FBN Holdings Grows 2024 Half-Year Net Profit By 99.66%, Earns N10.11 Per Share

  • As Otedola Raises Stake To 20.33%

The board of FBN Holdings Plc, on Wednesday presented its 2024 half-year unaudited financials through the Nigerian Exchange Limited with three-digit growth in total revenue, outpacing the net profit with Earnings Per Share for the period jumping to N10.11 from the N5.19 each reported for the corresponding period of last year.

Total revenue for the period was expectedly boosted by the interest income, which improved by 155.39%, which was however slower than the interest expenses growth of 218.95%.

Another major disclosure by the group in the result was the significant increase in the stake of the chairman and majority shareholder, Mr. Olufemi Otedola, whose direct and indirect holding jumped to 7,298,003,323 units, representing 20.33%; compared to 1,999,342,378 shares or 5.57% in the same period of last year.

A breakdown shows that Mr. Otedola, who is also majority owner of Geregu Power Plc, holds 3.14% direct stake; and 8.53% indirectly, while his Barbican Capital Limited also holds the remaining 8.67%.

Specifically, total revenue for the period stood at N1.402tr, N761.39bn or 118.75% better than the previous half-year’s N641.127bn. A breakdown showed that the commercial banking group contributed N1.343tr to total revenue, from previous half-year’s N607.731bn; trailed from afar by investment and asset management group’s N55.359bn, which was an improvement over the N31.164bn contributed in the similar period of last year; while others amounted to N5.243bn, from N3.102bn.

In what may indicate the need for the bank to play deeper into the African market, thereby diversifying its revenue and profit, FBN Holding earned all of N1.063tr from its Nigerian operationgs from N541.676bn; with just N338.974bn from outside the country, including its First Bank (UK), from N99.451bn.

Of the total revenue also, interest income improved from N371.079bn to N947.694bn, representing an increase of N576.615bn; with interest from customer loans and advances amounting to N568.902bn, from N245.427bn; followed by investment securities which contributed N307.017bn in the half-year period, from N108.568bn; ahead of loans and advances to banks at N71.775bn, compared to N17.084bn in the prior half-year.

Interest expenses rose by N297.081bn to N432.761bn from N135.68bn, led by N262.7bn interest paid on customer deposit, as against N93.59bn in the corresponding period of 2023. A total of N103.696bn was paid as interest to other banks; while borrowings and others cost N66.365bn from just N13.77bn. This resulted in net interest income of N514.933bn, an improvement over the previous N235.399bn.

Impairment charge for losses increased almost three-fold to N92.986bn from N39.902bn; leaving net interest income after impairment charge for losses of N421.947bn from N178.683bn.

Fee and commission income rose from N87.114bn to N129.926bn, boosted by N35.129bn electronic banking fees which was a marginal increase over the previous N34.014bn; ahead of the N20.578bn in letters of credit commissions and fees, up from N14.545bn; while account maintenance fees fetchedN17.19bn, compared to N9.172bn. Credit related fees yielded N17.992bn from N6.71bn, among others.

Fee and commission expense from N15.146bn to N19.09bn; following which net fee and commission income stood at N110.836bn from N71.968bn.

Foreign exchange loss soared to N165.048bn from N98.139bn; net gains on sale of investment securities fetched N11.827bn, down from N43.253bn; just as net gains from financial instruments at full value yielded N432.201bn from N228.043bn. Dividend income almost doubled from N4.404bn to N8.027bn; other operating income improved significantly from just N5.914bn to N37.863bn. Personnel expenses for the period was more than double from N63.914bn to N134.197bn, in what may have reflected the recent exit of Dr. Adesola Adeduntan, the Group Managing Director of First Bank of Nigeria, the group’s flagship who reportedly resigned on the orders of the Central Bank of Nigeria. Depreciation, amortization and impairment rose to N30.494bn from N14.434bn; just as other operating expenses increased from N150.19bn to N280.999bn. This was driven by the N77.256bn paid as levy to the Asset Management Corporation of Nigeria (AMCON), from N47.346bn; followed by N51.358bn cost of maintenance by the group, from N24.77bn.

Operating profit amounted to N411.799bn from N204.872bn; while profit before tax improved from N205.047bn to N411.99bn, representing a 100.99% increase. Income tax expense rose by 171.89% to N19.024bn to N51.725bn. Net profit for the period therefore rose to N360.265bn from N186.023bn.

According to the balance sheet, total assets grew to N23.425tr from N16.937tr at the end of December 31, 2023; boosted by loans and advances to customers of N9.056tr, compared to N6.359tr; just as total liabilities improved from N15.19tr to N21.212tr, after customer deposits jumped 50% to N15.13tr from N10.663tr.