Chinwendu Obienyi
Six out of 24 banks that have so far released their financials for the first quarter of the year have posted a cumulative profit of N169.39 billion.
The banks are Guaranty Trust Bank (GTB), Ecobank Transnational Incorporated Plc (ETI), Stanbic IBTC, Sterling Bank, United Bank for Africa (UBA) and Zenith Bank Plc.
Given the challenging environment, these banks appeared to have pushed against recessionary headwinds. According to the results released on the Nigerian Stock Exchange’s (NSE)’s website, GTBank recorded an increase of 7.7 per cent in PAT to N44.67 billion in first quarter (Q1) of 2018 as against N41.48 billion profit in its Q1 results of 2017.
The bank’s Profit Before Tax (PBT) gained 4.43 per cent to N52.62 billion as against N50.39 billion reported in three months of 2017, driven by 4.65 per cent increase in its gross earnings to N108.97 billion from N104.13 billion reported in three months of 2017.
Highlights from statement of financial position showed 10.81 per cent increase in total assets to N3.5 trillion as at March 30, 2018 from N3.16 trillion reported in 2017 while total liabilities increased by 13.5 per cent to N2.97 trillion as at March 30, 2018 from N2.6 trillion reported in full year ended December 31, 2017.
ETI on its part reported that its profit for the period ended March 31, 2018 rose by 48.6 per cent to N27.75 billion from N18.68 billion recorded a year earlier. Similarly, pretax profit increased 48.1 per cent to N33.90 billion from N22.89 billion declared the same period of 2017. Gross earnings of the bank grew from N178.38 billion to N198.61 billion in the review period of 2018, showing a growth of 11.3 per cent.
Stanbic IBTC Holdings Plc, a member of Standard Bank Group, recorded a growth of 44 per cent in post-tax profit while its PAT increased to N23.1 billion from the N16.1 billion posted in the corresponding period of 2017. The bank’s PBT made a similar progression during the quarter, from N18.6 billion to N26.7 billion, an increase of 43 per cent recorded in the comparable period of 2017.
At N57.4 billion, gross earnings during the period grew by 22 per cent over the N47.0 billion recorded in the comparable period of last year while total assets went up to N1.41 trillion from N1.39 trillion in December 2017.
Sterling Bank Plc posted a PAT of N3.1 billion on gross earnings of N39.8 billion for the first quarter ended March 31, 2018. The impressive first quarter net income is an improvement on net income of N1.9 billion for the corresponding period of 2017, representing an increase of 65.2 per cent.
A further review of the financial performance indicates that net loans and advances increased by two per cent to N609.8 billion, customer deposits rose by 4.9 per cent to N718.5 billion, while total assets (excluding contingent liabilities) were relatively flat at N1.05 trillion.
Following a sterling performance in the 2017 financial year, UBA Group delivered another impressive 18 per cent year-on-year growth in gross earnings in the first three months of 2018.
Leveraging on strong growth in both interest and non-interest income, UBA grew top-line to N119.4 billion in the first three months of the year, ending March 31, 2018 compared to N101.2 billion recorded in the first three months of 2017.
The group recorded N26.6 billion in PBT, compared to N25.5 billion achieved in the first quarter of 2017 while its PAT stood at N23.7 billion in Q1, an impressive 6.2 per cent year-on-year growth compared to N22.4 billion achieved in the corresponding period of 2017 while sustaining its strong profitability, recording an annualised 18 per cent Return on Average Equity (RoAE).
Zenith Bank Plc also reported a PAT of N47.079 billion for the first quarter ended March 31, 2018, showing an increase of 26 per cent from N37.449 billion recorded in the corresponding period of 2017 while its gross earnings grew by 14 per cent from N147.736 billion to N169.192 billion.
The bank’s net income increased by 35 per cent from N70.604 billion to N95.898 billion in 2018 while its fee and commission income reduced from N21.128 billion to N20.837 billion. However, in a bid to reduce cost, personnel cost fell from N18.166 billion in 2017 to N15.566 billion while operations expenses rose from N26.991 billion to N43.917 billion.
Consequently, the bank’s PBT rose by 22 per cent from N44.2 billion to N54 billion, while PAT grew faster by 26 per cent from N37.449 billion to N47.079 billion in 2018. Commenting on these results, the Managing Director, GTBank, Segun Agbaje, said the bank was able to deliver a strong result in a challenging environment by achieving record growth in earnings, carefully managing cost margins and leveraging on digital-first customer-centric strategy to deliver world-class services, which were simple, cheap and easily accessible.
He further stated that, “the result demonstrates the fundamental strength of our franchise as well as the progress we are making in transforming our organisation into a platform on which our customers could build their businesses, connect with their consumers and access all the resources they need to make their lives better.”
Chief Executive Officer, Stanbic IBTC Holdings Plc, Yinka Sanni, attributed the performance of the bank to the growing economy.
“Stanbic IBTC delivered strong results in the first quarter of 2018 in demonstration of its growth aspirations as the country’s economic environment continues to improve. The 22 per cent growth in gross earnings was driven by 38 per cent increase in non-interest revenue while net interest income remained stable year-on-year. The growth in non-interest revenue was driven by a significant growth in trading income and fee and commission revenue.”
Sanni stated that each business line reported better performance when compared to the corresponding quarter of 2017 and would expect even higher performance going forward.
“We expect that our risk asset position will improve with particular focus on the export sectors, including agriculture, even as macro-economic fundamentals improve to drive lending. We will continue to dedicate efforts in growing our client base through excellent service delivery in our quest to remain the leading end-to-end financial solutions provider in Nigeria,” he said. Chief Executive Officer, Sterling Bank Plc, Abubakar Suleiman, said, “we are pleased to be starting 2018 on a good note, by sustaining the strong performance delivered in 2017 with growth across key financial indices. This demonstrates strength and is indicative of our outlook for the financial year.”
He added that Sterling Bank is actively mobilising private sector capital to solve some of the most pressing social and economic needs of Nigerians.
On his part, The Group Managing Director, United Bank for Africa (UBA) Plc, Kennedy Uzoka, expressed satisfaction with the Bank’s impressive performance in the first quarter of 2018, despite intensifying competition and moderation in yield environment in Nigeria and Ghana.
“Notwithstanding the moderation in sovereign yield in Nigeria and Ghana, we achieved a 60bps improvement in net interest margin (NIM) to 7.6%, as we extract efficiency gains from balance sheet management,” Uzoka said.
“I am particularly pleased with the 8% year-to-date growth in our retail deposit, as it reflected the benefit of improved customer service and continued customer acquisition. We are committed to exceeding our 2018 deposit growth target in the year, with strategic focus on retail, low cost savings and current accounts, which is critical to sustaining our NIM uptrend,” he explained.
