Access Bank has delivered strong results in the first half of 2021 despite the challenging macroeconomic and regulatory environment. The report shows strong performance across all income lines.
Key extracts of the audited report and accounts of Access Bank for the six-month period ended June 30, 2021, showed that gross earnings rose by 14 percent from N396.8 billion in the first half of 2020 to N450.6 billion in first half of 2021.
The bank’s top-line remained anchored on its core banking activities with interest and non-interest income accounting for 71 percent and 29 percent respectively. Profit before tax the period rose by 31 percent from N74.3 billion to N97.5 billion. After taxes, net profit rose by 42 percent from N61 billion in the first half of 2020 to N86.9 billion in the first half of 2021.
The overall profitability outlook was driven largely by robust growth across income lines and increasing operating cost efficiency. The bank’s core business interest income rose by 30 percent growth while net fee and commission income grew by 45 percent. Meanwhile, interest expense slipped by 0.7 percent.
The bank’s balance sheet closed June 2021 at N10.1 trillion, 16 percent above N8.7 trillion recorded at the end of the year ended December 31, 2020. Net loans and advances also increased from N3.6 trillion in December 2020 to N4.0 trillion in June, this year.
Despite loan increases, the non-performing loans (NPL) ratio remained flat at 4.3 percent, below the industry’s benchmark of five percent. The bank’s capital and liquidity ratios remained well above regulatory benchmarks, with a Capital Adequacy Ratio (CAR) of 21.3 percent and a Liquidity Ratio (LR) of 50.7 percent, which enabled the bank to drive its aggressive growth strategy.
Further analysis showed that the cost-to-income ratio declined by 5.70 percentage points to 60.1 percent in the first half of 2021 as against 65.8 percent in first half of 2020.
A breakdown of the top-line indicated that the retail banking business grew by 24 percent from N95.8 billion in first half 2020 to N118.6 billion in the first half of 2021. These included 46 percent increase in interest income and 37 percent growth in revenue from channels and digital businesses.
The strides in retail business drove savings deposits up by four per cent to N1.4 trillion in June 2021 from N1.3 trillion in December 2020. Cost of funds reduced to 2.9 per cent in first half 2021 as against 3.7 per cent in first half 2020.