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Wednesday, June 7, 2023

Access Holdings Fined N604mn by CBN for Violating FX Guidelines, BOFIA Act

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Access Holdings a tier-one Nigerian lender has been fined by its Regulator the Central Bank of Nigeria (CBN) for contraventions of the Banks and Other Financial Institutions (BOFIA) Act of Nigeria and CBN circulars during the 2022 financial year.

Access Holdings banking subsidiary was fined as listed below: sum of N2m in respect of breach of accounts administration agreement 11 Mar 2022. A sum of N2m in respect of wrong account opening with mismatched details 11 Jul 2022, a sum of N100 million being penalty for contravening guidelines on FX on 8 Dec 2022, and a sum of N500 million being penalty for contravening guidelines on FX on 8 Dec 2022.

Access, which is the largest lender by total assets in Africa’s largest economy, booked an impairment charge of N197.79 billion in December 2022, which represents a 137.69 percent surge compared to N83.21 billion as at December 2021.

A breakdown of loan loss expense shows the bank took an impairment of N103.10 billion in recognition of the economic loss impact of Ghana sovereign debt crisis (Domestic debt and Eurobonds).

The heavy loan loss expense weighed on the bottom line as profit after tax reduced by 5 percent to N152.20 billion as at December even as it realised N281.30 billion in net gains on financial assets at fair value.

Of course, the management and board of directors of Access Bank are not efficient in generating income and growth from its equity financing as the return on average equity (ROAE) fell to 13.34 percent in December 2022 from 17.79 percent the previous year.

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