Wema Bank Plc has demonstrated a remarkable financial upswing in its audited financial statements for the year ended December 31, 2024. The bank's gross earnings soared to N433.43 billion, driven by robust interest income and strategic asset expansion. This performance underscores Wema Bank's ability to capitalize on favorable market conditions and effectively manage its financial resources.

One of the most significant highlights of the report is the impressive 141% surge in profit before tax (PBT), reaching a record-breaking N102.5 billion. This milestone reflects the bank's success in leveraging rising interest rates and strengthening its loan and investment portfolio. The Board of Directors has proposed a dividend payment of N1.00 per share for the 2024 financial year, signaling confidence in the bank's sustained profitability and commitment to shareholder returns.

Wema Bank's revenue streams were primarily fueled by strategic lending and investments in government securities. The bank's income from loans grew by an impressive 91% to N233.85 billion, constituting approximately 66% of its total interest income. This increase is attributed to a substantial expansion in the bank's loan portfolio, with gross loans reaching N1.237 trillion, of which N1.125 trillion were long-term loans. Concurrently, income from government investments, including bonds and treasury bills, rose by 98% to N113.68 billion, contributing about 32% of the total interest income. These figures highlight Wema Bank's adeptness in optimizing its asset allocation to maximize returns while maintaining a balanced risk profile.

In response to the Central Bank of Nigeria's (CBN) policies aimed at curbing inflation, Wema Bank strategically increased its lending activities and investments in government securities. The bank held N712 billion in Federal Government Bonds and N111.11 billion in Treasury Bills, which are considered safer investments compared to loans. To further strengthen its capital base and meet regulatory requirements, Wema Bank initiated a N40 billion rights issue, boosting its share capital and premium. Looking ahead, the bank plans to raise N200 billion in fresh capital, as approved by shareholders at the last Annual General Meeting. This capital raise will be executed through a N150 billion Rights Issue and a N50 billion Special Placement, reinforcing the bank's financial stability and capacity for future growth.

Despite its strong financial performance, Wema Bank faces challenges related to potential loan losses. The bank has set aside N36 billion as a provision for expected credit losses (ECL), with a significant portion (N27.33 billion) allocated to Stage 3 loans, which are loans already in serious trouble. After accounting for this provision, the net loans on the bank’s books stand at N1.201 trillion. This cautious approach reflects the bank's commitment to prudent risk management and maintaining a healthy balance sheet.

Like other Nigerian banks, Wema Bank experienced increased funding costs due to the prevailing high-interest rate environment. Interest expenses on bank deposits surged by 732.9%, reflecting the higher cost of funds. Borrowing costs also increased by 139.9%, putting pressure on net interest margins. Total interest paid on customer deposits reached N103.4 billion, underscoring the impact of monetary tightening on the bank's operations. Despite these challenges, Wema Bank's diversified revenue streams and digital banking innovations have helped mitigate the impact of rising funding costs.

Wema Bank's non-interest revenue witnessed substantial growth, driven by its digital banking innovations and diversified service offerings. Net fees and commission income rose to N55.576 billion, fueled by FX transactions (N15.039 billion), electronic products (N14.073 billion), management fees (N8.023 billion), and account maintenance fees (N7.364 billion). The success of Wema Bank's digital platforms, such as ALAT Xplore (Nigeria’s first mobile banking app for teenagers) and Coop Hub (a platform for cooperative societies), has played a pivotal role in driving this growth. ALAT Xplore has attracted younger users, boosting account openings, card transactions, and e-banking fees, while Coop Hub has facilitated digital financial management for cooperative societies, increasing fund transfers and transaction-based revenue.

The bank’s total assets grew to N3.593 trillion, with customer deposits making up a significant portion. Shareholders’ funds increased to N256.421 billion, driven by retained earnings of N103.251 billion, share capital of N10.715 billion, and share premium of N56.431 billion. These figures demonstrate Wema Bank's financial strength and its ability to generate value for its shareholders.

In summary, Wema Bank’s strong performance in 2024 reflects its strategic focus on leveraging market opportunities, expanding its digital footprint, and maintaining prudent risk management practices. The bank’s commitment to innovation and customer-centric solutions positions it well for continued success in the dynamic Nigerian banking landscape. As of early 2025, Wema Bank’s share price stood at N10.7, marking an 18.8% increase, reflecting investor confidence in the bank’s future prospects.