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Banks’ Loan To Real Sector Drops To N14trn In Q3 2017




With banks getting more income from trading in foreign exchange and government securities, lending to the real sector has been on the decline as the loan book of banks dropped slightly by one per cent in the nine months period of 2017.

From a loan book balance of N13.865 trillion as at December 2016, the loan books of 10 banks in the country dropped to N14.703 trillion as at September 2017 from N14.851 trillion. Nine months results of 11 banks examined by LEADERSHIP showed that the decline in lending was evident majorly in the big banks who had recorded increased income from short term securities and foreign exchange.

FBN Holdings, Access Bank, Guaranty Trust Bank, Zenith Bank, Diamond and Wema Bank had recorded drops in their lending to the real sector while Fidelity Bank, Ecobank Transnational Incorporated, Stanbic IBTC, Sterling Bank and United Bank for Africa had recorded slight increases in their loan books in the nine months period.

GTB which had recorded a N125.57 billion profit after tax in the nine months period ended September 2017, an increase of 7.25 per cent compared to N117.08 billion achieved in the comparable period of 2016 had seen a 10 per cent drop in its loan book.

From N1.589 trillion, the bank’s lending had dropped to N1.428 trillion as its deposit base declined to N1.89 trillion from N1.98 trillion. Likewise, the loan book of Zenith Bank had dropped from N2.289 trillion to N2.155 trillion, a 5.9 per cent decline.

The bank which saw its deposit base in the nine months period rise by 2.6 per cent from N2.98  trillion to N3.06 trillion, had recorded a profit after tax of N129.23 billion, a 35 per cent rise compared to N95.38 billion which it made in the comparable period of 2016.

FBN loan book had declined slightly from N2.083 trillion as at December 2016 to N2.043 trillion as at September 30, 2017, as its deposit base dropped from N3.1 trillion to N2.93 trillion. Access bank had also seen a decline in both its loan book and deposit  base as its lending to customers dropped to N1.777 trillion from N1.809 within the nine month period while deposits dropped to N1.92 trillion form N2.08 trillion.

The loan book of Diamond Bank had also dropped to N975.62 billion form 995.33 billion as deposits from customers declined to N1.339 trillion from N1.424 trillion. The bank had at the end of the nine months period recorded a profit after tax of N5.9 billion compared to N3.51 billion it made in the comparable period of 2016.

Wema Bank had also seen its loan book and deposit base decline in the nine months period ended September 30, 2017. With deposits down to N250.92 billion from N283.3 billion, lending had also dropped to N210.86 billion from N227.008 billion.

On the other hand, United Bank for Africa which had recorded a profit after tax of N60.92 billion in the ix month period had grown both its loan book and deposit base slightly. Customers’ deposit in the bank had grown to N2.51 trillion form N2.48 trillion while lending rose to N1.59 trillion from N1.56 trillion.

Fidelity banks had also increased its lending to customers by 4.9 per cent to N753.79 billion fro N718.4 billion as at December 2016. This was despite a decline in deposit base which stood at N774.38 billion as at September 30, 2017 compared to N792.97 billion which it was as at December 30, 3016.

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