Nigeria’s Tier-One Banks Battle For Dominance As Assets Hit All-Time High Of N94trn

Nigeria’s tier-one banks have set a new record by growing their assets to N94.22tn which is the equivalent of $76.6bn (N1,230/$), defying expert predictions.

THE WHISTLER can report that the combined assets of first-tier banks which are First Bank of Nigeria Holdings Plc, United Bank for Africa Plc, Guaranty Trust Holding Plc, Access Bank Holdings and Zenith Bank Plc (FUGAZ) rose by 70.7 per cent from N55.16tn ($44.85bn) in 2022 to N94tn last year.

The year 2023 marked a tough period for the Nigerian economy with the series of policies by the Central Bank which includes naira redesign and the floating of the currency aimed at making the currency cheap for foreign investors.

Both policies had a direct effect on the banking industry. Some of the resultant effects were cash scarcity hitting the country while the floating of the naira led to the depreciation of the currency by over 98 per cent in 2023 to nearly N1,000 per dollar, according to a PricewaterhouseCoopers report.

Although banks suffered huge losses, their books showed that they recorded huge foreign exchange revaluation gains during the year after the naira fell.

THE WHISTLER analysis also found that Nigeria’s largest banks have all benefited from higher interest rates as the CBN has been hawkish in its monetary policy rate.

Some tier-one banks also went on a rampage with the multiple acquisitions of other banks across the continent.

Meet Top 5 Banks By Assets

Access Bank Plc

Access Bank retained its position as the country’s biggest lender by assets after announcing a series of acquisitions of banks across the continent.

In 2023, Access Bank concluded acquisitions of Standard Chartered’s majority shareholdings in its subsidiaries in Angola, Cameroon, The Gambia, and Sierra Leone, and its Consumer, Private & Business Banking business in Tanzania and African Banking Corporation (Tanzania) Limited.

Access also saw a record growth of derivative financial assets from N402.4bn in 2022 to N2tn; a growth in loans and advances to customers to N8tn, from N5tn and cash and balances with banks rising from N1.9tn in 2022 to N3.1tn in 2023.

By the end of 2023, Access Bank grew its assets by 77.4 per cent to N26.61tn, from the N14.99tn held in December 2022.

United Bank for Africa

United Bank for Africa overtook Zenith Bank Plc by 2023 ending after it grew its assets by over 90 per cent from N10.9tn in 2022 to N 20.7tn on the account of aggressive growth in cash and bank balances.

The books of UBA showed that cash and bank balances grew from N2.5tn in 2022 to N6tn by the end of 2023, while loans to customers rose to N5.2tn from N3tn held in 2022.

UBA also grew its investments in securities at fair value to N3.1tn from N2.2tn held in 2022 while investment security at amortised cost grew from N1.9tn in 2022 to N4.3tn by 2023 ending.

Zenith Bank Plc

Zenith Bank fell from its position as the second-largest lender by assets to the third after its assets base failed to beat UBA’s performance.

Although the bank grew its assets by 65.7 per cent to N20.4tn compared to the N12.3tn held in 2022.

Zenith’s assets in form of cash and balances with central banks grew from N2.2tn to N4.3tn in 2023; investments in securities grew from N4tn to N6tn in 2023 while investments in subsidiaries rose to N3.3tn from N1tn held in 2022.

FBN Holdings Plc

FBNH retained its position as the fourth largest bank by asset base with assets of N16.89tn, a growth 59.7 cent from the N10.6tn held back in 2022.

FBNH assets in the form of loans and advances to customers grew to N6.36tn from N3.8tn held in 2022.

First Bank grew its investment securities from N2.3tn in 2022 to NN3tn in 2023; cash and balances with central banks also rose from N1.7tn to N2.6tn by 2023 year-end while assets pledged as collateral grew from N595.1tn in 2022 to N1.2tn.

Guaranty Trust Holding Plc

GTCO emerged as the country’s fifth-biggest bank when measured by assets. The lender grew its assets to N9.7tn by the end of 2023 up by 50.3 per cent from N6.45tn held in 2022.

The major highlights in GTCO assets are restricted deposits and other assets which grew from N1,23tn in 2022 to N2tn in 2023. While cash and bank balances grew from N1.6tn to N2.31tn in 2023.

The lender also witnessed growth in loans and advances to customers from N1.9tn to N2.5tn by 2023 year-end.