FCMB Group revenue, gross profit decline in Q1

FCMB Group revenue, gross profit decline in Q1

FCMB Group revenue, gross profit decline in Q1

FCMB Group Plc has posted gross earnings of N34.4 billion and profit before tax of N2.2billion in its first quarter operations.

Specifically, the bank’s unaudited result for the first quarter ended March 31, 2016 showed gross revenue of N34.4, as against N39.3 billion recorded within the same period in 2015.

The bank’s profit before tax stood at N2.2 billion, compared to N5.8 billion for the first quarter of 2015.

Net interest income stood at N17.2billion, a decline of five per cent Year-on-Year from N18.1 billion achieved during the same period prior year.

Loans and advances reduced by five per cent quarter-on-quarter (QoQ) to N561.6 billion in March 2016.

However, the Group’s net fees and commissions were up 11 per cent to N3.4 billion, from N3.0 billion during the same period last year.

The bank’s capital adequacy ratio increased to 18.5 per cent, compared to 18.1 per cent for the fourth quarter 2015, just as liquidity ratio rose by 38.2 per cent , as against 35.9 per cent for the fourth quarter of 2015. Operating expenses was flat at N16.5 billion.

Commenting on the results, the Managing Director of FCMB Group, Peter Obaseki explained that the continued lull in the economy, especially international trade, capital flows and government spending weighed on the bank’s group’s Q1 results.

He explained that the bank is actively rebalancing its financial position by reducing wholesale deposits and slowing down loan growth, especially from lumpy sources.
He added; ‘‘this approach is complementary to enhancing our capital position, liquidity management and cost saving initiatives.

Core fees and commission which are not tied to loan expansion are showing a strong and sustainable trend, with YoY growth of 11 per cent .

“We expect that subsequent quarterly earnings will improve upon Q1 2016, PBT of N2.2 billion, especially if government rolls out its expansionary budget and subject to well co-ordinated monetary stance.” he added.

The Group Managing Director of FCMB Limited, Ladi Balogun expressed optimism that the bank would witness significant recoveries and reduced cost of risk in subsequent quarters.

“This, in addition to the momentum in the retail banking division, particularly cards and electronic banking as well as rapid growth in current and savings accounts, should fuel stronger performance in the second quarter of the year.” He added.

Source:© Copyright Guardian Online