Deposit Money Banks (DMB) in Nigeria have demonstrated operational resilience in the financial year ended December 31, 2020, with results showing improvement across key income lines.

With the performance reaffirming the banks’ ability to navigate the current global economic challenges occasioned by the impact of COVID 19 pandemic, financial analysts say it is a reflection of good management of the financial institutions.

For the analysts, the performance of the banks in 2020 does not reflect the true state of the Nigerian economy, which slipped into recession in the third quarter, contracting -3.62%, having earlier recorded negative growth of -6.1 per cent in the second quarter of the year.

When COVID-19 took hold across Africa, impacting lives and livelihoods, Nigeria’s banking system was swift to respond. The Central Bank of Nigeria (CBN) took immediate steps, rolling out a stimulus package to combat the effects of the pandemic on critical sectors, including cutting the interest rate on its intervention facilities from 9 to 5 percent.

But banking in Nigeria faces a challenging road ahead. Already under pressure coming into the crisis as a result of a sluggish economy, a challenging operating environment, currency devaluation, and other macro challenges continue to place roadblocks in the sector’s path.

However, the results show that the hard choices the lenders made to navigate through the turbulent times are paying off, suggesting a likelihood of better performances in 2021 were the trends to be maintained.

“It is a pleasant surprise because the operating environment has been seriously depressed with a lot of headwinds. Despite this, the banks are coming with this kind of result. While the banks are coming up with impressive reports, the other sectors such as the oil and gas, manufacturing, in fact, the productive economy, are not doing well. This means the banks are earning their income not from productive activities of the economy,” posits Mr David Adorin, Executive Vice President, HighCap Securities.

Mr Ayodele Akinwunmi, Relationship Manager, FSDH Merchant Bank, noted that a lot of the banks have invested in skill, because of this they are making money from non-interest activities.
He said, “But when we look at these performances in real terms, they are not all appreciation, because inflation is over 17 percent. It means anyone that does not make up to 17 percent growth in profits, has not made profit in real terms.”


In its audited financial statements released on Thursday, the bank reported 4.6 per cent leap year-on-year in revenue to N455.23bn from N435.31bn, 2.33 per cent growth in profit and a final dividend per share of N2.70, bringing its total to N3 per share for the financial year under review.

According to the results, the tier one lender’s profit after tax (PAT) rose to N201.44bn from N198.85bn in 2019. Its profit before tax (PBT) rose to N239.09bn from N231.71bn in 2019. Deposits from customers surged by 38.74 per cent to N3.51tn in 2020 from N2.53tn a year ago, while loans and advances to customers rose to N1.66tn from N1.50tn.

GTBank said during the 2020 financial year, its directors declared and paid an interim dividend of 30 kobo per ordinary share on the issued capital of 29,431,179,224 ordinary shares of 50 kobo each, for the half-year period ended June 30, 2020.

“The directors recommend the payment of a final dividend of N2.70k per ordinary share of 50 kobo (bringing the total dividend for the financial year ended December 31, 2020 to N3.00k (2019: N2.80K per share). Withholding tax would be deducted at the point of payment,” it added.

Analysts at Cordros Capital Limited said despite weaker performance in the third and fourth quarters of 2020 and as the performance came under pressure as expected, the bank managed to record a relatively stronger performance primarily due to a 30.8 per cent quarter-on-quarter decline in interest expense.

“In conjunction with sustained efficiency and performance across key lines, FX revaluation gains, this strong balance sheet management was responsible for the performance recorded. Our estimates are under review,” they said in an emailed note on Thursday.

Commenting on the financial results, the Managing Director/Chief Executive Officer, Guaranty Trust Bank Plc, Mr Segun Agbaje, said, “2020 was arguably the most challenging year that the world has faced in decades.

“In such unprecedented times, we sought to live out the full extent of our values; safeguarding lives and livelihoods for our people, our customers and across the communities where we operate.

“We were on solid footing going into 2020; the strength, scale and liquidity of our balance sheet, coupled with the quality of our past decisions and the efficacy of our digital-first customer-centric strategy gave us the resilience and flexibility to navigate the economic shocks and market volatility that dominated the year.”

He added, “Amidst the many challenges that persist, we remain ardent believers in Africa’s growth potential. Our world is increasingly digital, and we see it opening new and exciting opportunities for empowering people and uplifting our communities.

“With our commitment to deepening customer relationships and intense focus on delivering innovative financial solutions, we enter 2021 well-positioned to lead this new world.”


According to the 2020 audited financials filed at the Nigerian Stock Exchange (NSE), the bank’s gross earnings grew by 10.8 percent to N620.4 billion, compared to N559.8 billion recorded in the corresponding period of 2019. The bank’s total assets also grew by 37.0 percent to N7.7 trillion for the year under review.

The lender defied the challenging business environment occasioned by the Covid-19 pandemic and the resultant effect on economies globally, to post impressive Profit Before Tax (PBT) of N131.9 billion, compared to N111.3 billion at the end of the 2019 financial year.

In the same vein, the Profit After Tax (PAT) rose remarkably by 27.7 percent to N113.8 billion compared to N89.1 billion recorded at the end of the 2019 financial year.

On the cost side, Operating Expenses grew by 10.1 percent to N249.8 billion, as against N217.2 billion in 2019, well below average inflation rate of 13.2 per cent for the year, thus reflecting the bank’s cost effectiveness.

In its usual tradition of rewarding shareholders, the bank proposed a final dividend of N0.35 kobo for every ordinary share of 50 kobo. The final dividend, which is subject to the affirmation of the shareholders at its Annual General Meeting, will bring the total dividend for the year to N0.52kobo as the bank had paid an interim dividend of N0.17 kobo earlier in the year.

UBA recorded a remarkable 24 percent growth (to N2.6 trillion) in loans to customers, whilst customer deposits increased by 48.1 percent to N5.7 trillion, compared to N3.8 trillion recorded in the corresponding period of 2019, reflecting increased customer confidence, enhanced customer experience, successes from the ongoing business transformation programme and the further deepening of its retail banking franchise.

Commenting on the result, the Group Managing Director/CEO, Kennedy Uzoka noted that the year 2020 was important for UBA Group, as it gained further market share in most of its countries of operation.

He said, “We ended a very challenging year on a reassuring note. The Bank recorded double-digit growth in both our top and bottom lines, as gross earnings and after-tax profit grew by 10.8% and 27.7% to N620.4billion and N113.8 billon respectively. Return on equity was 17.2%, even as our cost-to-income ratio moderated to 61.3%. Our earnings per share of N3.20 is a 26.8% growth from the preceding year, as we continue to ensure maximum value creation for our highly esteemed shareholders.

Continuing, Uzoka said, “Despite the tumultuous impact of Covid-19 pandemic globally and across our 23 countries of operation, we created N519.0 billion additional loans as we continued to support our customers and their businesses. Customer deposits grew 48.1% to N5.7 trillion, driven primarily by additional N1.8 trillion in retail deposits. As a global bank, we remain well capitalized and determined to successfully drive financial inclusion on the continent through our innovative products and vast network. Our capital adequacy and liquidity ratios came in at 22.4% and 44.3%, well above the respective regulatory minimum of 15.0% and 30.0%.

United Bank for Africa Plc is a leading Pan-African financial institution, offering banking services to more than twenty-one million customers, across over 1,000 business offices and customer touch points, in 20 African countries. With presence in the United States of America, the United Kingdom and France, UBA is connecting people and businesses across Africa through retail; commercial and corporate banking; innovative cross-border payments and remittances; trade finance and ancillary banking services.

Zenith Bank

Shareholders of Zenith Bank Plc, on Tuesday, approved proposed final dividend of N2.70 per share, bringing total dividend for the 2020 financial year to N3 per share, amounting to N94.19 billion.

According to the audited financial results, profit before tax rose by five per cent to N255.9 billion from N243.3 billion reported in 2019, in spite of a challenging macro-economic environment exacerbated by the COVID 19 pandemic.

Chairman of the Bank, Mr Jim Ovia, in a statement explained that : “The increase arose from a mixture of growth in the topline and a significant reduction in interest expense from N148.5 billion in 2019 to N121.1 billion in 2020. significantly increasing the net interest income from N267.0 billion in 2019 to N299.7 billion in 2020.

“The group recorded a growth in gross earnings of five per cent from N662.3 billion in the previous year to N696.5 billion.

“The group recorded eight per cent growth in non-interest income from N232.1 billion in 2019 to N251.7 billion in 2020 and one per cent increase in interest income from N415.6 billion in 2019 to N420.8 billion in 2020.

“The group’s increased retail activities translated to a corresponding increase in retail deposits and loans.

“Thus, retail deposits grew by N612.7 billion from N1.11 trillion to N1.72 trillion year-on-year (YoY), while savings balances significantly grew by 88 per cent YoY and closed at NGN1.16 trillion,” he said.

The chairman also said that retail drive, coupled with the low-interest yield environment, reduced the cost of funding from 3.0 per cent to 2.1per cent and reduced interest expense.

He, however, said that the low-interest environment also affected the net interest margin, which declined to 7.9 per cent from 8.2 per cent in the current year due to the re-pricing of interest-bearing assets.

“Operating costs grew by 10 per cent YoY but are still tracking well below inflation which at the end of the year stood at 15.75 per cent.

“Although returns on equity and assets also reduced from 23.8 per cent to 22.4 per cent and from 3.4 per cent to 3.1 per cent, respectively.

“The group still delivered improved Earnings per Share, which grew 10 per cent from N6.65 to N7.34 in the current year.

“The group equally increased corporate customer deposits, which alongside the growth in retail deposits, delivered total deposit growth of 25 per cent, to close at N5.34 trillion, driving growth in market share,” he said.

The chairman noted that total assets also increased significantly by 34 per cent to N8.48 trillion, from N6.35 trillion.

“In spite the COVID-19 pandemic and its associated challenges, the group managed to create new viable risk assets as gross loans grew by 19 per cent, from N2.46 trillion to N2.92 trillion.”


Redoubled efforts by Ecobank Group paid off, with the pan African financial institution posting revenue of N641.8 billion for the year ended December 31, 2020, representing nine per cent increase compared with N586.9 recorded in the corresponding period of 2019.

According its audited report submitted to the Nigeria Stock Exchange (NSE) last week, the lender also defied the harsh operating environment that characterized the turbulent year to record impressive performance in other key financial indices.

Further details of the report revealed stable gross earnings of N841.1 billion from N842.5 in 2019. The operating income before impairment losses increased by 20 per cent, from N198.6 billion to N239.1 billion during the year under review. Also, total asset of the bank nudged up to N10.4 trillion in the year ended from N8.6 trillion in the corresponding year of 2019, representing 20 percent increase.

Profit before goodwill impairment, however, went down by 12 percent to N129.1 billion as against N 146.5 billion recorded in the corresponding period of 2019, just like Profit before tax dipped to N66.6 billion from N146.5 billion reported in 2019 while Profit after tax closed at N33.7 billion.

“This is a reflection of the power of our pan-African diversified one-bank business model” says Ade Ayeyemi, Ecobank Group CEO.

Ayeyemi further said: “2020 was a year which tested the resilience of the human spirit in rising to the many challenges as governments, businesses and households’ unrelentingly strove to keep citizens, clients and loved ones safe. I am proud of Ecobankers’ hard work and continued service to our customers and the support we provide to the communities we serve.”


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