Fidelity Bank’s Q3 Profit Up 65% To N14.45bn, As Customer Deposits Drop

Shareholders of Fidelity Bank Plc are in for better returns on their investment, if its performance so far is sustained in the last quarter of the year, judging by figures for the nine-month ended September 30, which showed that net profit grew at a more significant pace than gross income, just as customer deposits, the life blood of any bank dropped marginally.
According to the result, earnings rose by N19.74bn or 17.88% from N110.346bn to N130.086bn, with interest and similar income rising from N91.428bn to N110.368bn, boosted by the N78.678bn earned from customer loans and advances, up from N64.547bn, with the rest coming from treasury bills and other investment securities. Interest and similar expense increased by N15.655bn or 7.12% from N40.908bn to N56.563bn, mainly from term deposits interest which increased from N25.169bn to N37.933bn; while debt issued and other borrowed funds stood at N10.899bn, from N10.751bn; resulting in net interest income of N53.805bn, up from N50.52bn.
Impairment charge for credit losses for the period was flat at N7.323bn, compared to N7.96bn in the corresponding nine months of 2016; while net interest income after impairment charge for credit losses increased to N46.48bn from N42.56bn.
Fee and commission income dropped from N15.944bn to N13.775bn, impacted most significantly by the fall in commission on electronic banking activities from N6.309bn to N1.33bn; as maintenance charge rose to N1.789bn from N1.202bn; ATM charges, N2.541bn, down from N1.718bn; letters of credit fetched N1.201bn, up from N941m; while commission on travellers cheque and foreign bills rose to N1.37bn from N1.122bn. Expense incurred in the process rose slightly to N2.662bn from N2.132bn, other operating income jumped from N2.975bn to N5.943bn, with a lift from the Net foreign exchange gain of N4.871bn, as against the previous N2.677bn. Other operating expenses dropped to N47.487bn from N48.741bn, as personnel expenses contributed the lion’s share of N17.139bn from N18.407bn, basically salaries and wages; banking sector resolution cost to the Asset Management Corporation of Nigeria increased slightly to N4.847bn from N4.611bn; marketing communications & entertainment stood at N6.572bn from N6.776bn.
Profit before tax from continuing operations therefore jumped to n16.236bn from N9.835bn; income tax expense increased to N1.786bn from N1.082bn; leaving profit after tax at N14.45bn, a N5.697bn or 65.08% improvement over the preceding third quarter’s N8.753bn, which translated into Earnings Per Share of 67 kobo, as against the 40 kobo recorded in the corresponding period of last year. This has also shown that “all things being equal,” the board now has increased capacity to pay juicier dividend, if the performance continues in the last quarter of the year.
On the balance sheet, total assets fell slightly to N1.327tr from N1.396tr, the bulk of which remained the loans and advances to customers at N753.799bn, which increased from N728.023bn, buoyed by term loans of N687.647bn from N656.605bn. Total liabilities for the period dropped to N1.127tr from N1.211tr, as customer deposits decreased by N21.211bn or 2.66% from N795.592bn in the 2016 third quarter, to N774.381bn; other liabilities dropped from N104.739bn to N77.482bn. Shareholders’ funds rose to N200.6bn from N184.984bn.

Sign In

Register

Reset Password

Please enter your username or email address, you will receive a link to create a new password via email.