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FCMB grows Q3 net profit by 31% to N13b

FCMB Introduces Product For Youths

FCMB Group Plc recorded considerable growths in the top-line and profitability in the third quarter as the financial services group grew net profit by 30.6 per cent to N13 billion within the nine-month period.

Key extracts of the nine-month report for the period ended September 30, 2016 showed that group gross earnings rose by 29 per cent to N140.7 billion in September 2016 as against N109.3 billion by September 2015. Non-interest income had increased by 128 per cent from N19.6 billion to N44.8 billion. This increase was driven by 612 per cent increase in foreign exchange income from N5 billion in third quarter 2015 to N35.3 billion in third quarter 2016. Profit before tax rose by 19.4 per cent from N14.18 billion to N11.88 billion. Profit after tax also increased to N12.98 billion in third quarter 2016 as against N9.94 billion in comparable period of 2015.

FCMB Group includes First City Monument Bank (FCMB) Limited, FCMB Capital Markets Limited, CSL Stockbrokers Limited and CSL Trustees Limited.

Managing director, FCMB Group Plc, Mr. Peter Obaseki, said the improvements in the key performance indicators of the group to the soundness of ratios, steady buffers against the subsisting adverse operating environment, the group’s sustained revenue momentum and cost optimisation programme.

He noted that the capital adequacy and liquidity ratios of the bank have held up at 17.6 per cent and 36.8 per cent respectively, adding that the underlying revenue momentum remains strong as the cost optimisation programme of the group led to a marginal drop in operating expenses, despite the inflationary environment.

“The macro economic conditions in the final quarter remain challenging; we will keep up a conservative stance,” Obaseki said.

Group managing director, First City Monument Bank (FCMB) Limited, Mr. Ladi Balogun, said the audited results of the bank reveal that the extraordinary performance in second quarter 2016 offset the loss recorded in third quarter of N2.4 billion, thereby resulting in strong year-on-year profit growth.

He pointed out that in order to avoid an unsustainable, non-cash, spike in earnings from further revaluation gains in third quarter, the bank also significantly stepped up its loan loss provisions as the macroeconomic climate is taking a significant toll on the bank’s borrowing customers across all segments.

“While our prudential ratios should continue to strengthen into the fourth quarter, modestly buoyed by a tier 2 capital injection of N7.5 billion in November, we do not anticipate improvement in the fourth quarter earnings. Nonetheless, we are pleased with the gains we continue to record in growing our business in areas such as retail banking with a 315 per cent year-on-year growth in profitability and increasing our share of banking activities in the agricultural sector,” Balogun said.

He noted that in spite of the fact that the banking sector has seen several revenue lines diminish due to external factors; FCMB will be well positioned for a strong rebound in core earnings in the medium term as it builds a more resilient balance sheet.

“FCMB expects to continue to distinguish itself by delivering exceptional services, while enhancing the growth and achievement of the personal and business aspirations of its customers and all stakeholders,” Balogun said.

Categories: BANKING
Cynthia Charles: She is a prolific writer and has special interest on writing about business and opportunities. She can be contacted via cynthiaadigwe@financialwatchngr.com
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