- About 10 banks in Nigeria are making vast amounts from keeping monies for their customers in their vaults
- A recent report shows the 10 biggest banks earning the highest through account maintenance charges
- The banks charge their customers N1 for every N1000 debit and transfer to other banks known as Commission on Turnover
Nigerian banks made a total of N70.47 billion in revenue from account maintenance in the year's first half.
The banks' revenue represents a 19.4 per cent increase from the N59.01 billion they generated in the period last year.
Obeying CBN directives
According to data from the quarterly financial statement of the banks, the top earners were regarded as tier 1 banks comprised of First Bank, UBA, GTBank, Access and Zenith banks.
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The bank lead other banks with the highest income from current account maintenance in the period under review.
According to a report, the Central Bank of Nigeria (CBN) states that account maintenance fees be charged to current accounts only regarding debit transactions to third parties and debt transfers and deposits to customers' accounts in other banks.
Bank's revenue from account maintenance makes up a substantial amount on their non-interest income.
CBN's directives to banks allow them to charge customers a negotiable N1 per mile, meaning an N1 charge on every N1000 debit on current accounts.
The charges come in the form of Commission on Turnover (COT), levied on customer withdrawals by their banks.
The 13 banks trading on the floor of the Nigerian Stock Exchange posted a profit after tax of N500.9 billion in the first half of the year, a 13 per cent increase from the N443.17 billion recorded in the second half of 2021.
Biggest banks by account maintenance
UBA is fifth on the list with N6.59 billion in revenue from account maintenance, which is 21.5% higher than the N5.43 billion recorded in 2021.
The bank's maintenance income made up 9.4% of its total N70.47 billion recorded by the 13 banks under consideration.
FirstBank saw its account maintenance revenue spike by 15 per cent from N7.93 billion generated in the first half 2021 to N9.11 billion in the same period of 2022, accounting for 12.9% of the total account maintenance income of the industry.
GT Bank: N9.44bn
GT Bank made N9.44 billion from account maintenance income between January and June 2022.
The revenue represents a 20.9% increase compared to N7.8 billion recorded in 2021, accounting for 13.4% of the total banks' inflow.
Access Bank: N12.04bn
Access Bank recorded a 10.9% year-on-year increase in its account maintenance income in H1 2022 to stand at N12.04 billion from N10.86 billion.
Zenith Bank: N19.77bn
Zenith Bank occupies the top position after generating the sum of N19.77 billion from account maintenance, representing 28.1% of the total income of the 13 banks. Zenith Bank increased its account maintenance income by 24.3% in comparison to N15.9 billion made in H1 2021.
- FCMB: N3.32bn
- Stanbic IBTC: N2.37bn
- Fidelity Bank: N2.34bn
- Sterling Bank: N1.85bn
- Union Bank: N1.4bn
Africa’s 10 biggest banks by asset base, Nigerian banks missing
Legit.ng reported that despite their claim of continental spread, Nigerian banks have missed out on the latest list of the 10 biggest banks in Africa.
Banks in Africa’s biggest economy have been aggressive in their push for a continental expansion in recent years but have not been able to catch up with their counterparts elsewhere as they have been dwarfed by assets of much larger banks in Africa.
United Bank for Africa (UBA) has a presence in 20 countries and is regarded as one of the fastest-growing banks on the continent.