FBN Holdings hits N5.1trn in total assets

First Bank of Nigeria Holdings Plc grew total assets to N5.1 trillion in nine months ended September, 27 per cent from N4.2 trillion in December, 2015.

The growth in total assets was driven by customer deposits that gained nearly 11 per cent to N3.3trillion from N2.97 trillion in 2015 while loans and advances to customers rose by 22 per cent from N1.8 trillion to N2.2 trillion as at September 2016.

The financial institution said, “We are focusing on ensuring an appropriate deposit mix at the optimum price. Low-cost deposits now represent 69.1 per cent of the Group’s total deposits, up from 67.3per cent as at December 2015.

“Deposit growth was essentially driven by a 41.8per cent and a 9.4per cent increase in domiciliary and savings deposits respectively.

“Demonstrating the strength of our franchise and ability to continually attract a well-diversified and sustainable funding base, retail banking  deposits within FirstBank (Nigeria) remain strong at 69.5per cent of total deposits (Dec 2015: 67.7per cent) as deposits in other business lines grew stronger.

“Foreign currency deposits now represent 18.5per cent of the Group’s total deposits (Dec 2015: 14.5per cent) but 20.4per cent (Dec 2015: 17.8per cent) of the FirstBank (Nigeria) deposits at N516.1 billion.”

FBN Holdings unaudited result and accounts to The Nigerian Stock Exchange (NSE) on Wednesday said its Profit before tax closed 3.5 per cent lower at N57.4 billion in September 2016 as against N59.6 billion recorded in September 2015.

Income tax expense was N14.9 billion from N9.3 billion in prior nine months of 2016, resulting in an effective tax rate for the period at 26 per cent.

Commenting on the results, the Group Managing Director, FBN Holdings Plc, Mr. UK Eke,  said: “the group performance has again demonstrated its underlying resilience despite the ongoing macroeconomic and business challenges with gross earnings and profit before tax closing at N417.3 billion and N57.5 billion respectively. This has been achieved through sustained revenue generation as well as increased cost efficiencies.

“Although the current currency weakness is a challenge for our remedial process, we are steadfastly progressing on improving the overall risk management culture, governance and technology as well as the degree of compliance across the Group”.

“The Group remains committed to ensuring sustained improvement in our performance with a view to restoring shareholder value”.

Gross earnings increased by seven per cent to N417.3 billion from N390 billion in September 2015.

The financial institution said it reflects the strong business fundamentals on revenue momentum amidst a slow business environment.

However, despite the 56.5 per cent increase in non-interest income to N131.0 billion, interest income declined by 7.3 per cent to N278.6 billion from N300.4 billion in September 2015.

Net-interest income improved by 5.2per cent to N202.9 billion (Sept 2015: N192.9 billion), driven by a 38.4 per cent reduction in interest expense on customers’ deposits to N56.7 billion (Sept 2015: N92.0 billion).

“This was partly offset by a 7.3per cent decline in interest income, largely due to a 4.7 per cent drop in loans to customers to N193 billion (Sept 2015: N202.5 billion) due to tightening of our risk acceptance criteria, as well as 12.7 per cent decrease in interest on investment securities to N74.1 billion (Sept 2015: N85.0 billion),” the bank said in a statement.