Published On: Fri, Apr 1st, 2016

Fidelity Bank grows revenue by eight percent

Fidelity Bank grows revenue by eight percent

…offers N4.6bn as dividend payout

In an unpalatable operating environment, Fidelity Bank Plc has said that its gross earnings for the period ended December 31, 2015 grew to N146.9 billion from N136.1 billion recorded in 2014 Financial Year (FY).

In the same vein, it promised shareholders N4.6 billion as dividend payout, thus maintaining a tradition of consistent dividend pay-out for the past six years.

According to the lender’s audited financial statements for the period under review, Fidelity Bank posted a rise of 7.9 percent and 0.8 percent in its gross earnings and profit respectively, despite the nation’s harsh operating environment characterised by regulatory and economic headwinds. Profit after Tax (PAT) for the period ended December 31, 2015 rose marginally to N13.9 billion as against N13.8 billion made in the comparable period last year. Whereas total equity increased by 6.0 percent to N183.5 billion from N173.1 billion in 2014 FY, net operating income stood at N83.9 billion, a moderate 12.5 percent rise from N74.6 billion in 2014 FY.

Commenting on the result, Chief Executive Officer, Fidelity Bank Plc, Nnamdi Okonkwo said that the bank’s 2015 FY performance reflects the disciplined execution of the management’s medium term strategy and the resilience of evolving business models despite the extremely challenging business environment in 2015. He explained that the bank improved the earning capacity of its balance sheet even in the face of decline in fee income precipitated by a N10.0 billion reduction in its foreign exchange income.

 

“We continued to increase yields on earning assets faster than the growth in funding costs which improved our Net Interest Margin (NIM) to 6.9 per cent in 2015.”  This development, the Fidelity helmsman added, is indeed indicative of the bank’s continual focus on balance sheet optimisation, rebalancing of its loan portfolio in consonance with its medium term strategy and increased growth in retail deposit base. In spite of the strong double digit growth of 12.5 per cent in net operating income, Profit before Tax (PBT) for the period ended December 31, 2015 assumed a downward trajectory, declining by 9.6 per cent to N14.0 billion from N15.5 billion in 2014 Financial Year.

“PBT declined by 9.6 per cent largely due to two critical factors: the 17.1 per cent increase in total expenses due to strategic investments and cost incurred in 2015 to position the business for further growth in line with our aspirations. The increase in impairments due to a more prudent approach adopted with respect to a special regulatory provision which was charged directly to the Profit and Loss (P&L) was responsible for the decline in profit”, he added.  But more importantly, the lender’s cost of risk remained within its guidance of 1.0 percent despite a 6.7 percent growth in the loan book and weaker macro-economic indices in the 2015 FY.

While total expenses rose by 17.1 percent to N64.1billion from N54.8 billion in 2014 FY, deposits fell to N769.6 billion from N820.0 billion representing a 6.1 percent decline.

Okonkwo explained that the decline was due to the implementation of the Treasury Single Account (TSA), adding that  the disciplined execution of the bank’s retail strategy continued to deliver strong results as savings deposits grew by 22 percent YoY in the 2015FY.

“Our NPL ratio remained constant at 4.4 percent while our regulatory ratios remained well above the set thresholds, our capital adequacy ratio at 19 percent gives us ample leverage to take advantage of emerging business opportunities”, Okonkwo stated.

In the new business year, the bank says it will focus on redesigning its systems and processes to enhance service delivery, disclosing plans to embark on cost optimisation initiatives aimed at reducing expenses by 5 percent. The bank will also adopt proactive risk management strategies, increase customer adoption/migration to its digital platforms and grow its retail banking market share.

The board of directors of the Bank said it is offering investors 16 kobo per share dividend for the period ended December 31, 2015. The Bank says the 16 kobo dividend is payable to shareholders whose names appear on the Bank’s register as at the close of business on April 18 to April 22, 2016, while the Annual General Meeting (AGM) and payment date is May 5, 2016. The lender said the 16 kobo per ordinary share of 50 kobo each amounts to N4.6 billion and this is subject to Withholding Tax at the appropriate tax rate, which will be deducted before payment.

© 2016, Hallmarknews. All rights reserved. Reference and link to this site is required if you wish to reuse any article.

Reactions from Facebook

comments and opinions

Leave a comment

XHTML: You can use these html tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Most Shared

Recent posts

  • Oshiomhole tackles Saraki in fight to finish

      By OBINNA EZUGWU Adams Oshiomhole, National Chairman of the All Progressive Congress (APC), has since made the removal of Senate President, Dr. Abubakar Bukola Saraki from office as Senate helmsman his major preoccupation. But his plots in this regard, as well as his hard-line stance on otherwise delicate issues, are not only threatening APC […]

  • Financial crisis in power sector endanger banks

    By AYOOLA OLAOLUWA   Except prompt actions are urgently taken, the banking sector could face another major financial crisis, no thanks to their heavy exposure to distressed power firms operating in the country. According to concerned experts in the power industry, a large chunk of the loans to power firms might be impaired likely throw […]

  • NSE: Investors devise survival strategies

    By TESLIM SHITTA-BEY As the Nigerian All Shares Index (ASI) scrapes past a downward slanting tunnel, a growing number of investors in the local stock market have started to rebalance their equity portfolios. Investors who have largely been exposed to fast moving consumer goods industries (FMCG’s) are beginning to redirect scarce cash to banking sector […]

  • Interim Dividends: Naira rain at GT Bank

    By OKEY ONYENWEAKU With its year on year yield at 9.98 per cent, GT Bank Plc has become the toast of local investors as its stock price bounced from N24 per share at the start of 2017 to a more recent price of N38. Audited accounts for the bank released last week saw gross earnings […]

  • Python Dance 3: Uwazurike condemns planned military operation in the South East as unnecessary intimidation

    By OBINNA EZUGWU Senior lawyer and president emeritus of Igbo think tank group, Aka Ikenga, Chief Goddy Uwazurike has condemned the planned military operation in the South East zone, Python Dance 3, as unnecessary and an attempt to intimidate the people of the zone. Chief Uwazurike who registered his displeasure over the planned military exercise […]

  • Stocks: Oil sector stocks defy economic downturn in 2nd Quarter

    By TESLIM SHITTA-BEY Despite a mild economic recovery in 2018, Oil sector stocks listed on the main board of Nigeria’s stock exchange are only recently shaking off the anguish of last year’s sector melt down. Indeed of the six leading Oil-related companies that have published 2nd quarter results in 2018, Seplat beat the blues by […]

  • Bears clobber Bulls in major rout

    By FELIX OLOYEDE After a stellar 2017, The Nigerian Stock Exchange (NSE) has collapsed to becoming the fourth worst performing equity market on the global over the last six months as political pressure and a United States of America (USA) interest rate hike intensify investor’s apathy. The local bourse plunged 18.24 per cent over the […]

  • PDP Coalition: anxiety mounts over flag bearer

    By OBINNA EZUGWU With the recent defection of Senate President, Abubakar Bukola Saraki and Sokoto State governor, Aminu Waziri Tambuwal to the People’s Democratic Party (PDP), the list of anticipated presidential hopefuls under the main opposition party’s platform is complete. But it now faces an imminent danger of being torn apart by the collision of […]

  • H1: Zenith Bank waves the magic wand

    By OKEY ONYENWEAKU Despite weak economic tailwinds, Zenith Bank Plc is fashioning a path to stronger corporate earnings in the year 2018. The bank’s management has recently struck a pact with lower operating expenses relative income while putting a spear through the heart of nonperforming loans (NPLs) as the banks half year (H1) 2018 results […]

  • I will disclose my 2019 presidential ambition in due time – Saraki

    By OBINNA EZUGWU Senate President, Abubakar Bukola Saraki has said he will tell Nigerians whether or not he will run for president in 2019 when the time is ripe. Saraki who stated this while responding to questions from journalists during his world press conference earlier on Wednesday in Abuja, following Tuesday’s invasion of the National […]

  • 2019 election budget: NASS leadership meets INEC in Abuja

    The leadership of the National Assembly (NASS) is currently in a meeting with the Chairman of Independent National Electoral Commission (INEC), Prof. Mahmood Yakubu. The meeting is a special hearing on INEC’s budget for the 2019 elections. The ongoing meeting was also tweeted via INEC’s official handle, @inecnigeria, where it was stated that the meeting […]

  • At last, Senator Akpabio dumps PDP for APC

    Former Minority Leader of the Senate, Senator Godswill Akpabio, on Wednesday officially decamped from the Peoples Democratic Party (PDP) to the All Progressives Congress (APC). Akpabio was welcomed to the ruling party at a rally organised for him by the Akwa Ibom State chapter of the APC. Some of the senators in attendance were Abdullahi […]

  • Sack of DSS boss: Osinbajo has made it clear invasion order didn’t come from him – Uwazurike

    Senior lawyer and president emeritus of Igbo think tank group, Aka Ikenga, Chief Goddy Uwazurike has commended Nigeria’s Acting President, Professor Yemi Osinbajo for summoning courage to sack the Director General of the DSS, Lawal Daura over Tuesday’s invasion of the National Assembly, noting that the Acting President, has, by his action, made it clear […]

  • NASS siege: Acting President, Osinbajo sacks DSS boss, Lawal Daura

    Acting President, Yemi Osinbajo, has sacked the Director-General of the Department of State Service (DSS), Lawal Daura following the siege on the National Assembly by security operatives on Tuesday. Osinbajo’s spokesman, Laolu Akande, disclosed Daura’s sacking on his Twitter handle, @akandeoj. He wrote, “AgP Yemi Osinbajo has directed the termination of the appointment of the […]

  • We want to restore Abia to its deserved glory—Otti

    Okey Onyenweaku Dr. Alex Otti, a forefront contestant for the post of Governor of Abia State, yesterday Sunday August 5, 2018 said in Lagos that he was gunning for position of Governor of the State to change the story of the Igbo man in Nigeria and perhaps the world. Otti, who met with friends at […]

  • Stocks: Investors scout for hidden value as market turns bearish

    By TESLIM SHITTA-BEY As Nigeria’s Stock Exchange’s All Shares Index (ASI) dips below a year-to-date yield of zero per cent (-4.58 per cent at the close of the previous week’s business on Friday), a growing number of investors have put gun sights on emerging hidden value opportunities in the market. So far the results have […]