Ten commercial banks in Nigeria paid a combined N987.40bn in corporate income tax to the Federal Government in the 2024 financial year, The PUNCH reports.
This sum was disclosed in the banks’ consolidated and separate financial statements for the year ended December 31, 2024, on the Nigeria Exchange Limited.
An analysis of the financial statements of Access Holdings, United Bank for Africa, First HoldCo Plc, Sterling Financial Holdings, Wema Bank, Zenith Bank, Guaranty Trust Holding Company, Stanbic IBTC, Fidelity Bank, and FCMB revealed this collective tax remittance.
According to The Federal Inland Revenue Service Company Income Tax, also known as Corporate Tax, is a tax levied on the profits made by companies operating in Nigeria.
UBA paid N241.12bn in corporate income tax for the year, which is a 6.07 per cent increase from N227.30bn in 2023.
Zenith Bank remitted N201.62bn in taxes for the year, reflecting a sharp 468.16 per cent increase from N35.47bn in 2023.
Access Holdings made a tax payment of N159.26bn in 2024, a significant 109.51 per cent increase from the N76.01bn paid in 2023.
First HoldCo paid N58.66bn in taxes, marking a 108.89 per cent increase from N28.17bn in 2023.
Sterling Financial Holdings contributed N2.48bn in income taxes in 2024, up 118.45 per cent from N1.13bn in 2023
Wema Bank paid N13.27bn in corporate taxes, reflecting a substantial 638.73 per cent increase from N1.80bn in 2023.
GTCO paid N175.03bn in corporate tax, a 205.48 per cent increase from N57.29bn in 2023.
Stanbic IBTC paid N35.19bn in taxes in 2024, up 106.56 per cent from N17.03bn in 2023.
Fidelity Bank contributed N82.42bn in taxes, a remarkable 306.99 per cent increase from N20.30bn in 2023.
FCMB paid N18.36bn in corporate taxes, reflecting a 101.92 per cent increase from N9.12bn in 2023.
When contacted the Chief Economist and Managing Editor of Proshare, Teslim Shitta-Bey, explained the underlying dynamics shaping the financial performance of banks.
“The increase in profit is a direct result of the high interest rate environment,” he said. “Banks are earning more from treasury instruments and retail lending. The Federal Government’s aggressive borrowing through the treasury bills market has pushed up yields, allowing banks to benefit from higher returns on investment.”
Shitta-Bey noted that while these gains have strengthened bank balance sheets, they have also resulted in a redirection of funds.
“The money that could have been channelled towards dividend payouts or risk assets is now largely tied up in government securities. It reflects a tougher business environment where credit to the private sector is being deprioritised in favour of safer, higher-yielding government debt.”
He added that while banks are thriving, the wider economy faces a mixed outlook as government borrowing crowds out private investment.
The PUNCH reported that receipts into the federation account grew by 7.48 per cent to N6.86 trillion in the third quarter of 2024. Last year, The PUNCH reported that Seven banks paid N392.53bn as tax in the first half of 2024, according to an analysis of their second-quarter financial reports for the period ended June 30 filed with the Nigeria Exchange.
