Major Nigerian banks listed on the stock exchange have experienced robust financial performance in the first nine months of 2023. According to data compiled from unaudited financial statements, these banks collectively increased their loan books by N8.45 trillion between January and September 2023.
The ten commercial banks that have released their Q3 financials witnessed a 37.3% growth in loans to customers, reaching N31.1 trillion by the end of September 2023 from N22.66 trillion in December 2022. Customer deposits also rose significantly, increasing by N18.6 trillion to reach N61.99 trillion compared to N43.37 trillion in December 2022.
The interest income of these banks experienced a substantial boost, rising by 65.9% to N4.18 trillion from N2.48 trillion in the same period of 2022. Net profit also surged by 153% year-on-year to N1.93 trillion in the first nine months of 2023, compared to N762.6 billion in the previous year.
However, it’s important to note that a significant portion of the net income may not be paid as dividends to shareholders due to a Central Bank of Nigeria (CBN) directive restricting banks from paying dividends from foreign exchange (FX) revaluation gains.
The remarkable performance of the banks is largely attributed to the devaluation of the official exchange rate, with the naira depreciating by 39% between January and September 2023. The impact of FX revaluation on loans and interest income, coupled with a high-interest rate environment maintained by the CBN to control inflation, contributed to the increased revenue of these banks.
UBA recorded the highest growth rate in loans to customers at 57%, reaching N3.14 trillion. Zenith Bank led in nominal growth, increasing its loan book by N1.9 trillion to N5.78 trillion. Access Bank maintained the highest loans to customers at N6.7 trillion, a 31% increase from December 2022.
Among the listed banks, Access Bank also recorded the highest interest income, totaling N1.04 trillion, followed by Zenith Bank and UBA with N670.9 billion and N666.3 billion, respectively. GTCo, Fidelity Bank, and Unity Bank reported interest incomes of N374.6 billion, N324.8 billion, and N33 billion, respectively.
