Access Holdings PLC has posted impressive results for the third quarter (Q3) of 2024, showing robust growth in key financial metrics. The group recorded a pre-tax profit of N209.2 billion, reflecting a 65.01% increase compared to N126.8 billion in the same period last year. This growth continued a strong performance trajectory for the first nine months of the year, with cumulative pre-tax profit reaching N558.1 billion, marking an 89.59% rise from the previous year.
Key Financial Highlights (Q3 2024 vs. Q3 2023)
- Interest Income: N867.6 billion, up 142.87%
- Interest Expense: N594.3 billion, up 115.42%
- Net Interest Income: N331.4 billion, up 100.01%
- Fee and Commission Income: N150.5 billion, up 81.07%
- Fee and Commission Expense: N25.3 billion, up 1.12%
- Fair Value and FX Gain: N141.4 billion, up 15.43%
- Pre-tax Profit: N209.2 billion, up 65.01%
- Post-tax Profit: N176.4 billion, up 53.40%
- Earnings per Share (EPS): N4.79, up 50.63%
- Total Assets: N41 trillion, up 53.96%
Key Drivers of Performance
- Interest Income and Net Interest Income:
- The growth in interest income was driven primarily by loans and advances to customers, which contributed N1.2 trillion of the N2.39 trillion total interest income for the nine months. Investment securities added N838.1 billion to interest income.
- Net interest income more than doubled, surging to N331.4 billion, up 100.01% from N165.7 billion in Q3 2023.
- Fee and Commission Income:
- Fee and commission income also showed strong growth, rising 81.07% to N150.5 billion in Q3 2024. The group reported N151 billion in credit-related fees and commissions, while channel and e-business services contributed N121.1 billion to the total.
- Foreign Exchange and Fair Value Gains:
- The fair value and foreign exchange gains saw a modest increase of 15.43%, adding N141.4 billion to the bottom line.
- Geographic Contribution:
- By geographic segment, Nigeria remained the largest contributor to gross earnings, with N2.47 trillion in revenue. This was followed by N752.9 billion from the rest of Africa and N38.8 billion from Europe.
- Despite Europe’s relatively lower earnings, the region’s pre-tax profits of N185.29 billion surpassed those of Africa, which contributed N143.7 billion, while Nigeria led with N377.3 billion in pre-tax profits.
Asset and Liability Overview
- Total Assets:
- As of September 30, 2024, Access Holdings’ total assets surged to N41 trillion, up 53.96% from the previous year. This increase was driven by substantial growth in cash holdings, customer loans, and investment securities.
- Cash holdings and bank balances rose dramatically from N2.0 trillion to N4.2 trillion.
- Customer loans saw significant growth, with overdrafts from individual customers reaching N772.9 billion and loans from corporate entities totaling N5.1 trillion.
- Treasury bills made up a significant portion of the bank’s investment securities, with a fair value of N2.1 trillion. The total value of debt securities (including Treasury bills, federal government bonds, and euro bonds) stood at N6.8 trillion.
- Deposits and Liabilities:
- Deposits from financial institutions and customers were major contributors to the bank’s liabilities. The total deposits amounted to N9.7 trillion from financial institutions and N22.8 trillion from customers.
- Customer deposits were composed of N9.0 trillion in term deposits and N9.3 trillion in demand deposits.
- The group’s total liabilities rose to N3.7 trillion, primarily due to increases in customer and financial institution deposits.
Commentary: Strong Growth Underpinned by Core Banking Operations
Access Holdings’ strong financial results in Q3 2024 reflect the strength of its core banking operations, with a significant portion of revenue coming from interest income and commission-based services. The increase in net interest income indicates the group’s effective management of its loan book and investment securities, while growth in fee and commission income highlights the expanding role of its e-business and channel services.
The company also benefited from strong foreign exchange and fair value gains, contributing to overall profitability. Furthermore, the diversified geographic performance, especially in Nigeria and Europe, suggests a solid foundation for growth in the future.
Outlook and Future Expectations
Looking ahead, Access Holdings PLC is poised to maintain its momentum, driven by its core revenue streams. The growth in customer deposits, coupled with increased loan issuance and strategic investments in financial technologies, positions the company well for continued success.
However, while the strong asset growth and healthy profit margins are promising, the bank must remain vigilant against broader economic challenges, including rising inflation, regulatory changes, and the global economic environment.
Access Holdings has demonstrated strong financial performance in Q3 2024, with significant growth in key metrics such as net interest income, fee and commission income, and profitability. The continued expansion of its total assets and robust deposit growth solidifies its position as a leading financial institution in Nigeria and beyond. With a solid strategy in place, the bank is well-positioned to navigate the evolving economic landscape and sustain its growth trajectory.
