Access Holdings, Nigeria’s largest lender, reported its highest-ever revenue in 2022, largely driven by interest on loans, but its after-tax profit slowed despite a 42.8% increase in turnover, according to its audited financials.
The financial services group saw interest earned from lending surge by almost half to N770bn ($1.87bn), but the majority of that was consumed by interest expense, the cash it paid customers in exchange for keeping their deposits.
As a result of regulatory requirements, Access Holdings set aside N197.6bn in its revenue pool to cover loans, whose chances of being repaid are uncertain, and also depreciation of its financial assets, resulting in weakening earnings.
Operating expenses also increased from N232.2bn to N341.7bn, with IT and e-business expenses, administrative costs and premises & equipment costs being the main contributing factors. Profit before tax contracted by 5%, while profit for the year dipped to N152.2bn from N160.2bn.
The lender’s commercial banking unit, Access Bank, recently received $300m to drive expansion in Africa, while it also commenced the business combination process to merge its Zambian subsidiary and the African Banking Corporation Zambia into a single entity. Access Holdings declared a final dividend per share of N1.30, taking its total for the year to N1.50, surpassing the preceding year’s by 50%.