Fidelity Bank Plc announced it recorded strong financial performance in the first quarter of 2021, with appreciable growth in profits in the period ended March 31, 2021.
Details of the unaudited results, released at the Nigerian Stock Exchange (NSE) show that Profit before Tax (PBT) grew by 53.9 per cent from N6.6billion in 2020 to N10.1billion in the corresponding period of March 31, 2021. Similarly, the bank’s Net revenue in the period increased by 13.4per cent from N30.3billion in Q1 2020 to N34.4billion in 2021, with impressive growth in other performance indices.
Commenting on the bank’s records, Mr Nneka Onyeali-Ikpe, MD/CEO of Fidelity Bank Plc said, “We commenced the year showing impressive double-digit growth in profitability and improved performances across key efficiency indices whilst ensuring our business model continued to deliver strong positive results in line with our guidance for the 2021 financial year.
Gross Earnings increased by 7.7 per cent YoY to N55.1bn on account of 66.7 per cent growth in non-interest revenue to N12.1billion from N7.2billion in Q1 2020. In absolute terms, the increase in NIR came from FX related income, digital banking income and account maintenance charge etc. as total customers’ induced transactions across all our service channels increased by 30.4per cent YoY and 17.1 per cent QoQ.
Net Interest Margin remained unchanged at 6.3per cent compared to 2020FY as the drop in average funding cost offset the decline in average yields on earning assets. Average funding cost dropped to 2.5 per cent from 3.6 per cent in 2020FY due to a combination of improved deposit mix and a slight moderation in average borrowing cost. This led to 26.2per cent decline in total interest expenses, which translated to 17.1 per cent increase in net interest income to N28.8bn despite a 4.3 per cent increase in interest bearing liabilities. We refinanced our 7-Yr N30.0bn Tier II Bonds issued in 2015 at 16.48 per cent p.a. with cheaper 10-Yr N41.2bn Tier II Bonds priced at 8.5 per cent p.a., which led to a 61bpts drop in average borrowing cost to 4.5%.
Operating Expenses increased by N1.3bn (6.2%) to N23.0bn largely driven by N4.3bn growth in regulatory charges (NDIC & AMCON Charges). Excluding the increase in regulatory charges, total operating expenses would have dropped by 13.8% (6.1% QoQ) to N18.6bn from N21.6bn in Q1 2020 (Q4 2020: N19.8bn).