First Bank Holdings of Nigeria has announced a profit before tax of N39.9 billion in the first-half of 2019. This is an increase of 2.6 percent over N38.9 billion made a year ago.
In the six month period ended June 30, 2019, gross earnings of FBHN stood at N294.2 billion, up 0.3 percent year-on-year from N293.3 billion in the corresponding period of 2018.
Net-interest income slowed by 2 percent to N146.7 billion year-on-year, however, FBHN was able to improve its non-interest income by 3.6 percent from last year. The lender recorded 63.6 billion non-interest income, up from N61.3 billion in H1 2018.
Net interest margin, a measure of the difference between interest income banks make and the interest paid on depositor funds, rose to 7.7 percent in H1 2019, as against 7.1 percent in the same period last year.
In H1 2019, FBHN noted an impairment charge for credit losses of N22.1 billion, down 58.1 percent y-o-y from N52.8 billion.
Post-tax return on average equity, a gauge of how well shareholders fund is utilised in creating net income, improved to 11.6 percent compared to 10 percent in H1 2018. However
post-tax return on average assets of declined to 1.1 percent.
FBHN’s Non-Performing Loan ratio dropped to 14.5 percent as of June 30, 2019. The bank’s NPL was higher at 25.9 percent in December last year. Liquidity ratio for H1 2019 was 40.3 percent for First Bank (Nigeria) , down from 45.2 percent in December 2018, while its Capital Adequacy Ratio stood at 15.6 percent.
For FBNQuest Merchant Bank, the unified brand name for the Merchant Banking and Asset Management businesses of FBN Holdings, CAR improved to 13.4 percent from 12.2 percent in December 2018.
In H1 2019, total assets of the bank rose 1.8 percent to N5.7 trillion, from N5.6 trillion in December. Customer deposits increased by 2.8 percent to N3.6 trillion while customer loans and advances (net) also rose 3.5 percent to N1.74 trillion from N1.68 trillion in December last year.
Recall that Chapel Hill Denham, a Lagos-based independent investment bank projected that First Bank will sustain its earnings recovery amid further clean-up.
It expects profit After Tax (PAT) to of the lender to grow 19.2 percent year-on-year to N71.22 billion in full year 2019. “Our higher earnings forecast is hinged on non-interest income growth (+10.0 percent year-on-year) and sustained decline in impairment changes (-13.4 percent yearon-year).
In first quarter of 2019, PAT grew by 6.9 percent year-onyear as non-interest income increased by 21.8 percent year-on-year and impairment charges fell by 45.3 percent year-on-year, offsetting the impact of the 26.3 percent yearon-year growth in operating expenses on earnings.
