Why Fidelity Bank posted 66% profit jump in audited Half Year results
Managing director and chief executive officer of Fidelity Bank Plc., Mr. Nnamdi Okonkwo has linked the impressive performance of the tier 2 lender which jumped to double digits growth in earnings and profits to operational resilience, management discipline and tailored execution of the Banks medium term strategy.
Business Hilights recalls that Fidelity bank’s had since mid last year keyed into deepening its market share in the Small and Medium Enterprises (SME), pumping as huge as over N30bn in the sub sector. The bank has also stemmed progress in both retail and digital banking business segments within the period under review.
Giving more insights on the encouraging performance, Okonkwo averred that “Our balance sheet optimization initiatives continued to deliver improved results as Net Interest Margin (NIM) increased by 7.4% in H1 2017 from 6.4% (2016FY), just as the growth in the yield on our earning assets outpaced the increase in funding costs”.
Details of the audited results, released at the Nigerian Stock Exchange (NSE) shows that gross earnings rose by 22.1 percent from N70.3billion in H1 2016 to N85.8 billion for the corresponding period at June 30, 2017. The growth in Gross Earnings was driven primarily by a 27.8% increase in interest income and a 0.7 percent growth in net fee income to N11.2 billion. This resulted in the profits growth by 66.7 percent from N6.1 billion in 2016 to N10.2 billion, just as it recorded significant improvement in other key performance indices such as Net Interest Margin of 7.4%, Cost Income Ratio at 67.3% and Capital Adequacy of 18.4% in the period under review.
Continuing, Fidelity bank boss made it clear that “The process improvement and digital banking initiatives in the period helped to optimize our cost profile as total expenses declined by 1.8% (despite the high inflationary environment) leading to a reduction in our Cost to Income Ratio (CIR) to 67.3%”.
Analysts say the bank’s retail strategy continued to deliver impressive results in H1 2017 as savings deposits; a measure of customer confidence, increased by 3.9% to N161.1 billion in June 2017 on the strength of improved cross selling of its digital banking products with about 30% of customers now enrolled on our flagship mobile (*770#) and internet banking products” he explained.
Besides, Fidelity Bank was rated as one of the Top 4 banks in the retail segment in the recently published KPMG BICSS, and again; star presence in major commercial centers in the country powered by innovative digital banking products and channels, plus being managed by highly professional team and reputable Board of Directors contributed in the impressive results.
