Beyond its core lending activities, Wema Bank’s non-interest income rose significantly, driven by digital banking innovations and diversified financial services. Net fees and commission income reached N55.576 billion.
Lagos, Nigeria – Wema Bank Plc has posted its strongest financial results in five years, with both gross earnings and profit reaching new heights in 2024.
According to the bank’s audited financial statements for the year ending December 31, 2024, gross earnings surged to N433.43 billion, fueled by increased interest income and strategic asset growth. Profit before tax also saw an impressive 141% jump to N102.5 billion, reflecting the bank’s ability to capitalize on favorable interest rates and an expanded loan and investment portfolio.
Dividend Proposal
Following the robust financial performance, the Board of Directors has proposed a dividend of N1.00 per share for the 2024 fiscal year, rewarding shareholders for the bank’s impressive gains.
Loans and Investments Drive Revenue Growth
Wema Bank’s revenue boost in 2024 was largely attributed to its aggressive lending strategy and investments in government securities.
- The bank earned N233.85 billion from loans, marking a 91% increase compared to the previous year. Loans contributed approximately 66% of total interest income.
- Income from government securities, including bonds and treasury bills, climbed 98% to N113.68 billion, accounting for 32% of total interest income.
By leveraging higher interest rates, Wema Bank increased lending activities while expanding its holdings in safer government-backed assets.
- The bank’s total loan portfolio (gross loans) reached N1.237 trillion, with N1.125 trillion allocated to long-term loans.
- Investment holdings included N712 billion in Federal Government Bonds and N111.11 billion in Treasury Bills.
Despite its strong financial performance, the bank maintained provisions for potential credit losses:
- A total of N36 billion was set aside to cover expected credit losses (ECL).
- Stage 3 loans—those already experiencing repayment difficulties—accounted for N27.33 billion of the provision.
- After accounting for these adjustments, net loans stood at N1.201 trillion.
Managing Rising Costs Amid High-Interest Rates
Like other Nigerian banks, Wema Bank faced increased funding costs due to prevailing high-interest rates:
- Interest expenses on customer deposits surged by 732.9%, significantly raising the cost of funds.
- Borrowing costs increased by 139.9%, affecting net interest margins.
- Total interest paid on customer deposits amounted to N103.4 billion, reflecting the impact of monetary tightening measures.
Despite these challenges, the bank’s strong net interest income helped offset cost pressures.
Non-Interest Revenue Sees Significant Growth
Beyond its core lending activities, Wema Bank’s non-interest income rose significantly, driven by digital banking innovations and diversified financial services. Net fees and commission income reached N55.576 billion, supported by:
- Foreign exchange transactions (N15.039 billion)
- Electronic banking services (N14.073 billion)
- Management fees (N8.023 billion)
- Account maintenance fees (N7.364 billion)
The bank’s digital products, including ALAT Xplore (a mobile banking app for teenagers) and Coop Hub (a platform for cooperative societies), contributed to this growth.
- ALAT Xplore attracted younger customers, boosting e-banking transactions and card usage.
- Coop Hub enhanced digital financial management for cooperative societies, increasing transaction-based revenue.
Strengthening Capital Base for Future Growth
Wema Bank’s total assets expanded to N3.593 trillion, with customer deposits playing a crucial role. Shareholders’ equity increased to N256.421 billion, supported by:
- Retained earnings of N103.251 billion
- Share capital of N10.715 billion
- Share premium of N56.431 billion
To enhance its capital structure and comply with regulatory requirements, the bank launched a N40 billion rights issue. Additionally, the Chairman, in the 2024 Annual Report, reaffirmed plans to raise N200 billion in fresh capital.
“To meet the new CBN capital requirements, the bank will be raising N200 billion in new capital as approved by the shareholders at the last Annual General Meeting. This will be broken down into N150 billion Rights Issue and N50 billion in Special Placement,” the Chairman stated.
Wema Bank’s stock closed at N10.7, reflecting an 18.8% increase in 2025, underscoring investor confidence in the bank’s growth trajectory.
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