Fidelity Bank announces profit before tax of N28.1bn

FIDELITY Bank Plc, in a clear demonstration of its resilience and stability, has announced its financial results for the year ended December 31, 2020.

The performance which capped a remarkable year showed strong growth in core operating profits, net revenue, and other key financial indices.

The top Nigerian lender among Tier 2 banks, posted a 50.9 per cent growth in core operating profits from N29.8 billion in 2019 Financial Year (FY) to N44.9billion while net revenue increased by 15.0 per cent from N111.8 billion in 2019FY. Customer deposits, which is a measure of consumer confidence rose by 38.7 per cent from N1.2 billion to N1.6 billion just as total assets grew by 30.5 per cent from N2.1 trillion in 2019FY to N2.7 trillion.

However, profit before tax dropped by 7.6 per cent to N28.1 billiin from N30.4 billion in 2019FY, due to an increase in the bank’s loan provisions to shield it from any headwinds; positive for the bank especially in the current era of Covid-19 and its attendant effect on business risks.

Encouraged by the healthy results, the board of Fidelity Bank is proposing a N6.4 billion payout, which translates to 22 Kobo dividend per share to its shareholders.

“We are pleased with our financial performance, which clearly showed the resilience of our business model as core operating profit increased by 50.9 per cent to N44.9 billion from N29.8 billion in 2019FY.

“We also saw a significant improvement in our efficiency indices as cost-to-income ratio moderated downward to 65.1 per cent from 73.4 per cent in 2019FY.

“However, (PBT) dropped by 7.6 per cent to N28.1 billion as we proactively increased our provisions on risk assets to N16.9 billion from a net write-back of N0.6 billion in 2019FY,” said Nneka Onyeali-Ikpe, Fidelity Bank CEO, adding that the bank “took a conservative stance in recognition of the impact of the global pandemic, which has redefined business risks and opportunities in the new normal”.

As seen in recent years, the bank’s digital retail banking approach has continued to yield positive results. Though digital banking income dropped by 18.8 per cent due to the revised banker’s tariff, it increased by 19.6 per cent quarter on quarter (QoQ) on account of increased customer adoption as more services were migrated to the bank’s digital channels.

Onyeali-Ikpe is happy with the progress of the digital banking and the role it plays, stating that over 52.8 per cent of customers are now enrolled on the bank’s mobile/internet banking compared to 47.4 per cent in 2019FY, while 88.4 per cent of customers’ transactions were done on the digital platform and more than 81 per cent of total transactions done on the same channel.

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