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In the first half of 2023, 11 banks listed on the Nigerian Exchange collectively generated N72.723 billion from account maintenance charges, according to data extracted from their half-year financial statements.
Leading the pack in account maintenance revenue were Zenith Bank, Access Holdings, GTCO, and UBA. This figure represents a 7.44% increase when compared to the N67.690 billion recorded during the same period in 2022.
The Central Bank of Nigeria specifies that account maintenance fees are applicable exclusively to current accounts for customer-induced debit transactions to third parties and debit transfers or lodgments to the customer’s account at another bank. Although account maintenance charges contribute a significant portion of banks’ non-interest income, they remain relatively low compared to other revenue streams.
According to the Central Bank’s directive on bank charges, Nigerian banks are permitted to charge their customers a “negotiable” N1 per mille. In practical terms, this means banks can charge N1 per N1,000 for debit transactions on current accounts. These charges are often referred to as Commission on Turnover (COT), which is levied on customer withdrawals by their banks.
Here’s a ranking of the 11 banks based on their account maintenance earnings in H1 2023:
1. Zenith Bank – N21.02 billion: Zenith Bank secured the top position, with account maintenance revenue of N21.02 billion, accounting for 28.91% of the total income generated by the 11 banks. This represents a 6.32% increase compared to the N19.77 billion earned in H1 2022. Additionally, the bank reported a remarkable year-on-year increase of 162% in its profit after tax, reaching N291.73 billion, compared to N111.413 billion in the corresponding period of 2022.
2. Access Holdings – N13.363 billion: Access Holdings ranked second with N13.363 billion in account maintenance income, reflecting a 10.97% year-on-year increase in H1 2023. However, the company ranked fifth in terms of profit before tax growth. Access Holdings reported a 52.37% increase in profit after tax, reaching N135.441 billion in H1 2023.
3. GTCO – N10.481 billion: GTCO secured the third position with a year-on-year increase of 11.08% in account maintenance income in H1 2023, totaling N10.481 billion, compared to N9.44 billion in H1 2022. Additionally, the holding company reported a substantial year-on-year increase of 261.65% in profit after tax, reaching N280.48 billion.
4. UBA – N9.64 billion: UBA generated N9.64 billion from account maintenance income in H1 2023, marking a significant 46.11% increase compared to N6.595 billion in the corresponding period of 2022. The bank also reported a substantial year-on-year increase of 437.76% in net profit, reaching N378.24 billion.
5. First Bank – N5.19 billion: First Bank of Nigeria’s account maintenance income decreased by 43.5%, totaling N5.19 billion, compared to N9.17 billion generated in H1 2022. Despite this decline, the bank reported a remarkable year-on-year increase of 231% in profit after tax, reaching N187.18 billion in H1 2023.
6. FCMB – N3.85 billion: FCMB ranked sixth with N3.85 billion in account maintenance revenue, reflecting a 16.3% year-on-year increase from N3.32 billion in H1 2022. Additionally, FCMB reported a substantial 159.17% year-on-year increase in profit after tax, reaching N35.410 billion.
Other Banks:
- Stanbic IBTC – N2.643 billion
- Sterling Bank – N2.392 billion
- Fidelity Bank – N1.769 billion
- Wema Bank – N1.636 million
- Unity Bank – N745 million
While account maintenance fees contribute significantly to banks’ revenue, they make up only a part of their overall income streams.
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