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  • Business - Banking & Finance
  • Updated: Jun 29, 2020

Five Most Profitable Nigerian Banks In 2019

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Olalekan Fakoyejo

Fakoyejo Olalekan is a certified media practitione...

The banking industry in Nigeria is very competitive from afar, but when a closer look is given to their financial statements, there are double figures running into millions separating the banks in Nigeria. In order for customers to know the five most profitable banks in Nigeria for last year, 2019, AllNews dug through the financials of these commercial banks.

Truth is, every bank has a slogan that will probably fool anyone into thinking they are the most profitable in the banking industry, but if you look beyond the marketing noise, it will be discovered that the true state of their profitability can be found in the financials, as the most profitable bank in 2019 is one of the quietest banks that hardly bombard account holders or the underbanked with call-to-action adverts.

The banks who spent the most on advertising & marketing were nowhere close to the top two most profitable banks. These shows there are less expensive methods in luring underbanked communities to trust the banks with their money and profit from it. Also, what was noted was that having the largest customer base doesn't translate or shoot a bank's profitability through the roof - as the case of Access Bank.

Five Most Profitable Banks In 2019

Zenith Bank

Zenith Bank topped the list of the most profitable banks last year after recording N208.843 billion in 12 months. This was the highest profit after tax in the banking industry as seen by AllNews. This shows a slight growth when compared to its profit after tax of the corresponding period, 2018 when Zenith Bank generated N193.424 billion within a year.

Meanwhile, Zenith Bank's profit before tax stood at N243.294 billion in 2019, compared to the N231.685 billion profit before tax generated two years ago. This still made Zenith Bank the most profitable bank within both periods. The bank's revenue for 2019 and 2018 stood at N662.251 billion and N630.344 billion respectively.

Note that Zenith Bank's report showed that N1.871 billion was disbursed for Advertising & Marketing of its services in Q1 2020. The Q1 2020 budget surpassed the N1.819 billion spent in the first three months of last year.

Guaranty Trust Bank

The second most profitable bank in 2019 was Guaranty Trust Bank (GTBank), as it generated N196,849 billion profit after tax in the calendar year of 2019. This makes GTBank the closest bank behind Zenith Bank, as both lenders were the only banks to surpass N100 billion in the banking industry. GTBank's profit after tax for 2019 surpassed the N184,711 billion profit after tax generated for 2018.

A further check on its profit before tax showed that GTBank generated N231.707 billion last year, also surpassing the N215.586 billion it generated as profit before tax in the corresponding period of 2018. GTBank's revenue was N435.306 billion in full-year 2019, surpassing the N434.698 billion revenue it grossed in 2018.

Note that GTBank spent N1.878 billion in the first quarter in 2020 on Advertising & Marketing, more than the N1.3 billion it spent on advertising & marketing in Q1 2019.

Access Bank

Access Bank has been seeing its earnings rise since the acquisition of Diamond Bank. This reflected in the company's profit after tax, although it couldn't break into the hundred billion naira class, it, however, came close with N97.509 billion it generated last year. The figure of 2019 surpassed that of 2018 significantly, rising from the N94.981 billion generated two years ago. This places Access Bank as the third most profitable bank in Nigeria in 2019.

It's profit before tax, however, surpassed the hundred billion mark, reaching N115.378 billion in 2019 and generating N103.187 billion in profit after tax in the corresponding period of 2018. Meanwhile, Access Bank's revenue grew significantly last year, hitting N666.690 billion, surpassing the N253.024 billion revenue generated in 2018 - The significant increase in revenue was caused by the Access Bank and Diamond Bank merger.

Note that the largest bank in Africa by customer size increased spent N1.3 billion on advertising & marketing in Q1 2020, surpassing the N961 million it spent on Advertising & Marketing in 2019.

United Bank of Africa (UBA)

UBA was the fourth most profitable Nigeria bank last year, generating N89.089 billion profit after tax in 12 months. The figure place it behind the aforementioned banks as it also couldn't join the hundred billion naira club in 2019. In 2018 also, UBA was below the hundred billion naira mark, generating N78.607 billion profit after tax.

However, UBA's profit before tax climbed to N111.287 billion in 2019, surpassing the N106.766 billion generated as profit before tax in 2018. Meanwhile, the revenue of UBA was capped at N559.805 billion last year, also surpassing the N494.045 billion revenue generated in 2018.

Note that UBA reported that it spent N1.6 billion on marketing in the first quarter of this year. This shows a reduction in UBA's budget when compared to the N1.7 billion spent in the corresponding period of Q1 2019.

First Bank of Nigeria

FBN made it to the top five most profitable banks in Nigeria after grossing N73.665 billion in profit after tax last year. This was one of the highest rise in profit after tax when compared to the N58.232 billion generated in 2018. Meanwhile, profit before tax also grew significantly, hitting N83.595 billion in 2019, surpassing the N63.853 billion recorded in 2018.

FBN's revenue also reached N627.008 billion last year, reflecting a slight growth when compared to the corresponding period when the lender generated N587.406 billion in revenue in 2018. Meanwhile, First Bank spent N2 billion on its Advertising & Marketing to promote its services to customers and prospective clients in Q1 2020.

The advertising & marketing budget dropped when compared to the amount spent in the corresponding quarter of 2019. First Bank had spent N2.9 billion in Q1 2019.

 

Editor's Note: Ecobank recorded N274,934 billion in profit after tax last year, surpassing the N99,461 billion it generated in 2018. However, Ecobank wasn't placed in the top five as its financial statement grouped the profit after tax of all its subsidiaries across Africa, not excluding Nigeria.

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