Amid the rising cost of inflation and Naira devaluation, the combined operating expenses of 10 Nigerian commercial banks rose by 42.51 per cent to N3.23 trillion in 2023 compared to N2.26 trillion in the previous year.
This is according to the annual results of financial institutions filed with the Nigerian Exchange Limited.
Financial institutions analysed include Access Holdings, FBN Holdings, Zenith Bank, United Bank for Africa, FCMB Group, Sterling Financial Holding, Fidelity Bank, Wema Bank, Stanbic IBTC and Guaranty Trust Holding Company.
In the period under review, Access Corporation saw its operating expenses grow by 38.85 per cent to N697.53bn from N502.36bn in 2022.
Explaining the increase, Access Corp stated that its personnel cost increased by 43.97 per cent to N167.90bn from N116.62 due to increased wages and salaries.
Other operating expenses also went up to N465.67 billion from N341.32 billion on the back of IT and e-business expenses, which rose to N78.05bn.
The 30.49 per cent rise to N68.81 billion in the Asset Management Corporation of Nigeria surcharge that the group paid last year also contributed to the appreciation of its operating costs.
Access Corp’s depreciation and amortisation costs stood at N63.96bn.
FBN Holdings’ unaudited results revealed that operating expenses jumped by 46.83 per cent to N534.34bn in 2023.
FCMB Group, according to its unaudited report for 2023, saw operating expenses rise by 35.64 per cent to N154.44bn, underpinned by higher personnel expenses.
According to its condensed unaudited interim financial statements for 2023, the total expenses of Sterling Financial Holdings Company and subsidiaries rose by 25.26 per cent to N109.24bn.
Fidelity Bank reported a 60.77 per cent increase in operating expenses to N194.18 billion from N120.78 billion in the prior year.
Wema Bank, which recorded a profit-before-tax growth of 196 per cent to N43.59bn in 2023, also grew operating expenses by 32.16 per cent to N78.76 billion.
For Stanbic IBTC, operating expenses were up 29.41 per cent to N166.81 billion.
Also, the operating expenses of Guarantee Trust Holding Company, GTCO, rose by 26.54 per cent to N250.42 billion on the back of personnel expenses and other operating expenses.
Zenith Bank Plc, in its newly released annual result, revealed that operating expenses increased by 32.31 per cent to N449.47 billion, while UBA’s operating expenses rose by 68.99 per cent to N591.64 billion from N350.09 billion in the previous year.
Meanwhile, financial experts have linked lenders’ operating expenses to inflationary pressure, naira devaluation and upward salary reviews.
Nigeria’s headline inflation soared to 31.7 per cent in February 2024.
Recall that the Central Bank of Nigeria floated the Naira in June 2023 in an effort to defend the country’s currency.
Credit Gist New Today News in Newspaper Nigeria Headlines
