Six Big Banks Rake in N4.15tn Profit in First Nine Months of 2024

Kayode Tokede

Amid macroeconomic challenges facing the Nigerian economy, Zenith Bank Plc, Guaranty Trust Holding Company Plc (GTCO), Access Holdings Plc, United Bank for Africa Plc (UBA), FBN Holdings Plc and Ecobank Transnational Incorporated (ETI) generated an estimated N4.15 trillion profit before tax in the first nine months of 2024.
According to data compiled by THISDAY, the aforementioned amount raked in by the financial institutions, was about 110.4 per cent increase, compared with the total of N1.97 trillion profit before tax generated by the banks in nine months of 2023.

The figures were compiled from the respective nine months unaudited financial statement of the financial institutions released to the investing public on the Nigerian Exchange Limited (NGX).
After paying an accumulative N789.88 billion income tax expenses in nine months of 2024, THISDAY gathered that the six deposit money banks (DMBs) generated N3.91 trillion profit after tax in nine months of 2024, a growth of 104 per cent compared with the total of N1.92 trillion reported by the banks in nine months of 2023.
So far in 2024, these DMBs are faced with a range of challenges stemming from both domestic economic factors and global financial trends.

Notable challenges include currency volatility and foreign exchange shortages, double-digit inflation that is currently at 32.70per cent as at September 2024; rising interest rate and the restrictive monetary policy of the Central Bank of Nigeria (CBN); digital transformation and cybersecurity threats, and competition from Fintech and Mobile Money Operators (MMO).

These DMBs, however, leveraged on the interest rate hike by the CBN to drive interest income from loans & advances to customers, and interest from Government securities.
Others challenges are power and infrastructure challenges; talent acquisition/retention and geopolitical and global economic factors.

Despite these challenges, DMBs operating in Nigeria and Sub-Saharan Countries in Africa have significantly driven profit before tax generation in the period under review.  
For instance, GTCO, and Zenith Bank emerged the only DMBs with over N1 trillion profit before tax generation in nine months of 2024.
In the period under review, GTCO’s declared N1.21 trillion profit before tax, about 181.5 per cent increase over N433.2billion generated in nine months of 2023, while Zenith Bank hit N1 trillion profit before tax in nine months of 2024, representing an increase of 99 per cent from N505.04 billion reported in nine months of 2023.
As ETI announced N708.54 billion profit before tax in nine months of 2024, a growth of 170 per cent from N262.17billion in nine months of 2023, FBN Holdings declared N610.86 billion profit before tax in nine months of 2024, up by 128 per cent from N267.88 billion reported in nine months of 2024.
The CEO of Ecobank Group, Mr. Jeremy Awori, stated that the nine months of 2024 results highlighted the resilience and commitment of the Pan-African financial institution, even amid a challenging economic landscape that African governments actively address through fiscal and monetary policies.
“These results also exemplify our diversified business model’s strength and unwavering commitment to executing our Growth, Transformation, and Returns (GTR) strategy.
“We have made significant progress on our transformation agenda over the past three quarters. Our revenue and earnings growth expectations are built on strengthening our customer-centric business lines, allowing us to deliver the products and services our customers need.
“We are simplifying operations and developing new offerings. Furthermore, we continue to invest in our technology platforms to maximise our potential. Hence, we have restructured our organisation to prioritise client focus, creating new opportunities to achieve our goals,” Awori added.
On his part, the Group Managing Director, FBN Holdings, Mr.  Nnamdi Okonkwo said, the Holdings delivered a strong performance in the nine months of 2024, achieving significant growth driven by the effective execution of our strategic priorities.
“’Despite a challenging macroeconomic environment, our focus on operational efficiency, customer-centric innovations, and prudent risk management continues to generate sustainable value for our stakeholders,” he said.
Looking ahead, Okonkwo added that, “we remain focussed on executing our digital transformation strategy, enhancing customer experience, and driving long-term growth.”
In addition, UBA’s profit before tax stood at N603.48billion in nine months of 2024, about 20.2 per cent increase from N502.09billion reported in nine months of 2023, while Access Holdings announced N558.18billion profit before tax in nine months of 2024, a growth of nearly 90 per cent from N294.42billion reported in nine months of 2023.
The Group Managing Director/CEO, UBA, Mr. Oliver Alawuba, said the nine months 2024 performance was underpinned by consistent strong growth on all core and sustainable banking income lines.
He added that “Our substantial investments in technology are yielding tangible business value. This commitment is instrumental in delivering enhanced customer experiences and optimizing operational efficiency.”
Commenting on these DMBs nine months 2024 performance,  Investment Banker & Stockbroker, Mr. Tajudeen Olayinka said a significant portion of the banks’ recent profit gains came from revaluation gains on their net long US dollar income positions.
He stated that most banks have structured their balance sheets to maintain net long US dollar positions, which means that they are able to record gains whenever the currency is adjusted.
“Most tier-one banks currently hold a net long position in USD. This means that their foreign currency assets exceed their currency liabilities. Consequently, whenever there is currency revaluation, it will positively impact their profits,” Olayinka added.
From a shareholder’s perspective, the President, Progressive Shareholders Association of Nigeria (PSAN), Mr. Boniface Okezie said listed big DMBs on the NGX have shown resilience and improved performance this year amid headwinds in Nigeria and Africa at large.
“These banks’ performance in nine months of 2024 is a reflection that the economy is doing well despite numerous challenges. I hope other sectors can maintain the resilience of these banks and drive the nation’s economy further,” Okezie added.