FBN Holdings: We Understand The Market, Okonkwo Says Of Superlative Profit Ahead AGM

The Group Managing Director of First Bank Holding, FBNH, Nnamdi Okonkwo has set the tone for what stakeholders are expecting at the Holder’s next month’s Annual General Meeting, AGM, next month after disclosing that the company understands the financial market better than competitors.

The deeply rooted understanding of its operating business environment, Okonkwo said, has ensured that the Group continues “to deliver a strong financial performance,” leveraging cutting-edge digital platforms despite the prevailing economic headwinds.

Coming on the back of the release of FBNH 2023 Half Year results, keen analysts insist that his comment will resonate positively with investors and other major stakeholders amidst the economic headwinds currently affecting the country’s financial sector.

Okonkwo while commenting on the results said in line with its focus, “the Group delivered strong growth in gross earnings and profit before tax resulting in N656.6 billion and N206.3 billion respectively, for the first half of 2023 financial year.

“Across our businesses, we continue to focus on customer-centric innovations with strong transactional and digital capabilities supported by sound risk management practices to anticipate and creatively deliver products and services that delight the different customer segments that we serve.

“Furthermore, we are committed to leveraging technology via digital platforms to enhance operational efficiency.

“Although the current operating environment remains challenging, we are confident of successfully navigating the terrain in our transformation journey to deliver sustainable value to our stakeholders,” he added.

FBNH’s half-year 2023 results, clearly indicate that the financial service provider delivered superlative performances in key metric areas in the period ending June 30, 2023.

The results have received wide applause from not a few industry stakeholders who said the conglomerate is well positioned in the nation’s financial sector.

For instance, Futureview Financial Services Limited, in its analysis said the report “portrayed a positive outlook” citing management and tax efficiency as key factors that delivered incredible profitability for FBNH.

According to the financial service firm, “The financial analysis of First Bank Nigeria Holdings for H1 2023 portrays a positive outlook, with notable growth across key financial indicators and improved profitability.

“The bank’s increased interest income, net interest income, and fee-based revenue demonstrate its strong financial performance during the period. Furthermore, First Bank Nigeria Holdings’ prudent cost management practices and tax efficiency have contributed to its enhanced profitability.

“The growth in total assets and net assets indicates a robust financial position, enabling the bank to effectively support its business expansion and future endeavors.

“With this positive momentum witnessed in H1 2023, the company is well-positioned to continue its growth trajectory in the Nigerian financial market. Nevertheless, prudent financial management and risk mitigation strategies will be crucial in sustaining this impressive performance in the coming periods.”

The report obtained by the magazine indicates that the company’s assets have grown significantly by close to 50 percent year-on-year, YoY to N14.2 trillion at the end of June 2023.

Commenting further, the firm said, “Return on Average Assets (ROAA) remained stable at 1%, reflecting the bank’s ability to generate earnings from its assets. Earnings Yield experienced a remarkable growth of 20% to 29%, signifying increased returns for investors relative to the market price.”

Compared to the half year 2022, its profit before tax, PBT, rose by over 200 percent to over N200 billion from N65 billion, while Profit After Tax, PAT, stood at over N187 billion compared to the same period in 2022.

The significant increase in PAT, the firm said, reflects the bank’s ability to generate higher earnings while efficiently managing tax liabilities.

Further analyses of the report indicate that Net Interest Margin declined by six percent to 62 percent, while Net Interest & Commission Margin decreased by seven percent to 19 percent.

Operating Profit Margin rose by 25 percent to 54 percent; Tax Rate decreased by five percent to nine percent; while Net Profit Margin witnessed a significant increase of 24 percent to 49 percent.

Meanwhile, key industry stakeholders familiar with the holder’s trajectory insist that Okonkwo has been a round peg in a round hole since he took charge of FBNH, bringing with him a wealth of experience spanning over three decades in the nation’s banking sector.