Billionaire Elon Musk Receives Axel Springer Award

The Top 10 Richest People In The World (January 2024)

Nigeria&#8217;s top seven most profitable publicly-listed companies, including five banks, Dangote Cement, and MTN Nigeria, reported a total profit before tax of ₦1.89 trillion ($2.43 billion) in H1 2023. Bank profits surged due to gains from foreign exchange transactions. UBA led with ₦404 billion ($520 million), a 371% YoY increase. This trend diverges from the global norm, prompting calls for inclusive growth measures to address economic disparities and job losses, particularly in manufacturing.



Five banks, a cement manufacturer (Dangote Cement Plc), and a telecommunications company (MTN Nigeria Communications Plc) are among Nigeria’s seven most profitable publicly-listed companies in the first half of the year, collectively reporting a combined profit before tax of ₦1.89 trillion ($2.43 billion).



The five banks are United Bank for Africa Plc (UBA), Zenith Bank Plc, Guaranty Trust Holding Company (GTCO), FBN Holdings Plc, and Access Holdings Plc. Analysts attribute their profitability primarily to revaluation gains from foreign exchange (FX) swaps and forwards with the Central Bank of Nigeria (CBN).



UBA recorded the highest profit before tax, amounting to ₦404 billion ($520 million), reflecting a 371% increase compared to the ₦85.75 billion ($110.38 million) in H1 2022.



The dominance of banks in the list of most profitable companies in Nigeria contrasts with the global trend, where technology and oil companies typically lead in profitability.



President Bola Tinubu&#8217;s declaration on May 29 to unify exchange rates prompted the Central Bank of Nigeria&#8217;s (CBN) announcement on June 14 of a free-floating system. This transition enabled deposit money banks (DMBs) and foreign exchange market dealers to freely trade forex at market-determined rates, leading to a 40% depreciation of the currency against the dollar in June. Consequently, the official exchange rate increased from ₦463.38/$ to ₦776.8/$ today.



Analysts make a call to action for the government to implement measures that promote inclusive growth, address economic disparities, and ensure the prosperity of all sectors.



Economist Kelvin Emmanuel shedding light on the implications emphasizes to FORBES AFRICA about the stark imbalance in the nation&#8217;s economic landscape.



The profits amassed by these influential banks, according to Emmanuel, underscore a concerning reality – the fragility of Nigeria&#8217;s economic structure. He argues that this financial success primarily tied to FX transactions reveals a system that is skewed, with the banking sector thriving while other crucial segments, particularly manufacturing, face challenges. Job losses in Nigeria’s manufacturing sector has spiked to a three-year high.



Emmanuel asserts that the government must address key issues to rectify this economic disparity. He advocates for a strategic approach to &#8220;decouple inflation as a tool for adjusting the Monetary Policy Rate (MPR).&#8221; According to Emmanuel, this shift is crucial to making credit more affordable for the real sector, enabling increased production capacity.



Furthermore, Emmanuel urges policymakers to focus on stabilizing the FX markets. A stabilized FX environment is deemed essential for providing businesses, especially those in manufacturing, with easy access to raw materials and machinery. This, in turn, is crucial for boosting production and narrowing the gap between the flourishing banking sector and struggling manufacturing companies.



&#8220;It doesn’t speak well about an economy if the banks are doing better than manufacturing companies,&#8221; states Emmanuel, underscoring the need for a comprehensive economic strategy that fosters balanced growth across various sectors.



Moses Adeolubodun, an investor, expresses concern about heavy reliance on FX gains for profit, emphasizing the necessity of diversification for a more sustainable economic foundation.



Adeolubodun tells FORBES AFRICA, &#8220;Banks must guard against overreliance on short-term gains and focus on long-term strategies for sustained growth.&#8221;



He underscores the importance of a diversified economic landscape to mitigate risks linked to dependency on a specific sector.



&#8220;There is a need for policymakers to carefully monitor the impact of monetary policies on the economy and consider measures to ensure stability and resilience.&#8221;



He highlights the importance of a well-balanced and transparent foreign exchange policy to foster investor confidence and economic sustainability.

Banking in Nigeria

Five Banks Among Nigeria’s Top Seven Profitable Companies In First Half, Reporting $2.43 Billion In Collective Profit

<h2 class="wp-block-heading" id="h-topline">TOPLINE</h2>



Elon Musk, <a href="https://www.forbes.com/profile/elon-musk/?sh=5b8ba5487999">the world’s richest man</a>, grew his net worth by $10.5 billion Wednesday, a 4.2% increase, on the back of an approximately 6% jump in Tesla’s stock, which comprises a vast majority of his wealth—putting his total riches at $260.4 billion.



<h2 class="wp-block-heading">KEY FACTS</h2>



Tesla’s 5.9% increase brought the share price to about $261 for the stock when markets closed Wednesday afternoon.



This comes despite a&nbsp;<a href="https://ir.tesla.com/press-release/tesla-vehicle-production-deliveries-and-date-financial-results-webcast-third-quarter-2023" target="_blank" rel="noreferrer noopener">report</a>&nbsp;released Monday that showed a 7% decline in vehicle deliveries during the third quarter, something the company blamed on factories being temporarily shut down for upgrades.



Still, investors bet on a fourth-quarter rebound with the launch of a revamped Model 3 car in China and the expected launch of the Cybertruck, according to&nbsp;<a href="https://www.investors.com/news/tesla-stock-flashes-buy-signal-leads-sp-500-bulls-shrug-off-bad-news/" target="_blank" rel="noreferrer noopener">Investor’s Business Daily</a>.



<h2 class="wp-block-heading">KEY BACKGROUND</h2>



Musk first&nbsp;<a href="https://www.forbes.com/sites/forbeswealthteam/article/elon-musk/?sh=27503b4726af">jumped</a>&nbsp;into the top spot on&nbsp;Forbes’&nbsp;Billionaires List in September 2021. “I’m sending a giant statue of the digit ‘2’ to Jeffrey B., along with a silver medal,” he told&nbsp;Forbes&nbsp;after&nbsp;<a href="https://www.forbes.com/profile/jeff-bezos/?sh=4ffe328c1b23">overtaking Amazon’s Jeff Bezos</a>—who, with a $149.8 billion estimated net worth, is now No. 3—for the spot. Recently, he and French fashion mogul&nbsp;<a href="https://www.forbes.com/profile/bernard-arnault/?list=rtb/&amp;sh=25a8e88f66fa">Bernard Arnault</a>&nbsp;have been flipping back and forth between the No. 1 and No. 2 spots, though Musk has maintained his spot as No. 1 in recent weeks. Around $170.6 billion of his $260.4 billion net worth comes in the form of Tesla stock. Other significant assets include his 42% stake in SpaceX, which amounts to $60.2 billion, and his acquisition of Twitter in October 2022, which is now worth $8.9 billion (he purchased the social media platform for $44 billion).&nbsp;Forbes&nbsp;estimates he has $5.2 billion in cash and other liquid assets.



<h2 class="wp-block-heading">TANGENT</h2>



Musk has given away a meager fraction of his wealth to charitable causes,&nbsp;Forbes&nbsp;has found.&nbsp;Forbes&nbsp;<a href="https://www.forbes.com/sites/forbeswealthteam/article/elon-musk/?sh=27503b4726af">estimates</a>&nbsp;Musk, who signed the Giving Pledge in 2012, has donated $281 million over his lifetime to charitable causes, which is less than 1% of his net worth as of September 2023. Though, he’s not alone among America’s richest in his lack of philanthropy. Oracle cofounder Larry Ellison, Nvidia cofounder Jensen Huang and 124 others on&nbsp;Forbes’&nbsp;400 list have all given away&nbsp;<a href="https://www.forbes.com/sites/phoebeliu/2023/10/03/the-forbes-philanthropy-score-2023-how-charitable-are-the-richest-americans/?sh=51f3f084eccc">less than 1%</a>&nbsp;of their wealth. Of the 400 richest Americans, only a handful have given away&nbsp;<a href="https://www.forbes.com/sites/phoebeliu/2023/10/03/the-forbes-philanthropy-score-2023-how-charitable-are-the-richest-americans/?sh=51f3f084eccc">more than 20%</a>&nbsp;of their wealth: John Arnold, Edythe Broad, Warren Buffett, Bill Gates, Melinda French Gates, Amos Hostetter Jr., Pierre Omidyar, MacKenzie Scott, Lynn Schusterman, Jeff Skoll and George Soros.



<h2 class="wp-block-heading">FURTHER READING</h2>



<a href="https://www.forbes.com/sites/forbeswealthteam/article/elon-musk/?sh=27503b4726af">Elon Musk’s Road To Riches: Behind The Billions</a> (Forbes)



<a href="https://www.forbes.com/sites/maryroeloffs/2023/10/03/grimes-reportedly-sues-elon-musk-over-parental-rights-to-child/?sh=3131bc3421ed">Grimes Reportedly Sues Elon Musk Over Parental Rights To Child</a>&nbsp;(Forbes)



<a href="https://www.forbes.com/sites/willskipworth/2023/09/12/musk-bio-bombshells-secret-child-techno-mechanicus-and-rocky-romantic-relationships-among-these-explosive-revelations/?sh=4322672b17b4">Musk Bio Bombshells: Secret Child Techno Mechanicus And Rocky Romantic Relationships Among These Explosive Revelations</a>&nbsp;(Forbes)



<a href="https://www.forbes.com/sites/willskipworth/2023/10/02/elon-musk-sued-for-falsely-linking-man-to-neo-nazi-group-and-federal-agency/?sh=3cc354ea7956">Elon Musk Sued For Falsely Linking Man To Neo-Nazi Group—And Federal Agency</a>&nbsp;(Forbes)



<a href="https://www.forbes.com/sites/willskipworth/2023/09/18/elon-musk-says-he-might-put-xtwitter-behind-a-paywall/?sh=639508407209">Elon Musk Says He Might Put X/Twitter Behind A Paywall</a>&nbsp;(Forbes)

Tag: Billion Dollar

FORBES AFRICA SOCIAL MEDIA

The Top 10 Richest People In The World (January 2024)

Five Banks Among Nigeria’s Top Seven Profitable Companies In First Half, Reporting $2.43 Billion In Collective Profit

Elon Musk Becomes $10 Billion Richer After Tesla Stock Shoots Up 6%