Nigerian banks recorded a combined pre-tax profit of N1.58 trillion in Q1 2024, marking a 263% year-on-year increase compared to N436 billion in Q1 2023, with GTCO posting the highest profit in banking history for the quarter.
The banking sector’s performance was driven by significant increases in net interest income and fair value gains on financial instruments, influenced by rising interest rates and Naira fluctuations, contributing to record-breaking profits for several banks.
Top performers in Q1 2024 included Zenith Bank (N320.2 billion pre-tax profit), FBN Holdings (N238.5 billion), Access Holdings (N202.7 billion), and UBA (N156.3 billion), showcasing the sector’s profitability and growth despite economic challenges.
After an impressive financial performance in 2023, banks have continued to record impressive figures in the first quarter of the year.
For example, GTCO posted the highest profit in banking history in the first quarter of 2024.
Eleven of the 12 listed banking stocks have announced their quarterly financial results, collectively reporting a pre-tax profit of N1.58 trillion.
This marks a 263% year-on-year increase compared to the N436 billion pre-tax profit recorded in the same quarter last year.
Here are the best-performing banking groups in Q1 2024 based on pre-tax profit.
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Sterling Holdco – N8.1 billion
Sterling Holdco posted an 84% year-on-year growth in pre-tax profit, as it hit a profit before tax of N8.1 billion in Q1 2024, from N4.4 billion as of Q1 2023.
The group posted gross earnings of N71 billion during the quarter, representing a 53.5% YoY growth from the N46.3 billion posted in Q1 2023.
The bank’s gross earnings were driven by a N55.3 billion income.
However, the group posted a net interest income of N27.2 billion, representing a 23% YoY increase from the N22.1 billion posted in Q1 2023.
Wema Bank – N9.7 billion
Despite an impressive 80% increase in pre-tax profit, Wema Bank posted a relatively smaller year-over-year profit growth than most banks in the first quarter of 2024, highlighting the sector’s performance during this period.
The bank posted a pre-tax profit of N9.7 billion, up from N5.4 billion as of Q1 2023.
Wema posted a net interest income of N26.1 billion during the quarter and a net fee and commission income of N10.9 billion, resulting in an operating income of N36.8 billion.
FCMB Group – N31.3 billion
FCMB Group posted a profit before tax of N31.3 billion, representing a 193% YoY growth from the N10.7 billion pre-tax posted in Q1 2023.
The group posted a net interest income of N55.4 billion and a net fee and commission income of N11.9 billion during the quarter.
FCMB recorded a net income of N28.8 billion, marking a 210% increase from the N9.3 billion net income posted in Q1 2023.
Fidelity Bank – N39.5 billion
Fidelity Bank Plc posted a pre-tax profit of N39.5 billion, marking a 120% growth from the N17.9 billion pre-tax profit recorded in Q1 2023.
During the quarter, the bank posted a net interest income of N99.6 billion, marking a 90% YoY growth from Q1 2023.
Fidelity Bank posted gross earnings of N192.1 billion during the quarter, as it also recorded a net income of N31.4 billion, up by 101% YoY from N15.7 billion as of Q1 2023.
Stanbic IBTC – N62.7 billion
Stanbic IBTC Holdings posted a pre-tax profit of N62.7 billion during the quarter under review, marking a 73% YoY growth from the N36.3 billion posted in Q1 2023.
Stanbic IBTC Bank, the banking division of the group, reported a pre-tax profit of N48.2 billion, marking a 102% year-over-year increase from the N23.8 billion pre-tax profit recorded in Q1 2023.
The bank contributed significantly to the group’s total income, generating N106.3 billion, which accounts for 77% of the group’s overall income.
UBA – N156.3 billion
Among the top-tier banks, UBA generated the least profit during the quarter under review. UBA Plc generated a pre-tax profit of N156.3 billion, marking a 155% increase from the N61.4 billion posted in Q1 2023.
During the quarter, the bank posted a net interest income of N300.7 billion, representing a 151% YoY increase from the N119.6 billion posted in Q1 2023.
The group reported a net operating income of N375.3 billion.
However, operating expenses surged by 104% year-over-year, rising to N219 billion from N107.3 billion in Q1 2023.
Access Holdings – N202.7 billion
Access Holdings posted a pre-tax profit of N202.7 billion during the quarter under review, marking a 148% YoY increase from the N81.7 billion posted in Q1 2023.
During the quarter, the group recorded a net interest income of N275.7 billion, representing 189% YoY growth from the N95.3 billion posted in Q1 2023.
During the period, the group’s assets increased to N32.5 billion, from N26.7 billion as of FYE 2023.
FBN Holdings – N238.5 billion
FBN Holdings, the parent group of First Bank of Nigeria Limited posted a pre-tax profit of N238.5 billion in the first quarter of 2024. This marks a 325% increase from the N56.1 billion posted in Q1 2023.
During the quarter, the group posted a net interest income of N228.6 billion, marking a 104% YoY increase from the N111.8 billion posted in Q1 2023. However, the group’s operating income was driven by a N288.9 billion net gain on financial instruments at fair value.
Zenith Bank – N320.2 billion
After posting an unprecedented return in FY 2023, Zenith Bank continued in Q1 2024, posting a pre-tax profit of N320.2 billion.
This marks a 270% YoY growth from the N86.6 billion posted in Q1 2023.
The bank, the top profit earner in FY 2023, was the second highest in Q1 2024. It posted a net interest income of N306.5 billion for Q1 2024, the largest in the country.
In Q1 2023, Zenith Bank also posted the largest net interest income, with N120.8 billion.
Zenith Bank posted a whopping N210.7 billion net trading income in Q1 2023.
GTCO – N509.3 billion
GTCO made history by posting the highest ever quarterly pre-tax profit in their history.
The group recorded a pre-tax profit of N509.3 billion, representing a 587.5% YoY increase from the N74.1 billion posted in Q1 2023.
Throughout FY 2023, GTCO posted a pre-tax profit of N609.3 billion.
The group posted a net interest income of N227.3 billion, representing a 177% YoY growth from the N82.2 billion recorded in Q1 2023.
However, the group posted a fair value gain of N331.6 billion, despite posting an FX revaluation loss of N12.7 billion.
What you should know
Jaiz Bank, the only national non-interest bank in Nigeria posted a pre-tax profit of N6 billion, marking a 278% YoY growth from the N1.59 billion posted in Q1 2023.
The bank recorded a net income of N16.4 billion, including a N910 million writeback.
Ecobank Nigeria, part of the Ecobank Transnational Incorporated posted a pre-tax profit of $4 million, representing a 48% decline from the $7 million posted in Q1 2023.
However, in Naira terms, the group’s pre-tax profit grew by 55% year-on-year.
An analysis of bank balance sheets in Q1 2024 shows that substantial profits, while partly driven by rising interest rates, were also bolstered by fair value gains on financial instruments held by the banks.
Given that these banks hold dollar-denominated financial instruments, the significant fluctuation of the Naira in Q1 has played a crucial role in generating gains.
