BusinessFeaturedTrending Story

Fidelity Bank records 53.9% growth, Profit-Before-Tax of N10.1bn in 2021 Ist Quarter

106

Top Nigerian lender, Fidelity Bank Plc recorded a strong financial performance in the first quarter of 2021, posting appreciable growth in profits for the period ended 31 March 2021.

According to unaudited results released at the Nigerian Stock Exchange (NSE), profit-before-tax (PBT) grew by 53.9 per cent from N6.6 billion in 2020 to N10.1 billion for the corresponding period of March 31, 2021.

Similarly, net revenue in the period increased by 13.4 per cent from N30.3 billion in the first quarter of 2020 to N34.4 billion in 2021, just as the bank recorded growth in other performance indices.

Commenting on the results, Mrs Nneka Onyeali-Ikpe, the Managing Director/CEO of Fidelity Bank, described it as an impressive showing.

Mrs Nneka Onyeali-Ikpe

“We commenced the year showing impressive double-digit growth in profitability and improved performance across key efficiency indices whilst ensuring our business model continued to deliver strong positive results in line with our guidance for the 2021 financial year.

“Gross Earnings increased by 7.7% YoY to N55.1bn on account of 66.7% growth in non-interest revenue to N12.1bn from N7.2bn in Q1 2020. In absolute terms, the increase in NIR came from FX related income, digital banking income and account maintenance charge etc. as total customers’ induced transactions across all our service channels increased by 30.4% YoY and 17.1% QoQ.

“Net Interest Margin remained unchanged at 6.3% compared to 2020FY as the drop in average funding cost offset the decline in average yields on earning assets. Average funding cost dropped to 2.5% from 3.6% in 2020FY due to a combination of improved deposit mix and a slight moderation in average borrowing cost.

“This led to 26.2% decline in total interest expenses, which translated to 17.1% increase in net interest income to N28.8bn despite a 4.3% increase in interest bearing liabilities. We refinanced our 7-Yr N30.0bn Tier II Bonds issued in 2015 at 16.48% p.a. with cheaper 10-Yr N41.2bn Tier II Bonds priced at 8.5% p.a., which led to a 61bpts drop in average borrowing cost to 4.5%.

“Operating Expenses increased by N1.3bn (6.2%) to N23.0bn largely driven by N4.3bn growth in regulatory charges (NDIC & AMCON Charges). Excluding the increase in regulatory charges, total operating expenses would have dropped by 13.8% (6.1% QoQ) to N18.6bn from N21.6bn in Q1 2020 (Q4 2020: N19.8bn).

“Total deposits increased by 3.1% YTD to N1,751.3bn from N1,699.0bn in 2020FY, driven by 5.5% increase in low cost deposits (Demand: 6.2% | Savings: 4.1%).

“Foreign currency deposits increased by 15.7% YTD (N46.9bn) and now accounts for 19.7% of total deposits from 17.5% in 2020FY, as we harness the benefits of our renewed drive in Diaspora Banking as well as the recent CBN Naira-for-Dollar Incentive Scheme for diaspora remittances to Nigeria,’’ she said.

“We are committed to sustaining our growth trajectory and achieving the long-term strategic aspirations of the Bank as we look forward to delivering another set of good results in the next quarter.’’

Retail Banking continued to deliver impressive results as savings deposits increased by 4.1% YTD to N441.6bn and we are on course to achieving the 9th consecutive year of double-digit growth in savings deposits.

Savings deposits was responsible for 32.9% of the absolute growth in total deposits and now accounts for 25.2% of total deposits compared to 25.0% in 2020.

Net loans and advances increased by 7.6% YTD to N1,426.3bn from N1,326.1bn in 2020 financial year. However, the actual growth was 6.8% while the impact of the currency adjustment (2020FY: N400.3/$ – Q1 2021: N407.6/$) accounted for a 0.8% YTD growth in the loan book. Cost of risk came in at 0.4% and the NPL ratio dropped to 3.6% from 3.8% in 2020 financial year.

Other regulatory ratios remained above the required thresholds with liquidity ratio at 33.9% and capital adequacy ratio (CAR) at 18.4% from 18.2% in 2020 financial year.

Fidelity Bank

Fidelity Bank is a full-fledged commercial bank operating in Nigeria, with over 6 million customers who are serviced across its 240 business offices and various other digital banking channels.

The bank has in recent times won accolades as the Best SME Friendly Bank, Best in Mobile Banking and the Most Improved Corporate/Investment Bank among several industry awards and recognitions. The bank was also ranked the 4th Best Bank in the Retail Banking Segment in the 2017 Banking Industry Satisfaction Survey conducted by KPMG.

Focused on select niche corporate banking sectors as well as Micro Small and Medium Enterprises (MSMEs), Fidelity Bank is rapidly implementing a digital based retail banking strategy which has resulted in an exponential growth in savings deposits over the last 3 years and a corresponding surge in customer enrollment on the bank’s flagship mobile/internet banking products.

READ ALSO: Fidelity Bank announces sweeping directorate, executive management positions as incumbents retire

Leave a comment

Related Articles

Nigerian Business Community to FG: Use Ghana Trade Office to solve our problems

The Nigerian business community in Ghana has urged the federal government to...

FG approves N12.7bln for mass metering of army barracks nationwide

The Federal Government says it has released N12.7 billion to provide electricity...

Heirs Holdings tells story of transformational investment in Africa, launches its first-ever TV commercial

Heirs Holdings has launched its first-ever television commercial (TVC), showcasing the company’s...

Aig-Imoukhuede, co-founder, returns to Access Holdings as Chairman

Access Holdings PIc has announced the return of Mr. Aigboje Aig-Imoukhuede as...

CBN to sanction MfBs over late non-rendition of statutory monthly returns

The Central Bank of Nigeria (CBN) has directed all microfinance banks (MfBs)...

In a great leap forward, Heirs Holdings launches Heirs Technologies, set to lead Africa’s digital evolution

Heirs Holdings, a leading African investment company dedicated to improving lives and...

Women’s Day: Tinubu felicitates women, vows to prioritise their welfare, rights

President Bola Tinubu has promised to prioritize the welfare of women, protect...

All African Games: Nigeria’s Flying Eagles start their campaign on a losing note

The Flying Eagles of Nigeria started their campaign in the men’s football...

Transcorp Group announces listing of Transcorp Power Plc by introduction on Nigerian Exchange’s Main Board March 4

Transnational Corporation Plc (Transcorp Group) wishes to announce the listing of its...

CBN to sell N1.64trn Treasury bills in Q2 2024

The Central Bank of Nigeria (CBN) has said it will sell Treasury...

Nigeria lacks sufficient reserves to tackle FX demands, backlog in the market, says expert

An economist, Mr. Esili Eigbe, has said Nigeria lacked sufficient reserves to...

CBN to sell dollar at N1,301 to authorized BDC

In its bid to increase liquidity, strengthen the naira, and curb distortion...

Economic hardship: Elumelu to partner MOFI to boost economy

Nigerian philanthropist and Chairman of Heirs Holdings Group, Mr. Tony Elumelu, has...

NSA, CBN join forces to curb illicit activities in forex market

In its bid to strengthen Nigeria’s foreign exchange market, the Office of...

CBN stops dollar cash payments for BTA, PTA

The Central Bank of Nigeria (CBN) has announced that it will no...

Wigwe’s death: Access Holdings appoints Bolaji Agbede its Ag. CEO

Access Holdings Plc has announced the appointment of Ms. Bolaji Agbede as...

We must moderate our demands for forex, says Cardoso

The governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso,...

NNPCL, CBN partner for seamless banking operations

In their bid to foster transparency and seamless commercial operations, the Nigerian...

FG set to disburse N200bln to Nano business owners

Poised to turn around the economic fortunes of Nigeria, the Federal Government...

EFCC sets up task force to combat dollarization of economy, mutilation of naira

The Economic and Financial Crimes Commission (EFCC) has announced the setting up...