…best earnings yield stock
By Chioma Obinagwam
Fidelity Bank Plc. has said that its Profit Before Tax (PBT) for the 9-months ended September 30, 2018 increased by 23.6 percent.
According to the result, PBT grew from N16.2 billion to N20.1 billion.
An impressive financial performance for the third quarter (Q3) of 2018 and is on course to finishing strong in the 2018 financial year.
The bank disclosed in a statement at the weekend.
Extracts of the result, released at the Nigerian Stock Exchange (NSE) also showed a double-digit growth in revenues and profitability.
The result also showed that Gross Earnings grew by 6.9 percent to N139 billion from N130.1 billion reported in the same period in 2017 whilst total assets grew by 21.9 percent to N1,680.8 billion from N1,379.2 billion in the same period of the preceding year.
Total deposits, a measure of customer confidence, increased by 27.3 percent to close at N986.8 billion from N775.3 billion in 2017.
Reacting to the result, Fidelity Bank Chief Executive Officer (CEO), Mr. Nnamdi Okonkwo said,”We are delighted with our 9 months financial performance with the continuing execution of our medium-term strategy which has further yielded positive results, leading to impressive growth across key performance indices including profitability, total deposits and balance sheet size etc.”
He said that the bank has continued to grow its market share driven by significant traction in its chosen business segments such as Corporate, Commercial, SME and digitally led Retail Banking.
“Gross earnings increased Year on Year (y-o-y) by 6.9 percent to close at N139.0 billion, primarily driven by the growth in earning assets by 19.2 percent, which led to a 9.1 percent increase in interest income to N120.4 billion,” he explained.
“Over the years, Fidelity Bank has differentiated itself from its peers by continuously introducing customer – focused digital products to grow its market share and mobilize cheaper funds. Attesting to that, its savings deposits increased by 12.9 percent to N201.7 billion leading to the fifth consecutive year of double-digit savings growth whilst low cost deposits, now account for 73.6 percent of total deposits as shown in the results,” he continued.
The growth in deposits, the statement disclosed, is further complemented by its digital banking push which has resulted in having over 40 percent of its customers enrolled on the mobile/internet banking products and recording over 80 percent of total transactions on digital platforms.
Despite the high inflationary environment, the Bank’s expenses grew by 6.5 percent to N50.6 billion due to increased technology investment and higher Asset Management Corporation Of Nigeria (AMCON) charges.
The result further showed that its Cost to Income ratio remained relatively stable at 68.4 percent compared to 67.5 percent in the 2017 Full Year (FY).
Non-performing Loans (NPLs) Ratio improved to 6.0 percent from 6.4 percent in the 2017FY despite a 3.4 per cent growth in the absolute NPL numbers with the NPL coverage ratio at 109.9 percent.
Other regulatory ratios remained above the required thresholds with Capital Adequacy Ratio (CAR) at 17.0 percent and Liquidity Ratio at 38.3 percent.
Recall that the bank recently clinched the prize for best Earnings Yield at the Capital Market Correspondent Association of Nigeria (CAMCAN) awards for 2018 where it posted 25.23 percent, the highest among it’s peers.
Earnings Yield is the ratio of earnings per share to its market price per share.
Fidelity Bank is a full-fledged commercial bank operating in Nigeria with over 4 million customers who are serviced across its 240 business offices and various digital banking channels. The bank is focused on select niche corporate banking sectors as well as Micro, Small and Medium Enterprises (MSMEs).
