By Dipo Olowookere
Access Bank Plc has surprised its shareholders by increasing its final dividend payout for the year 2020 by 37.5 per cent or 15 kobo to 55 kobo from 40 kobo.
The bank, led by Mr Herbert Wigwe, is not known to pay a huge dividend like its two other tier-1 peers, GTBank and Zenith Bank, which paid N2.70 each.
In the financial statements for the year ended December 31, 2020, the lender said it intends to pay a final dividend of 55 kobo on Friday, April 30, 2021, to shareholders whose names appear on the register of members as at the close of business on Thursday, April 15, 2021.
If the cash reward is approved by shareholders at the company’s Annual General Meeting (AGM) fixed for Friday, April 30, 2021, at the Access Towers at Oniru Estate, Victoria Island, Lagos, the total dividend for the year would be 80 kobo. The bank had earlier paid an interim dividend of 25 kobo last year.
The year 2020 was very challenging for most businesses across the globe because of the COVID-19 pandemic, which forced many countries to declare a lockdown.
But in the midst of this, Access Bank managed to grow its earnings by almost 15 per cent, precisely by 14.7 per cent to N764.7 billion from N666.8 billion recorded a year earlier.
A brief analysis of the results by Business Post indicated that the financial institution recorded a decline in its interest income to N425.7 billion from N453.6 billion.
Also, the interest expense went down to N226.3 billion from N259.6 billion, leaving the net interest income lower at N263.0 billion as against the previous year’s N277.2 billion.
With a net impairment charge of N62.9 billion versus N20.2 billion in FY 2019, the net interest income after impairment charges dropped to N200.1 billion from N257.0 billion.
However, in the year under review, fee and commission income increased to N116.7 billion from N91.9 billion as a result of the significant rise in the revenue generated from its electronic banking channels (N56.1 billion versus N36.0 billion in 2019).
There was also a spike in credit-related fees and commissions (N32.5 billion versus N26.6 billion). The bank generated N15.1 billion from account maintenance charges and handling commission, higher than N14.0 billion raked from the means a year earlier.
In the year, Access Bank said it reduced its personnel expenses to N73.2 billion from N77.0 billion in 2019 and this was from the wage cut announced by Mr Wigwe last, which almost put the bank in trouble after a video he had with members of staff on this issue went viral.
Last, the lender said its wages and salaries gulped N69.0 billion in contrast to N73.2 billion used for the same purpose in 2019.
Despite some of its employees working from home as a result of the government’s directives on the restriction of movement in 2020 due to COVID-19, the other operating expenses of Access Bank rose to N215.8 billion from N151.1 billion.
The bank explained that it was because of the rise in premises and equipment costs (N15.6 billion versus N13.4 billion in 2019), AMCON surcharge of N35.4 billion in contrast to the previous year’s N22.7 billion, administrative costs of N15.5 billion as against N11.4 billion in 2019, communication expenses of N7.5 billion versus N3.3 billion in 2019, IT and e-business costs of N18.7 billion compared with N9.8 billion a year earlier, outsourcing costs of N25.1 billion versus N16.7 billion in 2019, advertisement and marketing expenses of N11.3 billion in contrast to N6.3 billion recorded a year earlier, security costs of N7.9 billion as against N4.3 billion in 2019 and stationeries, postage and printing expenses of N5.9 billion versus N1.9 billion the preceding year.
These expenses and others left Access Bank with a profit before tax of N125.9 billion in 2020 as against N111.9 billion in 2019, while the profit after tax closed at N106.0 billion versus N94.1 billion a year earlier.
In the period under consideration, the earnings per share (EPS) of Access Bank rose to N3.01 from N2.79, while the total assets increased to N8.7 trillion from N7.1 trillion, with the total liabilities jumping to N7.9 trillion from N6.5 trillion. A part of the liabilities had N5.6 trillion as customer deposits, higher than N4.2 trillion in 2019.
