Banks have not adopted a uniform exchange rate in reporting foreign currency assets in their financial statements, a Fitch Ratings report has said.
The banks’ action falls below the International Financial Reporting Standards (IFRS) which the lenders are expected to comply with. Many of the Tier-1 banks have released their 2017 full year results.
The IFRS guidelines state that companies operating in countries with multiple exchange rates should translate their foreign currency assets and liabilities into local currency based on the exchange rates at which they expect to settle them. But the guidelines leave room for considerable judgment and flexibility, and Nigeria operates with multiple exchange rates, which adds to the confusion.
The global rating agency said the need for uniform exchange rate reporting becomes exigent as exchange-rate risk warrants scrutiny for banks as about 40 per cent of assets and liabilities in Nigeria’s banking sector are denominated in dollars and not all banks operate with matched foreign currency positions.
Confirming the asset reporting gaps, Exotic Capital said foreign exchange measures implemented by the authorities appear to have worked. “We think we may see more lenders adjust the exchange rate used in reporting results. Such adjustments could impact capital and other metrics, but we think the banks are in a better position to deal with these adjustments now than some were before,” it said.
The research firm, said banks’ management teams appear as focused on changes in required provisions against specific exposures to the power sector and to companies, such as 9 Mobile, for instance, as they are on the overall impact of IFRS 9 implementation.
“Lenders expect regulatory risk reserves to help offset the impact of the transition to IFRS 9, at least in part. Provisions against loans to the power sector and against 9 Mobile exposures may rise at some banks. Having said this, most banks believe the worst is behind us and asset quality metrics may improve as the year progresses,” it said.
Continuing, Fitch said banks’ move to a more market-based presentation of dollar-currency assets, liabilities and profit-and-loss items is likely to come into focus as the lenders begin to publish their 2017 results.
Fitch said financial statements with foreign currency items translated more in line with market exchange rates will give a more realistic representation of banks’ foreign currency positions and capital at risk from potential further depreciation of the naira.
“Our discussions with banks that we rate suggest that most will publish their 2017 financial statements based on the Nigerian Foreign Exchange Fixing (NiFEX) rate (about NGN330/$) instead of the official exchange rate of NGN305/$, which they previously used. Some may use a blended rate. The NiFEX rate is the Central Bank of Nigeria’s (CBN’s) reference rate for spot foreign-exchange transactions, widely used on the interbank market,” it said.
Tier one bank, Fidelity Bank PLC, has been named “Nigeria’s Best Private Bank” at the prestigious Euromoney Awards 2025. The recognition was formally unveiled at the awards ceremony held recently at The Savoy in London. 
Access Holdings PLC (“the Group”) (Bloomberg: ACCESSCO), a leading African financial services group, today, announced its audited financial results for the full year ended December 31, 2024. The Group delivered 88% year-on-year growth in gross earnings, rising from N2.594 trillion in 2023 to N4.878 trillion in 2024. The strong performance was driven by diversified income streams, with interest income growing by 110% to N3.480 trillion and non-interest income increasing by 47.8% to N1.397 trillion, supported by robust retail banking activities, digital expansion, and a dynamic trading strategy.Profit before tax (PBT) increased by 19% to N867.0 billion, while profit after tax (PAT) rose to N642.2 billion, despite inflationary and macroeconomic challenges. Total assets grew by 55.5% to N41.498 trillion, and customer deposits rose by 47% to N22.525 trillion. Shareholders’ funds also increased by 72%, reaching N3.760 trillion.In 2024, the Group made significant social and environmental impact across the continent, touching millions of lives and earning multiple industry accolades. Through various corporate social investment initiatives in education, entrepreneurship, health, and the environment, the Group reached over 21 million individuals across Africa. Its employee wellness programmes also covered 28,000 staff across operating entities. Access Bank, the flagship subsidiary, through its W-Initiative, disbursed loans to over a million women-led SMEs, advancing financial inclusion and gender empowerment.The Group’s efforts attracted prestigious recognition and awards, including three Euromoney Awards for Excellence (notably ‘Best Bank for ESG’); International Finance Award for ‘Most Innovative Bank for Community Development and Community Engagement’; and World Economic Magazine Award for ‘Most Sustainable Bank’.In terms of economic sustainability, Access Bank recorded strong strides through its Economic, Social and Governance (ESG) programmes. It facilitated $437.42 million in DFI inflows to support MSMEs across Africa, disbursed 1.6 million digital loans to low-income individuals, and booked its first N1.4 billion diaspora mortgage loan.The Group also achieved a 13.4% reduction in operational emissions, planted 57,302 trees, and enabled solar power adoption for 226 homes and businesses. Its headquarters was awarded the IFC EDGE (Excellence in Design for Greater Efficiencies) Green Building Certification for sustainable design and construction
L-R: Chairman, Access Holdings Plc, Aigboje Aig-Imoukhuede, CFR; His Eminence John Cardinal Onaiyekan; President of Dangote Group, Alhaji Aliko Dangote, GCON; Founder and Chairman of Zenith Bank Plc, Jim Ovia, CFR; Governor of Lagos State, Mr. Babajide Sanwo-Olu; and Governor of Delta State, Rt.Hon. (Elder) Sherrif Oborevwori, during the admission of Jim Ovia to the Freedom of the City of London in the United Kingdom, on Monday.
