During the first nine months of 2023, Nigeria’s tier-1 banks amassed a total of N102.96 billion in income from account maintenance, marking a 20.4 percent increase compared to the N85.53 billion recorded in the corresponding period of 2022.
The surveyed banks, including First Bank, United Bank for Africa, Guaranty Trust Holding Company, Access Bank, and Zenith Bank, reported that their collective account maintenance charges represented 13.6 percent of the total fees and commission income in 9M’2023. This reflected a slight decrease from the 14.8 percent recorded in the previous year.
As per the Central Bank of Nigeria, account maintenance fees apply solely to current accounts for customer-induced debit transactions to third parties and debit transfers/lodgements to the customer’s account in another bank. Despite being relatively low compared to other revenue streams, earnings from account maintenance charges remain a significant component of the banks’ non-interest income.
A Business Day report indicated that the total fees and commission income from the tier-1 banks surged to N755.61 billion in 9M’2023, up from N579.01 billion in 2022.
Zenith Bank’s account maintenance accounted for 25.6 percent of the total fees and commission income in 9M’2023, marking a 170 basis points increase from the same period in 2022 when it contributed 23.9 percent.
Foreign currency transaction fees and commissions rose to N7.38 billion in 9M’2023 from N4.44 billion in the corresponding period of 2022. Asset-based management fees increased to N8.14 billion from N6.66 billion, while auction fees income rose to N382 million from N330 million.
On the other hand, corporate finance fees declined to N68 million from N293 million, and foreign withdrawal charges increased to N15.27 billion from N8.9 billion.
Guaranty Trust Holding Company’s (GTCO) account maintenance contributed 19.8 percent to the total fees and commission income in 9M’2023, indicating a 40 basis points decline from the 20.2 percent contributed in the same period of 2022. GTCO’s account maintenance charges grew to N18.04 billion in 9M’2023 from N15.88 billion in 2022.
Access Holdings’ account maintenance contributed 10.5 percent to the total fees and commission income in 9M’2023, representing a 350 basis points decline from the 14 percent contributed in the same period of 2022. The holding company’s account maintenance charge and handling commission increased to N21.85 billion in 9M’2023 from N18.71 billion in 2022.
In total, fees and commission income for the surveyed banks reached N208.18 billion in 9M’2023, compared to N133.49 billion in the same period in 2022.
