February 26, 2021

Wema Bank Posts N81bn Earnings, N5.1bn Profit after Tax

Wema Bank Plc yesterday released its unaudited results for the year ended December 31, 2020, showing marginal decline in top and bottom-lines. The financial institution recorded gross earnings of N80.852 billion in 2020, indicating a decrease of 14.7 per cent compared with N94.890 billion in 2019.

Net interest income improved by 19.4 per cent to N31.038 billion in 2020 from N25.986 billion in 2019.
But net trading income slumped by 73 per cent from N14.789 billion to N3.0966 billion following the crash in Treasury Bills yields last year. The bulk of the net trading income in the previous year came from treasury bills (N14.5421 billion) in 2019.

This dipped to N3.627 billion in 2020. Wema Bank Plc strived to reduce personnel expenses from N14.871 billion to N14.004 billion and other expenses from N19.115 billion to N18.859 billion. However, impairment charges rose by 35.2 per cent to N26.852 billion from N19.855 billion.

Consequently, profit before tax rose by three per cent to N6.964 billion in 2020, from N6.760 billion in 2019, while profit after tax fell 2.6 per cent to N5.062 billion in 2020, from N5.199 billion in 2019. Wema Bank Plc’ deposits from customers grew from N577 billion to N812 billion, just as loans and advances improved from N289.239 billion to N368.748 billion.

Meanwhile, the bears returned to the stock market yesterday leading to a decline of 0.31 per cent to close at 40,095.49, while market capitalisation shed N65.8 billion to be at N21 trillion. The decline followed sell-offs in Nigerian Breweries Plc, Access Bank Plc and Zenith Bank Plc. The market recorded only 14 price gainer and 24 laggards.

Also, the volume and value of trading tanked 30.6 per cent and 47.6 per cent N 326.0 million shares and N3.7 billion respectively. The most traded stocks by volume were Transcorp (48.4 million shares), Dangote Sugar Refinery Plc (33.9 million shares) and United Bank for Africa Plc (27.5 million shares) while Zenith Bank Plc (N637.6 million), Dangote Sugar Refinery Plc ( N611.8 million) and Guaranty Trust Bank Plc (N478.8 million) led by value.

Performance across sectors was mixed as the NSE Banking Index led laggards with 1.4 per cent , followed by the NSE Consumer Goods Index and NSE Oil & Gas Index closed lower by 0.8 per cent and 0.2 per cent in that order. But the NSE Insurance Index rose 0.2 per cent, while the NSE Industrial Goods Index closed flat.