How Jaiz Bank Benefits SMEs

Jaiz Bank

Jaiz Bank is Nigeria’s premier non-interest bank with the vision “to be the clear leader in Ethical Banking in Sub-Saharan Africa”.

Jaiz Bank offers non-interest banking services for retail, commercial and corporate sectors. Its full-service product offering includes transactional accounts, savings, working capital, real estate, personal, medical, education and project finance. Jaiz Bank also provides online banking, leasing, banking cards, bonds and guarantees.

Jaiz Bank


How it works

  1. Jaiz Bank is predicated on the principle of partnership which includes risk-sharing. Conventional banks give loans at a fixed rate without any risk on their part, while under Jaiz banking system, the bank shares the profits & losses from investment.
  2. Profit over interest: The bank receives deposits to invest them on behalf of depositors & shareholders and the profit is shared between depositors & shareholders. Account-holders are considered as investors while the bank act as the fund manager.
  3. Non-interest proposition: Jaiz bank takes ownership of the asset and then either rent the asset or sell it on to the customer (on a cost-plus basis with deferred payment).  For instance, for a customer who needs a car, the bank buys the customer’s specific car, leases the car to the customer; the customer pays the bank a monthly amount, and the customer buys the car from the bank at the end of the lease period.
  4. With Jaiz banking model, profit charged or rent charged do not compound like you have in conventional banking where the system runs on the principle of compounding interest.

Key extracts from the recent nine-month report for the period ended September 30, 2019, released to the Nigerian Stock Exchange (NSE) showed that total income rose by 49.2 %, while pre and post-tax profits increased by 509.47% and 673.21% respectively.

The nine-month report indicated that Profit – before-tax increased from N241.3million to N1.47billion, while net profit rose to N1.25billion from N161.7 million in the corresponding period of 2018.

The Bank also grew its total income by 49.2% from N5.14billion in the corresponding period of 2018 to N7.7billion at the end of September 30th 2019, while earning per share improved by 670.91%, from 0.55kobo to N4.24 kobo.

The Balance Sheet showed stronger underlying strength during the period as Total Assets rose by 40% from N108.46 billion to N152 billion, while the Bank’s liabilities also grew by 45.60% from N95.35billion in September 2018 to N138.84billion in the period under review.

This growth trajectory of the Bank can be traced to its early positive development right from the beginning of the when it posted impressive results in both the first and second quarters of the year.

For instance, the Bank grew its total income by 42.17% from N3.39 billion as at June 30th 2018 to N4.82 billion at the end of June 30th 2019, while earning per share improved by 294.87%, from 0.78 kobo to N3.08 kobo. Still, in the second quarter, its Total Assets rose by 47.62% from N99.58 billion to N144 billion, while the return on investment grew by 18.35% from N1.01 billion to N1.2 billion.

The Bank’s first-quarter results laid the foundation for positive outing as it recorded a profit after tax of N428.68 million, compared to the N124.58 million recorded in the comparable period in 2018. Key underlying ratios showed improvements in returns and operational strength of the bank.

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