 40 , Sho mo lu Tel: 070 19914449-52

277. Silverbird Galleria E-Center 133 Ahmadu Bello Way Vic to ria Island Tel: 070 19913668

278. Sura Annex Cash Center Sura Sho pping Co mplex Tel: 070 19914320 -21

279. Surulere Branch 3, Western Avenue P.M.B. 30 0 2 Surulere Tel: 070 19914441-4

280 . Tin Can Island Port

8, Ibafo n, Apapa P.M.B. 1147, Apapa, Lago s Tel: 070 19913910 -11

281. Tinubu Branch

19, Tinubu Square P.M.B. 120 40 , Lago s Tel: 070 19914359-62

282. Trade Fair Complex Branch Olusegun Obasanjo Hall P.M.B. 0 0 3, Festac Town Tel: 070 19913937-8

283. W harf Road Branch 32, Wharf Ro ad, Apapa P.M.B. 1172, Apapa Tel: 070 19913902-5

284 . Yaba Branch

349 Herbert Macaulay Street P.M.B. 10 0 2, Sabo , Yaba Tel: 070 19914445-8

285. Yaba E-Center

Ozo ne Center, Lugard Street Sabo , Yaba, Lago s State Tel: 070 19914445-8

NASARAWA STATE

286. Lafia Branch

No 26, Angwan Mangu Jo s Ro ad Lafia Tel: 070 19914734-7

287. Awe Cash Center

Co urt Ro ad Sabo n Gari, Awe Tel: 070 19914738-9

288. Karu Branch New Karu Tel: 070 19914791-2

289. Nasarawa Egon Cash Centre 1 Ungwan Moyi (Oppo site ERCC) Tel: 070 19914734-7

NIGER STATE

290 . Agaie Cash Center Bida Ro ad P.M.B. 3, Bida Tel: 070 1991480 6-7

291. Bida Branch 9 Lemu Ro ad P.M.B. 3, Bida Tel: 070 1991480 4-5

292. Minna Branch 2 Bank Street, Minna P.M.B. 22, Minna Tel: 070 19914798-80 1

293. Paiko Cash Center Minna/ Suleja Ro ad P.M.B. 22, Minna Tel: 070 1991480 8-9

294 . Suleja Branch

Oppo site field base G.R.A. Suleja P.M.B. 22, Suleja Tel: 070 1991480 2-3

OGUN STATE

295. 2nd Ijebu Ode Branch

New market, Ijebu Ode Tel: 070 19914938-9

296. Abeokuta Branch

Plo t B, Co mmerc ial Bank Site Oniko lo bo Ro ad, Ibara P.M.B. 30 30 Abeo kuta Tel: 070 19914924-7

297. Agbara Branch Ilaro Ro ad Agbara Industrial Estate P.M.B. 1163 Tel: 070 19913929-30

298. Ijebu-Ode Branch 15 Ibadan Ro ad P.M.B. 20 0 3, Ijebu-Ode Tel: 070 19914922-3

299. Ilaro Branch

1, Tho mas Iso la Akino la Crescent P.M.B. 0 5, Ilaro Tel: 070 19914930 -31

30 0 . Ogere Branch 27 Abeo kuta Ro ad Ogere Remo P.M.B. 12, Iperu Remo Tel: 070 19914932-3

30 1. Otta Branch

152/ 154, Idi-Iro ko Ro ad Ojuo re Otta Tel: 070 19914416-7

30 2. Sagamu Branch High Co urt Junctio n 10 , Oba Awo lesi Erinwo le Ro ad Dual Carriage Way P.M.B. 20 33, Shagamu Tel: 070 19914928-9

ONDO STATE

30 3. Akure Main Branch Alagbaka Street P.M.B. 625, Akure Tel: 070 19914870 -3

30 4 . Akure Market Branch 37 Ilemo Street, Off Oba Adesida Ro ad P.M.B. 710 , Akure Tel: 070 19914880 -81

30 5. Idanre Cash Center 135 Bro ad Street P.M.B. 513, Idanre Tel: 070 19914892-3

30 6. Ilutitun Branch 38, Bank Ro ad, Ilutitun Oso ro P.M.B. 0 0 1, Ilutitun Tel: 070 19914882-3

30 7. Ita-Ogbolu Cash Center

66 Main Ro ad P.M.B. 26 Ita-Ogbo lu Tel: 070 19914894-5

30 8. Ode Irele Branch

1, Olo fin Street P.O. Box 26, Ode-Irele Tel: 070 19914886-7

30 9. Ondo Branch

Odo dibo Street P.M.B. 50 2, Ondo Tel: 070 19914878-9

OSUN STATE

310 . Erin-Ijesa Cash Center 47 To so Akinleye Street P.M.B. 50 43, Ilesa Tel: 070 1991490 8-9

311. Ifewara Cash Center 11, Enuwa Square, Ifewara P.O. Box 51, Ifewara Tel: 070 19914910 -11

312. Ikirun Branch

4 , Inisha Ro ad P.M.B. 520 5, Ikirun Tel: 070 1991490 6-7

313. Ile-Ife Branch 63, Iremo Ro ad P.M.B. 550 9, Ile-Ife Tel: 070 19914896-7

314 . Ilesa Branch Ereja Square P.M.B. 5079, Ilesa Tel: 070 1991490 4-5



154

315. Osogbo Branch 2/4 Obafemi Awo lowo, Gbo ngan/ Ibadan Ro ad P.M.B. 4342, Oso gbo Tel: 070 19914898-9, 070 1991490 0 -0 1

OYO STATE

316. Agodi Roundabout Branch Ago di Ro undabo ut Secretariat P.M.B. 55144, Ibadan Tel: 070 19914943-4

317. Bank Road Branch Dugbe, P.M.B. 5176, Ibadan Tel: 070 19914942-3

318. Challenge Cash Center Challenge Ro undabo ut P.M.B. 5655, Ibadan Tel: 070 19914946-7

319. Dugbe Branch 3, Lebano n Street Dugbe, Ibadan Tel: 070 19914950 -51

320 . Iseyin Branch

Adjacent Ebedi Market Oyo Ro ad Barracks P.M.B. 10 0 3, Iseyin Tel: 070 19914956-7

321. Iwo Road Branch

90 , Iwo Ro ad Ibadan Tel: 070 19914960 -61

322. New Gbagi Market Branch

Bo la Ige Internatio nal Market New Ife Ro ad, Ibadan Tel: 070 19914954-5

323. Ogbomosho Branch

Co l. Adeniran's Ho use P.M.B. 3592, Ogbo mo sho Tel: 070 19914958-9

324 . Oyo Branch

Owo de Street P.M.B. 1073, Oyo Tel: 070 19914952-3

325. University College Branch

University Co llege Ho spital P.M.B. 5412, Ibadan Tel: 070 19914948-9

PLATEAU STATE

326. Bank Street Branch 7, Bank Street P.M.B. 20 29, Jo s Tel: 070 19914696-9

327. Doemak Branch Qua'anpan LGA, Do emak Tel: 070 19914710 -11

328. Jos Main Market Branch 28, Rwang Pam Street P.M.B. 2131, Jo s Tel: 070 1991470 0 -0 1

329. Kabong Branch Satellite Market Tel: 070 1991470 6-7

330 . Langtang Branch Pankshin/ Shendam Ro ad P.M.B. 0 0 2, Langtang Tel: 070 1991470 2-3

331. M. M. Way, Jos Branch 48, Murtala Muhammed Way, Jo s Tel: 070 1991470 6-7

332. NBC Teller Inplant NBC Depo t Tel: 070 19914696-9

333. Panyam Branch Alo ng Mangu-Pankshin Ro ad Panyam, Plateau Tel: 070 1991470 4-5

RIVERS STATE

334 . 171D Aba Road Branch

171D, Aba Ro ad P.M.B. 5186, Po rt Harco urt Tel: 070 19913994-5

335. 45 Ikwerre Road Branch

45, Ikwerre Ro ad, Po rt Harco urt Tel: 070 19913992-3

336. 10 1 Ikwerre Road Branch

10 1, Ikwerre Ro ad Po rt Harco urt Tel: 070 19913998-9

337. Bonny Branch

10 Finima Ro ad P.O. Box 144, Bo nny Tel: 070 19913958-9

338. Bori Branch

No .1 Bank Ro ad, Bo ri Tel: 070 19913982-3

339. Eleme Petro Chemical Complex Branch

P.M.B. 13, Nchia Eleme Eleme LGA Tel: 070 19913964-5

340 . Kingsway Road Branch 12 Azikiwe Ro ad P.O. Box 5886, Po rt Harco urt Tel: 070 19913970 -73

341. NAFCON Onne Branch NAFCON Co mplex P.O. Box 653, Po rt Harco urt Tel: 070 19913960 -61

342. Orije Branch 28 Aba Ro ad P.O. Box 540 4, Po rt Harco urt Tel: 070 19913974-7

343. Oyigbo Branch 52, Lo catio n Ro ad Oyigbo , P.M.B. 5211 Po rt Harco urt Tel: 070 199140 0 8-9

344 . Rivers State Secretariat Cash Center Rivers State Secretariat Co mplex, Go kana Street Off Mo scow Ro ad

345. Station Road Branch Po rt Harco urt- Statio n Ro ad P.M.B. 50 0 5, Po rt Harco urt Tel: 070 19913966-9

346. Trans Amadi Branch Plo t 468, Trans Amadi Industrial Layo ut P.M.B. 5496, Po rt Harco urt Tel: 070 19913978-81

SOKOTO STATE

347. Isa Branch

So ko to Ro ad Isa LGA Tel: 070 19914556-7

348. Sokoto Main Branch

2, Ahmadu Bello Way P.M.B. 2117, So ko to Tel: 070 19914538-9 070 19914540 -41

349. Sokoto Market Branch So ko to Market Ro ad By Ko far Doya (Western Gate) P.M.B. 2410 , So ko to Tel: 070 19914554-5

TARABA STATE

350 . Bali Cash Center Oppo site Bali Lo cal Govt. Secretariat P.M.B. 10 26, Jalingo Taraba State Tel: 070 19914639-40

351. Donga Cash Center Danzo mga Way P.M.B. 10 20 Do nga, Taraba Tel: 070 19914633-6

352. Ibi Cash Center Wukari-Shendam Ro ad Wukari Taraba P.M.B. 0 0 5, Ibi Tel: 070 19914637-8

353. Jalingo Branch 17, Hamaruwa way, Taraba P.M.B. 10 26, Jalingo Tel: 070 19914631-2



155

YOBE STATE

354 . Damaturu Branch 70 , Po tiskum Ro ad P.M.B. 10 65, Damaturu Tel: 070 19914652-3

355. Gashua Branch Alo ng Nguru Rd. Gashua Damaturu Tel: 070 19914650 -51

BRANCHES TO BE RELOCATED IN 20 16

• Sapele Branch fro m 84, Yo ruba Ro ad to Otitie junctio n by Ajo go do ro ad, Sapele, Delta State.

• Katsina Yahaya Madaki Branch fro m Madugu Ho use (annex), Madaki way to Ko far/ Kaura Layo ut, Old Liberty, Katsina State

• Oko Branch fro m Ekwulo bia-Umunze Ro ad, Ezio ko Village to Oko Po lytechnic , Anambra State

• Ajo se Adeo gun Branch fro m 275, Ajo se Adeo gun Street to 243b Muri Okuno la Street, Vic to ria Island, Lago s State



ZAMFARA STATE

356. Gusau Branch Bank Ro ad P.M.B 10 0 1, Gasau, Zamfara Tel: 070 19914542-5

156

PROXY FORM UNION BANK OF NIGERIA PLC 47TH ANNUAL GENERAL MEETING

I/We

1.

2.

To approve the remuneratio n o f Direc to rs.

4. To elec t/ re-elec t members o f the Audit Co mmittee.

To elec t/ re-elec t Direc to rs.

To receive and ado pt the Audited Gro up Financ ial Statements fo r the financ ial year ended 31st December, 20 15 to gether with the repo rts o f the Directo rs, Audito rs, Bo ard Appraiser and the Audit Co mmittee.

To autho rize the Directo rs to fix the remuneratio n o f the Audito rs.

I/ We desire this proxy to be used in favo ur o f/ o r against the reso lutio n as indicated alo ngside (Strike o ut which-ever is no t desired)

ORDINARY BUSINESS FOR AGAINST

SPECIAL BUSINESS

ORDINARY RESOLUTION:

SPECIAL RESOLUTIONS:

To amend the Bank's Memo randum and Artic les o f Asso c iatio n (“MEMART”) as hereinafter stated:

3.

2.

1.

2a Alteration of the MEMART

i. Deleting the Share Capital Histo ry attached to the MEMART and replac ing same with the fo llowing :

Share Capital History

1. On 7th July 1969 the autho rized share capital o f the Co mpany was increased to £10 ,0 0 0 ,0 0 0 divided into 10 ,0 0 0 ,0 0 0 o rdinary shares o f £1 each.

2. On 28th January 1971 by a Spec ial Reso lutio n, all the o rdinary shares were sub-divided into 20 ,0 0 0 ,0 0 0 o rdinary shares o f N1 each (o ne Naira).

3. By a Spec ial Reso lutio n dated 10 th January 1977 the autho rized share capital o f the Co mpany was increased fro m N20 ,0 0 0 ,0 0 0 to N30 ,0 0 0 ,0 0 0 by the creatio n o f 10 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f N1 each.

4 . By a Spec ial Reso lutio n dated 23rd January 1978 the autho rized share capital o f the Co mpany was increased fro m N30 ,0 0 0 ,0 0 0 to N50 ,0 0 0 ,0 0 0 by the creatio n o f 20 ,0 0 0 ,0 0 0 o rdinary shares o f N1 each.

5. By a Spec ial Reso lutio n at the 13th AGM held o n 27th January 1982 the autho rized share capital o f the Co mpany was increased fro m N50 ,0 0 0 ,0 0 0 to N10 0 ,0 0 0 ,0 0 0 by the creatio n o f 50 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f N1 each.

6. By a Spec ial Reso lutio n passed at the 22nd AGM held o n 23rd January 1991 the autho rized share capital o f the Co mpany was further increased fro m N10 0 ,0 0 0 ,0 0 0 to N20 0 ,0 0 0 ,0 0 0 (80 0 ,0 0 0 ,0 0 0 o rdinary shares o f 25 ko bo each) by the creatio n o f 40 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 25 ko bo each.

7. By a Spec ial Reso lutio n passed at the 23rd AGM held o n 29th o f January, 1992 the autho rized share capital o f the Co mpany was further increased fro m to N20 0 ,0 0 0 ,0 0 0 to N250 ,0 0 0 ,0 0 0 (1,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 25 ko bo each) by the creatio n o f 20 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 25 ko bo each.

8. By a Spec ial Reso lutio n passed at the 25th AGM held o n 23rd February 1994, the autho rized share capital o f the Co mpany was further increased fro m N250 ,0 0 0 ,0 0 0 to N50 0 ,0 0 0 ,0 0 0 (2,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 25 ko bo each) by the creatio n o f 1,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 25 ko bo each.

9. By a Spec ial Reso lutio n passed at the 27th AGM held o n 27th March 1996, all the 2,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 25 ko bo each o f the Co mpany, were co nso lidated and divided into 1,0 0 0 ,0 0 0 ,0 0 0 Ordinary shares o f 50 ko bo each (i.e. an autho rized share capital o f N50 0 ,0 0 0 ,0 0 0 ).

10 . By a Spec ial Reso lutio n passed at the 29th AGM held o n 4th March, 1998 the autho rized share capital o f the Co mpany was increased fro m N50 0 ,0 0 0 ,0 0 0 to N1,0 0 0 ,0 0 0 ,0 0 0 by the creatio n o f 1,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each.

11. By a Spec ial Reso lutio n passed at the 32nd AGM held o n 8th August, 20 0 1 the autho rised share capital o f the Co mpany was increased fro m N1,0 0 0 ,0 0 0 ,0 0 0 to N3,0 0 0 ,0 0 0 ,0 0 0 divided into 6,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 50 ko bo each (by the creatio n o f 4 ,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each).



A. To elec t the fo llowing Directo rs being the first Annual General Meeting since their appo intments:

1. Mrs. Beatrice Hamza-Bassey2. Mrs. Arina McDo nald3. Mr. Adekunle So no la4. Mr. Jo hn Vitalo

B. To re-elec t the fo llowing Directo rs who retire pursuant to Artic le 90 o f the Artic les o f Asso c iatio n and are elig ible fo r re-elec tio n:

1. Mrs. Oyinkansade Adewale2. Engr. Mansur Ahmed3. Mr. Ian Clyne4. Mr. Ibrahim Kwargana5. Dr. Adeyemi Osindero

Being a member/ members o f UNION BANK OF NIGERIA PLC hereby appo int.......................... ....................................................................o r failing him/ her MR. CYRIL ODU o r failing him MR. EMEKA EMUWA as my/ o ur proxy to ac t and vo te fo r me/ us and o n my/ o ur behalf at the 47th Annual General Meeting o f the Co mpany to be held in the Ballro o m, Oriental Ho tel, 3 Lekki Ro ad, Vic to ria Island, Lago s o n Thursday, 2nd June, 20 16 at 11.0 0 a.m. and at any adjo urnment thereo f.

As witness my/ o ur hands this ……………. day o f ……………………..20 16

Signed…………………………………………….....

NOTE:A member entitled to attend and vo te at the Annual General Meeting is entitled to appo int a proxy in its, his o r her stead. All proxies sho uld be depo sited at the o ffice o f The Registrar, GTL Registrars Limited, 2, Burma Ro ad, Apapa, Lago s no t less than 48 ho urs befo re the time scheduled fo r ho lding the meeting . A proxy need no t be a member o f the Co mpany.

In the case o f jo int shareho lders, any o ne o f such may co mplete the fo rm but the name o f all jo int shareho lders must be stated.

It is required by law under the Stamp Duties Act, Cap F8. Laws o f the Federatio n o f Nigeria, 20 0 4 that any instrument o f proxy to be used fo r the purpo se o f vo ting by any perso n entitled to vo te at any meeting o f shareho lders must bear stamp duty at the appro priate rate, no t adhesive po stage stamps.

If the shareho lder is a co rpo ratio n, this fo rm must be under its co mmo n seal o r under the hand o f o fficers o r an atto rney duly autho rized in that behalf.

157

12. By a Spec ial Reso lutio n passed at an Extra-o rdinary General Meeting held o n 1st December, 20 0 4 the autho rised share capital o f the Co mpany was increased fro m N3,0 0 0 ,0 0 0 ,0 0 0 to N5,0 0 0 ,0 0 0 ,0 0 0 divided into 10 ,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 50 ko bo each (by the creatio n o f 4 ,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each).

13. By a Spec ial Reso lutio n passed at the 37th AGM held o n 6th September, 20 0 6 the autho rised share capital o f the Co mpany was increased fro m N5,0 0 0 ,0 0 0 ,0 0 0 to N7,50 0 ,0 0 0 ,0 0 0 divided into 15,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 50 ko bo each (by the creatio n o f 5,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each).

14. By a Spec ial Reso lutio n passed at an Extra-o rdinary General Meeting held o n 27th September 20 07 the autho rised share capital o f the Co mpany was increased fro m N7,50 0 ,0 0 0 ,0 0 0 to N10 ,0 0 0 ,0 0 0 ,0 0 0 divided into 20 ,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 50 ko bo each (by the creatio n o f 5,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each).

15. By a Spec ial Reso lutio n passed at the 39th AGM held o n 26th November, 20 0 8 the autho rised share capital o f the Co mpany was increased fro m N10 ,0 0 0 ,0 0 0 ,0 0 0 to N15,0 0 0 ,0 0 0 ,0 0 0 divided into 30 ,0 0 0 ,0 0 0 ,0 0 0 o rdinary shares o f 50 ko bo each (by the creatio n o f 10 ,0 0 0 ,0 0 0 ,0 0 0 additio nal o rdinary shares o f 50 ko bo each).

16. By a Spec ial Reso lutio n and No tice o f Reductio n dated the 30 th September, 20 11, the autho rised share capital o f the Co mpany was reduced fro m N15,0 0 0 ,0 0 0 ,0 0 0 to N9,511,562,50 0 divided into 19,0 23,125,0 0 0 o rdinary shares o f 50 ko bo each (by the reductio n o f 10 ,976,875,0 0 0 o rdinary shares o f 50 ko bo each).

ii. Reword ing Clause 3(b) in the Memo randum o f Asso c iatio n, to read:

“To establish, carry o n, co ntinue, extend and develo p the business o f a bank in Nigeria and elsewhere and in particular but witho ut restric ting the generality o f the fo rego ing powers to carry o n the business o f receiving mo ney in current, savings and o r depo sit acco unts, o f paying and o r co llec ting cheques drawn o r paid in by custo mers and o f making advances to custo mers”.

iii. Revising the enactment year o f the Co mpanies and Allied Matters Act (“CAMA”) fro m 1990 to 20 0 4 in all applicable c lauses in the MEMART.

2a Alteration of the Articles of Association (“the Articles”)

i. Reword ing Clause 5 to read:

“Subjec t to the provisio ns o f Sectio n 141 o f the Act o r any amendments thereto , if at any time the share capital is divided into di? erent c lasses o f shares, the rights attached to any c lass (unless o therwise provided by terms o f issue o f the shares o f that c lass), may, whether o r no t the Co mpany is being wo und up, be varied with the co nsent in writing o f the ho lders o f three-quarters o f the issued shares o f that c lass o r with the sanctio n o f a spec ial reso lutio n passed at a separate general meeting o f the ho lders o f shares o f the c lass, the provisio ns o f these Artic les relating to general meetings shall apply, but the necessary quo rum shall be two perso ns at least ho lding o r representing by proxy o ne-third o f the issued shares o f the c lass and that any ho lder o f shares o f the c lass present in perso n o r by proxy may demand a po ll”.

ii. Reword ing Clause 9 to read:

“Every perso n who se name is entered as a member in the Register o f Members shall be entitled witho ut payment to receive within two mo nths o f the allo tment and three mo nths fro m the date o f a transfer (o r within such o ther perio d as the co nditio ns o f the issue shall provide) a transfer o f all his shareho lding to an acco unt designated by the shareho lder with the Central Securities Clearing System Plc (CSCS) o r the delivery o f o ne share certi? cate fo r all his shares o r several certi? cates each fo r o ne o r mo re o f his shares upo n payment fo r every certi? cate o f such amo unt as the Directo rs shall fro m time to time determine. Every no tice o f share transfer o r share certi? cate shall spec ify the shares to which it relates and the amo unt paid up thereo n. Provided that in respect o f a share o r shares held jo intly by several perso ns, the Co mpany shall no t be bo und to issue mo re than o ne share certi? cate o r no tice o f transfer o f the shareho lding to mo re than o ne shareho lder's acco unt with CSCS, and delivery o f a share certi? cate o r evidence o f the CSCS transfer o f shares to o ne o f several jo int ho lders shall be su? c ient delivery to all the jo int ho lders.”

iii. Delet ing from Clause 11: “(Altered by a Spec ial Reso lutio n passed o n 12th March, 1979)” such that the c lause reads:

“The Co mpany shall no t g ive, whether direc tly o r indirec tly (whether by means o f a lo an, guarantee, the provisio n o f security o r o therwise) any ? nanc ial assistance fo r the purpo se o f o r in co nnectio n with a purchase o r subscriptio n made o r to be made by any perso n o f o r fo r any shares in the Co mpany o r in its ho lding co mpany provided that no thing in this regulatio n shall pro hibit transactio ns mentio ned in Sectio n 159(3) o f the Act.”



158



iv. Delet ing from the Art icles:

1. Clauses 12 to 15 o n 'Lien o n Shares'.2. Clauses 16 to 21 o n 'Calls o n Shares'.3. Clauses 22 to 27 o n 'Transfer o f Shares'.

v. Reword ing Clause 28 to read:

“The Co mpany shall be entitled to charge a reaso nable fee o n the reg istratio n o f every pro bate, letters o f administratio n, certi? cate o f death o r marriage, power o f atto rney, no tice in lieu o f distringas, o r o ther instrument.”

vi. Reword ing Clause 29 to read:

“In case o f death o f a member, the survivo r o r survivo rs where the deceased was a jo int ho lder and the legal perso nal representatives o f the deceased where he was a so le ho lder shall, be the o nly perso ns reco gnised by the Co mpany as having any title to his interest in the shares.”

vii. Reword ing Clause 30 to read:

“Any perso n beco ming entitled to a share in co nsequence o f the death o r bankruptcy o f a member may, upo n such evidence being pro duced as may fro m time to time pro perly be required by the Directo rs and subjec t as hereinafter provided, elec t either to be reg istered himself as ho lder o f the share o r to have so me perso n no minated by him reg istered as the transferee thereo f.”

viii. Reword ing Clause 31 to read:

“If the perso n so beco ming entitled shall elec t to be reg istered himself, he shall deliver o r send to the Co mpany a no tice in writing signed by him stating that he so elec ts. If he shall elec t to have ano ther perso n reg istered he shall testify his elec tio n by executing to that perso n a transfer o f the share.”

ix. Delet ing Clauses 33 to 39 on Forfeit ure of Shares.

x. Reword ing Clause 41 to read:

“The ho lders o f sto ck may transfer the same, o r any part thereo f in the same manner, and subjec t to the same regulatio ns, which the shares fro m which the sto ck aro se might prio r to co nversio n have been transferred, o r as near thereto as c ircumstances admit and the Directo rs may fro m time to time ? x the minimum amo unt o f sto ck transferable but so that such minimum shall no t exceed the no minal amo unt o f the shares fro m which the sto ck aro se”.

xi. Delet ing “ or special” f rom Clause 44 such that t he Clause reads:

“The Co mpany may fro m time to time by o rdinary reso lutio n increase the share capital by such sum, to be divided into shares o f such amo unt, as the reso lutio n shall prescribe.”

xii. Delet ing Clause 45 on Pre-empt ive Rights of Shareholders.

xiii. Reword ing Clause 51 to read:

“An AGM and a meeting called fo r the passing o f a Spec ial Reso lutio n shall be called by at least twenty-o ne days' no tice in writing and a meeting o f the Co mpany o ther than an AGM o r a meeting fo r the passing o f a Spec ial Reso lutio n shall be called by at the least twenty-o ne days' no tice in writing . The no tice shall be exc lusive o f the day o n which it is served o r deemed to be served and o f the day fo r which it is g iven and shall spec ify the place, the day, the ho ur o f meeting and the general nature o f the business to be transacted, and shall be g iven, in the manner hereinafter mentio ned o r in such o ther manner, if any, as may be prescribed by the Co mpany in General Meeting , to such perso ns as are under the regulatio ns o f the Co mpany, entitled to receive such no tices fro m the Co mpany.

Provided that a meeting o f the Co mpany shall, no twithstanding that it is called by sho rter no tice than that spec i? ed in this regulatio n, be deemed to have been duly called if it is so agreed by all the members entitled to attend and vo te thereat”.

xiv. Reword ing Clause 53 to read:

“All business shall be deemed spec ial that is transacted at an Extrao rdinary General Meeting , and also that is transacted at an Annual General Meeting , with the exceptio n o f dec laring a dividend, the co nsideratio n o f the acco unts, balance sheets, and the repo rts o f the Directo rs and Audito rs, the elec tio n o f Direc to rs in the place o f tho se retiring and the appo intment o f and the ? xing o f the remuneratio n o f the Audito rs, which shall be deemed to be o rdinary business.”

xv. Reword ing Clause 56 to read:

“The Chairman, if any, o f the Bo ard o f Direc to rs shall preside as Chairman at every General Meeting o f the Co mpany, o r if there is no such Chairman, o r if he shall no t be present within thirty minutes after the time appo inted fo r the ho lding o f the meeting o r is unwilling to ac t, the Directo rs present shall elec t o ne o f their numbers to be the chairman o f the meeting”.

159

xvi. Reword ing Clause 80 (a) to read:

The Directo rs' tenure o f o ? ce shall be as fo llows:(a) The Chief Executive O? cer and Executive Directo rs shall upo n appo intment to

the Bo ard, serve in the respective o ? ces until they attain the retirement age o f 60 years, subjec t to the terms o f engagement co ntained in their respective co ntract(s) o f Executive Employment, statuto ry and o r regulato ry direc tives.

xvii. Reword ing Clause 91 to read:

“The Directo rs to retire in every year shall be tho se who have been lo ngest in o ? ce since their last elec tio n, but as between perso ns who became Directo rs o n the same day tho se to retire shall (unless o therwise agreed amo ngst the Directo rs) be determined by the precedence o f their surnames in alphabetical o rder.”

xviii. Reword ing Clause 95 to read:

“The Co mpany may fro m time to time by o rdinary reso lutio n increase o r reduce the number o f Direc to rs generally, and may no t determine in what ro tatio n the increased o r reduced number is to go o ut o f o ? ce”.

xix. To insert t he fo llow ing clauses after Clause 10 0 in the sec tio n o n 'Pro ceedings o f Direc to rs' which wo uld read:

1. A Directo r may attend and partic ipate at Bo ard o f Direc to rs o r Bo ard Co mmittee meetings by physical attendance o r attendance by means o f video , telepho ne, o r any o ther elec tro nic co mmunicatio n mo de that allows the Directo r to hear and be heard in his partic ipatio n in deliberatio ns o f the meeting .

2. A Directo r attending a meeting by any elec tro nic co mmunicatio n mo de shall co unt to fo rm the quo rum at the meeting and any reso lutio n passed with vo tes cast by such Directo r shall be valid as if the reso lutio n was passed at a Bo ard o r Bo ard Co mmittee meeting at which such Directo r was physically present.

3. The Chairman o f the Bo ard o r a Bo ard Co mmittee may o nly Chair a meeting while being physically present at such meeting .

4 . The Directo rs shall determine the maximum number o f meetings a Directo r may attend by video , telepho ne, o r any o ther elec tro nic co mmunicatio n mo des within a ? nanc ial year.

5. No tice o f Bo ard o f Direc to rs o r Bo ard Co mmittee meetings may be served o n every Directo r o r Alternate Directo r either perso nally o r by dispatching the no tice by po st o r co urier o r by elec tro nic mail (excepting sho rt mail service and so c ial media platfo rms) to the g iven addresses provided that fo r no tices to be served o utside Nigeria such no tice shall be g iven o nly by po st, co urier o r elec tro nic mail.

6. Where a no tice is served by po st o r co urier, service is deemed to have been e? ected at the expiratio n o f seven (7) days fro m the time the no tice is po sted and a no tice served by elec tro nic mail is deemed to have been e? ected at the time the elec tro nic mail is despatched.

xx. In Clause 10 2, replac ing “? ve minutes” with “thirty minutes” as the time after which the Directo rs may appo int a Chairman fo r any meeting when the incumbent Chairman is absent.

xxi. In Clause 10 4 , replac ing “? ve minutes” with “thirty minutes” as the time after which a Co mmittee may appo int a Chairman fo r any co mmittee meeting when the incumbent Chairman is absent.

xxii. Reword ing Clause 117 to read:

“Except as by the Act, expressly autho rized, no dividend shall be paid o therwise than o ut o f pro ? t and subjec t to the co nditio ns (if any) fro m time to time impo sed by o r under any relevant leg islatio n and o r regulatio n.”

xxiii. Reword ing Clause 118 to read:

“The Co mpany shall maintain a Statuto ry Reserve Fund in acco rdance with the requirements o f the Banking Act.”

xxiv. Reword ing Clause 119 to read:

“In additio n to such payments as are provided fo r in Artic le 117 the Directo rs may at any time set aside o ut o f the pro ? ts o f the Co mpany such amo unts as they think pro per and transfer them to an Ordinary Reserve Fund which shall at the discretio n o f the Directo rs be applicable fo r any purpo se to which the pro ? ts o f the Co mpany may be pro perly applied, and pending such applicatio n may, at their discretio n, either be employed in the business o f the Co mpany o r be invested in such investments (o ther than shares o f the Co mpany) as are permitted under the Banking Act and as the Directo rs may fro m time to time think ? t. The Directo rs may also witho ut plac ing the same to the Ordinary Reserve Fund carry fo rward any pro ? ts, which they may think prudent no t to divide.”



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xxv. Reword ing Clause 120 to read:

“Subjec t to the rights o f perso ns, if any, entitled to shares with spec ial rights as to dividends, all dividends shall be dec lared and paid acco rding to the amo unts paid o r c redited as paid. All dividends shall be appo rtio ned and paid pro po rtio nately to the amo unts paid o r c redited as paid o n the shares during any po rtio n o r po rtio ns o f the perio d in respect o f which the dividend is paid; but if any share is issued in terms providing that it shall rank fo r dividends as fro m a particular date such share shall rank fo r dividend acco rding ly.”

xxvi. Delet ing Clause 121 o n “Unpaid Calls”.

xxvii. Deleting fro m Clauses 127, 128 and 129 all references to “Pro ? t and Lo ss Acco unts” and “Balance Sheet” and replac ing same respectively with “Co nso lidated and Separate Statements o f Pro ? t o r Lo ss and Other Co mprehensive Inco me” and “Co nso lidated and Separate Statements o f Financ ial Po sitio n”.

“That fo llowing the deletio n o f the above-stated c lauses fro m the Artic les o f the Co mpany, all the c lauses retained in the Artic les be renumbered acco rding ly and all typo graphical erro rs in the Artic les amended”.

2c .

“That all sec tio ns o f the CAMA c ited in the Co mpany's MEMART sho uld be reviewed and o r amended to ensure co rrectness”.

“That the Co mpany's MEMART inco rpo rating the above-listed amendments, be and are hereby approved and ado pted as the MEMART o f the Co mpany, in substitutio n fo r and to the exc lusio n o f all previo us editio ns thereo f”.

2d.

2e.

2f. “That the Co mpany Secretary be and is hereby autho rized to ? le the amended MEMART o f the Co mpany at the Co rpo rate A? airs Co mmissio n”.

Please indicate with “X” in the appro priate box how yo u wish yo ur vo te to be cast o n the reso lutio ns set o ut above. Unless o therwise instructed, the Proxy will vo te o r abstain fro m vo ting at his/ her discretio n.

Befo re po sting the above card, kindly tear o ? this part and retain it.

ADMISSION CARD

UNION BANK OF NIGERIA PLC

47TH ANNUAL GENERAL MEETING

PLEASE ADMIT ONLY THE SHAREHOLDER NAMED ON THIS CARD OR HIS DULY APPOINTED PROXY TO THE 47TH ANNUAL GENERAL MEETING BEING HELD IN THE BALLROOM, ORIENTAL HOTEL, 3, LEKKI ROAD, VICTORIA ISLAND, LAGOS ON THURSDAY, 2ND JUNE, 20 16 AT 11.0 0 A.M

NAME OF SHAREHOLDER/ PROXY…………………………………………………………………….SIGNATURE…………………………………………………………………..

ADDRESS……………………………………………………………………………………………………………………………………………………………………………………….

THIS CARD IS TO BE SIGNED AT THE VENUE IN THE PRESENCE OF THE REGISTRAR

Investor Relations

Union bank annual report 2015