Wema Bank, a tier-2 Nigerian lender with ₦2.5 trillion ($1.6 billion) in consumer deposits, has reported a 95% reduction in fraud losses for 2024, falling to ₦29 million, a stark contrast from ₦685 million in 2023. This positive development, as seen in its recently released financial statement, marks a turnaround for the bank, which has faced fraud-related challenges.
The bank has yet to respond to requests for comments on any part of the story.
Wema Bank’s impressive fraud report demonstrates its willingness to strengthen its monitoring process. Last year, the bank promised to hire more people in its digital compliance department to reduce the number of fraud cases.
Despite these fraud concerns, Wema Bank delivered robust financial results for 2024, more than doubling its profits to ₦86 billion from ₦35 billion in 2023. This surge was partially attributed to a ₦14 billion foreign exchange revaluation gain. In March 2024, the CBN barred banks from paying FX currency gains as dividends or drawing on them for operational expenses.
Key takeaways
- Gross earnings were up 91% to ₦432 billion from ₦225 billion in 2023
- Net interest income was up 93% to ₦177 billion from ₦91 billion in 2023
- Account maintenance fees grew 86% to ₦7 billion from ₦3.9 billion in 2023
- FX transactions grew 263% to ₦15 billion from ₦4 billion in 2023
Additionally, the bank saw significant growth in the loan portfolio it offered to customers. The value of those loans rose by 49% for the full year 2024 to ₦ 1.2 trillion, up from the ₦801 billion disbursed in 2023.
The bank also grew its digital income to ₦881 million and brought in a whopping ₦14 billion in fees on electronic products.
Big ambitions
In 2024, Wema Bank migrated its contact center infrastructure to the Cloud, which enabled the lender to implement several AI-based capabilities, leveraging technology to improve speed and efficiency. The impact of this shift lowered the percentage of dropped calls in the contact center to 6.7% by the end of the year.
“Our bots were smoothly integrated with internal robotic processes to maximize the level of acceptance of our chatbots by customers (increased by 41% in 2024 compared to 2023). While the average response time by the bots was reduced to about 2 minutes,” notes from the lender’s financials read.
These technological advancements align with Wema Bank’s ambitious goal to achieve tier 1 bank status within three years and become a systemically important bank (SIB) within five years. To meet the Central Bank of Nigeria’s (CBN) new capital requirements, the bank plans to raise ₦200 billion through a ₦150 billion rights issue and a ₦50 billion special placement, with fundraising slated for Q2 2025.
