Despite the economic challenges experienced by the financial sectors in Nigeria, the banking sub-sector of the financial services segment has reportedly gained N471 billion in three months.
The sub-sector, which closed at N2.219 trillion in market capitalisation on February 27, 2015, had appreciated in growth value to N471 billion (21.22 per cent) to close at N2.690 trillion on May 28, 2015.
The gain recorded by the sector was attributed by market watchers to good earnings posted by the financial institutions and promises of increase in shareholders’ return on their investments.
Most Nigerian commercial banks had recorded improvements in their unaudited 2015 first quarter (Q1) results. The results, which covered the period between January to March 2015, showed that the banks witnessed significant growth across all financial indices with total profit after tax of N115.9 billion.
Zenith Bank Plc, Guaranty Trust Bank Plc, FBNH Plc, UBA Plc, Access Bank Plc, Sterling Bank Plc and Skye Bank Plc, were among the banks the reported their results, with Zenith Bank leading the top five banks with a 17 percent increase in profit after tax to N27.6 billion from N23.6 billion recorded in the same period in 2014.
Guaranty Trust Bank Plc followed with 15 per cent growth in net earnings. The bank’s first-quarter profit after tax grew to N26.563 billion from N23.110 billion in the same period under review.
FBNH Plc posted a 41 per cent increase in posttax profit for the first quarter ended March 31, 2015 to N22.6 billion from N21.6 billion; while Access Bank Plc posted 18 per cent increase in net earnings to N13.688 billion from N11.626 billion a year ago.
UBA also grew its profit after tax by 35 per cent to N17 billion from N12.6 billion. Sterling Bank Plc’s profit after tax rose from N3.1 billion to N3.9billion year-on-year, while Skye Bank Plc’s profit after tax grew 85 per cent to N5 billion compared to N2.7 billion achieved during the corresponding period in 2013.
Market analysts however believe that the Nigerian macroeconomic environment will continue to be vulnerable to exogenous shocks in 2015, with pointers to oil prices and international capital flows.