Nigeria’s Most Profitable Bank Lost NGN 1.03 Bn To Fraud In H1 2019 And It May Have Been An Inside Job… Mostly!

One of the powerhouses of Nigeria’s banking sector, Zenith Bank, just released its financial statement for the first half of 2019 and even as the bank remains the country’s most profitable bank, there are some other data that is threatening to steal the spotlight.

The Nigerian tier-1 bank may have scored points at the business end of things but it also recorded significant losses to fraud and forgeries. As can be deducted from the financial statement, the bank lost as much as NGN 1.03 Bn to fraud and forgeries in the first half of 2019, as against a relatively paltry NGN 2.98 Mn recorded over the same period in the previous year; it’s an incredible 900 percent spike of the wrong kind!

And interestingly, further analysis of the data points to company staff as the perpetrators of most of the fraud, accounting for 97 percent of the bank’s total financial loss to fraud and forgeries for the said period. Also, internet banking fraud and impersonation led to losses of NGN 30.6 Mn and NGN 2.8 Mn respectively during the period under review.

In the previous year, Zenith Bank endured a 400 percent increase in losses to fraud and forgeries despite turning in impressive profits to the tune of NGN 193 Mn. The generally impressive financial report for the year 2018 was somewhat blighted by an NGN 429 Mn loss to such dishonest dealings. That figure has now more than doubled in the first half of 2019. 

In general, absent the losses to fraudulent activity, Zenith Bank did quite well in the first half of 2019, recording an increase of 8.7 percent in profit-after-tax which now sits at NGN 88.9 Bn, as against NGN 81.7 Bn during the same period from the previous year. And it’s pretty much the same story of positive growth for other key financial metrics.

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