Foremost financial institution, Fidelity Bank Plc has released its first half 2022 results recording 21.6 per cent growth in profit to N25.1 billion as well as decent growth in most key ratios.
According to the report released on the Nigerian Stock Exchange (NGX), the bank grew total deposits by 13.1 per cent year-to-date to N2,290.1 billion from N2,024.8 billion in the 2021 financial year, driven by double-digit growth in low-cost deposits.
Low-cost deposits increased by 26.1 per cent year-to-date to N1,902.4 billion and now represents 83.1 per cent of total deposits from 74.5 per cent in 2021 financial year, which explains the drop in funding cost.
“We are delighted with our H1 2022 performance which showed strong growth across key performance indices. With improved efficiency and customer experience around our network, customer transactions have grown considerably as we optimize our balance sheet and build up a large stock of stable low-cost deposits,” Fidelity Bank’s CEO, Mrs. Nneka Onyeali-Ikpe, said.
Gross earnings increased by 37.9 per cent YoY to N154.8 billion on account of 52.9 per cent growth in interest income to N136.2 billion from N89.1 billion in the first half of 2021. The increase in Interest Income was driven by improved yield on earnings assets and 14.9 per cent year-to-date expansion in earnings base to N2,546.5 billion.
Similarly, Net Interest Margin improved to 6.4 per cent from 4.7 per cent in 2021 financial year, due to a combination of improved yields on average earning assets and a decline in average funding cost.
Average yields on earning assets increased by 211bps YoY to 11.5 per cent while average funding cost declined by 84 bps to four per cent year-on-year, which resulted in 50.4 per cent growth in net interest income to N75.6 billion.
The release of the half year results coincides with the bank’s recent announcement on expanding to the United Kingdom with its proposed purchase of Union Bank UK.
Commenting on the proposed acquisition, Onyeali-Ikpe said: We recently executed a binding agreement for the acquisition of 100 per cent equity stake in Union Bank UK Plc in line with our strategic objectives and business expansion drive.
Union Bank UK offers a compelling synergy we hope to build on, to create a scalable and more sustaining service franchise that will support the wider ecosystem of our trade businesses and diaspora banking services.
On the back of the positive H1 2022 performance, the board of fidelity bank approved an interim dividend of 10k per share, making it the first time the bank will pay an interim dividend in its 34years history.
Credit: thenationonlineng.net
