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GTBank, Zenith, Access, FBN, 10 others spend over N8 billion on CSR

GTB, Zenith Bank, Access Bank, FBN, UBA and 10 others spent over N8 billion on their Corporate Social Responsibilities in 2018.

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Q1 2020, Disrupting Nigerian banks, Evolution of Nigerian banks in 59-years , GTB, UBA, Zenith, Access Banks’ salary advance loans, Can a company operate without a website in 2019? , Banks refund N3.09 billion to customers over claims on excess charges, fraud, others  , Bank CEOs applaud NCC’s decision to suspend USSD charges, GTBank, Zenith, Access, FBN, 10 others spend over N8 billion on CSR, Banking: Evolving trends in the bankers’ market, GTBank, Access, FBNH, Standard Chartered wrestle over women entrepreneurs , GTBank, Access Bank, Zenith, FBN, 16 others disburse CBN’s N610.4 billion to farmers , Credit to government declines, as Credit to private sector hits N25.8 trillion, Banking sector NPLs down, loans up, Non-Performing Loans in Agriculture, construction, others rose to N143.76 billion, Asset seizure: Banks begins recovery of N6.125 trillion borrowed to the oil sector, Customer Experience: GTB, FCMB, Citibank, others emerge best banks in 2019, Nigeria’s top 5 banks spent more than N40 billion on adverts in 2019, Nigerian banks face risky future over low oil prices, coronavirus, Testing the financial strength of Nigerian banks

GTBank Plc, Zenith Bank, Access Bank, First Bank of Nigeria (FBN), United Bank of Africa (UBA) and 10 others spent over N8 billion on their Corporate Social Responsibilities in 2018.

While Zenith Bank Plc spent N3.06 billion, UBA spent N1.04 billion, GTBank spent N928.07 million, FBN spent N831 million, Access Bank (N376.75 million), FCMB (N315.80), Sterling Bank (N299.01 million), Stanbic IBTC (N233.40 million), Fidelity (N158.36 million), Wema Bank (N34.62 million), Union Bank (N30.20 million) and Unity Bank (N13.38 million).

[READ MORE: GTBank, Access, Zenith, UBA, FBN loans rise to N9.28 trillion in six months]

Guaranty Trust Bank Plc

Segun Agbaje, CEO of GTBank

Details 

GTBank

  • Arts – N49.70 million
  • The bank initiated Painting the future for tomorrow’s leaders when it engaged children with a 4-week Art635 Summer programme where they explored and harnessed their creativity through painting, sketching and photography. It also promoted creative expressions through writing, harnessed art for economic development, conducted capacity building for female photographers, and preserved historical artefacts and monuments among others.
  • Community Development – N326.61 million
  • It launched a nationwide campaign, tagged “#SimpleChangeBigImpact” through which it collaborated with individuals and groups to invest in the social infrastructure of 20 communities nationwide.
  • Education – N544,964,714
  • Having transformed the Herbert Macaulay Library into a vibrant centre for personal learning and group interactions, GTBank also promoted innovation and academic excellence as it empowered four outstanding Junior Secondary School students; Mordi Menashi, Gbemi Famobiwo, Afolabi Williams and Osagumwenro Ugbo, who created a Virtual Farm Application that helps farmers manage their farm and connect with their target market.
  • Environment – N905,118
  • Others-  N5,888,289
Zenith Bank reaffirms market dominance and leadership with Q3 2019 results

Zenith Bank GMD-CEO

GTBank 728 x 90

Zenith Bank

The financial institution spent N3.06 billion on various states governments’ security funds (N1.57 billion). Others are:

  • sports organisations (N363 million);
  • seed contribution to private health sector alliance (N305 million);
  • financial inclusion project (N200 million),
  • medical assistance to the underprivileged (N158 million);
  • educational support to Nigerian schools (N131 million);
  • Information Communication Technology (ICT) centres for educational firms (N85 million);
  • economic summit (N81 million);
  • Delta State principal Cup second edition (N43 million);
  • CFA Society of Nigeria, Musical Society of Nigeria, Centre for Value in leadership youth empowerment and Louisville girls high school among others.
Access Bank, Scam Alert: Access Bank issues warning to customers over fraudulent acts , Director, West Africa region, IE, Onyekachi Eke, Access Bank lists N30 billion bonds on NSE , Access Bank

CEO/Group Managing Director, Access Bank Plc, Herbert Wigwe

Access Bank

The Bank identifies with the aspirations of the communities and the environments in which it operates. It made contributions to charitable and non-charitable organisations amounting to N376.7 million, lower than the N567.02 million it spent in 2017.

  • The financial institution spent N100 million on its contribution towards deepening financial inclusion in Nigeria;
  • Lagos State Security Trust Fund (N100 million);
  • National MSME clinics in Nigeria (N40 million);
  • Donations to 2018 Brains Initiative (N14.7 million); and
  • Sponsorship of Capacity Building Programme for the Association of Senior Staff of Banks Insurance & Financial Institutions (N10 million).

Others are sponsorship of the 2018 International Press Institute Conference (N10 million), supporting 2018 World Mosquito Day (N10,000); contribution towards commemoration of World Malaria Day 2018 (N6.03 million), sponsorship of the African Women Business Initiative (N5.50 million) and  contribution to NSE for its Essay Competition (N5 million) among others.

FBNQuest Trustees, Anniversary,FBNQuest Trustees, Marks 40th Anniversary of preserving legacies in Nigeria

FBN Holding

FBN’s Corporate Responsibility and Sustainability (CR&S) involves meeting the needs of its current stakeholders now and in the future. It goes beyond financing economic activity in a responsible way to ensuring an inclusive, positive impact on our communities. It is about creating long-term stakeholder value by adopting the opportunities and managing the associated environmental, social and governance risks. It concentrated on areas like:

  • Deepening Wealth Creation for Women across the Nation: Through FirstGem, its passion and drive to increase the number of women who take pride of place in business and wealth creation intensified. FirstGem is a bespoke solution to foster women empowerment across all socio-economic strata.
  • Supporting SMEs in Growing the Nation’s GDP:  The Bank organised several empowerment programs for SMEs tagged ‘SME Connect Series’. This initiative provides 360 degrees support to startups and scale-ups, offering practical and realistic solutions to numerous business challenges encountered.
  • Youth Empowerment Series: This is a program designed to sensitise children and young adults on issues relating to financial literacy with focus on financial discipline, savings, investment and career guidance. In 2018, children between the ages of 10 to 24 years were hosted at the 2nd edition of the Youth Empowerment Series which attracted about 1,350 youths across the Lagos metropolis.
  • Employee Giving and Volunteering: Its Employee Giving and Volunteering programme was set up to encourage employees to give back to the community and instil the integral corporate culture of giving.
  • Renovation of classrooms and donation of Boreholes: The Company renovated two blocks of classrooms at a primary school and also donated boreholes to both the primary school and the neighbouring secondary school located in a village near Abraka, Delta State among others.

[READ ALSO: GTBank removes all Bank Charges for Young Undergraduates on its GTCRea8 Account Product]

UBA Plc's profit after tax up by 38.99% in Q3 2019 

UBA

The bank engaged in various community development initiatives either directly through UBA Foundation, its special purpose vehicle for Corporate Social Responsibility, or in partnership with credible non-governmental organisations and public institutions. They are:

GTBank 728 x 90
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  • Financial Inclusion and Public Enlightenment Project (N400 million);
  • Akwa Ibom State Government Security Project (N177.25 million);
  • Ambrose Ali University, Edo State (N93.72million);
  • Taraba State Government Security Project (N84 million);
  • Abia State Government Security Project (N65.86 million);
  • Plateau State Specialist Hospital (N37 million);
  •  Benue State Financial Management System (N32.88 million);
  • Taraba State University (N30 million);
  • National Youth Service Corps (N27.76 million); and
  • Chartered Institute of Bankers of Nigeria (N15.50 million).

Others are Delta State African Senior Athletics Competition (N10 million), Flood Victims of Jibia Local Government Area, Katsina State (N10 million), Augustine University, Lagos State (N10 million), Ibrahim Badamosi Babangida University, and Niger State (N10 million) among others.

Abiola has spent about 14 years in journalism. His career has covered some top local print media like TELL Magazine, Broad Street Journal, The Point Newspaper. The Bloomberg MEI alumni has interviewed some of the most influential figures of the IMF, G-20 Summit, Pre-G20 Central Bank Governors and Finance Ministers, Critical Communication World Conference. The multiple award winner is variously trained in business and markets journalism at Lagos Business School, and Pan-Atlantic University. You may contact him via email - [email protected]

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Is Zenith Bank thriving on the strength of sound financial indices?

Zenith Bank posts N103.8bn profit in half-year financial result.

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Zenith Bank reaffirms market dominance and leadership with Q3 2019 results, Zenith Bank Plc, Access Bank Plc and United Bank for Africa Plc, Zenith Bank reports 7.9% profit increase for full-year 2019

Sound financial indices have made Zenith Bank one of the largest banks in the Nigerian banking Industry. It was recognized as the Most Valuable Banking Brand in Nigeria 2019, in the Global Banker magazine Top 500 Banking brands; and Best Commercial Bank in Nigeria 2019, by the World Finance.

Zenith Bank has successfully bolstered this narrative even further with the release of its Half Year 2020 Financial Report, where it closed with a profit of N103.8 billion.

Growing profit position in these perilous times, speaks remarkably of the suppleness and elasticity of any establishment. A lull in economic activity caused by inflationary pressures, precariousness of the market, and the coronavirus pandemic has forced most Deposit Money Banks (DMBs) to cave in, and reveal achievements worse off than their 2019 results y/y – but not Zenith Bank Plc. The institution has showcased beyond reasonable doubt, that the apparent limitations are incapable of distorting its active growth pattern.

Zenith Bank closed H1 2020, 16.8% better off than it did in 2019 y/y, in terms of profit after tax. Although this massive leap, hugely resulting from tax paid as profit before tax, noted just a 2.2% growth. Further analysis of its HY’2020 results, demonstrates more efficiency, a focused cost of fund optimization, and an aggressiveness in generating income across its business heads and segments. This strategy had begun since 2018, and was shared by the bank when it disclosed planned implementation of an improved core banking system, hoping it would ultimately enhance efficiency while reducing costs.

Zenith Bank has thrived on the strength of its sound business model, corporate governance, conservative risk management, and strategic corporate social investment. The bank has been very forceful in the market, improving massively across all of its income generating segments, despite the plausible and obvious hindrances. This is a testament to its superiority, and sponsors its claim for supremacy.

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The bank made N22billion from foreign exchange revaluation gains and despite evidence to the contrary, it endeavored in operating expenditure (OPEX). OPEX may have grown by 7.7%, but disclosures and note to the accounts shows that in virtually every expense head, costs dropped. The 7.7% was triggered majorly by Information Technology related costs, fuel and maintenance, and an increase in the compulsory banking cost fund, set up for the Asset Management Company of Nigeria (AMCON) by the CBN.

Now, like every hero susceptible to their hubris, Zenith has its own problems, which questions its position at the top. Yes, the bank may have an amazing and constantly improving interest expense to interest income ratio, but it does not possess the finest result in this regard as of yet. HY 2019 interest expense took as much as 33.6% of its income, while HY 2020 dropped to 27.4%. This is good, but still considerably high, if we carry out a peer-to-peer analysis with Guarantee Trust Bank Plc (masters of low-interest expenses), whose ratio stands at 16% for HY 2020.

However, Zenith has sustained the momentum of positioning itself as the crème de la crème in the Nigerian Banking Industry for quite some time. The bank’s pattern of growth and performance, strongly indicates its capabilities to manage its interest expense in subsequent quarters. It will be interesting to see how this pans out by year end.

In summary, despite economic difficulties this year, with most bank’s bottom-line at a worse position than the corresponding period last year, Zenith posted improved profit yet again. Could this be enough to portray supremacy?

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UBA Plc H1’2020 results, a true reflection of its rightsizing decision? 

UBA’s H1 2020 result is yet another demonstration of the resilience of its business model.

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UBA

The upward review in benefits of some employees and directors this year, coupled with the rising operational costs, constitutes the hot topics from the 2020 semi-annual results released by UBA Plc. 

Widely regarded as the banking sector’s largest employer of labour in Nigeria, the bank in December 2019, embarked on a ‘rightsizing’ exercise, which partly resulted in new hires, as well as promotions, improved remunerations, and benefits for existing employees.

READ: Zenith Bank’s Profit After Tax in H1,2020 rises by 16.8% to N103.8 billion

The Group Head, Media and External Relations, UBA Plc, Nasir Ramon commenting on this said, over 5000 staff of UBA Plc, started the new year with a lot of cheer, as the bank promoted to new grades, coupled with salary upgrades. Beneficiaries of this exercise will receive up to 170% increase in their salaries and benefits, whilst a good number have been moved to higher grade levels.” 

Directors saw their emoluments amplify by 177.7% (Fees and Sitting allowances) as demonstrated in the financial statements of the bank. Rising to N50million in June 2020, from N18million in 2019 y/y. 

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READ: Access Bank posts Profit Before Tax of N74.31 billion in H1 2020

Now, Deposit Money Banks (DMB’s) might be adjudged to be honorable in all of their objectives, but the truth is they are neither self-sacrificing nor are they expected to be. DMB’s are established for profit, and would incessantly prioritize business good sense over social empathy, for the sake of their owners The import of this is, UBA Plc expects its colossal investments in employees and directors to overwhelmingly reflect in its bottom-line. 

Half-year 2020 results is clearly not in sync with this philosophy, as it reflects a weakened position compared to the corresponding period last year, despite the investments in human capitalProfit before tax dropped by 18.7%, from N70.3billion recorded in HY’2019 to N57.1billion in the current period. Profit after tax waned as well by 21.7% to N44.4billion from N56.7billion in HY’2019. 

READ: Are tech talents Africa’s ‘new export’?

Interestingly enough, the top-line fared pretty well. Interest income and fee income showed improvements, albeit marginally by 0.3% and 6.7% respectively. This makes it illogical to attribute the entirety of the decline in profit to the recent austerity measures put in place by the CBN, reducing funds transfer fees and card maintenance charges 

The Coronavirus pandemic played a big role too, by widely stunting the economy in the second quarter of 2020, and negatively impacting profit. But even these do not provide substantial and sufficient convictions as to why the Tier-one bank did not hit the profit-bar it set for itself, from its truly emphatic 2019 financial year. Does this mean that UBA Plc got the decision wrong at the start of the year? 

READ: FUGAZ; Nigerian banks considered too big to fail

Six months seem too short a period to immediately class management’s decision to jack up the benefits and emoluments of its internal customers as a failed one. Although, no one anticipated the travails of COVID-19 and its resulting consequences, investments in human capital is widely proven to yield tremendous growth in the long haul. Besides the fact that it has given UBA Plc a solid reputation in the market place, it also makes the company very attractive to the very best of industry talents. Furthermore, employee engagements of this nature, foster brand loyalty which ultimately trickles down to how passionately these personnel undertake their tasks and deliverables. The true bearing of this investment is expected to reflect in due course, in subsequent quarters.  

Commenting on the result, UBA’s Group Managing Director/Chief Executive Officer, Mr Kennedy Uzoka said, “Our H1 2020 results is yet another demonstration of the resilience of our business model in an extremely uncertain and tough operating environment. We recorded commendable growth in our underlying business in terms of customer acquisition, transaction volumes, and balance sheet whilst inflation, depressed yield environment and exchange rate volatility impacted our net earnings as anticipated.” 

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READ: GTBank, Access Bank, 11 others pay workers N271.64 billion in H1 2020

Rising cost

In today’s increasingly aggressive marketplace, where consistently generating revenue, is paramount to preserving the longevity and going-concern status of any establishments, costs must also be accorded as much attention and significance. Tightening and managing costs with the aim to improve and generate profit is genius strategy especially in today’s banking industry. The banking industry is under threat from ruthless competitions. Multifarious streams that had hitherto been available for generating income for DMB’s are being severely hindered by the ‘austere’ policies (from the perspective of commercial banks) from the apex bank, making effective cost management a survival mechanism. 

Explore the Nairametrics Research Website for Economic and Financial Data

Employee benefits rose by 20% from N37.2billion in HY’2019 to N44.6billion in HY’2020, while Directors’ emoluments (Fees and Sitting Allowance) as earlier stated, surged by 177% from N18million in 2019 to N50million in 2020 y/y. The total operating expenses increased 22.6% in 2020UBA Plc, unavoidably expended N22.4billion on Banking Sector Resolution cost trust fund, in compliance with the CBN’s requirement to contribute to the cause of the Asset Management Company of Nigeria (AMCON). Security and other payments for core services experienced increase as well compared to the preceding year. 

Avoidable expenses like Penalties and Premises Maintenance Charge, should be extensively reviewed and extinguished wherever possible, to improve bottom line. UBA plc has forked out N565million in penalties so far in 2020representing 6177.7% increase from just N9million in 2019 y/y. This is a prime example of the operational brick walls, UBA Plc must properly address to improve its fortunes in subsequent quarters. 

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Finding Balance: GTB’s impeccable gains versus its notable losses

Bank’s strategy of increasing gains while seeking out ways to decrease its losses is on a true course to growth.

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Finding Balance: GTB’s impeccable gains versus its notable losses, GTB donates medical facility for COVID-19, GTBank, others have begun fulfilling pledges towards fight against Covid-19 (coronavirus), COVID-19: GTBank suspends loan repayment for small businesses, GTBank Releases Q1 2020 Unaudited Results…….. Reports Profit Before Tax of ₦58.2Billion

Guarantee Trust Bank Plc (GTBank), over the past few years, has taken the Nigerian banking industry by storm, particularly through the foresight and strategic actions of its management.

The bank has, over time, tactically built its operations and expanded its market share, earning its spot as one of the credible names in the Nigerian banking space.

Faced with challenges like increase in the loan-to-deposits ratio (LDR) instituted by the CBN, and the COVID-19 pandemic that got companies in the financial sector thinking of new ways to survive, GTB may have found its way out.

READ: Nigeria’s inflation rate hits 13.22% in August 2020, highest in 29 months

Overview of its half-year results

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Net interest income increased by 9.7% to N127.6 billion in H1 2020, compared with N116.4 billion in H1 2019. Its Profit before income tax stood at N109.7 billion in H1 2020, compared with the N115.8billion in the corresponding period in 2019 – a decrease of 5.2%.

Somewhere in-between the good and the not-so-good, the bank has been able to round off its earnings to a balanced output for H1 2020.

READ: Even with a 939% jump in H1 Profit, Neimeth still needs to build consistency

The good: Foreign Exchange gains

One of the best happenings to investors this year, is the extreme volatility of the forex market – among other currency and commodity plays. In H1 2020 period, the company’s financial assets at fair value through profit or loss, was up by 91.6% to N140.8 billion, when compared with N73.5 billion in H2 2019.

Interestingly, this was due to 129.2% increase in treasury bills from N56.9 billion in H1 2019 to N130.5 billion in H1 2020. Through forward foreign exchange contracts and currency swaps, they were able to increase derivative assets by 49% from N188.6 billion (notional contract amount) in H1 2019 to N280.9 billion in H1 2020.

Explore the Nairametrics Research Website for Economic and Financial Data

Foreign exchange revaluation gain in the half-year period was significantly boosted, from N2.6 billion in H1 2019, it attained 723% growth to N21.9 billion H1 2020, and it was a major reason for the 28% increase in other income within the period under review. Deposits from customers were also higher by 18.5% to N3 trillion. While loans and advances to customers increased in line with the apex’s bank directive. This could be both a bad thing and a good thing, depending on the level of credit risk.

(READ MORE:GTBank, Dangote Cement, CAP record gains, Investors post N7 Billion gain)

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The not-so-good: Impairment losses, CBN’s penalties

Following CBN’s issuance mandating commercial banks to increase the percentage of customer deposits that were loaned to 65%, so as to effectively stimulate the economy, stringent penalties had been imposed on non-compliant banks by the apex bank.

Consequently, the company’s restricted deposits had increased to N1.054 trillion, owing to its limitations in full compliance. While its increased cash balance of 27.8% in the period under review, could signify that the worst of the challenge is over (particularly following the comparative reduction in cash in Q1 2020), a cursory look at the reason for the strengthened cash position, is the 75.7% increase in money market placements to N333.5 billion – another positive for the bank.

READ: Jaiz Bank reports 45.3% profit increase in H1 2020, involved in 21 litigations

Loan impairment charges in the half-year period, increased by 209.7% from N2.1 billion to N6.8 billion, and this was as a result of increased provisions for expected credit losses on financial assets extended to its customers, no doubt as a result of the economic uncertainties, synonymous with the period under review.

Commenting on the half-year results, the CEO, Segun Agbaje, noted that; “Going forward, our focus is not just to survive this pandemic, but to thrive beyond it. That is why we are going ahead with our plans to re-imagine how we create value for all our stakeholders.

“We know that making financial services work for customers goes beyond banking, and in line with our long-term strategy, we will seek to create and drive innovative financial solutions that go beyond banking.”

READ: Access Bank posts Profit Before Tax of N74.31 billion in H1 2020

The bank’s Return on Equity (ROE) of 26.8% is currently one of the best in the industry, and a testament to this promise. Its strategy of increasing gains by focusing on its strengths, while also seeking out ways to decrease its losses, is one that will set any organization on a true course for growth. GTBank is certainly on that path.

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