Commercial Bank Receives N48.64trn Deposits In Q1″22

Commercial banks in Nigeria received N48.6 trillion in deposits in the first quarter of 2022.

This represents a 20.20% increase when compared to the N40.47 trillion received during the same period in 2021.

Analysis of the total deposits received from customers based on account type for the Nigerian lenders revealed that 47 per cent, equivalent to N22.87 trillion, were paid into the current account.

When disaggregated, customers deposited N10.38 trillion in term account, and N12.16 trillion in savings account across the banks listed on the Nigeria Exchange Limited (NGX).

According to Gloria Fadipe, head of research at FCMB, deposits represent bank funds used in making money. She further noted that deposits have a direct relationship with bank loans, stating that “if deposits increase, loans increase”.

Fadipe explained that based on account types, it is better for banks to have cheap deposits: current accounts, and savings accounts.

“Savings account attracts less than one per cent and people don’t put their mind to it because they withdraw too many times, but current account attracts more. The higher the bank capital ratio, the lower the bank’s total funding cost and the more profitable the bank, and banks always try to ensure that the capital is growing. So, if the deposits that are growing are either in savings or current deposits, you can see the effect in the cost of funds which would be positive because it will reduce,” she added.

Innocent Unah, executive director at Graham Lynch Capital said “positive growth in deposits can mean either the banks’ customers are growing in number, existing customers are depositing more money with the bank, the bank is generating deposit customers from its competitors, or more previously unbanked population are being banked now.”

Unah explained that the implication is that banks will be able to create more loans and support businesses and generate more earnings as a result of increased risk assets.

The banks registered positive growth in customer deposits, with Ecobank leading the pack with an 11.11 per cent increase to N8.20 trillion, followed by Access Bank with a 31.87 per cent increase to N7.49 trillion, and Zenith Bank with a 27.87 per cent growth to N7.25 trillion in the first quarter of 2022.

Ecobank Transnational Incorporated recorded deposits from customers amounting to N8.20 trillion in the first quarter of 2022, the highest reported by Nigerian banks in the period under review. The bank’s total customer deposits represent an 11.11 percent uptick from N7.38 trillion recorded in the comparable period of 2021.

The second-highest on the list is Access Bank, accounting for N7.49 trillion of customer deposits in the first quarter of 2022, showing a 31.87 percent growth from N5.68 trillion recorded in the first quarter of 2021. Based on account types, term deposits contributed the bulk in the quarter accounting for 42.99 percent of customers’ deposits.

Total deposits from customers recorded by Zenith Bank in the first three months of 2022 amounted to N7.25 trillion, a 27.87 percent increase from N5.67 trillion recorded in the first three months of 2021. The deposits UBA recorded from customers amounted to N6.65 trillion in the first quarter of 2022.

First Bank reported an increase in deposits from customers by 20.39 percent to N6.14 trillion in the first quarter of 2022, up from N5.10 trillion recorded in the same quarter last year.