Seven top Nigerian banks have pocketed a staggering N4.2 trillion profit in the 2024 financial year, Daily Trust’s findings have revealed.
Zenith Bank PLC, United Bank of Africa (UBA), Guaranty Trust Holding Company Plc (GTCO), First Bank, Fidelity Bank, Stanbic IBTC and Wema Bank collectively generated the huge profit despite the economic headwinds in the country.
Daily Trust reports that inflation, naira depreciation, declining consumers’ purchasing power were some of the challenges the banking sector recorded last year.
Within the period, the banking sector recorded a combination of collapses, mergers, and regulatory reforms.
However, some of the top lenders in their 2024 FY results have reported huge earnings with impressive performances in their profit after tax.
In their 2024 financials, filed with the Nigerian Exchange Limited (NGX), some of the lenders’ gross earnings grew significantly with staggering profit.
Zenith Bank Plc’s 2024 FY results showed a record profit after tax of N1.03 trillion.
This represents a 52.5% increase over the N676.9 billion reported a year earlier.
The bank also reported a pre-tax profit of N1.32 trillion, which is also a record for the bank, and a 66.6% increase year on year.
A cursory analysis of the results also showed that the bank reported gross earnings of N3.9 trillion, with interest income and trading income contributing majorly to the top line.
As part of its earnings announcement, the bank proposed a final dividend of N4.00 per share, bringing its total dividend payout from 2024 profits to N5 per share, compared to N4 per share in 2023.
In its audited financial results, UBA recorded a rise in profit after tax which went up by 26.14 per cent to close the year at N766.6 billion, up from N607.7 billion recorded at the end of the 2023 fiscal year.
The 2024 financials filed with the NGX on Monday showed the bank’s gross earnings also grew significantly from N2.08tn recorded at the end of the 2023 financial year to N3.19tn in the period under consideration, representing a 53.6 per cent growth.
The banks’ total assets also rose remarkably by 46.8 per cent from N20.65 trillion in 2023, to close at N30.4 trillion in December 2024; signifying a milestone leap for the bank with the largest spread across the continent.
UBA recorded a profit before tax of N803.72 billion representing a 6.1 per cent increase from N757.68 billion recorded at the end of the 2023 financial year.
Consequently, UBA Group Shareholders’ Funds rose from N2.030 trillion as at December 2023 to close the 2024 financial year at N3.419 trillion, achieving an impressive growth of 68.39 per cent.
GTCO also experienced a year-over-year increase in gross earnings of 81.3 per cent, rising to N2.14 trillion in 2024, with corporate banking accounting for the largest share.
According to data from the NGX, this growth occurred alongside an increase in interest income, which rose to N1.32 trillion from N436 billion the previous year.
However, interest expenses increased significantly by 148 per cent year-over-year, reaching N283 billion, up from N114 billion in the prior year, expenses from deposits made up a large portion of this.
Despite the rise in expenses, the group’s net interest income was N1.05 trillion, reflecting a 140.8 per cent increase from N436 billion the previous year.
The company also reported an after-tax profit of N1.01 trillion for the year ended December 31, 2024, according to its financial statement.
This figure represents an 89.4 per cent increase year-over-year from the N539 billion reported in 2023, amid a significant surge in interest income.
For Fidelity Bank, its profit for the period was N278.106 billion.
The bank announced a pre-tax profit of N385.215 billion for the 2024 financial year that ended December 31, representing 210.01% year-on-year (YoY) growth.
Despite a windfall tax of N13.333 billion, post-tax profit surged by 179.63% to N278.106 billion.
According to the audited financial statement, gross earnings grew by 87.72% to N1.043 trillion, with core operational income contributing about 97% of total revenue.
Stanbic IBTC Holding Plc. has announced a pre-tax profit of N303.796 billion for the 2024 financial year that ended on December 31, 2024.
The pre-tax profit represents a 60.23% year-on-year (YoY) growth. Similarly, post-tax profit increased by 60.23% to N225.311 billion.
A further review of the financial statements suggests the performance can be attributed to strong revenue growth, as gross earnings surged by 78.26% to N823.309 billion, significantly boosting the bank’s bottom line.
Also, FBN Holdings grew its gross earnings by 113 per cent to N3.33tn in the 2024 financial year.
In the group’s unaudited financial statement published via the platform of the Nigerian Exchange Limited, profit before tax appreciated.
PBT rose by 142 per cent to N862.38bn at the end of the 2024 financial year from N356.15bn in the corresponding period in 2023.
In the period under review, net interest income grew by 155 per cent year-on-year to N1.39tn, while non-interest income rose to N846.9bn compared to N255.8bn in 2023.
Loans to customers increased significantly by N2.79tn, to close at N9.4tn. Similarly, customer deposits rose by 62 per cent to N17.29tn, and total assets appreciated to N26.54tn up from N16.94tn.
Wema Bank reported profit before tax of 102.51bn, representing an increase of 135% over the 43.59bn recorded in the corresponding period in 2023.
The bank’s balance sheet remained well structured, diversified and resilient with Total Assets growing by 60% to 3,585.05bn in FY 2024 from 2,240.06bn in FY 2023.
The bank also grew its deposit base year on year by 36% to 2,523.82bn from 1,860.57bn reported in FY 2023.
Loans and advances grew by 50% to 1,201.21bn in FY 2024 from 801.10bn in FY, 2023.
NPL stood at 3.86% as at the end of FY 2024.
The bank recorded improved year on year performance as gross earnings grew by 92% to 432.34bn (FY 2023: 225.75bn).
Why banks raked in huge profit – Expert
Speaking with Daily Trust, Adeleke Adebayo of the Independent Shareholders Association, attributed the positive results to the foreign exchange in flows and treasury bills due to high interest declared by the Central Bank of Nigeria last year.
He said, “Last year, there was much more money made by the banks in 2024 from foreign exchange bills. That’s one.
“Secondly, the interest regime maintained by CBN last year was very high and you know a lot of the banks were just putting their money back in the central bank through treasury bills at a very high rate.
“So, the income that banks made from just placing money with the CBN was enormous and part of the great results you see them declaring in 2025.
“These two key sources of income helped the banks greatly in terms of the results we have seen coming out.”
On his part, Mr Okezie Boniface, another shareholder, said, “Banks should be well commended for what they are doing, their resilience notwithstanding the harsh economic winds they have been passing through.”
He said the banking sector gave the shareholders a sigh of relief at a time other companies were declaring losses.
Why banks are declaring huge profits – Economist
An economist, Dr Muda Yusuf, stated that there are some sectors of the economy that are not doing badly despite the economic headwinds.
Yusuf who is the Chief Executive Officer, Centre for the Promotion of Private Enterprises (CPPE), said, “The banks’ transactions involve different segments of the economy. There are some segments of the economy that are not doing badly in spite of the economic situation and there are some segments of the economy that are doing badly.
“If you look at the public sector, the government, their revenue has increased. The volume of cash and monetary transactions generally has increased.”
Yusuf further stated that Nigerians should not be carried away by the trillion naira declaration because of the naira depreciation, saying one trillion naira in 2025 is like N500bn two years ago.
He said, “You know that the bank transactions are not different from the economy, there are some segments of the economy that are not doing too badly despite the harsh reforms and there are some segments that are really suffering you know.
“Now if you look at the government, the public sector you can see that as a result of the reforms, the revenue in that sector has increased.
“And you know the public sector, the states and local governments, they don’t keep their money, it is the banks that keep the money for them and whatever transaction is done through the bank.
“So transaction related revenue is increasing generally, how much was our budget last year and two years ago, how much is the budget now.
“So imagine just about 70% of 54 trillion, imagine the financial transactions, spending and savings. Bank’s revenue benefit from such transactions.”
Profits staggering, do not reflect economic reality – Analyst
An economic analyst, Professor Adebayo Adams, wondered how the banks were declaring staggering and humongous profits when the economy is not performing.
He said the Central Bank of Nigeria (CBN) and the Chartered Institute of Bankers of Nigeria (CIBN) should come out and explain the wonder to them.
Adams who is the Lagos State Chairman of the National Association of Small and Medium Enterprises (NASME), said, “How are the banks getting those humongous profits they are declaring where businesses are folding up, people are unable to eat and inflation is going up.
“Two, three days ago, they increased the pump price from N860 to N940, almost N100 added to it. And they are declaring these huge profits. It is very scary. The small businesses are struggling and we don’t even understand how they are doing. Anyway, the rate at which they are charging us for maintenance of accounts, if you take the population of Nigerians with bank accounts.”
He lamented that the small businesses cannot survive under the current interest rate regime the banks are charging.