Business
Access Bank bucks industry trend, posts 51% profit
BY EMEKA EJERE
Nigeria’s biggest bank by assets, Access Bank Plc has maintained its growth trajectory for the fourth consecutive year, recording 51.13% growth in profit to N160 billion for the full year 2021, ended December 31.
By this feat, the tier 1 lender has grown its profits by 167% in 4 years since hitting N60 billion in 2017.
The bank recorded gross earnings of N971.9 billion for the financial year ended December 31, 2021, representing an increase of 27 per cent over N764.7 billion posted in the financial year 2020.
According to its financial results released to the Nigerian Exchange Limited (NGX) on Friday, the lender’s Profit Before Tax (PBT) for the period rose by 40 per cent Year on Year to N176.7billion from N125.9 billion in 2020, while Profit After Tax (PAT) grew by 51 per cent y/y to N160.2billion from N106.0 billion in 2020.
The assets base of the group remained strong and resilient with total assets of N11.7 trillion as at December 2021, representing a growth of 35 per cent y/y from N8.7 trillion in 2020 and more than twice the bank’s total assets in 2018.
Other performance indicators show that customer deposits stood at N7.0 trillion as at December 2021, a whopping 24.47% leap from N5.6trillion in 2020. Net Loans and Advances stood at N4.4 trillion as at December 2021 from N3.6 trillion in 2020. Non-Performing loans (NPL) ratio stood at 4.0 per cent as at December 2021 as against 4.3 per cent in 2020.
The bank, however, recorded a 64.66% depletion of net gain on financial instruments to N42.46 billion, on the back of a N136 billion loss on non-hedging derivatives.
But its e-banking income raked in N66.28 billion, representing a 18% spike from N56.09 billion in 2020 and suggesting an improvement in the bank’s utilization of the e-channels in the delivery of financial services to its customers.
The bank last traded at N10.40 per share, with a market capitalization of N369.67 billion and Year-to-date performance showing 11.83% share price appreciation as of Thursday, March 17, 2022.
In line with its policy of regularly extending the fortune to the shareholders, the board of directors has proposed a final dividend of N0.70 per share, to be paid on each of the 35,545,225,622 issued ordinary shares, bringing the total dividend for the financial year to N1.00 kobo, having paid an interim dividend of N0.30 kobo in September 2021.
“Our diversified business model yielded positive sustainable results, guided by a robust risk management framework, as we grew the business cautiously and recorded sound prudential ratios. This year’s results reinforce our resolve to generate sustainable returns despite challenging market conditions”, said Herbert Wigwe, Chief Executive Officer, Access Bank Plc.
“We sustained robust capital and liquidity positions, well above regulatory levels with a Basel II Capital Adequacy Ratio of 24.5 per cent and a Liquidity Ratio of 51.0 per cent . This positions the Bank to support our customers across various markets and adequately execute our expansion strategy.
“To actualize our vision of becoming the world’s most respected African Bank and Africa’s Payment Gateway, we have taken strategic strides to create indelible footprints across the African continent.
“These include our most recent additions in South Africa, Botswana, and Guinea We also strengthened our business in Mozambique and Zambia, with noticeable improvement in rankings and market share.”
Strategic growth
With its successful ‘merger’ with Diamond Bank in 2019, Access Bank made a bold statement of intent to dominate the Nigerian banking space. It was a transaction that instantly shot it up as the biggest bank in the country, with assets base of N7.28 trillion, and customer base of 31 million.
However, an appreciation of N1.537 trillion or 21.6 per cent within one year ramped up the assets value of the lender to N8.680 trillion.
Access Bank was a small commercial bank, ranked 65th in size out of 89 banks in the country when Wigwe and his business partner, Aigboje Aig-Imoukhuede, acquired it in 2002. It was scaled up through a series of strategic mergers and acquisitions to build capacity and market strength over the years.
Wigwe took over from Aig-Imoukhuede as the bank’s MD/CEO in 2014 and has been driving its expansion, both in terms of footprint and product diversification.
The group is relying on its digital capability and innovative payments solutions to take the business to the next level as part of its expansion strategy.
“By 2023, Access Bank will have consolidated its position as Africa’s gateway to the world with about 100 million customers in Nigeria and additional 20m customers across our African subsidiaries,” Wigwe said last year.
