BY EMEKA EJERE
Fidelity Bank Plc. has defied the lingering economic headwind occasioned by the COVID-19 pandemic to maintain its growth trajectory, with a set of half-year results showing improvement in all the major income lines.
According to the bank’s audited half-year results for the period ended June 30, 2020, submitted to the Nigerian Stock Exchange (NSE) at the weekend, the lender recorded strong growth in profits and other indices.
Its gross earnings increased to N106 billion in the period under review, compared with the N104 billion recorded in the comparable period in 2019.
There was also a surge in profit before tax (PBT) of N12 billion, up from the N9.8 billion recorded in 2019, which translated to a 22 per cent growth.
Fidelity Bank’s net profit grew by 33 per cent from N8.5 billion to N11.3 billion in the reporting period.
Other indices also showed that the bank’s total assets rose by 13.7 per cent, from N2.1 trillion in 2019, to N2.4 trillion this year, while total deposits rose by 14.8 per cent, from N1.2 trillion to N1.4 trillion during the same period.
The Tier 2 lender had recently announced its unaudited results for the three months ended March 31, 2020, showing gross earnings for the period grew by 5.7 per cent to N51.1bn from N48.4bn in the previous quarter.
While the bank declared a profit before tax of N6.6bn for the first quarter of 2020, profit after tax declined by 1.4 per cent to N5.8bn.
Net assets grew by 20 per cent to N242bn from the N202bn reported in Q1 2019.
Commenting on the result, Managing Director/Chief Executive Officer of the bank, Nnamdi Okonkwo, stated that the result for the quarter showed the resilience of the bank’s business model in an increasingly challenging operating environment.
“We have continued to show growth in key performance indices while increasing our cost of risk as we anticipate a tougher business environment,” he said.
On digital banking, Okonkwo said the results showed significant traction in terms of usage and adoption.
According to him, Fidelity Bank restated its first half 2019 figures from N15.1 billion to N9.8 billion to reflect the impact of International Financial Reporting Interpretations Committee (IFRIC) 21- Levies, which was adopted for the first time on the first half 2020 financials.
“The key impact of IFRIC 21 was that our 2020 full year, the Asset Management Corporation of Nigeria (AMCON) cost was recognised 100 per cent in our first half 2020 accounts rather than been amortised over 12 months as was done previously on our financials,” he said.
He added that without implementing IFRIC 21, profit for the period would have been N17.9 billion compared to the N15.1 billion reported in the comparable period in 2019.
Fidelity Bank has been implementing a digital-led retail strategy and digital banking gained further traction during the period with 87.3 per cent of the bank’s customers now transacting on digital platforms.
The figures are up from 82 per cent in 2019 full year, while 51.2 per cent of the bank’s customers are now enrolled on the bank’s mobile/internet banking products.