Fidelity Bank Nets Profit Up 29%, On Marginal Earnings Rise, Offers N0.11 Dividend

Fidelity Bank Plc, on Friday, also presented its audited financials for the year ended December 31, 2018, with gross earnings limping 4.79%, just as interest and similar income, as credit loss expense dropped by a significant 62.75% from N11.32bn to N4.22bn.
The directors have recommended a final dividend of 11 kobo, amounting to N3.186bn payout, to shareholders whose names are on the register of members as of April 12, while closing date is April 15 to 19, 2019; while payment is slated for April 26, same date as the annual general meeting in Lagos where shareholders are expected to approve.
Gross earnings rose from N180.24bn to N188.87bn, boosted by the N86.593bn from retail banking, up from N75.32bn in 2017; followed by N64.384bn from corporate banking, compared to N66.093bn; while investment banking contributed N37.896bn, as against N38.831bn in the prior year.
Interest and similar income rose to N153.68bn, up from N147.42bn, a difference of 4.25%, mainly the N109.322bn earned from customer loans and advances, compared to N109.388bn. Interest expense inched 6.08% up from N79.28bn to N84.1bn, with expense on term deposits dropping from N52.23bn to N51.517bn; followed by debts issued and other borrowed funds, which climbed to N22.741bn from N16.819bn.
Net interest income therefore stood at N69.59bn, up from N68.14bn; just as credit loss expense dropped to N4.22bn from N11.32bn; following which net interest income after credit loss expense stood at N65.37bn, 15.04% improvement over the N56.83bn in prior year.
Fee and commission income was up 11.96% from N18.23bn to N20.41bn, representing 11.96%, buoyed by N18.628bn contributed by retail banking; followed by N5.826bn from corporate banking. Also, charges for the use of its automated teller machines fetched the bulk or N3.588bn, up slightly from N3.474bn in 2017; followed by accounts maintenance charge of N2.899bn from N2.602bn; while commission on electronic banking activities contributed N2.852bn, as against N1.764bn in prior year. Fee and commission expense fell by 8.74% to N3.35bn from N3.67bn.
Other operating income stood at N11.14bn from N10.93bn, lifted by the N10.122bn from net foreign exchange gains, an improvement from N9.49bn in 2017; net gain from financial asset at fair value was negative at N345.82m, as against the positive N111.89m.
Personnel expenses dropped to N23.91bn from N24.54bn; other operating expenses rose 42.85% from N37.86bn to N41.97bn, the lion’s share of which was the N8.764bn, up from N7.591bn banking sector resolution cost paid to the Asset Management Corporation of Nigeria (AMCON); followed by marketing, communication and entertainment expenses of N8.352bn from N8.173bn; just as N4.022bn was paid as premium to the Nigeria Deposit Insurance Corporation (NDIC), compared to N3.522bn in 2017.
Profit before tax was up 30.58% from N19.21bn to N25.09bn; just as net profit stood at N22.93bn from N17.77bn, retail banking fetched N17.303bn, as against the previous N13.125bn; followed by N3.441bn from investment banking, up from N2.376bn; and N2.181bn from corporate banking, compared to N2.268bn in 2017. The net profit translated to Earnings Per Share of 79.16 kobo, up from 61.35 kobo.
On the balance sheet, total assets rose 24.7% from N1.379tr to N1.719tr, with customer loans and advances at N849.88bn being the chunk, up from N768.737bn; just as total liabilities inched 29.51% to N1.525tr from N1.177tr, boosted by the N979.413bn customer deposits, which rose from N775.276bn. Shareholders’ fund however dropped 3.45% from N201.36bn to N194.42bn.