The Central Bank of Nigeria (CBN) made a profit after tax of N123.8 billion in the year ended December 2022.
This is contained in the audited accounts of the bank released and posted on its website.
The profit declared shows an increase from the N75.1 billion reported for 2021.
Audited results for 2016, 2017, 2018, 2019, 2020, and 2021 were also published by the apex bank.
Audited results of the apex bank have been shrouded in secrecy for the entire tenure of the suspended and embattled CBN governor, Godwin Emefiele.
The posted results which were signed by Emefiele and audited by EY and KPMG indicate that the CBN posted profit after tax every year for the last 8 years.
The latest result shows the apex bank has relied on a combination of higher interest income, fees, and commissions to remain profitable.
The results further showed that the apex bank earned a net interest income of N1.8 trillion compared to N1 trillion in 2021, representing an 80 per cent increase in net interest income.
Net operating income was N1.2 trillion compared to N1.1 trillion for the same period in 2021 while total operating expenses also rose from N1.1 trillion in 2021 compared to N1.2 trillion in 2022.
A major source of interest income was from loans and advances in the form of overdrafts given to the federal government.
The loans totaling N23 trillion and also known as “Ways and Means” generated interest of N1.9 trillion for the apex bank compared to N1.2 trillion in the previous year.
According to the audited accounts of the apex bank, the Ways and Means provision is priced at a whopping MPR+3%.
“Included in interest income on Loans and receivables is interest income on Overdraft facility granted to the Federal Government amounting to N1.9 trillion (2021: N1.2 trillion). The interest rate applied on this facility is MPR+3%.”
The apex bank’s results also show it earned an additional N247 billion and N156 billion from AMCON and via FGN Securities respectively.
The CBN also reported another N422.7 billion in income from “debt instruments measured at fair value through profit and loss (FVTL). FVTL is a way companies account for certain investments they own. Instead of noting the investment’s original cost, the company regularly updates the investment’s value to reflect its current market price.
This method ensures that the financial statements reflect the most up-to-date value of the investment.
The CBN also made N104.5 billion income from commissions from the sale of foreign currency and other related transactions while another N15.9 billion was earned from processing currency, Bureau de Change application and registration, commission on fund transfers, and other banks and financial institutions’ application and licensing fees.
A key feature of the expenses made by the CBN within the review period was N888.3 billion incurred by the apex bank as “other operating expenses” during the year.
The figure was N884.2 billion in 2021, showing an increase.
A breakdown of the amount reveals closer to half of the expenses (N346.2 billion) were losses arising from foreign exchange revaluation losses.
Also included is another N155.5 billion incurred as “rebate expenses” which the apex bank explained was connected to RT 200 and Naira4Dollar, a policy under CBN led Emefiele to attract forex inflows.
The Bank stated it incurred N137 billion in 2022 on the RT200 scheme and in 2021 Naira 4 Dollar expense was N4 billion. This policy has since been dropped since the unification of the naira was announced.
Another major expense item reported by the CBN and included in the “other operating expense” was N125 billion (N45 billion in 2021) which it incurred in connection to national security, the federal government, and security agencies. While the expenses are actually an extension of loans to the federal government, it is expensed on the FG repays the loans
intervention activities expenses represents expenses carried out by CBN in connection with national security, federal government, state securities, armed forces, financial sector capacity building where there is important need for the fund. All payments made in relation to intervention activities embarked on by the Group are expensed as incurred. However, payments made by the Group in relation to intervention activities on behalf of the Federal Government are recognized as receivables and are fully impaired after 12 months if the amount is not received from the Federal Government.
The apex bank also reported N875.2 billion in credit losses almost double the N498.2 billion reported a year earlier.
Its balance sheet shows a total loan of about N31.4 trillion.
The apex bank’s balance sheet expanded by about N22 trillion from N35.5 trillion in 2018 to about N57.9 trillion in 2022.