Investors React as Unity Bank Forecasts N21.5bn Net Loss
Equities investors on the Nigerian Exchange are currently selling off their interest in Unity Bank Plc after the lender announced it expects to post a huge loss for the second quarter of 2024.
The bank share price plunged by about 10% before noon to N1.81, according to details from the local bourse. The bank’s market value is just about N22 billion during the intraday trading session.
In its earnings forecast for Q2, Unity Bank Plc said it expects to incur a net loss of roughly N22 billion in the second quarter of fiscal year 2024, according to figures from its earnings forecast submitted with the Nigerian Exchange.
The bank is yet to release its fourth quarter of financial year 2024. Also, the market is expecting its first quarter of 2024 to pop in soon. Unity Bank faces pressures from the devaluation of the naira.
The Nigerian lender’s exposure to foreign currency obligations, combined with negative shareholder funds, has created a pressure point.
Ahead of its earnings release, Unity Bank estimates a significant revaluation loss of N20.902 billion, which analysts believe is too huge for the small company to accommodate on its books.
In addition, the financial institution expects an impairment charge of about N1 billion for credit losses during the quarter. This resulted in a negative net operating income of N13.225 billion.
The bank projected that its gross earnings would amount to N24.892 billion in the second quarter of the year. It estimated N6.022 billion as net revenue from funds deployed for business in the period. #Investors React as Unity Bank Forecasts N21.5bn Net Loss
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