How 13 banks rake N96.7bn from accounts maintenance in 2017

No fewer than 13 commercial banks operating in the country have realised a whopping N96.7 billion from maintaining customers’ accounts in 2017, against N84 billion raked in the previous year from charges on customers with, current and term deposit.

This translates into a 14.8 per cent increase the 13 banks recorded in maintaining customers’ accounts in 2017.

The banks by category include the following Tier-1 banks, FBN Holdings, Access Bank, Zenith Bank Plc, United Bank for Africa Plc (UBA), Guaranty Trust Bank Plc (GTBank) and Ecobank Transnational International.

Among the Tier-2 banks are Diamond Bank Plc, Union Bank for Nigeria, Sterling Bank Plc, FCMB group Plc, Stanbic IBTC Holdings Plc and Fidelity Bank Plc.

But while some banks were reporting significant increase in account fees, others were reporting decline in accounting maintenance charges in the year under review, following revision in charges and eligible transactions.

Of the Tiwer-1 commercial banks, The Daily Times can report that Access Bank, by percentage leads others while FBN Holdings reported decline in customers account maintenance fee in 2017.

Specifically, Access Bank reported N6.45 billion account maintenance charge and handling commission in 2017, an increase of about 147 per cent from N2.6 billion in 2016 while FBN Holdings reported 57 per cent drop in account maintenance fees to N6.69 billion from N15.63 billion reported in 2016.

FBN Holdings in a statement said, “The improvement in Fee & Commission was partly offset by a 57.2per cent y-o-y decline in account maintenance fees following revision in charges and eligible transactions.”

For the 2017 financial year, Zenith Bank reported an increase of 59.5 per cent in account maintenance fee moving up to N27.7 billion from N17.37 billion reported in 2016.

GTBank’s account maintenance charges closed 2017 at N9.4 billion, an increase of 11.4 per cent from N8.4 billion in 2016 while UBA reported 29 per cent increase in account maintenance fees to N5.4 billion from N4.2 billion in prior year.

In addition, ETI’s card & account management fees hit N24.47 billion in 2017 representing 35.2 per cent increase over N18.1 billion in 2016.

From the Tier-2 category of banks, only Stanbic IBTC Holdings and Sterling bank reported drop while other increase growth in account maintenance fees.

Stanbic IBTC reported 49.3 per cent drop in Account transaction fees to N3.6 billion from N7.1 billion while Sterling Bank reported N1.441 billion from N1.45 billion reported in 2016, a decline of about 0.62 per cent.

But Fidelity Bank reported 49.8 per cent increase in account maintenance fees to N2.6 billion from N1.7 billion reported in 2016.

Consequently, FCMB’s Account Maintenance fee grew by 28.7 per cent to N3.5 billion from N2.7 billion while that of Union Bank increased to N1.43 billion from N1.21 billion.

Finally, Diamond Bank’s reported N3.98 billion from maintaining customers account in 2017, an increase of about 9.3 per cent from N3.6 billion reported in 2016.

Financial market analysts said management of some of the banks lacked ideas on how to find alternative sources to generate revenue.
They also stated that commercial bank are engaging in exorbitant charges on customers as Central Bank of Nigeria (CBN) failed to sanctioned banks.
The CBN had indirectly reintroduced Commission on Turnover (CoT) fee as Current Account Maintenance (CAM) fee.

The apex bank in its last’s year circular to all banks, other financial institutions and Mobile payments operators, stated that CAM fee is negotiable subject to a maximum of N1 per mille.

The circular signed by Director, Financial policy & regulation department, Mr. Kevin Amugo, stated that, “Current Account Maintenance Fee – applicable to current accounts ONLY in respect of customer-induced debit transactions to third parties and debit transfers/lodgments to the customer’s account in another bank. Note that CAMF is not applicable to Savings Accounts.”

He had said the new guide line will enhance transparency and reduce ambiguity in loan transactions.

He stated that the new guild line was expanded to incorporate the concerns of both operators and users of financial services in the country.

The circular signed by him stated that, “the guide to bank charges issued in 2013 sought to reflect developments in the financial market, provide clarity on banking terms, and reduce ambiguity in loan transactions.

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Dailytimes Staff

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