FBN Holdings post-tax profit falls 5.5% to ₦31.64bn

The tough operating environment had an adverse impact on the financial performance of FBN Holding as its profit-after-tax declined 5.5 per cent to ₦31.64 billion during the first six months of 2019.

The half year result sent to the Nigerian Stock Exchange showed that the financial group gross earnings increased modestly 0.3 per cent to ₦294.22 billion, compared to ₦293.31 billion in H1 2018.

The increase in the group’s revenue was mainly driven by increases in Fee & Commission Income, which was up by 18.8 per cent to ₦49.49 billion, Insurance Premium Revenue (up by 33.6 per cent to

₦9.75 billion), Net Gains from Financial Instruments at FVTPL (up by 341.6 per cent to ₦3.56 billion), and Other Operating Income (up by 28.5 per cent to ₦1.74 billion).

On the other hand, FBNH’s Interest Income was down by 1.60 per cent between January and June 2019 to ₦221.78 billion  against ₦225.40 billion in H1’18, on the back of 23.6 per cent and 9.8 per cent drop in Interest Incomes from Loans and Advances to Banks and Customers and can be attributed to the declining cost of capital in the broader economy especially since the post general elections period.

The group’s Interest Income from Loans and Advances to Banks reduced to ₦7.92 billion in H1’19 as against ₦10.37 billion in H1’18, while its Interest Income on Loans and Advances to Customers fell to ₦122.07 billion as against ₦135.37 billion in the same period last year.

Despite the reduction in Interest Income in H1’19, the group’s Operating Profit (EBIT) and Profit Before Tax (PBT) rose by 2.57 per cent and 2.56 per cent respectively from H1’18 position to settle at ₦39.85 billion and ₦39.87 billion in H1’19.

Nevertheless, owing to higher Income Tax expenses in H1’19 compared to H1’18, the group’s Earnings Per Share (EPS) fell by 7.7 per cent to 0.84k as against 0.91k in H1’18.