Nigeria?s major banks failed to meet the February month-end deadline for submission of their audited financial reports, as the Central Bank of Nigeria (CBN) examines banks? results to ensure they comply with extant best practices and rules.

Most tier 1 banks, which control more than 75 per cent of Nigeria?s banking sector, were scheduled to submit their full-year audited reports and accounts for the 2024 business year to the Nigerian Exchange (NGX) for onward release to the investing public at the weekend.

The major banks, including Guaranty Trust Holding Company, Zenith Bank, Access Holdings, United Bank for Africa (UBA) and Stanbic IBTC Holding Plc, however failed to meet the submission deadline.

The banks attributed their inability to meet the deadline to ongoing review of their financial statements by their primary regulator, the CBN, expressing concerns that they envisaged a possible delay due to the CBN?s audit approval process.

Under the three-step final process for the release of audited reports and dividend recommendations for banks, the board of directors meets to consider and approve the audited financial statements as well as dividend recommendation, then authorises the transmission of the signed reports to the CBN, and with the receipt of the approval of the apex bank, transmits the audited report and dividend recommendation to the Securities and Exchange Commission (SEC) and the Nigerian Exchange (NGX) for announcement to the investing public.

All the major banks confirmed that they have completed their board approval process and transmitted their results to the CBN.

the delay of the results sparked off selloffs in the banking sector as investors who had anticipated the release of the banks? results adjusted their positions.

The NGX Banking Index has headlined losses at the Nigerian stock market in recent days, fuelling a contagious bearish market that has seen the equities? market average year-to-date dropping from 4.76 per cent to 3.9 per cent in two days.

The highly influential banking sector index declined by 1.8 per cent yesterday, the highest by any sectoral index and nearly four times the size of average loss for the overall market. The All Share Index (ASI) - the value-based common index that tracks all share prices at the NGX dropped by 0.5 per cent yesterday. The NGX Banking Index had also suffered the highest loss of 1.2 per cent on Monday.

Market analysts said the overall negative position at the stock market was connected to the banking sector.

Managing Director, HighCap Securities, Mr. David Adonri, said the situation in the banking sector appeared to be having contagious effect on the overall market.

?In terms of volume and value of trades, banks set the direction for the Nigerian capital market,? Adonri, a senior stockbroker, said.

Analysts at Cordros Capital said the banking sector weighed on the overall market.

Post-listing rules at the NGX require quoted companies to submit interim or unaudited quarterly report not later than 30 calendar days after the end of the relevant period. Such companies are also required to submit their audited full-year results not later than 90 days.

However, where a company chooses to audit its quarterly accounts, it shall be required to file such accounts not later than 60 calendar days after the relevant quarter.

These imply that companies that choose to audit their fourth quarter results are required to submit not later than 60 days after the end of the year. All the major banks fall under this category.

Other banks, including First Holdco, Jaiz Bank, FCMB and Sterling Bank that opted for submission of unaudited interim reports for fourth quarter have up till March 31, 2025 for the submission of their full-year audited report and accounts.

Most quoted companies including all banks, major manufacturers, oil and gas companies, breweries and cement companies use the 12-month Gregorian calendar year as their business year.

The NGX tags and applies fines on companies that fail to meet earnings reports? deadline. Companies that fail to meet the deadline will be tagged with poor corporate governance codes and are liable for sanctions that may range from N100,000 to about N100 million. The NGX is also empowered to suspend trading on the shares of chronic defaulters.

However, the NGX can grant a general waiver and extension due to special consideration such as national crisis, extended holiday and industrial crisis. Also, the NGX can give specific waiver to a company based on the strength of reasons in its application for waiver.

Many banks stated that they have secured regulatory extension that allows them to submit their reports after the deadline. (The Nation)

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