ENUGU, Nigeria (VOICE OF NAIJA) – Major Nigerian banks experienced a remarkable 53.6 per cent Year-on-Year (YoY) growth in customer deposits, soaring to N64.26 trillion in the nine months concluded on September 30, 2023, up from N41.83 trillion in the corresponding period in 2022.
The banks are Zenith Bank Plc, Access Bank Plc, FBN Holdings Plc, United Bank for Africa (UBA) Plc, Guaranty Trust Holding Company (GTCo) Plc, and Fidelity Bank Plc.
Others are Stanbic IBTC Holdings Plc, Sterling Bank Plc, FCMB Group Plc, Jaiz Bank Plc and Wema Bank Plc..
Leading the deposit surge were tier-1 banks, notably Zenith Bank Plc, achieving a staggering 66.42 per cent YoY growth to N13.38 trillion, and UBA Plc, with a 65.4 per cent increase to N11.63 trillion. Access Bank Plc and Stanbic IBTC Holdings Plc followed closely, each boasting a 55.6 per cent deposit growth rate.
Wema Bank secured the fourth position, witnessing a 52.8% growth to N1.65 trillion, while Guaranty Trust Holding Company (GTCo) Plc claimed the fifth spot with a 46.7 per cent increase to N6.23 trillion.
Financial analysts attribute this substantial growth to the release of depositors’ funds previously held by the Central Bank of Nigeria (CBN) post-Naira redesign, coupled with increased cash circulation in pursuit of foreign currencies following the Naira’s depreciation under the government’s new foreign exchange policy.
David Adonri, Vice Chairman of Highcap Securities, suggests that the rise in customer deposits may be linked to the floating of the Naira during the period, the return of previously seized deposits by the CBN, and the restoration of cash-based transactions disrupted during the currency redesign exercise.
Additionally, factors such as escalating petroleum product prices, impacting consumer pockets, and the pass-through effect of recent stock market booms, funneling investment funds through bank accounts, are believed to have further contributed to the surge in bank deposits.
He said, “Growth in banks’ customer’s deposits in the nine months may be connected with the floating of the Naira during the period. More Naira became required to purchase hard currencies sold by banks. Return of depositors’ cash that was earlier seized by the CBN may have also increased deposits. It also restored cash based transactions dislocated during the currency redesign exercise thus enhancing more sales deposit by micro and small enterprises.
“Rising prices of petroleum products also removed money from consumer’s pockets which may have increased the deposit made by marketers. The pass through effect of stock market transactions in the recent boom wherein investment funds go through bank accounts may also have increased bank deposits.”