FBN Holdings Plc, on Monday, became one of the earliest filers of its unaudited financials for the nine-month ended September 30, 2019, highlights of which included a decline in gross earnings income, while profit before and after-tax increased marginally. Other major highlights were the significant drop in net gains on foreign exchange which tumbled 76.57% down; just as the N47.725bn or 62.64% decline in loan loss provision for the period from N76.185bn, a figure which still remained scandalously high at N28.46bn and calls for an urgent and desperate tightening of the group’s risk management framework.
Gross earnings for the period dropped to N440.893bn from N443.116bn in the corresponding period of 2018; buoyed by the interest income of N327.469bn, a drop from N337.558bn in 2018. Interest income from the group’s commercial banking group remained the major honey pot, at N390.563bn, down from the previous N398.674bn; followed from afar by the N25.313bn from the merchant banking and asset management group, a drop from N27.368bn; while insurance group added N23.068bn to the till, up from N15.299bn. Interest expense stayed flat at N116.031bn, from N116.032bn, with N104.022bn from the commercial banking arm, compared to N103.898bn; while the merchant banking group accounted for N12.009bn, as against the previous N12.134bn. Net interest income, therefore, fell from N221.526bn to N211.438bn. A breakdown of the loan loss provision showed that the group’s impairment loss fell from N82.345bn to N33.976bn; but recovered N5.517bn of the previously written off loans, down from N7.572bn. Net interest income after impairment charge for losses (loan loss provision), therefore, stood at N182.978bn, up from N145.341bn, significantly driven by operations of the commercial banking arm.
Insurance premium revenue rose to N15.549bn from N12.35bn; insurance premium revenue ceded to reinsurers jumped to N3.245bn from N1.906bn; resulting in net insurance premium revenue of N12.304bn, as against the previous N10.444bn.
Fee and commission income for the period climbed from N62.669bn to N76.818bn, boosted by the N34.423bn electronic banking fees, which leaped from N23.593bn; expense rose to N13.616bn from N10.695bn; net foreign exchange gains plunged from N23.852bn to N5.587bn. Net gains on investment securities rose from N4.982bn to N7.452bn; other operating income rose to N3.279bn from N2.223bn. Insurance claims rose from N2.704bn to N6.574bn; personnel expenses increased from N69.733bn to N71.614bn; operating expense increased from N102.171bn to N128.58bn, out of which regulatory cost rose from N25.767bn to N29.229bn; following which profit before tax stood at N60.029bn from N51.340bn. Income tax expense for the period rose from N6.393bn to N8.193bn; resulting in profit after tax of N51.836bn, as against the previous N44.947bn; resulting in earnings per share of N1.38, as against the previous N1.22 each. Total net profit from the commercial banking group amounted to N44.887bn; the insurance group contributed N4.62bn, while merchant banking mustered N3.963bn.
Total assets for the period stood at N5.734tr, up from N5.568tr at the end of December 2018; with customer loans and advances accounting for N1.819tr, up from N1.68tr; while investment securities dropped from N1.663tr to N1.503tr.
Total liabilities stood at N5.129tr from N5.037tr, with customer deposit rising from N3.486tr, from N3.486tr; following which shareholders’ funds rose to N604.927bn from N530.647bn.