Thursday, April 27, 2017 11:55 AM / NSE
Nnamdi Okonkwo, Managing Director and CEO of Fidelity Bank Plc commenting on the results, stated that:
“We have started the 2017 FY showing impressive double-digit growth on gross earnings and profitability whilst keeping our operating costs under control as our business model continued to enable us deliver improved performance in line with our strategic objectives for the financial year.
Gross earnings increased y-o-y by 18.8% to N40.8 billion driven by a combination of increased yields on earning assets and an absolute growth in the volume of earning assets which led to a 24.1% y-o-y growth in interest income. However net interest income increased by 2.8% as interest expense also inched up in line with the higher interest rate environment. Net fee income declined y-o-y by 25.3% to N3.5 billion due to a 21.2% drop in E-banking income arising from the stoppage of international card transactions.
Our cost optimization initiatives continued to deliver cost savings as total operating expenses declined y-o-y by 10.4% to N14.4 billion, this was driven by a decline in over 60% of our operating expense lines in Q1 2017. We will continue to optimize our cost profile without impacting service delivery through the disciplined execution of the initiatives from our recently completed business optimization project
Total deposits increased q-o-q by 0.9% to N800.2 billion in March 2017 from N793.0 billion in December 2016 with low cost deposits accounting for 79.4% of total deposits. Our retail banking strategy continued to deliver impressive results as Savings deposits increased q-o-q by 5.6% to N163.7 billion in March 2017.
Risk assets increased q-o-q by 1.7% to N730.4 billion with cost of risk dropping marginally y-o-y to 0.4% while our coverage ratio stood at 90.9% from 83.5% in 2016 FYE. Non-performing loans ratio improved to 6.1% from 6.6% in the 2016 FYE due to a 7.1% drop in absolute NPL figures and the growth in the loan book. The decline in absolute NPL volumes was primarily from the following sectors which accounted for over 85% of the decline; General Commerce, Transport, Retail and Real Estate sector.
We remain focused on the execution of our medium term strategic objectives and targets for the 2017FY whilst we look forward to delivering another positive set of results in the next quarter”