Six Nigerian Banks Profits Hit N2.1tn in Q3 Report

Despite the economic struggles, six banks in the Nigerian financial sector are reported to have gained profits by 214% to N2.06tn in the period that ended September 2023 when compared to the corresponding year, which settled at a total of N656.15bn in 2022.

According to reports on the financial statements filed with the NGX, the top bank's profits rose by N1.4 trillion within the period under review when compared year-on-year.

The six banks under review include Access Holdings Plc, Zenith Bank International, United Bank for Africa, Guaranty Trust Holding Company Plc, FBN Holdings, and Stanbic IBTC Holdings.

From the records, it's revealed that all the banks listed in the review saw a growth of triple-digit in their profit. An overview of the profit record for the period that ended September 2023 shows that Zenith Bank's profit rose by 412.55% to N647.74bn; UBA's profit rose by 287.18% to 109.25bn; GTCO's profit rose by 181.87% to N367.41bn; FBN Holdings rose by 159% to N236.50bn; Stanbic IBTC rose by 97.96% to N109.25; and Access Holdings rose by 82.92% to N250.44bn in Q3 2023.

Nigerian banks have been recording positive results ever since the harmonization of segments of the currency market by the CBN in mid-June.

The real sector reports have suffered from foreign exchange losses, increasing borrowing costs, and the apex bank instructing commercial banks to stop using the FX revaluation profits for dividends and operational expenditures.

The announcement was in a letter signed by the Director, of the Banking Division Department, Haruna Mustafa, where the CBN said it had assessed the consequences of the recent FX rate regime change on the banking system and identified its potential to substantially impact the Naira values of banks’ foreign currency assets and liabilities, PUNCH reports.

However, the value of the assets of the banks rose by 43.57% to N83.55 trillion from N58.18 trillion as of the end of the 2023 financial year, with an increase in their loan books as a major contributor to the rising value of assets over the nine months.

Speaking on the increase in the assets of the banks, Professor Segun Ajibola, a former President and Chairman of the Council of the Chartered Institute of Bankers of Nigeria, said that the banks have a role in boosting the nation's economy; he also added that these efforts won't be effective from the beginning but will yield results later.

Discussing the issue with The Punch, Moses Ojo, a Lagos-based economic analyst, said that the macroeconomic situation of the country would likely have no impact on banking activities.

He said,

• The core activity of a bank is lending, and that’s how they make income. The present macroeconomic headwind in the country does not impact the ability of banks to lend because banks are still liquid to a reasonable extent.