May 17, 2011 by Goddy Egene
Shareholders of First City Monument Bank (FCMB) Plc last Friday approved the proposal by the Board of the bank to apply for a commercial banking licence with international authorisation in line with the Central Bank of Nigeria (CBN)’s new licensing regime.
With the approval, FCMB will relinquish its universal banking licence and apply for the new licence, which will position the bank for more growth and profitability.
The shareholders who gave the approval at bank’s 28th Annual General Meeting in Lagos, also ratified the decision of the bank to adopt a holding company (Holdco) structure, which will enable it separate and re-organise its non-banking subsidiaries within a group arrangement.
Equally, the shareholders approved a dividend payment of 35 kobo per share for the year ended December 31, 2010.
The 35 kobo dividend, which amounts to N5.7 billion, is 600 per cent higher than the five kobo paid the previous year.
Some of shareholders who spoke at the AGM commended the performance and pledged their continued support to the board and management of the bank.
For instance, National Chairman, Shareholders Trustees Association, Alhaji Muktar Muktar, said shareholders were impressed with the performance of the bank despite numerous challenges in the financial industry.
He, therefore, appealed to other shareholders and stakeholders to give FCMB Plc all necessary support needed to move the bank forward.
In his report, Chairman of the bank, Dr. Jonathan Long , said the bank recorded a profit after taxation (PAT) of N7.9 billion for the year ended December 31, 2010, compared to N564 million for the 8-months ended December 2009, following the 2009 change in financial year-end. This represented 837 per cent growth in post-tax earnings on an annualised basis.
The 2010 audited results also revealed gross earnings of N63 billion, a 17 per cent growth over the period ended December 2009. Risk assets grew by 38 per cent from N240 billion as at December 2009, to N330 billion as at December 2010.
Net interest margin however, narrowed during the year, a development, long attributed to the low interest rate environment and the focus on high quality credit, which resulted in a 10 percent decline in net interest income.
Operating expenses were kept under control and grew by only three per cent in the year. Asset quality improved significantly, with the non performing loans ratio of the group dropping from nine per cent in December 2009 to 5.5 percent in December 2010.
Total assets and contingents grew by 17 per cent from N514 billion in December 2009 to N604 billion in December 2010