Dipo Olowookere
By Dipo Olowookere
On Thursday, Fidelity Bank Plc released its financial performance for the third quarter of 2018, which has been adjudged as impressive by analysts and market observers.
According to the 9 months financial scorecard of the lender released to the Nigerian Stock Exchange (NSE), the company recorded a double-digit growth in revenues and profitability, indicating that the bank was on course to finishing strong in the 2018 financial year.
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).
Details of the 9-months results for the period ended September 30, 2018, showed that gross earnings grew by 6.9 percent to N139 billion from N130.1 billion reported in the same period in 2017 whilst profit-before-tax soared by 23.6 percent from N16.2 billion to N20.1 billion.
In other indices, total assets grew by 21.9 percent to N1.680 trillion from N1.379 trillion in the same period last year, while the total deposits, a measure of customer confidence, increased by 27.3 percent to close at N986.8 billion from N775.3 billion in 2017
“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,” said Fidelity Bank CEO, Mr Nnamdi Okonkwo.
According to him, 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 y-o-y by 6.9 percent to close at N139 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.
The growth in deposits is further complemented by its digital banking push with 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, Fidelity Bank’s expenses grew by 6.5 percent to N50.6 billion due to increased technology investment and higher AMCON Charges.
Its cost to income ratio remained relatively stable at 68.4 percent compared with 67.5 percent in the 2017 FY.
Also, non-performing Loans (NPLs) ratio improved to 6 percent from 6.4 percent in the 2017 FY despite a 3.4 percent 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 percent and Liquidity Ratio at 38.3 percent.
