In 2025, all three major cost centres of Wema Bank Plc shrank in relation to revenue, pushing profit margins to a record high and driving a triple-digit increase in the bottom line for the third consecutive year.
The bank’s unaudited financial report for the year ending December 2025 shows another record-breaking profit jump of 124 per cent, reaching over N193 billion. This marks a continued streak of triple-digit growth, following a 217 per cent rise to N36 billion in 2023 and roughly 140 per cent to N86 billion in 2024.
The bank’s towering profit figure in 2025 stands far above the sum of all the profits it has realised since it returned to profit as far back as 2013.
Underlying the bank’s rapid profit growth in 2025 are comprehensive cost savings that boosted profit margins and sustained strong revenue growth. Wema Bank moved into the medium range of banks in profit margin at 15.9 per cent in 2023, increased to 19.9 per cent in 2024, and finally reached the top-tier group at 29.6 per cent in 2025.
The bank’s strategy of boosting revenue while keeping costs in check has delivered profit growth unmatched by its peers. In 2025, interest income rose nearly three times faster than interest expenses, widening the margin in the bank’s highest cost and income centre.
Interest income expanded by 63 per cent to close at N577 billion in the year, while interest expenses grew by 23 per cent to stand at N217 billion at the end of the financial year. While interest earnings maintained strong growth for the fourth year running, interest expenses dived to the lowest growth mark in four years from the peak record of 89 per cent rise in 2024.
The favourable combination of strong interest income and highly moderated interest expenses produced an outstanding growth in net interest earnings that more than doubled at 103.4 per cent to close in excess of N360 billion. This represents a big advantage the bank gained in 2025 in the low-cost direction, with the naira of interest earnings devoted to interest expenses slashed from 50 kobo in the previous year to less than 38 kobo.
A second-level cost saving was provided by net impairment losses on financial assets, which broke the high growth speed seen over the preceding three years to a moderate increase. From an average annual growth rate of 117.7 per cent over the preceding three years, loan impairment expenses slowed down considerably to an increase of 6 per cent to close at under N23 billion in 2025.
The outstanding growth in net interest income against the sharp slowdown in net loan loss expenses provided a second-round cost saving that swelled margins and lifted net income during the year. Net interest income after impairment charges for credit losses rose by 117 percent to close the year at over N337 billion. This is well above the bank’s net income figures of the four preceding years put together.
The sharp slowdown in credit loss expenses reflect increased loan recovery success of the bank and major write backs of previous charges as well as reduction in new charges during the year. Loan recoveries amounted to N5.3 billion in the year and fresh charges on investments and other assets were slashed during the year.
These developments are despite a strong expansion of customer loans and advances portfolio by 45 per cent or N545 billion to N1.75 trillion.
Cost saving from operating expenses provided the third leg of the cost saving tripod that supports Wema Bank’s triple digit profit high-rise in 2025. Total operating expenses slowed down relative to gross earnings, indicating a reduced average operating cost to generate the naira of revenue.
Gross earnings rose by more than one-half for Wema Bank in 2025 to N653.3 billion compared to an increase of 45 percent in total operating cost in the year to N191 billion. Operating cost margin went down for the fourth straight year to 29 percent, the lowest cost margin the bank has seen in more than a decade at least.
The bank grew pre-tax profit by 116.6 percent to N222 billion in 2025 and after-tax profit rose by roughly 124 percent to close at over N193 billion for the year.
Earnings per share amounted to N7.08 at the end of the 2025 financial year, up from N4.83 per share in the previous year. The strong increase in earnings per share is despite a major increase of over 87 percent in the volume of shares outstanding due to fresh capital issue in the course of the financial year.
The bank paid a cash dividend of N1 per share for its 2024 operations and dividend for the 2025 financial year is expected to be announced in weeks when the bank’s audited accounts are released.
