Despite COVID-19 Headwinds, 11 Banks’ Profits Rise to N941bn

FILE PHOTO: Dr Ngong Cyprian receives his first dose of the Oxford/AstraZeneca coronavirus disease (COVID-19) vaccine from Dr Faisal Shuaib, Executive Director and Chief Executive Officer of the National Primary Health Care Development Agency, at the National hospital in Abuja, Nigeria, March 5, 2021. REUTERS/Afolabi Sotunde/File Photo

Obinna Chima

Despite the disruptive impact of COVID-19 last year, the full-year financial results of 11 commercial banks for the period ended December 31, 2020, have shown that their combined profit after tax (PAT) for the period under review stood at N941.063 billion, higher than the N917.764 billion they recorded the previous year.

The banks are Access Bank Plc, Fidelity Bank Plc, FCMB, FBN Holdings, Guaranty Trust Bank Plc, Union Bank of Nigeria Plc, United Bank for Africa Plc, Zenith Bank Plc, Stanbic IBTC, Sterling Bank Plc and Ecobank Trans National Incorporated.

THISDAY compiled the results from their respective nine-month reports for the period, which the banks presented to the Nigerian Stock Exchange (NSE).
However, they recorded a combined profit before tax (PBT) of N1.085 trillion, lower than the N1.097 trillion they realised in 2019.

The financial statements showed that in the period under review, while Access Bank Plc recorded profit after tax of N106 billion, compared with the N94 billion recorded in 2019, the bank’s PBT in 2020 stood at N125.922, up from the N111.925 billion it realised in 2019.

FBN Holdings Plc reported a PAT of N89.7 billion in 2020, higher than the N73.7 billion it made in 2019; but the holding company’s PBT stood at N83.7 billion in 2020, higher than the N75.3 billion it achieved in 2019.
While Zenith Bank’s PAT grew to N230.565 billion in 2020, up from the N208.843 billion recorded in 2019, the bank’s PBT also climbed to N255.861 billion in the year under review, from N243.294 billion. The United Bank for Africa’s (UBA) PAT jumped to N113.765 billion in 2020, as against the N89.089 billion it made in 2019. But the bank’s PBT grew to N131.860 billion in 2020, higher than the N111.287 billion it made in 2019.

For Guaranty Trust Bank, its PAT rose to N201.439 billion in 2020, from N196.849 billion the previous year while its PBT in the year under review was N238.095 billion, up from N231.707 billion the previous year.
Also, Fidelity Bank’s PAT stood at N26.650 billion in 2020, as against the N28.425 billion it made the previous year, just as the bank’s PBT stood at N28.054 billion.

FCMB posted PAT of N19.610 billion in 2020, higher than the N17.337 billion it made in 2019, just as its PBT stood at N21.912 billion in 2020, from N20.130 billion in 2019.

Also, Union Bank in the year under review recorded PAT of N25.129 billion, higher than the N24.366 billion the bank posted in 2019. However, its PBT stood at N25.974 billion in 2020, up from N24.844 billion in 2019.
Stanbic IBTC’s PAT stood at N83.211 billion, higher than the N75.035 billion it made in 2019, just as the bank made PBT of N94.717 billion in 2020, higher than N90.925 billion.

Ecobank Nigeria’s PAT was N33.742 billion in 2020, as against the N99.462 billion the pan-African bank recorded in 2019 and with a PBT of N66.598 billion in 2020. Sterling Bank also posted a PAT of N11.242 billion in 2020, up from the N10.602 billion it achieved in 2019.

Despite the impressive performance recorded by the banks, Moody’s Investors Service in a report released last week stated that the outlook for Nigeria’s banking system remains negative.
This, the rating agency stated, reflected expectations of rising asset risk and weakening government support capacity over the next 12 to 18 months.

Analyst at Moody’s and the co-author of the report, Peter Mushangwe, predicted that Nigerian banks’ loan quality would weaken in 2021 as coronavirus support measures implemented by the government and central bank last year, including the loan repayment holiday, are unwound.

Mushangwe said: “The negative outlook also captures the weakening capacity of the government of Nigeria to support the country’s banks in case of need, as reflected by the negative outlook on the government’s credit rating; on the other hand, Nigerian banks hold robust capital buffers and foreign-currency shortages will ease.”