- Shareholders of Nigeria's tier 1 banks enjoyed a bumper first nine months on the Nigerian Exchange
- The gains mostly happened under President Bola Tinubu's administration following a series of new policies
- On the whole, the banking sector recorded impressive gains, majorly thanks to the forex exchange policies
President Bola Tinubu's administration's new policies have resulted in a financial windfall for Nigerian banks listed on the Nigerian Exchange.
Data obtained from NGX showed that in the first nine months of 2023, the banking index rose by 59.57%.
The five tier-one banks, Zenith Bank, Guaranty Trust Holding Company Plc, FBN Holdings Plc, Access Holdings Plc and United Bank for Africa (UBA), grabbed the lion's share of the rally.
CBN successfully mops up N150bn excess cash in access, zenith, GTB, UBA, other banks via Omo auction
Together, the shareholders of the five banks watched the value of their investments increase by N1.29 trillion.
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Breakdown of the bank's earnings
Zenith Bank Plc led the pack with a 31.04% increase in share price, PrimeBusiness reports.
GTCO Holdings Plc followed closely with a remarkable 49.78% gain, while FBN Holdings Plc saw a 50% surge in share price.
Access Holdings Plc experienced 85.29% price appreciation, and United Bank for Africa (UBA) Plc stole the show with a 121.05% surge in share price.
How Tinubu policies sparked stellar performance for banks
The administration under President Tinubu has proven to be a blessing to the financial sector, even in the face of a challenging operating environment.
Legit.ng, in a previous report, revealed how banks reported substantial profits thanks to gains from exchange rate revaluation.
You may recall that the Central Bank of Nigeria (CBN) announced an exchange rate unification policy, resulting in the depreciation of the Naira from the official rate of approximately N400 to over N700.
This depreciation of the Naira has benefited banks with investments abroad, leading to significant gains in forex.
These impressive gains attracted stock investors to bank shares on the Nigerian Exchange, thereby driving up the prices.
CBN issues warning to banks involved in illegal sale of forex
In related news, Legit.ng reported that the CBN had issued a stern cautionary message to financial institutions engaged in illegally trading dollars or unauthorised foreign exchange transactions.
This advisory comes in light of the unfortunate depreciation of the Nigerian currency, the naira, against the US dollar in both official and unofficial markets.