With only 13 percent of N4.9trn revenue made converted to profit after tax in its 2024 financial year , poor valuation and low shareholders yield ,Access Bank , the biggest in Nigeria with N41trn assets , is a paradox of plenty that continues to worry shareholders

In the banking industry, size and resources are seen as key drivers of success. Large banks leverage their strong reputations, technological advancements, and deep pockets to attract top talent, command market share, and maintain extensive distribution networks. This size advantage also enables them to invest in training, capitalize on emerging opportunities, employ significant numbers of people , gain greater profitability and ultimately deliver superior returns for their shareholders

Access Bank is a typical example of an organization with the above potentials. An analysis of Access Bank’s 2024 financial performance reaffirms the above view; with the biggest assets; this bank controlled the biggest deposit , customer base as well as loans and advances .

But to Access Bank Holdings , the situation is to the contrary when it comes to leveraging those potentials to outperform the smaller entities . Despite being the largest bank in Nigeria with substantial financial assets , it continues to under-perform its peers with smaller asset bases where it matters most . With only 13 percent of N4.9trn revenue made converted to profit after tax in its 2024 financial year , poor valuation and low shareholders yield Access Bank , the biggest in Nigeria with N41trn asset , it is a paradox of plenty that continues to worry shareholders .This is generally worrisome..This paradox highlights a crucial lesson: having more resources doesn’t necessarily translate to better performance. The real differentiator lies in the ability to leverage resources effectively, not just to accumulate them. 

What is really the problem with Access Bank? A look back at its journey to the tier 1 banks’ club, which began in 2002 when Aig-Imoukhuede and Herbert Wigwe acquired stakes in Access Bank, reveals an impressive trajectory. To an analyst, their mission was clear: to propel the bank from 80th out of 90 to one of Nigeria’s top ten banks within five years.

BankTotal Assets (Trn)Gross Earnings (Trn)Profit After Tax (B)
Access BankN41N4.9N642b
GTBN14.8N2.15N1.01trn (N1,010b)
Zenith BankN30N3.97N1.03trn (N1,030b)

Access Bank and Its Power of Financial Assets

Indeed , they achieved this with relative ease within just few years. More than two decades later, Access Bank has grown into Access Holdings (Accesscorp), a holding company that spans banking, asset management, insurance, and fintech catapulting it into first position as Nigeria’s largest bank by total assets.  Access Holdings has since blown past competing with Nigerian banks and has now set its sights on the continent. This time, they want to be among the top 5 banks in Africa (the bank was not clear by what measure).  

To its leaders ,that mission has been largely achieved, and most often they boast of it . In his facts behind the figure’s presentation for its planned N350 billion rights issue held at the NGX not too long ago , the bank’s managing director and chief executive Roosevelt Ogbonna boisterously retriated this belief. To him , the bank is not only the largest lender in the country by total assets, loans and advances, and deposits, but is also the ‘fastest growing bank’ on the continent. In fact , he said the bank was first in many other aspects.

Ogbonna , no doubt stated the obvious ,if the standard for measuring success or industry leadership is only resources and not resourcefulness . After all , some companies judge their capacity for growth more by the strength of their balance sheet.

As of the 2024 financial year, Access Bank’s total assets stood at N41.50 trillion, funded by a combination of sources including N3.76 trillion in total equity, N9.31 trillion in deposits from financial institutions, and N22.53 trillion in customer deposits, along with other funding sources. This significant resource base underscores the bank’s substantial financial capacity when compared with few top banks in that industry.

The above humongous volume of assets, indeed, placed Access Bank above other tier 1 banks with a big gap between it and other players . Zenith Bank another tier 1 had a Total Assets were N29.958 trillion while Guaranty Trust Bank had a Total Assets stood at. N14.796 trillion within the same financial year . This indicates the combined assets of both GTCO and zenith are just slightly above those of Access bank.

The disparity in the asset bases of those two banks relative to Access Bank was created by the wide gap in their customer deposits and shareholders funds , the two key sources of the funding assets by banks . At the end of the 2024 financial year, Access Holdings’ customer deposits totaled approximately ₦32 trillion. Relative to Access Bank deposits, at the end of the 2024 financial year, Zenith Bank’s customer deposits totaled N22 trillion. For  GTCO’s , its total deposit as of June 2024 stood at N10.55 trillion.

Zenith Bank’s shareholders’ fund: stood at N4.029 trillion while GTCO shareholders’ fund was N2.712 trillion . Access Bank could be said to be at a vantage point relative to both Zenith and GTCO , at least in terms deposit volume , controlling the same total deposit of the two ;though slightly below Zenith regarding its shareholders equity .

The size or market share advantage gained by Access Bank could also be traced to its debt position. Access Holdings is the most leveraged financial institution in Nigeria . Thus, while it has expanded rapidly in assets, most of its acquisitions have been funded by debt, which will come at a cost to shareholder return. Most of the debt has funded the bank’s expansion and investment strategy over the years, providing it with ample economies of scale to compete not just as a local bank but as a pan-African behemoth

Access Bank Plc has been actively engaged in acquisition exercises, primarily focused on expanding its footprint and diversifying its operations in Africa. Recent notable acquisitions include the acquisition of Standard Chartered Bank’s subsidiaries in Angola and Sierra Leone, and the acquisition of Bidvest Bank in South Africa. These acquisitions aim to strengthen Access Bank’s position as a leading financial institution in the African market.

Failing In What Shareholders Particularly Value

But the above view by Ogbonna is far from the truth ; he is merely living in a fool’s paradise . Despite being the largest bank in Nigeria with substantial financial assets , his bank continues to under-perform its peers with smaller asset bases where it matters most . This is simply because it lacks the capability to deploy its asset advantage over its rivals and generate the expected competencies that could enable it to gain competitive advantages that deliver commensurate profitability.

The starting point for understanding the strategic capability of an organization is an understanding of what the stakeholders value . Understanding what they value shows that stakeholders in any market segment will have the threshold requirements on all features of the product or service rendered ; if one or more of these are not met, a provider will drop out of that of the market . But stakeholders are likely to value some features above others, and this will vary by market segment. Some stakeholders may be particularly interested in profit , others in reliability, and yet others in delivery time , and so on.

Measuring performance and leadership in banking is not limited asset size , and profitability itself is beyond the absolute figures above . Banking is coterminous with risk management. Although the number of services a modern commercial bank offers has increased immensely ,risk taking ,which is fundamental nature of banking remains unchanged .It inherent in the maturity transformation which is another fundamental feature of banking.

In managing risks ,a bank has to satisfy five main constituencies. One is the surplus units from which it borrows .These units demand the best possible term in rates of interest , maturity structures and the maximum liquidity to enable them to have the funds back when they want them , or as agreed ; the second constituency is the deficit units which borrow from the banks . They want to borrow when they need the funds and as cheaply as  possible .Like the lenders ,the borrowers also impose the obligation of maximum on the banks to enable them to obtain funds when they need them . In addition to satisfying the surplus and the deficit sectors ,the shareholders must also be satisfied .These require maximum or adequate returns on their investments in order to remain invested in the bank and to be willing to continue to provide additional resources and when needed .

To this is added the fourth  constituency , the regulatory authorities ,whose interest is to ensure that a bank  does not undertake excessive risks and that it operates prudently and within stipulated regulatory requirements .There is , finally the community at large. As the provider of the environment within which it operates . the bank owes an obligation to the community to be a good corporate citizen, capable of maximizing the exploitation of the opportunities available and minimizing the threats in the environment .

Access Bank and Its Ugly Profit Engine

No doubt ,Access Bank has satisfied virtually all the above constituencies ,particularly the deficit and the surplus units,deploying the biggest loans and controlling the biggest share of the industry deposits. Even , with its vast resources,it has performed impressively in satisfying the communities where it is operating. However, the same thing could not be said when it comes to satisfying its shareholders and the regulatory authorities where players with smaller assets have rubbished its asset leadership. Unfortunately for Access Holdings, satisfying the shareholders and regulatory authorities are the most critical success factors in banking.

Realities on ground in the last few years should have confirmed to Access Bank that performance is more about resourcefulness and not resources perse . Access Holdings Plc in its 2024 full-year , reported a pre-tax profit of N867. 019 billion, up from N729. 001 billion a year earlier ; it also reported a profit after tax of N642.22 billion for the 2024 financial year. This represents a 3.7% increase compared to the N619.32 billion recorded in the previous year. To the ignorant observers ,this is a wonderful achievement. No , that is not true, particularly when compared with banks with smaller assets like GTCO or Zenith Bank.

Access Bank profit is nothing but miserable relative the what GTCO with extremely smaller assets, customer deposit , loans and advances and gross earnings recorded during the period . At the year 2024, Guaranty Trust Holding Company Plc (GTCO) reported a profit before tax of ₦1.266 trillion and a profit after tax of ₦1.018 trillion. This represents a significant increase from the previous year’s profit before tax of ₦609.3 billion and profit after tax of ₦539.7 billion at the end of the 2023 financial year. Zenith Bank’s profit before tax was N1.33 trillion and its profit after tax was N1.03 trillion also confirmed Access Bank poor performance ,

Ironically, Access Bank saw a significant increase in gross earnings, rising to N4.878 trillion from N2.594 trillion in the previous year. the 2024 financial year . The closest earnings to Access Bank’s is Zenith Bank’s. Zenith Bank’s which surged by 86% to N3.97 trillion . Guaranty Trust Holding Company Plc (GTCO) gross earnings of N2.15 trillion at the end of 2024 more than ever exposed Access Bank as a weakling.

Something is ,indeed , wrong with Access Bank’s profit engine, the combination of a company’s served market definition, value proposition, margin and value-added structure, asset and skill configuration, and supporting administrative systems.

Maintaining a competitive profit engine is a significant challenge. Any change to the business environment can threaten the engine’s efficiency, and companies must be constantly on the lookout for potential threats. These threats can come from various sources, such as competitors redefining the boundaries of the served market, introducing new value propositions, or discovering more efficient ways to deliver products or services. For instance, a competitor may redefine the served market by targeting a previously underserved segment, or introduce a new value proposition that resonates with customers.

Truly ,. Access Bank is profitable . However , shareholders look beyond being merely profitable . If it has to outperform competition, it has to meet the critical success factors , not only operating at threshold level . In meeting the critical criteria , what is sure is that the shareholders do not value those features at any cost ; cost is also an important feature for them ,and therefore an organization must be competent in managing cost. Otherwise it will not be able to meet their expectations and generate sufficient profits that meet their request for the value for money. This is the key riddle , the leadership of Access Holdings has not resolved.

The Red Flag Hunts Access Bank’s Leadership Ambition

The difference between Access Bank’s leadership and its closest rivals is lack of resourcefulness, we repeat .And this is crystal clear when some profit ratios that measure a company’s ability to generate profit relative to revenue, assets, or equity are examined  These ratios help assess how efficiently a company is using its resources to produce income and value for shareholders. Essentially, they reveal how well a business turns its costs and investments into profits. 

When Access Bank is judged by some of these ratios , it is clear that the huge value created at the top line was wasted at the bottom line for this singular fact . Some of these ratios that include its cost to income ratio , earning per share ,net profit margins, interest expense to to interest income ratio , loan loss impairment charges , returns on equity and assets are all the red flags that show its bigness is merely a signal of obesity .In fact, Access Bank’s bigness without stretch and leverage is just obesity just smallness without stretch and leverage is impotence.

Net Profit Margin

In 2024, Access Bank (part of Access Holdings) had a net profit margin of 13.2%  This was achieved on gross earnings of N4.88 trillion and a net income of N642.2 billion. While Access Holdings is Nigeria’s largest publicly listed company by assets, its profit margin was miserably lower compared to its peers. For GTCO, its Net Profit Margin stood at 47.4 % compared to Access Bank’s 13% , indicating while GTCO is converting every N100 made as revenue to N48 as its profit after tax, Access is converting the same to N13, spending N87 to get N13 from every N100 made as its revenue . Is that not miserable? .

Return on Equity and Assets

Guaranty Trust Bank’s Return on Average Equity (ROAE) stands at 48.9%, more than double Access Holdings’ 21.6%. This significant gap suggests Guaranty Trust Bank is generating stronger returns on shareholders’ equity. Additionally, Guaranty Trust Bank’s Return on Average Assets (ROAA) is 18.0%, substantially higher than Access Holdings’ 1.9%. This indicates Guaranty Trust Bank is better at converting its assets into profits.

Earnings Per Share

EPS .In terms of Earnings Per Share (EPS), Guaranty Trust Bank’s N35.44 surpasses Access Holdings’ N16.71. This disparity highlights Guaranty Trust Bank’s ability to generate robust profits and reward shareholders.Earnings per share (EPS) is a key financial metric that indicates a company’s profitability for each outstanding share of its common stock. A higher EPS generally suggests a more profitable company, potentially leading to a higher stock price.

Poor Valuation: The Price of Its Weak Profitability

Either by omission or commission,Ogbonna failed to state the most painful issue that the bank has performed miserably where it matters most to shareholders: market valuation, the ultimate measure of performance for any quoted company.

Proponents of aggressive growth often suggest the tradeoff for lower profits lies in a brighter future, which is why they often have high valuation multiples. However, this is not the case for Access Corporation. It has continued to deliver profits every year, but then its valuation has remained subdued in most parameters, especially when compared to its peers.

The bank’s valuation has raised concerns among investors and analysts. With a significant disparity between its market capitalization and financial performance compared to peers, Access Holdings appears to be undervalued, sparking questions about the factors contributing to this discrepancy and the potential implications for investors

Its poor valuation may not spring any surprise when its fundamentals are juxtaposed with those of its peers ; moreover , virtually all the critical valuation metrics used to determine a company’s worth indicating its stock is undervalued.

Access Holdings also ranks last when it comes to the price-to-earnings (P/E) multiple, which indicates a low valuation the closer the number is to one or below one. Access Corp currently trades at just 1.43x, compared to its peers like zenith who trades at multiples of 1.93x and GTCO trading higher at 1.89x

 .A comparison of Zenith Bank, GTCO, and Access Bank based on Price-to-Book (P/B) ratio, indicates that GTCO is the least undervalued, followed by Zenith Bank, with Access Bank being the most undervalued based on this metric .The current price-to-book (P/B) ratio for Access Holdings PLC (ACCESSCORP) is approximately 0.3x. This indicates that the market is valuing the company’s shares at significantly less than the book. The current price-to-book (P/B) ratio for Zenith Bank is around 1.00. This suggests that the market price of Zenith Bank shares is roughly equal to its book value per share. GTCO (Guaranty Trust Holding Co. PLC) price-to-book ratio is currently around 0.74. This indicates that the market is valuing GTCO’s shares at less than its book value but greater compared to Access Bank’s . While Access Holdings has expanded its assets and footprint across Africa, these achievements have not translated into higher market valuation.  

Another plausible reason why the bank is likely undervalued could be its low shareholder yield, which indicates whether a company is returning enough value to its shareholders.It is the combination of cash dividends paid, share buybacks, and debt repayments as a ratio of a company’s market valuation. While Access Bank ranks high in terms of dividend yield, it ranks low in terms of shareholder yield largely because of its large debt accumulation.

 Access Bank is equally lagging far behind its peers in dividend payouts. Access Bank averages a paltry 23% in average (5 years) dividend payout ratio , one of the least when compared to its tier-one peers. The bank knows this well and tried to address it in its facts behind the presentation of the figures where Roosevelt claimed other banks that “pay big dividends have zero positive NPV projects,” alluding that its inability to compete in the area of dividends is because it has been investing in projects of the future that will deliver dividends. 

The negative impacts of its poor metrics glaringly indicated on its lower stock price and consequently on its market capitalization. The current share price of Access Holdings Plc (ACCESSCORP) is NGN 24.05. ACCESSCORP closed its last trading day (Tuesday, April 29, 2025) at 24.05 NGN per share on the Nigerian Stock Exchange (NGX), recording a 1.5% gain over its previous closing price of 23.70 NGN. Access began the year with a share price of 23.85 NGN and has since gained 0.84% on that price valuation, ranking it 73rd on the NGX in terms of year-to-date performance.

The current share price of Guaranty Trust Holding (GTCO) is NGN 67.80. GTCO closed its last trading day (Tuesday, April 29, 2025) at 67.80 NGN per share on the Nigerian Stock Exchange (NGX), recording a 1.2% gain over its previous closing price of 67.00 NGN. Guaranty Trust Holding began the year with a share price of 57.00 NGN and has since gained 19% on that price valuation, ranking it 42nd on the NGX in terms of year-to-date performance.

Access Holdings is currently valued at N1.2trn the least valued of the top-tier banks in Nigeria. Its main rivals, Zenith Bank and GTCO are currently valued at N1.5 trillion and N1.9trn respectively..Unsurprisingly, Access Holdings is nowhere near the top 20 financial institutions in Africa in terms of market capitalization. Achieving that status requires more than aggressive acquisitions and balance sheet expansion; it demands a clear strategy for enhancing shareholder value. 

HOW ACCESS BANK LOST THE BATTLE YO THE SMALLER BANKS

The wide gap between them is just a function of their fundamentals .The key driving its failure is its inability to convert or translate its revenue to profit effectively . This disparity begs the question: is bigger really better? A closer look at the Access Bank’s numbers reveals a corporate giant struggling to translate its size in assets and earnings into proportional profitability, earning it the moniker: “A Corporate Giant with Dull Brain”.”

As indicated above, from its customer deposits , shareholders funds and other liability position , Access Bank , indeed , was at a vantage position to fund its assets more heavily than its rivals and consequently to generate bigger profit .

With the above assets at each of the above players disposal , they went to the market to generate profit for their stakeholders in 2024 .Without any doubt, Access Bank is better placed to outperform its rivals going by its capability to deploy bigger assets to the core banking businesses relative to its competitors where the biggest revenues are usually cornered .

In the 2024 financial year, it deployed N11.3trn as its investment securities and N11.5 trn as loans and advances while its Cash and balances stood at N5.2trn

For Zenith Bank, approximately N10trn went to Loans and advances ; investment securities received N5, 09 trn while Cash and balances with central banks got N5.9trn and Treasury bills N2.7trn .In the case of GTCO, Loans and advances to customers received N2.8trn and its investment securities got N2.5trn

The reason for the priority given to the core banking may not be far to seek . The importance of loan portfolio derives from the functions lending performs for banks is ,no doubt ,very critical for the survival and success of each player .  Loan is the highest earning asset in the balance sheet ; it contributes materially to the achievement and fulfillment of the objectives  of profitability by providing higher return  than other financial assets ; it helps the bank management to satisfy the legal and regulatory objectives of the monetary authorities ;‘it is a key element in the creation and maintenance of depositor relationships ,particularly with the business firms ; it is a vehicle through which management attempts to satisfy the credit needs  of the community or the credit markets the bank serves or intends to serve

However , the degree of success achieved by each player is not only a function of the amount allocated to that sector alone but more of how each could lend safely and profitably.

Sequel to this , every player aspires to ensure the above is achieved ,ensuring that all the technical training is heavily geared towards lending . In fact, when it is said that one is a good or an astute banker ,what is meant is that one is a shrewd lender . –one who lends money safely and profitably..This is where the battle is mostly won and lost .

Unfortunately, this is one of the critical areas where Access Bank loses the battle to its rivals despite its humongous asset base relative to the others in the industry. At the end of the 2024 financial year its rivals proved once again that a big head with dull brain cannot win a profitability battle. They did not overtake it, they swallowed it by doubling it profitably as indicated earlier .

The race is not about market share but competencies

The above paradox highlights a crucial lesson: having more resources doesn’t necessarily translate to better performance. The real differentiator lies in the ability to leverage resources effectively, not just accumulate them. In the fast-paced world of banking, Access bank appeared to have misconstrued the race to competition as a scramble for immediate market share. Its founders’ ambition seemed to be taking the bank to the number one position in terms of total assets. This means the focus would always be more on inorganic growth, requiring that it acquire just about any financial institution that fits its growth plans .

The above thinking is not unusual as some companies judge their capacity for growth more by the strength of their balance sheet than by the strength of their development efforts . For Access Bank , mergers and acquisitions are all common methods for achieving growth than the principal alternative of ‘organic’ development,  or  the pursuit of a strategy relying on a company’s own resources . The bank embarked on upon these to achieve that goal . In other words ,no doubt , Access Bank unusually relied on big, bold acquisitions for corporate regeneration.

However , as potentially useful as they may be, acquisitions are not good substitutes for industry foresight. Analysts believed acquisition could an albatross as well. To them , those corporate leaders that adopt it as a growth strategy , often see a major acquisition as the only escape route from a business that has become hopelessly mature.

It may be difficult to fault that view . It’s not news to anyone that few acquisitions actually benefit the shareholders of the acquiring company, yet acquisitions are, in many cases, an easy out for senior executives too intellectually lazy to think through the future of the firm’s “core” business and too unimaginative to discover new ways of deploying existing capabilities. In some companies acquisitions help managers cover  up their anemic growth .in the core business. .Dozens of academic studies have shown that acquisitions destroy shareholder wealth more often than they create it .

The above perspective overlooks a crucial aspect: true success lies in building competencies that drive superior performance. To get to the future first, top management must either see opportunities not seen by other top teams or must be able to exploit opportunities, by virtue of preemptive and consistent capability-building, that other companies can’t ; banks must excel in key skills in all income-generating areas.In the competitive banking landscape, building competencies is essential for superior performance.

When a bank excels in generating incomes from the core banking , fees and commissions, and trading , the three core income streams , it can outperform rivals and achieve long-term success. But to do that , rather than focusing solely on market share, banks should prioritize developing expertise in those areas to drive sustainable growth and profitability. By doing so, they will be well-equipped to navigate the complexities of the banking industry and emerge as true leaders.

Don’t get it wrong , there is no crime in adopting acquisition as a strategic choice to grow a bank provided it is backed commensurate and relevant skills capable of enabling it to outperform competition . A look into the banking income mix and the performance of Access Bank relative to its competitors is the only way to ascertain its capability

ITS INCOME MIX TELL THE STORY BETTER .

CORE BANKING .

Bank management becomes coterminous with risk management ; it is no more than managing risks—the risk of mismatches between assets and liabilities and between borrowing and lending rates. In the period under review , interest income, which is money the bank earns from loans and other investments, remained the main source of Access Bank earnings, making up 71% of the group’s gross earnings for the year. That is a 12% increase from 2023, showing that the bank stayed focused on its core business. A closer look at where this interest income came from shows: About 51% came from loans it gave to customers and other banks. 47% came from investments in securities (like government and corporate bonds). The rest, just under 2%, came from cash balances, which, although small, grew by almost 1,000% during the year.

However , whether a player will win a profitability battle is usually exposed by how savvy every player’s is in effectively generating the Net Interest Income (NII), a critical component of a bank’s revenue stream, generated from lending activities and interest-bearing assets. The key challenge is that NII is sensitive to both credit risk and market risk, particularly interest-rate risk

Access Bank won the interest rate battle but at an excessively high cost that rubbished the bottom line . While the bank made more money from lending, it also spent more to attract and keep deposits.Most of its interest expenses, over 88%, were from paying interest on customer deposits and from other financial institutions. In fact, deposits from customers rose by N12 trillion (61%) to reach nearly N32 trillion. This helped the bank grow its balance sheet but also meant it had to pay more interest to depositors.

In the period under review, Access Bank grew its net interest income by 84% to N1.26 trillion, which is impressive and shows that it earned more from loans and investments than it paid out in deposit interest. However, Access Bank only won both the battles for interest rate and credit risks , it was at a great cost against the bottom line. At the end of the day, Access spent 63.5% of its interest income just to cover interest expenses as against 21percent of GTCO . The bank also had to set aside a bigger amount for loan losses, about N245 billion, up from N140 billion the previous year, set aside as impairment charges mostly for loans to customers that might not be repaid and for investments that had lost value within the same period.

Fee income

Fee income, earned through service provision, offers a more stable revenue stream. Unlike trading income or NII, fee income is less volatile and not susceptible to market risk. Moreover, fees are often paid upfront, eliminating credit risk. By offering a range of services, banks can build a diversified customer base and reduce dependence on volatile income sources.

Access Bank also earned money from other sources, such as fees on services .But in 2024, these made up a smaller portion of gross earnings compared to 2023: Fees and commission income contributed 10.5% of gross earnings. Even though these were lower as a percentage of gross earnings, the actual figures still grew. For example:The bank earned N162 billion in credit-related fees, more than 60% higher than in 2023.It also earned N59.8 billion from account maintenance fees, up by 87%.

Trading

Trading income, generated through financial products like equities, bonds, and derivatives, is the most volatile income source for banks. While it offers potential for high returns, trading income carries significant market risk and credit risk. To manage this risk, many banks employ the value-at-risk (VaR) methodology, which provides a statistical measure of expected losses under specific market scenarios. Access Bank’s gains from foreign exchange and financial instruments was less impressive as income from here backtracked . Fair value and FX gains contributed 8.5%.Fair value and foreign exchange gain/(loss) hit 415,804 in 2023 down from 628,931 in 2023 /Other operating income hit 459,131 against , 33,074 with N326187 from asset disposal alone .

Cost to Income

In 2024, Access Holdings’ cost-to-income ratio (CIR) was 58.3%, an increase from 46.9% in 2023. This ratio measures operating expenses as a percentage of gross earnings. While the CIR increased, Access Holdings still delivered strong financial results, with a 88% year-on-year growth in gross earnings, rising from N2.594 trillion in 2023 to N4.878 trillion in 2024. In its 2024 full-year results, Guaranty Trust Holding Company Plc (GTCO) reported a cost-to-income ratio of 24.1%. This figure indicates that for every N100 of income generated, the bank incurred N24.1

LEADERSHIP IS THE ISSUE

  The inability of Access Bank to justify its asset and earning leadership by translating them to profitability leadership exposes the quality of leaders . People are at the heart of strategy .The knowledge and experience of people can be the key factors enabling the success of strategies .But they can also hinder the adoption of new strategies too .Human resources may hinder strategy if they are not tailored to the types of strategies being pursued . Where strategies are built around high rates of innovation in products or services bureaucratic recruitment procedures may deter entry of creative individuals.

 One lesson its leaders must learn from both Zenith Bank and GTCO is that possession of resources does not guarantee strategic success. This is because strategic capability is essentially concerned with how these resources are deployed, managed ,controlled and in the case of people motivated to create competencies in those activities and business processes needed to run the business. The concept of core competencies goes beyond mere accumulation of resources, Access leadership must earch for those few activities that underpin competitive advantage or demonstrate excellence.

Whether a company adopts organic or inorganic strategy to grow its assets , the battle for an industry leadership is usually won or lost in a three stage overlapping battles.

Where and How Industry Leadership is Won

The first stage of competition is about gaining industry foresight and intellectual leadership, where companies compete to be prescient about the size and shape of tomorrow’s opportunities.

This stage involves conceiving fundamentally new types of customer benefits or radically new ways of delivering existing customer benefits. It’s about imagining the future and developing a deep understanding of the trends and discontinuities that could be used to transform industry boundaries and create new competitive space. Companies that excel in this stage are able to think outside the box and envision new possibilities that others may overlook.

The second stage of competition is about shaping the emergence of the future industry structure to one’s own advantage. This involves accumulating necessary competencies, testing and proving out alternate product and service concepts, attracting coalition partners, and constructing the necessary infrastructure. It’s a critical stage where companies must actively shape the direction of industry development and influence the path forward. By doing so, companies can position themselves for success and create opportunities for growth.

The final stage of competition is about market position and market share, where competition shifts to a battle for dominance within well-defined parameters of value, cost, price, and service. Innovation is focused on product line extensions, efficiency improvement, and marginal gains in product or service differentiation. While this stage is critical for short-term success, companies that focus solely on market share and neglect the earlier stages of competition may find themselves struggling to stay ahead of the curve.

  

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