FBN Holdings plc on The Nigerian Stock Exchange (NSE) has reported 17 per cent increase in its profit before tax in unaudited result and accounts for the nine months ended September 30, 2019.
The group’s profit before tax closed the period under review at N60 billion as against N51.3 billion reported in nine months of 2019.
Similarly, the group profit after tax gained 15.3per cent to N51.8 billion in nine months of 2019 from N44.9 billion reported in nine months of 2018.
The Group Managing Director, FBN Holdings, UK Eke, in a statement said, “Our performance in the third quarter reflects the growth trajectory over the first nine months of the year, with significant strides made in transforming the Group’s asset quality and diversifying our revenue streams across the board.
“During the third quarter, our NPL declined further to 12.6per cent as we approach the end of the curve in the resolution of our legacy portfolio and are confident of further reducing this to under 10% by the end of the current financial year.
“Critically, we have continued to focus on enhancing our risk framework processes enabling an improvement in the quality of our loan book.
“Concurrently, we have also continued our drive towards ensuing long-term operational efficiency, resulting in a one-off cost increase pushing our CIR for the first nine months.
“In terms of our revenue generation, we have delivered further increases in our non-interest income, on the back of growth in electronic banking fees as well as improvements in transaction-led income.
“Overall, we are pleased with the progress we are making on numerous fronts and remain committed to not only enhancing shareholder value but also adhering to the long-standing principles of this great financial institution.”
The commercial banking’s profit before tax grew by 18.6 per cent to N50.1 billion from N42.3 billion reported in nine months of 2018
The Commercial Banking business contributed 88.7per cent (Sep 2018: 90.3per cent) to the Group’s gross earnings and 84.2per cent (Sep 2018: 83.2per cent) to the Group’s profit before tax.
The Chief Executive Officer of FirstBank and Subsidiaries, Dr. Adesola Adeduntan in a statement said, “The Commercial Banking Group further improved its performance delivering an 18.6per cent year-on-year (y-o-y) growth in profit before tax.
In line with our commitment, we have continued to improve our asset quality while further enhancing the group risk management and controls.
“These deliberate steps continue to yield positive results with the NPL ratio further declining to 12.4per cent and impairment charges significantly decreasing by 63per cent y-o-y.
“As a result, cost of risk is down to 1.8per cent from 4.5per cent in the previous year, providing a stronger platform for enhanced future profitability.
“Clearly, we are in the final phase of addressing the legacy asset quality challenges and achieving our guidance of a single digit NPL ratio by the end of the year.
Equally important, we remain focused on transforming our business to a leading transaction-led institution, as highlighted by the 26.7per cent y-o-y growth in fees and commission-driven by 45.9per cent y-o-y growth in electronic banking fees.
“This has positively impacted non-interest income even as we continue to ramp up customer acquisition and retention through improved offerings from agents, digital, trade and transaction banking products. We are also focussed on further enhancing overall revenue generation capabilities with the aim of increasing share of the customers’ wallets.
“Furthermore, operational efficiency remains a key focus as we address all structural issues. With this in focus, we remain confident in our abilities to improve this metric going forward.
“In addition, our international subsidiaries have continued to contribute positively to our overall performance as we keep optimising the capacity of the Group to support stronger future earnings”.