Costs surged across the board for Access Bank, one of Nigeria’s largest Bank by assets in the Half Year (H1) period to June 2020, compared to a year ago following the tier-one lenders merger with second tier Diamond Bank.
Access Bank had touted synergy gains as one of the merits of that merger but recently released H1 2020 results showing flat profits amid other operating expenses that surged to N120 billion, shows that dream may be evaporating.
Combined personnel and other operating expenses jumped 40 percent to N156.92 billion from N111.82 billion in the 2019 period.
Among operating expenses AMCON surcharge increased 56 percent to N35.4 billion, as total assets increased following the merger with Diamond Bank.
The AMCON charge is equivalent to 0.5 percent of total assets. Access Banks total assets increased by 8.6 percent to N7.76 trillion in June 2020 from N7.14 trillion in December 2019.
Administrative expenses surged 100 percent to N7.73 billion from N3.86 billion, IT and e-business expenses increased by 91 percent to N12.09 billion as Access struggled to integrate former Diamond Bank customers into its on banking network.
Outsourcing costs surged 86 percent to N11.39 billion in 2020 from N6.11billion in 2019.
Access Bank recorded profit after tax of N61.03 billion in June 2020, down marginally from N61.8 billion in the 2019 period. A 25k interim dividend is proposed by the bank for the period.