UBA, Zenith, Access Lead Surge as Bank Deposits Soar 66% to N76.04 Trillion in 2023

…Strong Deposit Growth Signals Confidence in Nigerian Banks

Nigeria’s Tier-1 lenders, including United Bank for Africa (UBA), Zenith Bank Plc, and Access Bank Plc, reported significant growth in customer deposits for the full year 2023.

This positive trend comes against the backdrop of a challenging economic environment marked by inflationary pressures.

Customers’ deposits in major Nigerian banks surged by an impressive 66% in 2023, reaching a staggering N76.04 trillion. This significant increase occurred despite ongoing economic challenges, including inflation.

Data from the banks’ financial statement for the full year 2023 shows UBA recorded the highest growth of 90.3 percent to N14.89 trillion against N7.83 trillion it recorded in 2022, followed by  Zenith Bank Plc, which recorded a 69 percent increase to N15.17 trillion from N8.98 trillion.

Access Bank emerged third on the list with 65.6 percent deposit growth to N15.32 trillion from N9.25 trillion in 2022. Stanbic IBTC Holdings Plc ranked fourth with 65.5 percent increase to N2.07 trillion from N1.25 trillion, while GTBank emerged fifth with 65.2 percent deposit growth to N7.41 trillion from N4.49 trillion in the corresponding period in 2022.

Others are Wema Bank, which grew customer deposit to N1.87 trillion from N1.67 trillion in the same period in 2022, thus representing a 60.2 percent increase; FCMB Group recorded a 58.9 percent increase to N3.09 trillion compared to N1.95 trillion in the corresponding period in 2022; Fidelity Bank Plc achieved a 55.5 percent deposit growth to N4.02 trillion from N2.58 trillion, while FBN Holding Plc and Sterling Bank Plc, grew their customer deposit by 52.6 percent to N10.87 trillion and 9.4 percent to N1.33 trillion respectively.

Key Takeaways for Businesses and Savers:

Increased Confidence: The rise in deposits suggests growing trust in the banking sector, potentially leading to easier access to loans for businesses and attractive interest rates for savers.

Economic Resilience: Despite economic difficulties, Nigerians are turning to banks, indicating a potential boost for financial activity.

Top Performers: Zenith Bank, UBA, and Access Bank witnessed the highest deposit growth rates, exceeding 65%.

Expert Insights:

Financial analysts attribute this growth to several factors:

Improved Cash Availability: The end of cash scarcity is believed to have encouraged people to utilize banks more frequently.

Government Deposits: Increased allocations to sub-national governments might have contributed to the overall deposit rise.

Active Financial Markets: A thriving stock market and high-yielding debt instruments likely led investors to deposit funds for investments.

Rising Interest Rates: Higher interest rates could incentivize fixed deposits, further boosting bank liquidity.

Looking Forward:

The upcoming bank recapitalization exercise, interest rate hikes, and continued FAAC inflows are expected to maintain positive momentum for bank deposits in Nigeria. This trend bodes well for businesses seeking loans and individuals seeking secure investment options.