FY’21: Applause as FBNHoldings gross profit soars by 99% to N166.7bn

FY’21: Applause as FBNHoldings gross profit soars by 99% to N166.7bn

FBN Holdings Plc (FBNH) on Thursday, announced its audited results for its 2021 financial year reflecting a strong financial performance despite the challenging macro-economic environment posed by Coronavirus (COVID-19) pandemic, high inflation and currency devaluation.

According to the group’s un-audited results presented to the Nigerian Exchange Limited (NGX), gross earnings increased by 28.2 per cent in its total income, which rose to N757.3 billion, up from N590.7 billion in the previous year of 2020.

The Group also recorded a a stelar performance of 99% increase in its profit before tax (PBT) to N166.7 billion, up from N83.7 billion in the previous year.

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Though, its net interest income declined by 9.3% to N228.2 billion as against N251.6 billion in 2020, its non-interest revenue grew by 96.1% to ₦364.6 billion, up from N185.9 billion it recorded in 2020, on the back of increased fees and commission income, treasury activities and other operating income.

The Group’s deposit from customers also increased by 19.5% y-o-y to N5.9 trillion, up from N4.9 trillion it made in 2020.) reaffirming its strong market access and robust funding base. The Group said the growth was a result of its investment in agent banking, digitalisation and deployment of digital platforms improved customer penetration and deepened solid retail franchise.

In the period, FBNH’s total assets also grew by 16.2% y-o-y to N8.9trillion, up from N7.7trillion in the previous year.

Its non-performing loan ratio further declined to 6.1% against 7.7% in 2020 while coverage its ratio improved to 62.2% from 48.0%.

Nnamdi Okonkwo, the Group Managing Director while commenting on the results stated that:
“I am very proud to have assumed the role of Group Managing Director of this great organisation in January 2022 and I am excited about building on the momentum of recent positive developments.

Our performance over the course of 2021 is reflective of the resilience of the Group and underpins our growth strategy to generate sustainable value for all our stakeholders. As a Group, we are acutely aware of the macroeconomic challenges facing businesses and remain focussed on carefully navigating the environment through innovation and by putting our customers at the centre of our attention.

As a financial service holding company, driving synergies remains a critical part of our strategy and has been integrated into every aspect of our delivery model. We pride ourselves in the uniqueness of our diversified portfolio and the collaborative ecosystem that we have built around our lines of business, our customers, and the unique value proposition that we deliver. We are also increasingly leveraging technology – artificial intelligence, robotics, and other next-generation technological advancements, to deepen collaboration and further drive operational efficiency across the Group.

Highlighting revenue and profitability, the Group delivered a stellar performance growing gross revenue by 28.2% to ₦757.3 billion and profit before tax by 99.1% to ₦166.7 billion. The 30.0% growth in loans and advances to ₦2.9 trillion and 16.2% growth in total asset to ₦8.9 trillion reaffirms our commitment to drive revenue and profitability as we complete the balance sheet clean-up.

In 2022, our strategic focus is on revenue generation through digital channels and retail product offerings, further driving our synergy potential as well as continuing to improve our operating model to deliver more efficiencies”.

In his comment, Dr. Adesola Adeduntan, Chief Executive Officer of FirstBank Group said: “Following years of strategic restructuring of the Bank’s balance sheet and operations, the Commercial Banking business is beginning to transition into a sustained growth phase delivering performance commensurate to the size of our business and capabilities of our people. Profit before tax is up 77.9%, gross earnings 30.3%, total assets 15.9% and customer deposits up 19.5%.

“This performance was driven by a relentless focus on the needs of customers and improving the competitiveness of our offerings. We have sharpened our ‘Go To Market’ approach to better leverage the opportunities which our large scale provides in addition to becoming more relevant to our clients by improving our value propositions.

“This performance is also in line with the Bank’s Quantum Profitability Leap agenda which seeks to ensure that we fully maximise the revenue generating capacity of our business to boost the bottom line and fulfil the expectations of all stakeholders in the business.

“The demonstrated resilience of our franchise to headwinds and excellent risk management capabilities place us in a good position to weather any macro-economic shocks which may arise due to the volatile nature of current operating environment. Our Non-performing loans ratio at the end of the year was 6.1% which represents significant progress towards those of other Tier 1 banks and the regulatory threshold of 5.0%. We will continue to leverage our investments in digital platforms, IT infrastructure, people, and pan-African operations to ensure this growth trend is sustained”.

The Group further disclosed that with its cleaner balance sheet and resilient earnings generating capacity, FirstBank (Nigeria) was able to accrete capital buffers from organic earnings, stressing its the lender’s Capital Adequacy Ratio (CAR) remained steady, marginally increasing to 17.4%.