Fidelity Bank declares 53.9% increase in PBT

Arakunle Kayode

Fidelity Bank Plc recorded a 53.9 percent increase in Profit Before Tax (PBT) which puts its figures at N10.1 billion for the first quarter ended March 31, 2021 (Q1’21) as compared to N6.6 billion in the same timeframe in 2020 (Q1’20). This was contained in its unaudited report submitted to the Nigerian Exchange Limited (NGX).

According to the  report, the bank’s net sales rose by 13.4 percent to N34.4 billion in Q1’20 from N30.3 billion in Q1’20.

Speaking on the performance, the bank’s Managing Director, Nneka Onyeali-Ikpe said, “We began the year showing impressive double-digit growth in profitability and improved performance across key efficiency indices, while ensuring the business model continued to produce strong positive results in line with our guidance for the 2021 fiscal year.”

“Gross earnings increased 7.7 percent year on year (YoY) to N55.1 billion, with non-interest income increasing 66.7 percent to N12.1 billion from N7.2 billion in Q1’20.

In absolute terms, the rise in net interest revenue (NIR) was driven by foreign exchange related income, digital banking income, and account maintenance charges, among other things, as total customer-induced transactions across all of our service channels increased by 30.4 percent year on year and 17.1 percent quarter on quarter.

“The net interest margin remained unchanged at 6.3 percent in 2020, as lower average borrowing costs offset lower average yields on earning assets. The average funding cost fell from 3.6 percent in full year 2020 to 2.5 percent as a result of improved deposit mix and a marginal moderation in average borrowing cost.

Despite a 4.3 percent rise in interest bearing liabilities, this resulted in a 26.2 percent decrease in gross interest expenditures and a 17.1 percent increase in net interest income to N28.8 billion.

“We refinanced our 7-year N30.0 billion Tier II bonds issued in 2015 at a rate of 16.48 percent per annum. with cheaper 10-Year N41.2 billion Tier II bonds priced at 8.5 percent p.a., resulting in a 61-basis point reduction in average borrowing cost to 4.5 percent.”