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Fidelity Bank posts impressive half-year results, profits up by 22 per cent

…gross earnings hit all-time high N105.8bn

 

In spite of the economic challenges occasioned by the COVID-19 pandemic, Fidelity Bank says it has sustained the financial performance trajectory of recent years with another set of impressive financial results in its half year report.

 

According to the top Nigerian lender, a surge in Profit-Before-Tax of N12 billion from N9.8 billion in 2019 has been recorded this year which translates to a 22 per cent growth.

 

Net profits for Fidelity Bank grew by 33 per cent from N8.5 billion to N11.3 billion in the reporting period while in other indices total assets rose by 13.7 per cent from N2.1 trillion in 2019 to N2.4 trillion this year.

 

Total deposits rose by 14.8 per cent from N1.2 trillion to N1.4 trillion during the same period.

 

Persecondnews reports that the details of the audited half year results ending on June 30, 2020 which was released on the Nigerian Stock Exchange (NSE) on Thursday, September 3, 2020, showed strong growth in profits and other indices.

 

Speaking on the impressive showing of the bank, the CEO, Mr Nnamdi Okonkwo, said it reflected the resilience of the bank’s business model.

 

“Due to the global and domestic headwinds witnessed in H1 2020, we proactively increased our cost of risk as the impact of the pandemic slowed down economic activities whilst adapting our business model to the new risks and opportunities of the new normal.

“Fidelity Bank restated its H1 2019 figures from N15.1bn to N9.8bn to reflect the impact of IFRIC 21- Levies, which was adopted for the first time on the H1 2020 financials.

 

“The key impact of IFRIC 21 was that our 2020FY AMCON Cost was recognized 100% in our H1 2020 Accounts rather than been amortized over 12 months as was done previously on our financials,” he said.

 

Okonkwo noted that without implementing IFRIC 21, profit for the period would have been N17.9 billion compared to the N15.1 billion reported in H1 2019.

 

He also said: Fidelity Bank has been implementing a digital-led retail strategy and digital banking gained further traction during the period with 87.3% of the bank’s customers now transacting on digital platforms. The figures are up from 82.0% in 2019FY while 51.2% of the bank’s customers are now enrolled on the bank’s mobile/internet banking products.

 

“Though digital banking income dropped by 29.1% due to the downward fee revisions for electronic transactions in line with the new bankers’ tariff, we have continued to receive positive reviews on our digital channels.

 

“IVY, the bank’s chat box is rated as the clear leader, among virtual assistants in the industry, just as our flagship instant banking product (*770#) was also rated in the top tier category in the recently released 2020 KPMG Digital Channels Scorecard.’’

 

Buoyed by the H1 performance, the bank is optimistic about the remaining part of the year.

 

“We believe the new phase of normalcy will unveil some growth opportunities. We will continue to monitor and pro-actively manage any evolving risks as the Nigerian economy gradually reopens and economic activities pick-up in key sectors” Okonkwo said.

 

Retail Banking in Fidelity Bank has continued to also deliver impressive results. Savings Deposits in H1 2020 increased by 32.2% to N363.9bn with the bank on course to achieving the 7th consecutive year of double-digit growth in savings. Savings Deposits accounted for 49.1% of the total growth in customer deposits and now represents 25.9% of total deposits compared to 22.5% in 2019FY.

 

In reflection of the bank’s early conservative assessment of the sectors that were affected by the COVID-19 pandemic, the bank’s Non-Performing Loans (NPL) ratio increased to 4.8% from 3.3% in 2019FY. Regulatory Ratios however remained above the required thresholds with Capital Adequacy Ratio increasing to 18.8% from 18.3% due to the capitalization of H1 2020 Audited Profits while Liquidity Ratio stood at 32.1%.

 

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Written by Per Second News

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