Three commercial banks in the tier-one category-Zenith Bank Plc, GTBank Plc, and Stanbic IBTC Bank Plc, have reported a record performance of N62 billion, when assessed between the period of 2017 and 2018.
The all-time high figure represents a 75.12 per cent increase in profit shoot-up, rising from N390.085bn recorded in 2017, to consolidate with N452.504bn at the end of December 2018.
Analysis of the banks’ financial statements which was released to the investing public, through the Nigerian Stock Exchange last week, showed that the three banks reported impressive numbers with cumulative of 75.12 per cent to N452.504billion profit after tax in 2018, from N390.085billion in the comparable period of 2017.
Zenith Bank raked in 11.30 per cent increase to N193.424 billion, from N173.791bn, which was reported in 2017, while GTBank followed with 9.96 per cent increase in its profit to N184.640bn, from N167.913bn in the review period of 2017. Stanbic IBTC, however, recorded 53.86 per cent profit, to N74.440 bn, from N48.381bn, which the bank realised in 2017 financial year.
Some finance sector analysts who hailed the results said given the challenge of the operating environment, especially the many uncertainties of the election year, “this performance is very commendable.’’
The leader of shareholders group, Mr. Boniface Okezie, said the banks had performed well.
“Despite the challenging economy, killings here and there, the banks were able to churn out resilient results through the dint of hard work and being focused. That means, if the economy is doing well, the financial institutions would have released a far better result and return on investment to their shareholders,” Okezie said.
Managing Director and Chief Executive Officer of APT Securities, Mallam Garba Kurfi, said he would advise investors to look at those companies that are yet to declare their results for investment.
“Most of the companies have their year-end at December and most of them release their results around March, April and May. So, investors should take advantage of the earning season so that whatever the companies declare as dividend, they will benefit from it,” he said.
Kurfi added , “I will advise them to look out for the banking sector, especially the ones that have just declared their results. They should look at the others that are yet to release their results, like Access Bank, United Bank for Africa and others; they are all in price earnings ratio that is below five.”
Head of Research and Strategy at FSDH Merchant Bank Limited, Mr. Ayodele Akinwunmi, said there are pressure points in the economy that the federal government must quickly address to stimulate broad-based and inclusive growth.
According to the Lagos-based financial institution, the Nigerian economy has not been expanding enough to lift its citizens out of poverty. Owing to this, he stressed, there is the need for the economy to expand faster than it is at the moment.
Some of the economic pressure points, he listed, are weak infrastructure development in the economy that may not support the growth ambition of the federal government; economic depression in the real estate sector; fragile foreign exchange market, and weak revenue generation for the federal government, which has led to large fiscal deficits.
“Overall, despite the headwinds and the fact that 2018 presents a tough operating environment for the industry, we remain optimistic on the fundamentals underpinning our long term retail-led business strategy”, some of the banks told our correspondent.
Key extracts of the audited report and accounts of GTBank showed that gross earnings rose by 3.7 per cent to N434.7bn in 2018 as against N419.2bn in 2017. Profit before tax stood at N215.6 billion in 2018 as against N197.7 billion recorded in 2017, representing an increase of 9.1 per cent.
Further analysis showed that the bank’s customer deposits increased by 10.3 per cent from N2.062 trillion to N2.274trn. However, loan book dipped by 12.9 per cent from N1.449trn in 2017 to N1.262trn in 2018. Total assets stood at N3.287trn while shareholders’ funds totalled N575.6 bn in 2018.
Managing Director, Guaranty Trust Bank Plc, Mr Segun Agbaje, said the results reflected the success of the bank’s focus on staying nimble, strengthening customer relationships and driving digital-first strategy.
According to him, the bank successfully navigated the pressures of challenging and radically changing business environment as it recorded growth across key financial indices while reaffirming its position as one of the best performing and well managed financial institutions in
Africa.
“This result reflects, not just the fundamental strength of our brand, but also our commitment to our values of excellence, creating value for all stakeholders and putting our customers first in everything that we do. Driven by these values, we are building the bank of the future by pairing the best of our business with the massive potential of digital technologies to create Africa’s first integrated and trusted platform; Habari,” Agbaje said.
