The board of FBN Holdings Plc, on Wednesday presented its audited financials for the full-year ended December 31, 2021, with highlight such as a slowdown in interest income, amidst surging expenses, while impairment charges remained the highest in the industry yet at N91.711bn, up from N61.83bn in the corresponding period of 2020. This was made worse by the drop in net gains on sale of investment securities from N48.078bn to N31.295bn; the effect of which was countered by the leap in fee and commission income and the net gain from financial instruments at FVTPL. More significantly, other operating income for the period soared by 905.15%, resulting in the growth in the N61.349bn or 81.16% growth in net profit for the period, despite an equally huge 91.28% increase in income tax expense from N8.111bn to N15.515bn. Net profit, therefore, translated to earnings per share of N4.17, compared to the previous N2.46 each.
According to the result, total revenue for the period stood at N777.257bn; with interest income dropping from N384.798bn to N369.047bn; while interest expenses increased to N140.805bn from N133.183bn; resulting in a net interest income of N228.242bn from N251.615bn. Net interest income after impairment charge for losses fell from N189.785bn to N136.531bn; fee and commission income rose from N113.222bn to N140.574bn; and expense from N19.446bn to N23.936bn; leaving a net fee and commission income of N116.638bn, compared to the previous N93.776bn.
Dividend income for the period rose to N6.25bn from N3.983bn; personnel expenses rose to N128.772bn from N100.584bn; depreciation of property and equipment rose to N20.022bn from N18.634bn; amortization of intangible assets inched to N8.258bn from N7.238bn; operating expenses rose from N166.045bn to N177.13bn. These resulted in operating profit of N166.662bn from N83.703bn.
On the balance sheet, total assets grew from N7.651tr to N8.894tr; boosted by the N2.881tr worth of customer loans and advances, from N2.217tr; while total liabilities stood at N8.052tr from N6.923tr, helped by customer deposits amounting to N5.849tr, up from N4.894tr in the period. This resulted in total equity of N879.856bn, up from N765.171bn.
A breakdown of the figure showed that commercial banking recorded the lion’s share of the N716.761bn total revenue; followed by the merchant banking and asset management business which contributed N42.47bn. Commercial banking also contributed the biggest portion of impairment charge for losses of N90.767bn; followed by merchant banking with N945m. PBT at N160.285bn; ahead of the investment banking group’s N9.835bn. By geography, a total of N699.857bn was derived from Nigeria, up from the previous N505.997bn; while N57.439bn came from outside Nigeria. Also, the bulk, or N89.81bn of total profit came from Nigeria, while N26.117bn was reported from outside the country; up from N20.236bn in the previous full-year.
The lion’s share of interest income was the N271.024bn loans and advances to customer, up from N241.027bn; just as interest on customer deposit accounted for the bulk expenses, which however dropped to N79.658bn from N90.609bn. The major contributor to fee and commission income was the N56.375bn electronic banking fees from N48.68bn; expense was driven by the N11.81bn spent on acceptance cost on alternative channels; followed by the N7.439bn SMS charge from N5.499bn; and agent banking expenses which rose from N2.727bn from N4.643bn. Also, the biggest contributor to operating expenses was the NN55.234bn maintenance cost, from N44.82bn; followed by insurance premium, which rose from N29.617bn to N35.307bn.