UBA Loses ₦1.14 Billion to Fraud in 2024 Despite Record Profits

United Bank for Africa (UBA) lost ₦1.14 billion ($744,200) to fraud in 2024, even as the bank reported a record profit after tax of ₦766.6 billion ($493 million), according to its latest audited financial statements. The losses, driven primarily by electronic fraud and unauthorized transfers, highlight the persistent challenges Nigerian banks face in combating financial crimes.

UBA disclosed that fraudulent activities in 2024 amounted to ₦4.9 billion ($3.15 million), with 23% of those transactions resulting in actual losses. Electronic fraud accounted for the largest share, costing the bank ₦805 million ($518,000), while unauthorized transfers led to losses of ₦314 million ($202,000), representing 88% of the total value linked to such incidents.

Despite these losses, they remain a small fraction of UBA’s overall financial success. The bank’s ₦766.6 billion ($493 million) profit after tax reflects a strong 26% increase from ₦607.7 billion ($391 million) recorded in 2023.

UBA’s latest disclosure is the first of its kind since 2012 and comes at a time when Nigerian banks are under mounting pressure to combat fraud. A recent report by the Financial Institutions Training Centre (FITC) revealed that Nigerian banks lost ₦10.1 billion ($6.7 million) to fraud in Q3 2024, a 76.4% drop from the previous quarter. However, fraudsters are becoming more sophisticated, posing an ongoing threat to even the most advanced security systems. The FITC report also noted a sharp increase in fraud involving external actors, which surged by 70.4% between Q2 and Q3 2024, while cases involving bank staff rose by 54% in the same period.

UBA maintains that no fraud involving its management or employees played a significant role in these losses, stating in its financial report, “There is no fraud involving management or other employees who could have any significant role in the bank’s internal control.”

The rise in fraudulent activity coincides with broader financial pressures in Nigeria’s banking sector. In January, the Central Bank of Nigeria (CBN) mandated the Nigeria Inter-Bank Settlement System (NIBSS) to debit the settlement accounts of commercial banks that receive fraud proceeds, a move aimed at strengthening internal controls and curbing illicit financial transactions.

UBA’s transparency in disclosing fraud losses marks a shift in Nigeria’s banking sector, where many institutions have traditionally avoided reporting such incidents to protect their reputations. A NIBSS report found that only 60 out of 163 financial institutions in Nigeria reported fraud cases in 2023. As financial crimes continue to evolve, both regulators and banks face the challenge of reinforcing security measures while maintaining customer trust.