Zenith Bank held off strong gains by Access Bank to retain its position as Nigeria’s top lender, as John Everington reports.

After one of the most challenging economic downturns of recent memory, Nigeria’s banks bounced back in 2021. A rebound in oil revenues — which has extended into 2022 — has helped the country return to economic growth following its worst recession in more than 20 years. All five of the country’s largest lenders reported increases in Tier 1 capital during the year, compared with just one in 2020.

Zenith Bank remains the country’s largest lender, its Tier 1 capital base increasing by 4.2% to $2.75bn, even as it slipped six places to 460th position in the Top 1000.

The big success story of the year, however, is Access Bank, which has overtaken Guaranty Trust Bank to become the country’s second-largest lender — a position it last held in 2020.

Access’s growth within Nigeria has been accompanied by acquisitions in South Africa, Zambia, Botswana and Mozambique, together with the commencement of operations in Guinea. Its Tier 1 capital rose by 45.2% in 2021 — more than any major African lender — helping it rise a whopping 131 places to 499th in the overall ranking.

The bank also remains the country’s largest lender by assets, its total asset base increasing by 25.2% to $28.53bn, which is more than double that of Guaranty Trust Bank.

Despite falling into third position in the country, Guaranty Trust Bank recorded a respectable 9.5% increase in its Tier 1 capital, which saw it gain 27 places in the overall rankings, with United Bank for Africa and First Bank of Nigeria making similar gains.

Although First Bank Nigeria remains in fifth place in the country in terms of its Tier 1 capital position, the bank tops Nigeria’s best-performance table for 2022, unseating Guaranty from the top of the pile. First Bank Nigeria was the best performer in terms of profitability, its 84.5% growth in pre-tax profits more than double that of its nearest rival. The bank also topped the operational efficiency category, with its cost-to-income ratio decreasing from 62.47% to 51.6% for the year.

Guaranty ranks second in terms of overall performance, with chart-topping scores for soundness and leverage; the bank’s capital-to-assets ratio has increased from 12.06% to 12.96% over the course of 2021. Access’s strong asset growth helps it come third in the country’s performance rankings, placing first in the growth category. The bank also scored highly for its liquidity position, its loan-to-asset ratio decreasing from 43.98% to 39.18%.

Zenith falls from second to fourth position in 2022. Despite strong scores for soundness, leverage and profitability, the bank came in last for Nigeria’s biggest lenders in terms of return on risk, with its risk-weighted assets to total assets ratio standing at 63.01% for 2021, compared with 56.96% the previous year.

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