FBNH Directors Raise Dividend By 42.9%, Despite 8.9% Net Profit Slide

Directors of FBN Holdings Plc, on Friday presented its audited financials for the full-year ended December 31, 2022 to the Nigerian Exchange Limited. Highlights of the result was the marginal drop in gross earnings from N757.296bn in the corresponding period of 2022 to N805.128bn.
Profit before income tax dropped to N157.902bn from N166.662bn, while income tax expense rose to N21.591bn from N15.515bn, following which net profit dropped from N151.079bn to N136.173bn; despite which total dividend payout increased from N12.563bn to N17.947bn, translating to 50 kobo per share.
Gross earnings for the period increased to N868.992bn, up from N757.296bn; with the commercial banking group contributing N748,568bn, up from the previous N716.761bn; followed from afar by the Merchant Banking and Asset Management Group’s N53.278bn, up from N42.47bn; while ‘others’ recorded N67.148bn from N18.025bn.
Interest income for the period rose to N551.937bn from N369.047, driven by income from customer loans and advances which jumped significantly from N271.024bn to N403.616bn; while interest expenses inched to N188.88bn from N140.805bn, boosted by the N117.199bn paid on customer deposits, compared to N79.658bn in the prior year. This left net interest income at N363.249bn, up from N228.242bn.
Impairment charge for losses dropped from N91.711bn to N68.619bn, resulting in Net interest income after impairment charge for losses of N294.63bn from N136.531bn.
Fee and commission income improved marginally from N140.574bn to N143.981bn, the bulk of which was the N55.099bn income from electronic banking fees, which dropped marginally from N56.375bn, followed by account maintenance of N19.883bn, up from N16.667bn; even as funds transfer and intermediation fees fell significantly to N6.76bn from N12.747bn. Fee and income expense stood at N26.012bn from N23.936bn; resulting in net fee and commission income of N117.969bn, compared to N116.638bn in the preceding full-year.
Foreign exchange income jumped from N7.044bn to N22.392bn; net gains on sale of investment securities fell to N22.425bn from N31.295bn; net gains from financial instruments at face value also declined from N53.658bn to N38.648bn; dividend income fell to N3.166bn from N6.52bn; just as other operating income took a sharp dip from N149.416bn to N22.404bn. Personnel expenses reduced mildly from N128.772bn to N117.376bn; depreciation of property and equipment stood flat at N20.982bn, compared to the previous N20.022bn; amortization of intangible assets dropped from N8.258bn and N7.068bn; just as operating expenses amounting to N218.481bn, against the previous N177.13bn; following which operating profit dropped from N166.92bn to N157.727bn.
A breakdown of the group’s profit by operating segments showed that commercial banking pooled N139.865bn, down from N147.252bn; while merchant banking contributed N8.896bn, from N7.511bn; while ‘others’ suffered a N12.44bn, much more than the previous N3.61bn loss.
On the balance sheet, total assets soared from N8.932tr to N10.577tr, boosted by customer loans valued at N3.789tr, up from N2.881tr; while investment securities improved to N2.321tr from N1.957tr. Total liabilities also rose to N9.581tr from N8.052tr, boosted by the N7.124tr customer deposits, a significant rise from N5.849tr in the corresponding period of 2021.