Business
Ecobank, 4 others profit decline by 80%
…as UBA, others outperform market
By Odunewu Segun
Ecobank, Union Bank, FCMB, Wema Bank and Fidelity Bank led in profit losses in the sector due to the economic crisis in in the country.
According to the Banks 2015 annual financial results released in March, the five banks posted a combined 80 per cent decline in profits, their profit before tax tumbled by 69 per cent to N77.65bn from N131.19bn in 2014.
Similarly, the combined profit after tax of the five banks fell from N107.279bn in 2014 to N59.73bn in 2015, indicating a decline of 79.59 per cent.
The N53.54bn fall in profit was attributed by many of the banks’ chief executive officers to high impairment charges on bad loans, foreign exchange volatility and other challenges facing the economy following the significant drop in the nation’s oil revenue due to the sharp fall in oil prices.
Of the 10 banks that released their results, five posted sharp decline in profits, a major departure from the consistent rise in profits posted by almost all the banks in the country after the 2010 banking crisis.
The reports on the NSE website showed that Ecobank posted a PBT of N40bn in the 2015 financial year; Union Bank, N18.1bn; FCMB, N2.5bn; Fidelity Bank, N14bn; and Wema Bank, N3.046bn.
However, the five other banks that released their 2015 annual reports in March this year outperformed the market, posting increases in both their profit before tax and profit after tax. This is despite the huge provisions for bad loans that most of them made in the 2015 financial year.
ALSO SEE: Interbank rates rise by 0.9% as cash shortage bites hard
These are Guaranty Trust Bank Plc, United Bank for Africa Plc, Access Bank Plc, Sterling Bank Plc, and Zenith Bank Plc.
Sterling Bank’s PBT rose from N10.7bn in the previous year to N11bn in 2015, while its PAT rose from N9bn to N10.3bn; UBA’s PBT rose from N42.4bn to N50.8bn, while its PAT rose from N40bn to N47.6bn; and Zenith Bank’s PBT rose from N107bn to N115bn, while the PAT increased from N92.5bn to N98bn.
GTBank’s PBT rose from N120.7bn to N116.4bn, while its PAT moved up from N94.4bn to N99.4bn; and Access Bank’s PBT rose from N46.1bn to N65.2bn, while its PAT increased from N39.9bn to N58.9bn.
The five remaining banks out of the 15 listed on the NSE, which have yet to file their 2015 financial reports are; First Bank of Nigeria Limited, Skye Bank Plc, Diamond Bank Plc, Stanbic IBTC Holdings Plc and Unity Bank Plc.
They have filed notices of delay in filing their 2015 annual reports, stating various reasons. They are expected to release the results before May ending.
Already, Skye Bank Plc and First Bank of Nigeria Limited has issued profit warnings ahead of the release of their results. They said high impairment charges due to non-performing loans would lead to major decline in their profits.
.