Fidelity bank profits up 66 percent

[dropcap]T[/dropcap]op Nigerian lender, Fidelity Bank on Wednesday announced its profits rose by 66 per cent, a performance in line with analysts’ expectations.

The bank recorded a very strong financial performance in the first half of 2017, posting impressive growth in profits, gross earnings and other indices for the six months period ended June 30, 2017.

Details of the audited results, released at the Nigerian Stock Exchange (NSE) showed that gross earnings rose by 22.1 percent from N70.3billion in H1 2016 to N85.8 billion for the corresponding period at June 30, 2017. The growth in Gross Earnings was driven primarily by a 27.8% increase in interest income and a 0.7 percent growth in net fee income to N11.2 billion. Similarly profits surged by 66.7 percent from N6.1 billion in 2016 to N10.2 billion, just as it recorded significant improvement in other key performance indices such as Net Interest Margin of 7.4%, Cost Income Ratio at 67.3% and Capital Adequacy of 18.4% in the period under review.

“Our balance sheet optimization initiatives continued to deliver improved results as Net Interest Margin (NIM) increased by 7.4% in H1 2017 from 6.4% (2016FY), just as the growth in the yield on our earning assets outpaced the increase in funding costs, said Fidelity Bank CEO, Mr. Nnamdi Okonkwo.

“The process improvement and digital banking initiatives in the period helped to optimize our cost profile as total expenses declined by 1.8% (despite the high inflationary environment) leading to a reduction in our Cost to Income Ratio (CIR) to 67.3%.”

Okonkwo attributed the double digits growth in earnings and profits to the disciplined execution of the Banks medium term strategy which focused on deepening its market share in the Small and Medium Enterprises (SME), Retail and Digital banking business segments.

Fidelity Banks’ retail strategy continued to deliver impressive results in HI2017 as savings deposits; a measure of customer confidence, increased by 3.9% to N161.1 billion in June 2017 on the strength of improved cross selling of its digital banking products with about 30% of customers now enrolled on our flagship mobile (*770#) and internet banking products” he explained.

With presence in the major cities and commercial centers in the country complemented by innovative digital banking products and channels, Fidelity Bank was rated as one of the Top 4 banks in the retail segment in the recently published KPMG BICSS. The bank which is managed by a highly professional team and a reputable Board of Directors commenced the interim audit of its financials in 2017 in line with its emphasis for continuous process and governance improvement