FBN Holdings Plc has reflected the harsh operating environment challenges in its Q3 2017 unaudited result, which showed mixed performance for the group, while the company thrives to overcome its loss position as at the end of 2016 financial year.
This is coming as Babatunde Mimiko has been appointed, Executive Director, FBN General Insurance, while the group’s Global Head Marketing and Corporate Communications, Folake Ani-Mumuney has been appointed Non-Executive Director of FBN Insurance Brokers Ltd, subject to regulatory approval.
Meanwhile, the holding company’s result released by the Nigerian Stock Exchange (NSE) Thursday showed that, for the nine months ended 30th September, 2017, FBN Holdings posted Profit after tax of N45.8 billion, up reflecting 7.8 per cent growth, compared with N42.5 billion recorded in 2016.
However, Customer deposits closed lower at N3.0 trillion, indicating 5.3 per cent y-t-d decline, against N3.1 trillion recorded as at 31 December 2016.
Also, the company’s net Customer loans and advances followed the same trend by declining to N2.0 trillion, reflecting 1.9 per cent y-t-d, against N2.1trillion posted as at 31 December 2016.
Also, operating expenses closed higher at N175.3 billion, up 8.4% y-o-y , while opex closed the corresponding period of 2016 at N161.8 billion.
The FBN Q3 result showed that the company’s total assets stood at n4.9 trillion, up 2.7 per cent year-to-date (y-t-d) (Dec 2016:N4.7trillion)
The result further showed that gross earnings is N439.2 billion, up 5.2 per cent as against N417.4 billion in 2016 while Net-interest income is N254.3 billion, up 25.3% y-o-y (Sept 2016: N202.9 billion)
The Group Managing Director, UK Eke, commenting on the results, said: “FBNHoldings has again demonstrated its resilience in revenue generation with a 5.2% y-o-y growth in gross earnings to N439.2 billion following a y-o-y increase of 25.2% in net interest income to N254.3 billion.
The Group is progressing in building the right structures for sustainable growth through an improved credit culture and risk management; increased technologically driven operational efficiencies; and the introduction of revenue enhancing platforms.
“The Insurance group sustained its strong performance and we expect to see further growth from the retail, corporate and annuity businesses.
Similarly, we continue to see strong growth trajectory in the Merchant Banking and Asset Management group. These businesses complement our commercial banking business in our aspiration to becoming the leading financial services institution in Middle Africa.
“We remain confident that the initiatives being implemented across our subsidiaries will further strengthen our business and ultimately reposition the Group for sustainable growth”
FBN Holdings’ Total assets hits N4.9 trillion as at September 30, 2017, up 2.7per cent year-to-date (y-t-d) increase over N4.7 trillion reported in 2016 full year.
The statement said, “Total assets increased by 2.7per cent y-t-d to N4.9 trillion (Dec 2016: N4.7 trillion); this was largely driven by a 7.1per cent y-t-d increase in investment securities to N1.34 trillion (Dec 2016: N1.25 trillion); and a 41.9per cent y-t-d increase in loans to banks to N631.5 billion (Dec 2016: N444.9 billion).
“Earning assets have been further optimised with total interest earning assets growing by 5.7per cent y-t-d to N3.96 trillion from N3.74 trillion in December 2016, representing 81.3per cent of total assets (Dec 2016: 79.0per cent)
Total customer deposits declined by 5.3% y-t-d to N2.9 trillion (Dec 2016: N3.1 trillion) as we focused on growing inexpensive deposit at the right mix.
The Group’s deposit base remains overall stable and strong with a growing retail franchise and about 13 million active customer accounts.
The decline in domiciliary deposits yt-d can be attributed primarily to the state related remittances made and reported during the half year results.
Similarly, term deposits declined to N841.2 billion (Dec 2016: N842.3 billion). On the other hand, Savings deposits, representing a very stable funding base, has continued to increase to N974.1 billion, up 2.2% y-o-y (Dec 2016: N952.7 billion) reflecting the strength of the franchise and its well-diversified funding base.
Total loans & advances to customers (net) declined by 1.9% y-t-d to N2.0 trillion (Dec 2016: N2.1 trillion) primarily following repayments and write-off of assets that had been fully impaired.
This result speaks to the efforts being made to strengthen asset quality in a sustainable manner while cleaning up our legacy asset position.