• Friday, March 29, 2024
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Fidelity on course to be among Nigeria’s tier-1 banks by 2022, says CEO

Nnamdi Okonkwo

With key financial ratios staying comfortably within regulatory threshold, Fidelity Bank is very much on track to joining the league of tier-1 banks by 2022, the lender said.

By keeping an eye closely on Capital Adequacy Ratio (CAR), capital base and on the quality of loans to customers, the bank says it will achieve the target enshrined in its five-year strategic plan which would be driven mainly by organic growth.

“We have been able to drive our strategies to a point where the numbers are making us feel that we are doing things rightly even though we are yet to get to where we are going,” Nnamdi Okonkwo, the bank’s CEO, said, noting that the bank is somewhat around 44 percent implementation of the plan.

In full year 2018, Fidelity Bank sustained an impressive performance trajectory in its key financial ratios.

The bank saw a 0.7 percent increase in its CAR from 16 percent to 16.7 percent. This represents a 1.7 percent improvement when compared with the 15 percent minimum threshold of the Central Bank.

Similarly, non-performing loans (NPL) for the bank declined by 0.7 percent to 5.7 percent in 2018, from 6.4 percent in the previous year. Liquidity ratio also improved 3.1 percent to 3.9 percent, from 35.9 percent in 2017.

Okonkwo noted that keeping close focus on capital base, compliance and risk management as well as on liquidity management has helped in the bank in bringing down its NPLs overtime.
Recently, the bank announced the appointments of three new executives by its board of directors as part of corporate realignment aimed at repositioning it for further growth.

These appointments, the bank said, will help in strengthening its corporate market even as it focuses on lending to the retail sector of the market.

“We are growing our market share with continued traction in our chosen business segments. Consistent with previous years, we recorded double digits in interest income on our liquid assets, digital banking, FX and other income lines,” Okonkwo said.

Since assuming office in 2014, Okonkwo has transformed Fidelity Bank significantly, pursuing a digital retail banking approach whilst focusing on niche markets.

Under his watch, the bank successfully raised $400 million 5-year Eurobond with a 10.50 percent coupon which is the second largest combined new issue and liability management offering ever by a Nigerian issuer after Ecobank.

In a clear demonstration of its resilience and stability, the lender capped the year with growth in gross earnings, profitability and other key financial indicators.

The results showed that Fidelity Bank posted a 5 percent growth in gross earnings to N188.9 billion, from N180.2 billion in the previous year, whilst profit before tax soared by 30.6 percent to N25.1 billion when compared with the 19.2 billion recorded in 2017.

The bank’s profit after tax grew by 29 percent to N22.9 billion in 2018, from N17.7 billion in 2017, whilst operating income rose by 13.9 percent to N97.2 billion, from N85.9 billion in the previous year.

Also, the bank was able to grow its loans and advances by 10.6 percent to N30 billion despite juicy yields emanating from government securities that have made most banks turn off their tap to lending to the real sector.

Okonkwo was also pleased with the progress of the bank’s digital banking plan, with “over 42 percent of customers now enrolled in the bank’s mobile/internet banking products and more than 81 percent of total transactions done on digital platforms, resulting in 25 percent of fee-based income coming from digital banking”.

 

MICHAEL ANI