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10 Banks Earn N22 Billion On Account Maintenance Charges (See Names)

10 Banks Earn N22 Billion On Account Maintenance

A computation of Banks’ earnings from account maintenance charges, for 10 out of the 14 listed banks on the Nigerian Stock Exchange (NSE) amounts to N22 billion compared to N19.1 billion in Q1: 2019 The current year has seen a surge of N2.9 billion amounting to an increase of 13.2 percent year on year despite the coronavirus pandemic.

Account maintenance fee may be low when compared to other revenue streams, still make up a significant portion of their non-interest income.

According to the latest directive by the Central Bank of Nigeria on bank charges, Nigerian banks are allowed to charge their customers a “negotiable” N1 per mile.

What this means is that banks can charge N1 per N1000 debit transactions on current accounts. Banks’ account maintenance charges come in the form of COT (i.e., Commission on Turnover), which is a charge levied on customer withdrawals by their banks and are mainly applicable to current accounts.

A further breakdown of the earning revealed that Nigeria’s tier-1 banks, which comprises of First Bank, UBA, GTBank, Access Bank, and Zenith Bank generated a total of N18.4 billion from bank maintenance charges in Q1 2020.

The sum is 17.12percent more than N15.6 billion that was generated by the five banks during the comparable period in 2019.

The other five banks namely FCMB, Stanbic IBTC, Wema, Sterling and Union bank merely earned N3.6bn from account maintenance fee.

A further breakdown of the fees revealed that Zenith Bank generated the most income from account maintenance fees, which amounts to N5.7bn, followed by Access Bank N3.9bn and then, GTBank N3.3bn.

Other are: First Bank Plc: N3.1 billion, United Bank for Africa Plc: N2.3 billion, Stanbic IBTC N1bn, FCMB N911 million, Fidelity bank N735 million, Union Bank N406 million, Sterling bank N394 million and Wema bank N270 million.

The earning for Ecobank and Unity could not be ascertained as Unity Bank has not released it Q1; 2020 report, while that of Ecobank was not clear to our report from the financial statement According to Joseph Enenche, a banker who shed more light on the charge: “Account maintenance fee is calculated on the total amount of debit transaction or withdrawals on your account at a given interval.

“What this implies is that your account should not be charged AMC if there are no withdrawal either electronically via instant transfer, online or physical withdrawal with your cheque in the banking hall.

“If you continue to build your account balance without making withdrawals, your account will not be charged AMC.”

Written by jerry

This is my short profile ... iBlog, iDesign, iPromote And iEntertain. For Promotions and Advertisement, Contact me on WhatsApp:- +2349020857410

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