The Nation Newspaper

Tag: GTB

  • Five banks’gross earnings hit N388b

    Gross earnings of Guaranty Trust Bank (GTB), Zenith Bank, Access Bank, Skye Bank and Enterprise Bank rose to N388.9 billion last year, according to data compiled by The Nation.

    GTB’s gross earnings were N221.9 billion and profit after tax was N87.3 billion, indicating 68.7 per cent leap from N51.7 billion in 2011. Further review shows that the bank recorded a slight growth in risk assets, with its loan book expanding by 11 per cent year on year – almost flat at 0.3 per cent quarter-on-quarter.

    The bank grew deposits by 11.9 per cent last year despite what is believed to be the restrictive monetary policy of the Central Bank of Nigeria (CBN).

    On a quarterly basis, growth in the GTB’s net interest income was on downward trend, slowing from 103.8 per cent in the second quarter to 50.1 per cent in third quarter and narrowed down to 36.4 per cent in the fourth quarter of 2012.

    Renaissance Capital (RenCap) said in an emailed report that it viewed GTB’s results as positive, reinforcing the best-in-class operating efficiency and profitability of the lender.

    “While noting that exceptional income from the sale of its last subsidiary, GT Homes in May 2012, may have also contributed to its earnings, however slight, we would like to highlight the bank’s rather strong operating performance,” it said.

    Zenith Bank’s net income rose to N100.68 billion in 2012 from N48.7 billion a year earlier, as its cost-to- income ratio fell to 54 per cent from 63 per cent. “Zenith’s operating efficiency showed material improvement” driving earnings higher, Muyiwa Oni and Rele Adesina, Lagos-based analysts at Stanbic IBTC Holding Co, wrote in an e-mailed note to Bloomberg.

    Zenith doesn’t expect Nigerian bank industry earnings this year to be “as aggressive” as in 2012, Chief Executive Officer Godwin Emefiele said during a March 21 interview.

    Access Bank Plc said full-year profit more than doubled as customer deposits increased. Net income advanced to N38.6 billion in 2012 from N14.5 billion a year earlier. Revenue rose 54 per cent to N208.3 billion as loans and advances to customers climbed five per cent to N604 billion. Deposits grew nine per cent to N1.2 trillion. Access Bank restrained its loan book following its purchase of Intercontinental Bank Plc in 2011, Chief Executive Officer Aigboje Aig-Imoukhuede said in October.

    Another lender, Skye Bank Plc announced N12.64 billion profit after tax for the year ended December 31, 2012. Key extracts of the lender’s audited report showed that the result represents an increase of 872.6 per cent on N1.30 billion recorded in 2011.

    Profit Before Tax (PBT) rose from N2.84 billion in 2011 to N16.51 billion in 2012. The bank maintained a steady top-line in 2012 with net interest income and net non-interest income of N44.50 billion and N22.60 billion.

    In a statement, the bank said its audited report and accounts for the year ended December 31, 2012 showed remarkable improvement in profitability as it harnessed its vast business base and increasingly efficient cost management to deliver impressive returns to shareholders.

    “On the basis of the impressive bottom-line, the board of the bank has recommended an increase in cash dividend per share from 25 kobo paid for 2011 business year to 50 kobo for 2012. This performance underlined Skye Bank as a return-driven bank. Earnings per share increased to N1.01 in 2012 as against 20 kobo in 2011,” it said.

    Enterprise Bank Limited also announced PBT of N11.3 billion for 2012. The bank was one of the bridge banks that emerged on August 5, 2011 following the takeover by the Nigeria Deposit Insurance Corporation (NDIC) of the defunct Spring Bank Plc. The new bank was recapitalised by the Asset Management Corporation of Nigeria (AMCON).

    In a statement, the bank said the profit is a marked improvement from the loss of N5.2 billion for the five-month period it operated as Enterprise Bank in 2011 (August to December 2011). The PBT represents a growth of 316.6 per cent. Other figures from the result show that gross earnings grew by 283.9 per cent to N40.4 billion as at year ended December 2012, from N10.5 billion achieved in the five-month period in 2011.

    The bank’s deposit also grew from N162.6billion to N208.4 billion between the five months in 2011 and 2012 financial year. This represents a growth of about 28.2 per cent. Total assets also experienced a growth of 31 per cent between the periods from N198.5 billion as at end of 2011 to N261.1billion by the end of 2012.

    The Chairman of Enterprise Bank Limited, Mr Emeka Onwuka, attributed the achievement by the bank to a sustained growth in quality risk asset creation, which equally engendered growth in interest income.

    He stated that in addition, the bank’s other banking income items, such as commissions, fees, electronic banking income, significant improvements in trade-related transactions, facilitated through its strategic focus on Small and Medium scale Enterprises (SMEs) helped in boosting the bank’s fees and commission income.

  • S&P raises First, GTB, Zenith banks’ ratings

    Standard & Poor’s (S&P) has raised the long-term counterparty credit ratings on First Bank of Nigeria Plc , Zenith Bank Plc, and Guaranty Trust Bank Plc to ‘BB-’ from ‘B+’.

    The firm said also raised the long-term Nigeria national scale ratings on the three lenders to ‘ngAA-’ from ‘ngA+’, adding that the stable outlook on the trio reflects that on the sovereign.

    The firm said the banks’ business and financial profiles will remain relatively unchanged over the next 12 months. According to Reuters, the ‘B’ short-term counterparty credit ratings on all three banks were affirmed and their outlook remained stable.

    S&P said the rating actions on FirstBank, Zenith, and GTB follow the upgrade of the Federal Republic of Nigeria rating on improved fiscal and external buffers and strong growth. It said that the sovereign upgrade reflects its view of an improvement in the government’s fiscal buffer and external position, as well as ongoing reform momentum.

    “We believe these factors will benefit the three rated Nigerian banks through the improved quality of their large exposure to the sovereign treasury bills and other government or government-related debt account for about 25 per cent to 30 per cent of the banks’ total assets. There is also expected strong economic growth, especially in the non-oil sector,” it said.

    The S&P said it does not rate Nigerian banks above the foreign currency sovereign credit ratings because of the direct and indirect influence the sovereign in distress would have on a bank’s operations, including its ability to service foreign currency obligations. “The long-term counterparty credit rating on Zenith remains constrained by the ‘BB-’ foreign currency sovereign credit rating on Nigeria. The ratings on FirstBank and GTB reflect their SACPs of ‘bb-’,” it added.

    According to S&P, the stable outlook on FirstBank reflects the stable economic environment, adding that  the bank’s business and financial profiles will remain relatively unchanged over the next 12 months. It expects the bank to retain its strong market position as Nigerian banking sector leader, with relatively stable revenues and moderate geographic diversification.

    The bank’s capitalisation, it said, should remain in the five to six per cent range under S&P’s risk-adjusted capital (RAC) methodology, but there could be downward ratings pressure if loans grow faster than we currently anticipate.

    “In our view, positive economic prospects should keep asset quality and loss experience at currently good levels, although a focus on lending to midsize companies may pressure this in the next 12 to 18 months,” it said.

    On GTB, it said the stable outlook reflects the stable economic environment, stressing that the bank’s business and financial profiles will remain relatively unchanged over the next 12 months. “In our view, the positive economic prospects in Nigeria will further support GTB’s business relationships and earning capacity,” it said.

    It said the stable outlook on Zenith reflects that on the sovereign, adding that the lender’s business and financial profile will also remain relatively unchanged over the next 12 months. “We anticipate that the positive economic prospects in Nigeria will support Zenith’s financial performance. We would raise the ratings on Zenith if we were to raise the ratings on the sovereign,” it said.

    The agency said a downgrade of the sovereign rating would trigger a downgrade of the bank.