Leading financial institution, Fidelity Bank Plc, has released its H1 2022 results recording a remarkable 21.6 per cent growth in profit to N21.6 billion as well as decent growth in most key metrics.
According to the report released on the Nigerian Stock Exchange, NGX on Tuesday, 30 August 2022, the bank grew Total Deposits by 13.1 percent YTD to N2,290.1 billion from N2,024.8 billion in 2021FY, driven by double-digit growth in low-cost deposits. Low-cost deposits increased by 26.1 percent YTD to N1,902.4 billion and now represents 83.1 percent of total deposits from 74.5 percent in 2021FY, which explains the drop in funding cost.
“We are delighted with our H1 2022 performance which showed strong growth across key performance indices. With improved efficiency and customer experience around our network, customer transactions have grown considerably as we optimize our balance sheet and build up a large stock of stable low-cost deposits”, stated Fidelity Bank’s CEO, Mrs. Nneka Onyeali-Ikpe.
Gross Earnings increased by 37.9 percent YoY to N154.8bn on account of 52.9 percent growth in interest income to N136.2 billion from N89.1bn in H1 2021. The increase in Interest Income was driven by improved yield on earnings assets and 14.9 percent YTD expansion in earnings base to N2,546.5 billion.
Similarly, Net Interest Margin improved to 6.4 percent from 4.7 percent in 2021FY, due to a combination of improved yields on average earning assets and a decline in average funding cost. Average yields on earning assets increased by 211bps YoY to 11.5 percent while average funding cost declined by 84bps to 4.0 percent YoY, which resulted in 50.4 percent growth in net interest income to N75.6 billion.
The release of the half year results coincides with the bank’s recent announcement on expanding to the United Kingdom with its proposed purchase of Union Bank UK.
Commenting on the proposed acquisition, Onyeali-Ikpe said: We recently executed a binding agreement for the acquisition of 100.0 percent equity stake in Union Bank UK Plc in line with our strategic objectives and business expansion drive. Union Bank UK offers a compelling synergy we hope to build on, to create a scalable and more sustaining service franchise that will support the wider ecosystem of our trade businesses and diaspora banking services.
On the back of the positive H1 2022 performance, the board of fidelity bank approved an interim dividend of 10k per share, making it the first time the bank will pay an interim dividend in its 34 years history.
Fidelity Bank is a full-fledged commercial bank operating in Nigeria with over 6.5 million customers serviced across its 250 business offices and digital banking channels. The bank was recently recognized as the Best SME Bank Nigeria 2022 by the Global Banking & Finance Awards. The bank has also won awards for the “Fastest Growing Bank” and “MSME & Entrepreneurship Financing Bank of the Year” at the 2021 BusinessDay Banks and Other Financial Institutions, BAFI Awards.
