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Growth In Sale Of Investment Securities Boosts FBN Holdings H1 Profit

The board of FBN Holdings Plc, on Wednesday, presented its financials for the half-year ended June 30, 2020, which showed a 23.84% growth in net profit, despite the 38.65% spike in impairment charge for losses, the bulk of which was the N20.947bn provisioned between April and June, 153.59% above the N8.26bn in the corresponding period of 2019.

According to the half-year financials, total income stood at N296.411bn, the bulk of which commercial bank business contributed the lion’s share of N278.535bn; followed by the N17.343bn from the merchant banking and asset management group. Interest income dropped from N216.757bn last year to N207.417bn, N196.664bn of which was from commercial banking, which contributed N70.53bn of interest expense as it inched slightly from N75.063bn to N76.142bn, translating to a net interest income of N131.275bn, N10.419bn or 7.35% less than the N141.694bn.

Impairment charge for losses jumped to N30.651bn, up by N8.544bn or 38.65% from N22.107bn; following which net interest income after impairment charge for losses fell by 18.85% to N100.624bn from N119.587bn in the preceding half-year.

Fee and commission income for the period under review stood at N55.782bn from N49.062bn, which was boosted by the N21.717bn earned from electronic banking, as against N21.832bn; and other fees and commissions amounting to N3.221bn from N9.237bn.

Fee and commission expense rose to N9.03bn from N8.901bn; while foreign exchange loss stood at N3.586bn, as against the previous N4.779bn gain. Net gains on sale of investment securities soared from N3.753bn to N26.321bn; net gains from financial instruments at face value stood at N7.308bn during the half-year, despite the N1.033bn losses sustained in the second quarter operations, from N2.082bn.

Dividend income stood at N2.033bn from N2.075bn; other operating income dropped slightly from N1.73bn to N1.275bn; personnel expenses climbed to N49.537bn from N46.775bn; even as depreciation, amortization and impairment inched from N9.358bn to N11.636bn; just as operating expenses fell from N81.805bn to N78.0bn. The bulk of this ws the N22.65bn regulatory cost, which climbed up from N19.786bn

Operating profit increased by 14.69% from N36.229bn to N41.554bn; profit before ta stood at N41.415bn from N36.246bn; income tax expense declined from N7.463bn to N5.771bn.

Net profit improved by N6.861bn or 23.84% to N35.644bn as against the N28.783bn, translating to Earnings Per Share of N1.35, up from 84 kobo at the end of 2019.

On the balance sheet rose by N926.696bn or 14.94% from N6.203tr to N7.13tr; the lion’s share of which was the N1.1994tr customer loans and advances, up from N1.852r, representing an increase of 7.55%.

Total liabilities improved by N883.726bn or 15.94% to N6.426tr from N5.542tr, lifted by the N4.373tr customer deposits which increased by N353.38bn or 8.79% from N4.019tr at the end of December last year to N4.373tr. Shareholders’ funds stood at N704.095bn from N661.126bn.

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