Five banks in Tier-1 category have posted combined N764.5 billion profits in the last nine months of this year, analyses of their financial results have shown.
The unaudited accounts presented to the Nigerian Exchange (NGX) showed significant growth across income lines, despite challenging economic environments and headwinds.
Zenith Bank Plc achieved N202.5 billion Profit Before Tax (PBT), United Bank for Africa (UBA), recorded N138.5 billion, FBN Holdings, N105.5 billion, Guaranty Trust Holding Company, N169.7 billion and Access Holdings Plc, N147.30 billion.
These banks, which are also Strategically Important Banks (SIBs) control over 80 per cent of industry transactions, and profitability.
Other performance indicators showed that Zenith Bank Plc achieved N620.6 billion gross earnings, which represents 20 per cent growth in gross earnings compared with N518.7 billion reported in same period of 2021.
The bank’s interest income grew by 27 per cent from N308.8 billion to N390.8 billion in the current period, driven majorly by growth in risk assets and an improvement in pricing. These indicators, the bank said, raised Earnings Per Share (EPS) by nine per cent to N5.55.
Its total assets grew by 20 per cent from N9.45 trillion to N11.34 trillion in 2022, mainly driven by growth in customers’ deposits. Customer deposits grew by 24 per cent from N6.47 trillion in December 2021 to N8.04 trillion in September 2022 due to the market’s confidence in the brand.
Profit after tax equally grew by nine per cent from N160.6 billion to N174.3 billion in the same period respectively.
UBA Plc’S Gross earnings rose to N608 billion, up from N493 billion recorded in September 2021. Operating income also grew by 27.3 per cent to N414.1 billion in September 2022, up from N334.8 billion recorded in third quarter 2021 while profit after tax rose significantly to N116 billion from N104.6 billion recorded in third quarter 2021.
The report implied annualised return on average equity of 19.2 per cent for third quarter 2022.
Also, the report underlined that UBA continued to maintain a very strong balance sheet, with total assets rising to N9.3 trillion, representing a 9.1 per cent increase over the N8.5 trillion recorded at the end of December 2021.
The bank benefitted largely from its technology-led initiatives targeted at improving customer experience over the past few years, with customer deposits rising to N7.03 trillion, representing a 10.4 per cent increase on N6.4 trillion posted at the end of the last financial year.
Group Managing Director, United Bank for Africa (UBA) Plc, Oliver Alawuba, said that the group continued to show notable operating resilience amid significant headwinds in its presence markets amidst heightened global risk environment.
According to him, UBA’s strong diversification model and unwavering focus on customer satisfaction continues to give the bank an edge over its peers in the industry.
“We continue to reap the benefits of our diversification strategy and customer -first philosophy and build resilience in our operations across Africa and the rest of the world to support the mission of providing superior value to our stakeholders.
“This has translated into strong financial gains evident in growth in our customer deposits and Net interest margin. In addition, we are strategically positioned to drive our market share in our operating countries, with the strong growth of our payments and transaction banking offerings,” Alawuba said.
FBN Holdings Plc grew its profit after tax to N91.2 billion in nine months of 2022, representing an increase of 123.6 per cent year-on-year (y-o-y) from the N40.8 billion reported in nine months of 2021.
The increase in profit was attributed to a double-digit increase in gross earnings and interest income.
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FBN Holdings announced N547.2 billion gross earnings in nine months of 2022, representing an increase of N432.6 billion compared to the nine months results it posted in 2021, while its interest income hit N370.4billion in nine months of 2022, an increase of 26.6 per cent y-o-y from N260.1billion reported in nine months of 2021.
The financial position of FBN Holdings contributed to performance in the period as total assets closed September 30, 2022, at N9.85 trillion, representing an increase of 10.3 per cent y-o-y from N8.93 trillion in full year ended December 31, 2021.
The holding company reported N3.6 trillion net customer loans & advances as of September 30, 2022, from N2.88 trillion in 2021; just as its customers’ deposits rose by 12.8 per cent y-o-y to N6.6trillion as of September 30, 2022 from N5.85 trillion reported in 2021 financial year.
Guaranty Trust Holding Company Plc loan book (net) increased by 2.2 per cent from N1.80 trillion recorded as at December 2021 to N1.84trillion in September 2022, while deposit liabilities increased by 6.4 per cent from N4.13trillion in December 2021 to N4.39trillion in September 2022.
The Group’s balance sheet was resilient with total assets and shareholders’ funds closing at N5.81trillion and N872.8billion, respectively.
Commenting on the results, the Group Chief Executive Officer of Guaranty Trust Holding Company Plc (GTCO Plc), Segun Agbaje, said; “The Group’s third quarter result reaffirms our strategy for long-term growth and underscores our capacity to deliver sustainable strong performance despite the volatilities in our operating environment. We have also kept in focus our vision of supporting small and medium enterprises specifically through our free business platforms to help them stay in business and expand their offerings.”
Access Holdings Plc improved its gross earnings by 30.9 per cent to N906.9 billion from the N693.1 billion recorded in the same period of 2021.
This was boosted by the higher revenue from its corporate and investment banking segment, as well as the commercial banking business.
In the financial statements released to the stock exchange, the company said it generated N497.5 billion from interest income, higher than the N395.1 billion achieved in the first nine months of last year, while the interest expense increased to N291.5 billion from N203.2 billion.
This left the net interest income at N280.5 billion versus N267.7 billion recorded as of September 30, 2021.
A look at the fee and commission income showed that it grew to N133.5 billion from N113.6 billion as a result of the higher earnings from credit-related fees and commissions, channels and other e-business income, commission on foreign currency denominated, commission on bills and letters of credit, and others.
Fee and commission expense rose by 38.3 billion from N24.8 billion due to a rise in bank and electronic transfer charges to N5.9 billion from N3.5 billion and an increase in e-banking expense to N32.4 billion from N21.3 billion.
The Afrinvest 2022 Banking Sector Report (BSR) shown that commercial banks recorded modest improvement in all regulatory indicators despite daunting economic challenges.
Deputy Group Managing Director, Afrinvest West Africa Limited, Victor Ndukauba, said the banks beat all the prudential guideline limits set by the Central Bank of Nigeria (CBN), an indication of their resilience and strength during the year.
Its assessment of CBN’s financial stability indicators showed that industry Liquidity (Liquidity Ratio) and Non-Performing Loan (NPL) ratios both improved by 130 basis points (up) and 75bps (down), respectively, to 42.6 per cent and 4.95 per cent.
Although, the Capital Adequacy ratio (CAR) 14.1 per cent underperformed the June 2021 level by 140bps, all the indicators beat the prudential guideline limits of 30 per cent (LR), five per cent (NPLs), and 13 per cent (CAR), respectively, despite myriads of challenges in the business environment.
The report said the improvement is expected to be sustained over the coming years.