• Thursday, December 07, 2023
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Zenith, GTB record N200bn profit in IFRS compliant results


Deposit money banks in Nigeria on Tuesday commenced release of their 2012 year-end results after delays over compliance with the International Financial Reporting Standards (IFRS) with Zenith and GTBank posting over N200 billion profits.

Zenith Bank announced a profit before tax (PBT) of N102.10 billion for the financial year ended December 2012, up by 51.4 per cent, from the N67.44 billion recorded in 2011.

The bank’s group audited result announced on the floor of the Nigerian Stock Exchange, (NSE) showed that profit after tax (PAT) for the period was N100.68 billion, which represents a 106.7 percent increase, from the N48.70 billion recorded in 2011.

By this result, Zenith Bank becomes the first to cross the N100 billion profit after tax mark in a financial year. The result also showed the bank maintaining its leadership position on other parameters with total assets plus contingents of N2.60 trillion, representing a 12.7 per cent increase over the N2.30 billion recorded in 2011. The bank also declared N1.50 kobo dividend for every 50 kobo share held by shareholders.

Guaranty Trust Bank plc (GTBank) on the other hand recorded a group profit before income tax of N103.028billion, against N62billlion in 2011. Profit after tax for the year rose to N87.296billion against

N51.741billion, while cash flow from operating activities rose to N96.534billion against N80.783billion in same period of 2011, indicating a 19 percent increase. The value of GTBank plc proposed dividend rose to N38.260billion, against N25.016billion.

The bank’s income was driven majorly by interest charged to borrowers, evidenced by its interest income rising to N130.68 billion against N98.492 billion in 2011.

The 2012 financials, being the first fully IFRS compliant, has before now put most banks at loggerheads with the Central Bank of Nigeria (CBN) over the insistence by the latter for full compliance, a development that led to rejection of some banks’ results as falling short of the required open disclosure.

However, a dearth of manpower has been the major handicap of banks, and has led to delays in the release this year, as against previous years, when some banks released their results between February and March, almost two months ahead of the April deadline by the regulatory authorities.

IFRS are a set of accounting standards developed by the International Accounting Standards Board (IASB) which has become the global standard for the preparation of public companies financial statements, with the aim of providing a single set of high quality global accounting standards which require transparent and comparable information in general purpose financial statements.

It has the objective of bringing about convergence of national accounting standards for financial statements to give a true and fair view of the financial health of entities and also develop a single set of high quality understandable and enforceable global accounting standards that require transparent and comparable information in financial statements.

However, despite this development, the two banks known

traditionally as ‘early birds’ were able to release their results well ahead of others.

Besides, there is palpable apprehension among some banks envisaging the possibility of incurring the wrath of shareholders since this year’s financials will be comprehensive, with the attendant scrutiny by stakeholders.

Abdurahman Yenusa, executive director, Diamond Bank, told BusinessDay on Monday that the need for banks to adapt to the new methodology of the new reporting format has brought about the delay, as banks are careful not to make mistakes, being the first full year FIRS compliant report.

Another banker said yesterday that the adoption of IFRS is causing nightmares for some banks, and as such,the banks are very careful not to rush into publishing their reports which they fear might be criticised by shareholders.

Friday Ameh, an analyst, said the time has come for banks to demonstrate the benefits of the reforms by being transparent, by way of full disclosure to the investing public. Ameh said the new reporting format, if fully complied with, would assist investors in taking decisions on where to invest.