• Thursday, December 07, 2023
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FirstBank records strong Q1 2023 performance with 57% growth in profit to N53.5bn

First Bank, SMEDAN partner to offer SMEs financial, other support

First Bank of Nigeria Ltd has announced a Profit Before Tax (PBT) of N53.5 billion in the first quarter of 2023, a 57 percent increase from the N34.1 billion in the corresponding period in 2022.

According to Adesola Adeduntan, First Bank’s chief executive officer, “The FirstBank Group delivered an impressive performance in Q1 2023, with significant growth across key metrics.”

Data gleaned from the financial statement filed with the Nigerian Exchange (NGX) Limited showed the growth in PBT was driven by a 50.9 percent year-on-year growth in net interest income from N72.9 billion to N110 billion in Q1 2023.

“Net interest income saw a remarkable surge of 50.9 percent year-on-year on the back of optimal asset pricing and effective management of interest-earning assets,” Adesola Adeduntan, First Bank’s chief executive officer said.

Further findings showed the bank posted gross earnings of N245.7 billion in Q1 2023, a 44.2 percent growth against N170.4 billion it earned in the corresponding period of 2022.

“Gross earnings recorded a substantial increase of 44.2 percent year-on-year, demonstrating the bank’s ability to generate substantial revenue from core operations,” Adeduntan added.

First Bank’s non-interest income stood at N67.8 billion, a 10.6 percent increase compared to the corresponding period in 2022.

“Increasing penetration of digital and transaction banking offerings supported our Q1 performance in non-interest income by 15.3 percent growth,” Adeduntan noted.

The bank stated that its operating expenses of N107.6 billion in Q1 2023, was up by 21 percent from the N88.9 billion level in the corresponding period of 2022 while total assets increased by 5.1 percent to N10.6 trillion in Q1 2023.

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“The growth in our performance metrics underlies the strength in the core fundamentals underpinning our business strategy and sustainability of our business model,” Adeduntan said.

He added, “This year marks our 129th anniversary and these results clearly demonstrate the resilience of our business model and proven ability to transform ourselves to meet the demands of changing times and seasons.”

“Our transformative and purpose-driven strategy, alongside our strong value propositions, enable us to continue supporting our customers across our chosen markets. We are optimistic about the rest of FY 2023 and these results are a sign of better things to come,” Adeduntan said.

BusinessDay’s findings showed the board of FBN Holdings Plc has proposed the payment of 50 Kobo as dividends to shareholders of the company for the 2022 fiscal year.

“FBNHoldings continues to make good progress in transforming the enterprise despite the uncertain and complex operating environment, leveraging the execution capabilities of top talents across the Group to generate sustainable value for all our stakeholders,” Nnamdi Okonkwo, the group managing director said.

The group’s gross earnings grew by 6.3 percent to N805.1 billion in full-year 2022, a development that was by 49.6 percent growth in interest income to N551.9 billion.

“The increase in interest income benefited primarily from 31 percent growth in loans to customers. This was further supported by the higher interest rate environment, which positively impacted yields,” Okonkwo said.

The group’s total assets grew by 18.4 percent to N10.6 trillion. This was driven by a 31.5 percent increase in net customer loans and 18.6 percent increase in investment securities.

“Demonstrating improving earning asset position, cash and balances with central Banks, loans to banks & customers and investment securities constitute now 88.9percent of total assets versus 87.2 percent in the prior year,” Okonkwo said.

He noted that the group’s transformed risk management architecture continues to support the sustainable improvement in overall earnings.

“This has been demonstrated by the continuously improving asset quality metrics, despite the peculiar challenges across different markets,” Okonkwo said.

The group’s non-performing loan ratio declined to 4.3 percent in 2022 from 6.1 percent in 2021, within the regulatory benchmark of 5 percent, while the coverage ratio further improved to 86.6 percent from 62.2 percent. Similarly, the cost of risk dropped to 1.7 percent from 3.2 percent in 2021.

“The strengthened balance sheet provides a solid platform for resilient and sustainable earnings generation to support capital. On the back of this, our banking subsidiaries continue to maintain a disciplined approach to capital management supported by improving coverage ratios,” Okonkwo said.

The FBNQuest group also recorded 42.2 percent growth in profit-before-tax to close at a four-year high of N13.9 billion.

“The performance was underpinned by a 25.4 percent increase in gross earnings to N53.1 billion, and the successful implementation of cost optimisation initiatives saw operating expenses drop by 2.7 percent despite inflationary pressures,” First Holdings said.

It added, “We continue to make progress growing non-interest annuity type income, with non-interest income representing 82.8 percent of net revenues, growing by 13.9 percent. We also made progress growing net interest income by 27 percent, despite the rising cost of funds and increasing regulatory charges.”