March 28, (THEWILL) – Tier-1 lender, Access Bank Plc, has reinforced its prominence as Nigeria’s largest quoted company by assets size, its Full-Year 2021 audited results have revealed. By this performance, the 33-year-old bank has maintained the topmost position as the largest firm in Nigeria, ranked by assets, both among the financial services institutions and the 171 listed companies on The Exchange (NGX) for the 2021 accounting year.
The enhanced performance was achieved on a remarkable 28.25 percent increase in assets base to N11.14 trillion in 2021 from N8.68 trillion recorded in the preceding year. This puts Access Bank far ahead of other listed companies, with deposit money banks (DMBs) dominating the first 10 in the N8 trillion region,
The hefty balance sheet of Access Bank in 2921 resulted from the significant increase in critical components such as loans and advances which grew108.98 percent in five years from N1.99 billion in 2017 to N4.17 billion in 2021. The 2021 performance (N4.17 billion) was a 30 percent jump from N3.21 billion in 2020.
The bank’s N971.88 billion gross earnings for 2021 represents 30 percent increase from N764.71 billion in the preceding year, and 111.7 percent compared with N459 billion in five years – 2017. Customer deposits jumped from N5.58 billion in 2020 to N6.95 in 2021 reflecting 25 percent increase. Within five years, the growth trajectory resulted in 210.26 percent from N2.24 billion in 2017 to N6.95 billion (customer deposits) in the review period.
The bank’s pre-tax profit rose from N125.93 in 2020 to N176.7 billion in 2020 or 28.75 percent. It recorded 51.15 percent in profit after tax (PAT) to N176.7 billion from N106 billion in the preceding year. The 2021 PAT represents 166.63 percent jump over N60.08 billion in the five year period – 2017.
Commenting on the bank’s 2021 performance, the Group Managing Director/CEO, Mr Herbert Wigwe, said, “Our diversified business model yielded positive sustainable results, guided by a robust risk management framework, as we grew the business cautiously and recorded sound prudential ratios. This year’s results reinforce our resolve to generate sustainable returns despite challenging market conditions.
“To actualise our vision of becoming the world’s most respected African Bank and Africa’s Payment Gateway, we have taken strategic strides to create indelible footprints across the African continent. These include our most recent additions in South Africa, Botswana, and Guinea. We also strengthened our business in Mozambique and Zambia, with noticeable improvement in rankings and market share.
Wigwe said that 2022 is pivotal for the company as it concludes its 2018-2022 corporate strategic plan. He added that the bank will focus on a disciplined implementation of its strategy to drive efficiency and operational excellence across all segments, expand revenue and increase profitability. According to him, this will go with enhanced focus on risk management practices and a disciplined cost containment structure.
“As we go into our next 5-year strategy cycle, we are realigning the franchise for growth, by transitioning into a Holding Company (HoldCo). This will enable us to unlock and capture available non-banking opportunities in the market that would lead to the diversification of our earnings, drive efficiency, and grow scale while maintaining our moderate risk management approach,” Wigwe said on the release of the bank’s 2021 results recently.
Access Bank’s turnaround began in 2019 when it acquired Diamond Bank in April of that year. Access Bank emerged the largest bank in Nigeria by assets size in that exercise of 2019. It thus displaced Zenith Bank Plc that occupied that position with its assets base of N5.59 trillion as at December 31, 2018 over Access Bank’s N4.954 trillion. First Bank ranked second with 5,568,316 trillion while UBA and GTBank had asset bases of N4.86 trillion and N3.28 trillion respectively as of 2018.
Other strong parameters in Access Bank’s 2021 results include net interest income after impairment charges which rose from N200 billion in 2020 to N218.24 billion in 2021 reflecting a 10 percent increase. Massive investment in technology led to an increase in e-business income. It rose from N56.1 billion in 2020 to N66.28 billion, while investment in IT and e-business jumped to N25.78 billion in 2021 against N18.73 billion in 2020. The bank recovered bad debts totalling N48.54 billion in 2021 compared with N34.58 billion in the preceding year.
Earnings per share (basic) jumped to N4.59 in the review period from N3.00 in 2020 as total dividends remained flat at N35.54 billion – the figure since the 2019 merger with Diamond Bank. Before then, total dividends were N28.92 billion in both 2017 and 2018.
Commenting on the significance of strong asset base for the banks, a professor of Finance and Accounts at the Nasarawa State University, Muhammad Mainoma, said it signifies that the financial institutions take advantage of the environment and that they act strategically. “For a bank there is no period that people will not need money. Once a business is focused and invests in areas that people always need, they will not lose at all. This explains the continuous growth despite different circumstances for the past 5 years,” Mainoma told THEWILL in a note.
Access Bank in September 2020 received regulatory approval to become a Holding Company, thereby joining the list of conventional banks in Nigeria seeking to diversify and restructure their operations into a holding structure. The bank in a statement said that the holding company structure would enable it to further accelerate its objectives around business diversification, achieving improved operational efficiencies, talent retention and robust governance.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
