Story Kayode Tokede
A total of six banks generated N675.9billion from non-interest income in nine months of 2019, an increase of about 12 per cent from N606billion generated by the banks in prior nine months of 2018.
Non-interest income is bank’s income derived primarily from fees including deposit and transaction fees, , annual fees, monthly account service charges, inactivity fees, check and deposit slip fees, and so on.Nigerian NewsDirect gathered that banks in Nigeria leveraged on non-interest income to boost bottom- line performance given the macro economy challenges facing the nation’s economy. Of the six banks considered by our correspondent, United Bank for Africa plc (UBA) generated the highest in terms of percentage while Ecobank Transnational Incorporated (ETI) hits record high in terms of value generated in the period under review. From these banks unaudited financial statement for nine months ended September 30, 2019, UBA generated N107.08 billion in non-interest income, an increase of 22 per cent from N87.7 billion in nine months of 2018 while ETI reported N227.2 billion non-interest income in nine months of 2019 from N203.44 billion reported in nine months of 2018, representing an increase of 12 per cent.
The Group Managing Director/CEO, UBA, Kennedy Uzoka, said, the pan-African bank achieved a 22.1per cent growth in non-interest income, driven largely by the increased penetration of superior digital banking offerings, credit expansion, remittances and other lifestyle transactional services.
“UBA remains committed to its vision of becoming the undisputed leading and dominant financial services institution in Africa. “We will continue to innovate and lead in all our business segments, whilst delivering top-notch operational efficiencies and best-in-class customer service. We are beginning to realise early gains from our ongoing Transformation Program and I am indeed excited about the days ahead,” Uzoka stated.
However, First Bank of Nigeria Limited reported an increase of 0.5 per cent in its non-interest income to N75.9 billion in nine months ended September 30, 2019 from N75.5 billion in nine months ended September 30, 2018.
Responding, the Chief executive officer of First Bank and subsidiaries, Dr. Adesola Adeduntan in a statement had explained that the bank remained focused on transforming business to a leading transaction-led institution, as highlighted by the 26 per cent y-o-y growth in fees and commission driven by 45.9 per cent y-o-y growth in electronic banking fees.
“This has positively impacted non-interest income even as we continue to ramp up customer acquisition and retention through improved offerings from agents, digital, trade and transaction banking products. We are also focused on further enhancing overall revenue generation capabilities with the aim of increasing share of the customers’ wallets,” Adeduntan explained.
The other banks, Zenith Bank reported N156.7 billion non-interest income in nine months of 2019, 21.7 per cent increase over N128.7 billion in nine months of 2018, while Stanbic IBTC Holdings’s non-interest income grew by 2.5 per cent to N81.9 billion in nine months of 2019 from N79.9 billion reported in nine months of 2018.
In addition, Union Bank of Nigeria non-interest income dropped by 11.7 per cent to N27.1 billion in nine months of 2019 from N30.7 billion reported in nine months of 2018. The management of Union Bank of Nigeria said, reduced market volatility in this year had an impact on trading income.