Wema Bank records consistent earnings growth in 3 years

Indications are rife that Wema Bank Plc it is enjoying one of the best stock rallies since its existence, which validates a consistent earnings growth in the last three years.

The Bank recorded a return on equity (ROE) of 15.96 per cent in the first quarter, which compares to Fidelity Bank’s (13.29 per cent); First City Monument Bank, (8.39 per cent); Union Bank, (8.18 per cent), and Sterling Bank (7.79 per cent).

Because Wema Bank has been recording growth at the gross earnings and profit, as its shareholders’ funds moved to N71.57 billion in March 2022, from N48 billion in 2017;what this means is that it can effortlessly reward shareholders in the form of dividend payment.

The lender has a year to date return (which means its shares have been gaining since the start of the year) of 395.83 percent, which outperforms the NGX-ASI Index which is up 23.49 percent and NGX30 up 19.39 percent in the same period, according to data from the NGX.

Interestingly, Wema Bank is the second best performer on the stock exchange this year, and analysts are sanguine that the lender will maintain the growth momentum.

Valuations are attractive with a price-to-earnings multiples of 15.64 percent, which means investors are expecting a high growth rate in the future.

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