Fidelity Bank records 53.9% profit growth in Q1 2020

Fidelity Bank says it recorded N10.1 billion in profit before tax (PBT) for the first quarter of 2021 which ended March 31.

According to a statement released by the bank, this represents an increase of 53.9 percent when compared to N6.6 billion recorded in the corresponding period in 2020.

Gross earnings increased by 7.7 percent year on year to N55.1 billion on account of 66.7 percent growth in non-interest revenue to N12.1 billion from N7.2 billion in Q1 2020.

The bank’s unaudited results show an increase in net revenue by 13.4 percent from N30.3 billion in Q1 2020 to N34.4 billion in 2021.

The bank explained that the increase in its non-interest revenue came from foreign exchange related income, digital banking income and account maintenance charge, among other.

It said total customers’ induced transactions across all its service channels increased by 30.4 percent year on year and 17.1 percent quarter on quarter.

Commenting on the results, Nneka Onyeali-Ikpe, chief executive officer of Fidelity Bank Plc, said the bank is committed to sustaining its performance.

She said Fidelity Bank increased its operating expenses by N1.3 billion (6.2%) to N23.0 billion as a result of N4.3 billion growth in regulatory charges.

Excluding the increase in regulatory charges, the bank said its total operating expenses would have dropped by 13.8 percent to N18.6 billion from N21.6 billion in Q1 2020.

“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,” she said.

“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.

“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 2020FY. 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 2020FY.

“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.”