The 12 months 2020 was a outstanding 12 months for the Nigerian banking trade as totally different insurance policies such because the GSI coverage, mortgage restructuring, and so forth., had been issued of their favour. The trade turned extra aggressive within the 12 months, with every of the banks striving to extend its market measurement and income.
Tracking the general public data of listed banks on the NSE, we analysed them primarily based on standard metrics to find out the main gamers within the trade. For the evaluation, the total 12 months 2020 outcomes of the next banks had been tracked: Access, FBN, FCMB, Fidelity, GTB, Jaiz, Stanbic IBTC, Sterling, Union, UBA, Wema, and Zenith Bank. Ecobank was not thought of within the evaluation because the financial institution operates effectively in different markets apart from Nigeria.
The key metrics thought of in these analyses are Total Assets, Net Assets, Total Deposits, Profit After Tax, Return on Equity, and Return on Total Assets.
Leading Banks by Total Assets
An evaluation of the mixed belongings of the 12 listed banks which have launched their full-year (2020) outcomes (Ecobank excluded) confirmed that the overall belongings elevated by 27.9% from N38.7 trillion to N49.4 trillion. The enhance signifies the stronger monetary place of the banks.
Among the 14 listed banks whose outcomes have been revealed on the NSE, the next are the main banks.
First place – Access Bank: N8.7 trillion
Second place – Zenith Bank: N8.5 trillion
Third place – UBA: N7.7 trillion
Fourth place – FBN Holdings: N7.7 trillion
Fifth Position – GTB: N4.9 trillion
Upshots – Access Bank and Zenith Bank maintained their positions because the banks with the best complete asset in 2020. UBA nevertheless, neglected FBN to face within the third place, whereas FBN declined to fourth on the listing. Among the main banks (FUGAZ), UBA had the best year-on-year progress of 36.95% in 2020, whereas within the trade typically, Jaiz financial institution had the best progress in complete belongings of 39.3%.
Net Assets
The internet asset represents the rest when all liabilities have been subtracted from the financial institution’s complete asset. It signifies the shareholders’ funds within the banks. Due to the depository nature of economic banks and the flexibility of banks to significantly enhance their liabilities, the metric is adopted by the CBN in assessing the Banking sector’s skill to resist credit score losses.
The mixed internet asset of our 12 analysed banks elevated by 17.9% in 2020 with the biggest progress of 25.3% coming from Stanbic IBTC.
The main banks primarily based on internet belongings are:
First Position – Zenith Bank: N1.1 trillion
Second Position – Guaranty Trust Bank: N814.4 billion
Third Position – FBN Holdings: N765.2 billion
Fourth Position – Access Bank: N751.0 billion
Fifth Position – UBA: N724.1 billion
Upshots: It is noticed that each one the banks had important will increase of their internet asset in 2020 whereas the highest ones additionally maintained their positions. However, Union Bank and Wema Bank recorded the least progress in internet belongings with a 4.75% and 5.9% enhance respectively. Zenith Bank’s internet asset grew by 18.6%, Guaranty Trust Bank by 18.5%, FBNH by 15.7%, Access financial institution by 23.8%, and UBA by 21.1%.
Customer Deposits
Customer deposits stay one of the crucial aggressive objects within the banking sector since it’s out of deposits that loans are issued out and different investments are made.
The complete buyer deposits of the tracked banks elevated by 32.1% in 2020. The financial institution with the best progress in buyer deposits in the course of the interval was UBA rising by 48.1%, from N3.8 trillion on the finish of 2019 to N5.7 trillion as of April thirty first, 2021.
The main banks primarily based on Customer Deposits are:
First Position – UBA: N5.7 trillion
Second Position – Access Bank: N5.6 trillion
Third Position – Zenith Bank: N5.3 trillion
Fourth Position – FBN Holdings: N4.9 trillion
Fifth Position – GTB: N3.5 trillion
Upshots: UBA grew considerably in 2020, shifting from fourth place in 2019 to the financial institution with the best buyer deposits on the finish of 2020. Generally, all of the banks recorded buyer deposits progress larger than 20% in 2020 with the exemption of Jaiz financial institution and sterling financial institution which grew by 7.2% and 6.5% respectively.
Profits After Tax
Due to the elevated capability seen within the progress of complete belongings of the banks, the banks below our radar delivered improved PAT except Fidelity, and Wema Bank.
Banks that declared essentially the most earnings are;
First Position – Zenith Bank: N230.6 billion
Second Position – Guaranty Trust Bank: N201.4 billion
Third Position – UBA: N113.7 billion
Fourth Position – Access financial institution: N106 billion
Fifth Position – Stanbic IBTC: N83.2 billion
Upshots: Zenith Bank and GTB outperformed their friends as finished in earlier years. Also, UBA once more outgrew its 4th place in 2019 shifting up the ladder to the third place on the finish of 2020. However, when it comes to progress in PAT, UBA additionally grew highest by 27.7% within the interval below evaluate.
Return on Equity
The return on fairness is a crucial metric that exhibits the proportion of revenue made on each N1 of the shareholders’ fund. It is used to measure the efficiency and effectivity of the banks.
This metric will present how effectively banks have maximised the rise in shareholders’ wealth they loved in 2020.
The main banks primarily based on ROE are
First Position – Guaranty Trust Bank: 26.8%
Second Position – Stanbic IBTC Holdings: 24.4%
Third Position – Zenith Bank: N22.4%
Fourth Position – UBA: N17.2%
Fifth Position – Jaiz Bank: 16.6%
Upshots- Sequel to the rise in complete belongings and PAT of GTB, the financial institution was capable of obtain the best effectivity within the trade delivering a return fee of 26.8% to its shareholders.
Return on Assets
This metric measures the flexibility of a financial institution to sweat its belongings and ship the best potential earnings. In the sooner part of the report, we said that banks recorded important enhance of their belongings, nevertheless the ROA was decrease. The ROA is a greater measure of effectivity because it takes into cognition the financial institution’s utilization of buyer’s deposits.
Best banks primarily based on ROA are
First Position – Guaranty Trust Bank: 4.6%
Second Position – Stanbic IBTC Holdings: 3.8%
Third Position – Zenith Bank: 3.1%
Fourth Position – Access Bank: 1.3%
Fifth Position – UBA: 1.7%
Upshots: The same result’s seen in ROA simply as seen in ROE. The common trade ROA was 1.7% and Access (1.3%), FBN (1.2%), FCMB (1.1%), Fidelity financial institution (0.3%), Jaiz financial institution (1.3%), Sterling financial institution (0.9%), Union financial institution (0.9%) and Wema financial institution (0.6%) all carried out beneath the trade common.