FCMB Group announces 453% increase in PBT to N14 bn

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FCMB Group Plc has announced its unaudited group results (though containing the Bank’s Audited Results), for the nine-months ended  September 30,  2016 with profit before tax gaining 453 per cent to N14 billion as against N11.89 billion recorded in prior nine months ended  September 30,  2015.

The group said its gross earnings increased by 29 per cent to N140.7 billion for the nine months ended September 2016, from N109.3 billion for the same period prior year.

The lender’s non-interest income stood at N44.8 billion, for the nine months ended September 2016, an increase of 128 per cent Year-on-Year (YoY), from N19.6 billion for the same period prior year.

This increase in non-interest income was mainly driven by a 612per cent YoY increase in foreign exchange income, from N5 billion for the nine months ended September 2015, to N35.3 billion for the nine months ended September 2016.

Managing Director of FCMB Group Plc, Mr. Peter Obaseki,  said, “The audited nine months results for the period ended September 2016, reflects our focus on key soundness ratios and the need to maintain buffers against a sustained adverse operating environment.

“Accordingly, capital adequacy and liquidity ratios have held up at 17.6per cent and 36.8per cent, respectively.

“Underlying revenue momentum remains strong while cost optimisation programme led to a two per cent YoY drop in operating expenses, despite inflationary spiral.

“Overall, profit before tax came in at N14.2billion, a 453 per cent growth, translating to an EPS of 87 kobo, up 30.6per cent, YoY, respectively.

“The macro economic conditions in the final quarter remains challenging; we will keep up a conservative stance.”

Also, Group Managing Director of FCMB Ltd, Mr. Ladi Balogun, said “The audited results of the bank reveal that the extraordinary performance of Q2 2016 offset the loss recorded in Q3 of N2.4 billion, thereby resulting in strong year on year profit growth of 913per cent. In order to avoid an unsustainable, non-cash, spike in earnings from further revaluation gains in Q3, the bank also significantly stepped up its loan loss provisions. The macroeconomic climate is taking a significant toll on the bank’s borrowing customers across all segments. Accordingly, the bank will maintain high provision coverage ratios (currently 131per cent), continue to strengthen our capital adequacy ratio (currently 16.9per cent) and our liquidity ratio (currently 36.8per cent). While our prudential ratios should continue to strengthen into Q4 (modestly buoyed by a tier 2 capital injection of N7.5billion in November), we do not anticipate improvement in the fourth quarter earnings.

“Nonetheless, we are pleased with the gains we continue to record in growing our business in areas such as retail banking (with a 315per cent YoY growth in profitability) and increasing our share of banking activities in the agricultural sector.

“In spite of the fact that we have seen several revenue lines diminish due to external factors – as we build a more resilient balance sheet, we will be well positioned for a strong rebound in core earnings in the medium term.”

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