Deposit Money Banks are at the moment putting finishing touches to their full year financial reports.When the banks release the Financial Year (FY) 2014 results, they will be reporting Basel II/III-compliant ratios for the first time.Investors are repositioning to take advantage of these results to make good investment decisions on banking sector equities. Yet, falling oil prices are testing investors' and managers' business and investment acumen.analysts are unanimous that there is no better time than this to take a glance at the banks.Gone are the days when investors invest, and depositors put money in the bank and go home to sleep, trusting on the ability of fund managers and bankers to secure the money and investment. Today, though the Central Bank of Nigeria under the past governor, Sanusi Lamido Sanusi ensured that no depositor lost a kobo during the banking crisis, people now put their ear to the ground and sleep with one eye open.Though stakeholders are convinced that one good thing today is that customers can work into any Nigerian bank and expect world class services, complete with the beaming faces of smiling and extremely courteous staff, they also warn that 'You have to know what is happening to your bank and your money.'That said, the banks are currently engaged in fierce competition to out- perform one another. This is also good for the banking customers because a lot of services can now be rendered at competitive charges. In fact, the competition is getting stiffer now that a lot of factors have been added. Falling oil prices have put credit departments on their toes concerning oil and gas as well as dollar denominated loans; there is sharp decrease in share values; poor customer services, network failure, poor management, and poor facilities in general are still traceable to many banks.As investors look at computer screens daily, tracking stock information in the face of falling oil prices, Nigerian Tribune carried out a check on the current state of DMBs ahead of their annual report release dates.Access Bank PlcAccess Bank Plc is getting bigger by the day after it acquired Intercontinental Bank.Though the Bank's shares has fallen from N9.88 as at August 5,2014 to N5.09 as of January 22,2015, it is interesting to note that for the quarter three(Q3) nine months through September 2014, Access Bank's profit after tax surged by 28 percent to N35.34 billion from N27.59 billion the same period of the corresponding year Q3 2013. Its Q3 result showed total assets grew to N2.074 trillion, from N1.835 trillion in the corresponding period of 2013, indicating an increase of 13 percent. The bank's liabilities stand at N1.8billion with total customers' deposit at N1.5billion from over 5.7 million customers.In the face of rising cost of money and falling oil prices, the bank's maximum lending rate by sector is as follows: agriculture 25 per cent, Manufacturing 25 per cent, Oil and gas 25 per cent. 28 per cent of Access Bank's total loan portfolio went to the oil sector. This means that if it must restructure oil and gas loans, its only 28 per cent of total loans that can be restructured.In order to fund operation, bolster reserves and boost common stock, Access Bank is seeking to raise N68 billion ($420m), though the deal has not been finalised.First Bank of NigeriaFirst Bank is one of the banks in the country with most branches nationwide which is a plus to them.In their recent report, titled, 'Recalibrating Market Sentiment: Macro and market resilience,' analysts at an investment banking and research company, Afrinvest West Africa Limited disclosed that First Bank/FBN Holdings' 131.7 per cent ratio of oil sector loans versus shareholders' funds is a source of worry because 'Looking back, the 2008 banking crisis can be linked to the sharp decline in oil prices, resulting in the sudden accumulation of huge toxic assets, which wiped out banks' capital.'Between January 21 and 22, 2015, FBN's shares declined by 0.13 per cent from N7.50 to N7.49.FBN Holdings Plc has earned N55.6 billion as profit after tax by September 30, 2014, a marginal decrease of about 6per cent from N59.1 billion compared to the same time in 2013. Total assets grew by 8.3 percent to N4.2 trillion, customer deposits hardly changed at N2.9 trillion while loans and advances to customers went up 14.6 per cent to N2.0 trillion. However, this bank is the most improved old generation bank in Nigeria even though there are still customer complains around performance of its Automated Teller Machine network.Stanbic IBTC BankThis Bank is a member of Standard Bank Group, and one of the best banks in Nigeria judging by customers' comments and general ratings elsewhere. Stanbic IBTC is one of the few banks in Nigeria that really operate on international standards. Its share price opened at N29.92 and closed at N29.01 declining 3.04 percent on October 29,2014. Though it has lost another N3.01, it remains high at N26 as at January 22,2015.Stanbic IBTC's ratio of oil sector loans versus shareholders' funds stood at 56.9 per cent as at financial year 2013. This is a source of concern to the credit committee of the bank as oil prices plunge.Profit after tax also increased 57.3 percent to N25.3 billion from N16 billion reported in the same period of 2013.Stanbic IBTC said it raised N15 billion in Tier II capital at the end of the third quarter to increase its capital base to 19.7 percent, above the regulatory requirement of 10 percent.Zenith BankZenith Bank Plc is among 8 biggest banks in Nigeria. It recorded 5.6 per cent increase in Profit after Tax (PAT) to N71.1 billion in the nine months period ended September 30, 2014, from N67.3 billion in the same period of 2013.Its total Liabilities and Equity advanced to N3.4 trillion from the N2.9 trillion recorded in the prior year. Total Shareholders' Equity leaped to N523.9 billion from N482.5 billion. As at 2013 financial year, Zenith Bank recorded oil loans versus total loan portfolio ratio of 28.3 per cent; a ratio of oil sector loans versus shareholders' funds of 38.4 per cent. Its share price has lost N8.18 from N25 as at August 5,2014 to N16.82 as at January 22,2015.Zenith Bank was among six commercial banks that paid N392.77 million in fines to the Central Bank of Nigeria (CBN) in 2013 for contravening various aspects of Banks and Other Financial Institutions Act (BOFIA). A breakdown of the figures contained in the individual banks' 2013 Annual Report indicated that Zenith Bank paid the highest fine of N276 million for various contraventions. The bank was fined for promoting top management staff without CBN approval, insufficient data for lodgment on credit report and non-rendition of original certificate of capital importation. Shareholders are watching to see a financial year that if penalties free.Union BankThis is one of the most reliable banks in those days in terms of keeping depositors' money safe. Union bank is among the oldest banks in Nigeria and is still going strong. In 2014 the Bank's Managing Director came in from Citi Bank to transform Union Bank of Nigeria. Group Managing Director and Chief Executive Officer, Mr. Emeka Emuwa, has hired a transformation director to institutionalise and lead the bank's transformation management office which coordinates, centralises and tracks transformation work groups to ensure transformation achievements are embedded and delivered.The bank's shares today,are trading at N9.00 as of January 22,2015. The ratio of oil sector loans versus shareholders' funds at 31.8 per cent is considerably high in the face of falling oil prices, at this moment of transformation.Its unaudited results for the nine months ended 30th September 2014 showed the Bank's Profit after Tax decreased to N11.8 billion from N12.4 billion in Q3 2013. In December 2013, Union Bank's total Assets was N882.1billion but as at Q3 2014, it increased to N888.3 billion. The Bank's total shareholders' equity increased by N7.6 billion to N195.4 billion from N187.8 billion in December 2013. Total customer Deposits stood at N490.7 billion as at Q3 2013.Guaranty Trust Bank (GTB)GTBank is among 8 banks designated by the Central Bank of Nigeria as Significantly Important Banks (SIBs).However, the Bank's shares which sold at N29.15 as at August 5, 2014 now sell at N20.58 as at January 22, 2015.Its ratio of oil sector loans versus shareholders' funds of the banks for the financial year 2013 stood at 87.2 per cent which is a huge source of concern to stakeholders as oil prices plunge.Its 2014 third quarter (Q3) profit after tax (PAT) dropped 3.6 percent to N66.7 billion from N69.2 billion in the same period of 2013. The bank has one of the best online banking systems among Nigerian banks.Diamond BankDiamond bank is a bank that stands out in terms of quality banking and service delivery. However,its share price at N6.40 as at August 5,2014 has declined to N4.10 as at January 22, 2015.The bank's realised profit after tax of N20.2 billion in Q3, 2014 reflected a marginal increase as against the N20.1 billion reported in the third quarter of 2013.Diamond Bank ratio of oil sector loans versus shareholders' funds stood at 128.8 per cent for the financial year 2013, leading to serious worry among stakeholders in the face of oil prices plunge.As the bank prepare to roll out its 2014 full year result, its shareholders would not want a repeat of various infractions experienced in 2013. A breakdown of Diamond Bank's infractions showed that the bank paid N2 million fine for the delay in refunding a customer's 827,223 dollars as directed by the CBN. It was fined N4 million for promoting two senior management personnel without the approval of the CBN. The bank was also ordered to pay N1.99 million for withholding a customer's funds for 26 days after the promoters of the customer had written the bank that they were no longer interested in a facility.Mainstreet BankMainstreet Bank is one of the three banks taken over by the Assets Management Corporation of Nigeria (AMCON) in 2010 due to its inability to meet the new capital requirement of the Central Bank of Nigeria (CBN).The bank's last published financial results showed growth in all key financial indices. Gross earnings grew to a new high of N49.6 billion in 2013 . This bank is nothing different from the Afribank they took over. Its shares has not been trading on the NSE. Today,it has been bought over by Skye Bank Nigeria plc . Though the bid price had remained a secret, Nigerian Tribune investigations reveal that the disclosed deal price was a whopping N120 billion ($741mn), which was 4 per cent larger than Skye Bank's half year 2014 (1H14) equity base. Before conclusion of the deal, Board of Directors of Mainstreet Bank Limited agreed and paid Assets Management Corporation of Nigeria (AMCON) the sum of N6.25 billion as dividend accrued to the corporation from the 2013 financial year.The bank also announced a profit before tax (PBT) of N13.2 billion in its group financial performance for the year ended December 31, 2013.Sterling BankSterling Bank acquired Equatorial Trust Bank during the banks' consolidation era of 2005/2006. The bank's shares at the stock market recorded marginal improvement of N0.26kobo from N2.21as at August 5, 2014 to N2.47 on January 22, 2015.Looking at the ratio of oil sector loans versus shareholders' funds of the bank, Sterling Bank, according to industry analysts, recorded 157.1 per cent. This means that Sterling's exposure to the oil and gas sector is 1.5 times its shareholders' fund. Crisis in the oil and gas space according to analysts could negatively affect its profit for the year and shareholders' fund.Sterling Bank's unaudited results for the nine Months to September 2014 showed that profit after tax stood at N7.063 as against N5.074 billion of 2013. With a little over 1 million customers, Sterling Bank's total Deposits as at September stood at N678.98 billion but increased to N680 billion by November 2014. Its Net Assets stood at N781.677 as at Q3 2014 as against N644.339 in 2013.United Bank for Africa (UBA)UBA is one of the biggest banks in Africa.As the stock market take a hit from decline in global oil prices, the share price of United Bank for Africa declined by N3.82 from N7.48 as at August 5, 2014 to N3.66 on January 22, 2015.UBA's Q3 2014 results show that PAT declined by 56 per cent year on year mainly due to a significant loss on the other comprehensive income line as well as a higher tax rate. The Bank declared a profit before tax of N42.54billion and a profit after tax of N33.6billion for the nine months under consideration. UBA recently announced that it plans to raise an undisclosed amount of tier 1 capital by way of a rights issue. According to the bank, the rights issue will be on the basis of one new ordinary share for every 10 shares held.The Central Bank of Nigeria (CBN) in 2013 penalised UBA for contravening various aspects of Banks and Other Financial Institutions Act (BOFIA). Thus UBA was fined N43.70 million for opening a branch without prior approval of CBN, improper reclassification of public sector deposits and appointment of staff without CBN approval, among others.First City Monument BankFirst City Monument Bank is doing very well in the industry, always upgrading services and introducing new products. However, a source of concern has been the bank's 65.1 per cent ratio of oil sector loans to shareholders' funds due to falling oil prices. Also, shareholders would be expecting a 2014 result without penalties as opposed to N6.1 million which the group paid as fine for delayed disbursement for 20 days, to the beneficiary under Commercial Agriculture Credit Scheme, among others. FCMB Group's (FCMB) Q3 2014 results showed that Profit before Tax (PBT) and Profit After Tax (PAT) grew by strong double digits year on year, 39 per cent and 36 per cent respectively to N5.6 billion and N4.6 billion.Fidelity Bank NigeriaFidelity's ratio of oil sector loans versus shareholders' funds stands at 45.5 per cent as at Financial Year 2013. This remains a source of concern as oil prices plunge. Its share price has declined from N2.01as at August 5,2014 to N1.34 on January 22,2015. Its Profit after tax (PAT) went up slightly 1.7 percent to N11.247 billion for the Q3 2014 from N11.064 billion recorded in the same period of 2013.This bank is one silent giant bank in Nigeria and most social media experts say adding 'plc' in its domain name make it difficult to locate the bank online.Ecobank NigeriaThe bank acquired Oceanic Bank known for good product, good services, good online banking.The Bank's share price is not spared as it received a hit from falling oil prices, declining from N16.94 as at August 5,2014 to N14.90 as at January 22, 2015.For the first nine months through September 2014, Ecobank's profit after tax (PAT) surged by 31 percent to N52.49billion from N39.96billion in the same period of the corresponding year.Deposit from customers also spiked by 8.69 percent to N2.75trillion in Q3 2014 from N2.53trillion as at Q3 2013. Total assets were up by 10.69 percent to N3.83trillion in Q3 2014 compared with N3.46trillion the preceding year.Keystone Bank LimitedFormerly Bank PHB, Keystone Bank is one of the nationalised banks which the owner, Assets Management Corporation of Nigeria (AMCON) proposes to sell after the February elections.Skye Bank PlcSkye Bank is among eight banks recognised by the Central Bank of Nigeria as being significantly important, which required them to hold more liquid assets . Its shares were not left out of the effect of oil price shock. It has lost 0.97kobo from N3.11 as at August 5, 2014 to N2.14 on January 22, 2015. Skye Bank was fined N6 million for failure to obtain CBN's approval to promote a senior staff and under reporting of regulatory returns on public sector deposits. It was also fined for failure to update documentation on a customer's account.The Bank's post tax profit dropped 15.3 per cent to N9.866 billion in the nine months period of 2014 from N11.650 billion reported in 2013. It recently acquired Mainstreet Bank Limited and has commenced the process of integration.Unity Bank PlcUnity Bank has continued to improve on its profitability level from a negative Profit and Loss (P&L) witnessed in the industry. With share price at 0.50kobo its financial performance for the third quarter (Q3) ended September 30, 2014 showed total Assets depreciated to N407.8billion fromN439.9 achieved in the erstwhile year.Profit after tax (PAT) for the period climbed by 825 per cent to N11.1 billion from N1.2 billion in the corresponding period of 2013. Its exposure to the oil and gas industry is minimal but a few industry experts wonder why the bank is concentrating on building micro branches in-place of standard bigger branches like other banks.Enterprise Bank LimitedEnterprise Bank Limited was formerly Spring Bank. Not trading at the NSE, the Bank as at 2012, had Pre-tax profit of N11.3 billion while the worth of total assets stood at N261.1 billion. This bank has been bought by Heritage Bank Limited at the cost of N56billion. The two banks have began integration that will lead to a bigger and stronger bank in 2015.Heritage Bank LimitedHeritage Bank commenced operations as a regional bank with a capital base of N10billion. The bank is rapidly transforming into a big bank in Nigeria. It was appointed as a Lagos State revenue collection bank, meaning that though the bank is new, it is already doing great businesses. The bank acquired Enterprise Bank by October 2014.Standard Chartered BankStandard Chartered Bank's operating profit from Africa declined 27 per cent year-on-year to $209 million in the first six months of last year. The bank has offices in 16 countries in the region. Though not listed in the Nigeria Stock Exchange, the British company's stock has fallen 7.8 per cent since the start of the year.According to the Financial Times of London, as of January 14, 2015, the consensus forecast amongst 55 polled investment analysts covering Standard Chartered suggests that investors should hold their position in the company. Standard Chartered early this month announced it would close almost all of its equity businesses, which are sub-scale and loss making, cutting 200 jobs and saving $100 million a year.Wema BankWema Bank is one of the most improved banks in Nigeria in recent time. Analysts believe Wema is a regional bank doing very well. Its customer deposits as at September 2014 rose by 8 per cent to N234.5 billion from N217.7 billion at the end of 2013, while its total assets were up by 6 per cent to N351.4 billion from N330.9billion in the same period of 2013. Its capital adequacy ratio was 23.2 per cent; earnings per share, 7 kobo; and return on equity, 7.9 per cent.CitibankThis is another international bank with office in Nigeria. Citibank has retail banking operations in more than 160 countries and territories around the world. More than half of its 1,400 offices are in the United States. Like Standard Chartered Bank, it is an international bank doing investment banking in Nigeria with few outlets.
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