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Fidelity Bank’s declares N11.3bn half year profit

Despite the harsh economic environment enforced by the Covid-19 pandemic, Nigerian lender, Fidelity Bank has reported a N105.8 billion gross earnings in its audited results for the half-year ended June 30.

It also reported a net profit of N11.3 billion for the period.

A statement by the Bank on Monday, said it had sustained the financial performance trajectory of recent years with another set of impressive financial results despite the economic challenges occasioned by the Covid-19 pandemic.

A Fidelity Bank branch

The bank stated “Details of the Audited Half Year results ending June 30, 2020 for the top Nigerian lender, released on the Nigerian Stock Exchange (NSE) on Sept. 3, show strong growth in profits and other indices.

“The bank recorded a surge in Profit Before Tax of N12.0 billion from N9.8 billion in 2019, which translated to a 22 per cent growth.

“Net profits for Fidelity Bank grew by 33 per cent from N8.5 billion to N11.3 billion in the reporting period.

“In other indices total assets rose by 13.7 per cent from N2.1trillion in 2019 to N2.4 trillion this year whilst total deposits rose by 14.8 per cent from N1.2 trillion to N1.4 trillion during the same period”.

In his comments on the performance, Fidelity Bank CEO, Mr. Nnamdi Okonkwo it reflected the resilience of the bank’s business model.

According to him, “Due to the global and domestic headwinds witnessed in H1 2020, we proactively increased our cost of risk as the impact of the pandemic slowed down economic activities, whilst adapting our business model to the new risks and opportunities of the new normal”.

Okonkwo said Fidelity Bank re-stated its H1 2019 figures from N15.1billion to N9.8 billion to reflect the impact of IFRIC 21- Levies, which was adopted for the first time on the H1 2020 financials.

“The key impact of IFRIC 21 was that our 2020FY AMCON Cost was recognised 100 per cent in our H1 2020 accounts rather than been amortised over 12 months as was done previously on our financials,” bank CEO said.

He said that without implementing IFRIC 21, profit for the period would have been N17.9 billion compared to the N15.1billion reported in H1 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 82.0 per cent in 2019FY, while 51.2 per cent of the bank’s customers are now enrolled on the bank’s mobile/internet banking products.

“Though digital banking income dropped by 29.1 per cent due to the downward fee revisions for electronic transactions in line with the new bankers’ tariff, we have continued to receive positive reviews on our digital channel”, he explained.

“IVY, the bank’s chat box is rated as the clear leader, among virtual assistants in the industry just as our flagship instant banking product (*770#) was also rated in the top tier category in the recently released 2020 KPMG Digital Channels Scorecard.

“Retail banking in Fidelity Bank has continued to also deliver impressive results.

“Savings Deposits in H1 2020 increased by 32.2 per cent to N363.9 billion with the bank on course to achieving the 7th consecutive year of double-digit growth in savings.

“Savings Deposits accounted for 49.1 per cent of the total growth in customer deposits and now represents 25.9 per cent of total deposits compared to 22.5 per cent in 2019FY.

“In reflection of the bank’s early conservative assessment of the sectors that were affected by the COVID-19 pandemic, the bank’s Non-Performing Loans (NPL) ratio increased to 4.8 per cent from 3.3 per cent in 2019FY.

“Regulatory Ratios however remained above the required thresholds with Capital Adequacy Ratio increasing to 18.8 per cent from 18.3 per cent due to the capitalisation of H1 2020 Audited Profits while Liquidity Ratio stood at 32.1 per cent.

“Buoyed by the H1 performance, the bank is optimistic about the remaining part of the year”, he added.

Written by ExpressDay


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