Five Banks Raked In N175.41bn On Fees, Commission
Following the harsh macroeconomic environment that characterised the second quarter of 2020 due to the COVID-19 pandemic, five Nigerian commercial banks saw the amount generated from customers’ fees and commission in the first half of the year fall to N175.41bn
Checks by our correspondent revealed that the amount represents a drop of 11.60 per cent over the N198.43bn recorded in the same period of 2019 by the banks.
The banks are Zenith Bank Plc, United Bank for Africa Plc, Access Bank Plc, Guaranty Trust Bank Plc and Fidelity Bank Plc.
UBA reported the highest value of fee and commission in the half year, followed by Access Bank while Fidelity Bank reported the lowest value of fee and commission income.
The breakdown revealed that UBA reported 6.73 per cent increase in fee and commission to N55.87bn from N52.34bn in 2019 while Access Bank reported N51.77bn fee and commission in H12020, up from N41.86bn in 2019.
Zenith Bank posted N33.50bn in 2020 as against N55.82 in 2019, representing a drop of 30.97 per cent while GTBank generated N24.73bn from fee and commission income in 2020, compared to N35.35bn in 2019.
In addition, Fidelity Bank reported N9.52bn fees and commission in 2020, up from N13.07bn in 2019, representing 27.04 per cent drop.
The banking industry is now faced with the coronavirus pandemic, which comes with greater uncertainties and unpredictability of events in the business environment.
Augusto & Co, which assessed the impact of the coronavirus pandemic on the asset quality of the Nigerian banks in a recent report, noted that banks were significantly exposed to several sectors, including the oil and gas sector, manufacturing, real estate, public sector, construction and general commerce.
In addition, about 47 per cent of the banking industry’s gross loans are in foreign currency, according to the report.
It said the coronavirus pandemic would weaken the asset quality of the Nigerian banks in view of the impact on state governments’ finances, purchasing power of households and the performance of businesses.
According to the report, although the degree of impact will vary across different sectors, the key sectors that will bear the brunt are oil and gas (upstream), real estate, construction, transportation (aviation) and manufacturing (non-essentials).
Commenting on the half-year financial results, the Chief Executive Officer of Guaranty Trust Bank, Segun Agbaje, said, “These are undoubtedly tough and trying times for people, businesses and economies the world over.
“Our financial performance in the first half of the year reflects the quality of our past decisions which have broadened our earnings and strategically positioned us to thrive, thus far, through the current global health and economic crises.
“Underpinning this financial performance is our commitment to being there for our customers and the communities we serve, and over the past six months we have lent the full weight of our franchise to safeguarding lives and livelihoods of our staff and customers by leading from the front in the fight to curtail the Covid-19 outbreak and offering grace periods on loans to our small business customers.”