FCMB Group Plc has again proved its resilience and capability to deliver outstanding performance and returns to customers and shareholders going by the half-year results of the financial institution released recently.
For the six months ended June 30, 2020, the Group’s profit before tax (PBT) rose by 26 percent to N11.1 billion compared to N8.8 billion in the corresponding period in 2019. Profit after tax increased by 29 percent Year-on-Year to N9.7 billion.
This translates to an average return on equity(RoAE) of 9.4 percent and earnings per share of 49 kobos, a Year-on-Year improvement of 16 percent, and 29 percent, respectively.
The half-year results also showed that the Group recorded an increase in gross revenue by 9 percent to N98.2 billion as against N89.8 billion for the same period last year. Net interest income equally rose by 17 percent for the first half of 2020 to N45.4 billion from N38.7 billion posted in the first half of 2019, while non-interest income stood at N17.5 billion, an increase of 14 percent compared to N15.3 billion within the six months last year.
The financial institution intensified the tempo of its strong commitment and support to the growth of businesses and the Nigerian economy in general. For example, loans and advances grew by 29 percent Year-on-Year and 4 percent quarter-on-quarter to N794.6 billion.
Customer deposits went up by 28 percent Year-on-Year and 11 percent quarter-on-quarter to ₦1.1 trillion in June 2020, implying a significant increase in confidence in the institution.
Total assets surged upward by 31 percent Year-on-Year and 4 percent quarter-on-quarter to ₦1.97 trillion as of June 2020. The Group’s capital adequacy ratio stood at 17.3 percent, which is above the minimum requirement set by the Central Bank of Nigeria. The liquidity ratio was 32.2 percent. Customer base across the Group grew by 29 percent Year-on-Year from 5.9 million to 7.7 million.
FCMB Group is a holding company divided along with three business groups; Commercial and Retail Banking (First City Monument Bank Limited, Credit Direct Limited, FCMB (UK) Limited and FCMB Microfinance Bank Limited); Corporate & Investment Banking (the Corporate banking division of the Bank, FCMB Capital Markets Limited and CSL Stockbrokers Limited) as well as Asset & Wealth Management (FCMB Pensions Limited, FCMB Asset Management Limited, and FCMB Trustees Limited).
The subsidiaries of FCMB Group, who are market leaders in their respective segments, also performed satisfactorily within the six months. The Commercial and Retail Banking arm (comprising First City Monument Bank Limited, FCMB UK, Credit Direct Limited, and FCMB Microfinance Bank) reported a 42.9 percent Year-on-Year increase in PBT.
This was due to an increase in net interest income, fixed income instruments, trading income, and foreign exchange income. PBT also improved by 4.1 percent Quarter-on-Quarter due to an increase in fixed income instruments, trading income, and foreign exchange Income, as well as a decrease in expenses due to operational efficiency.
Corporate & Investment Banking (comprising the Corporate Banking Division of the Bank, FCMB Capital Markets Limited, and CSL Stockbrokers Limited) saw its performance improve Quarter-on-Quarter. This was driven by an increase in net interest income and non-interest income.
CSL Stockbrokers returned to strong and sustainable profitability, moving from a PBT of N18 million in half-year 2019 to N201 Million in half-year 2020, representing a 1034 percent Year-Year growth.
Investment Management (comprising FCMB Pensions Limited, FCMB Asset Management Limited, and FCMB Trustees Limited) grew its Assets Under Management (AUM) by 7 percent quarter-on-quarter and 28 percent Year-on-Year to N455 billion.
The growth in AUM reflects the increasing effectiveness of product sales strategy, which leverages the FCMB Group’s distribution strength and digital innovation.
The Group’s Pensions business contributed 75 percent of half-year 2020 AUM, compared with 83 percent within the same period in 2019. Other business lines accounted for 53 percent of the N99 billion Year-on-Year growth in AUM.
Analysts believe that with this impressive performance despite the challenging operating environment, FCMB Group is on a stronger pedestal to sustain its leading position in the financial industry and the Nigerian economy.
Over the years, the institution has created tremendous opportunities and added significant value to customers, shareholders, and other stakeholders through innovation and its customer-focused approach anchored on its culture of excellence.