FCMB Group announces N8.9bn profit before tax in H1 2021

By Kayode Tokede

FCMB Group Plc has reported 19.5 per cent Year-on-Year (YoY)  drop in its profit before tax to N8.9billion in unaudited result and accounts for period ended June 30, 2021 from from N11.07billion reported in H1 2020.

The group also reported 22.1 per cent YoY drop in profit after tax as stated in half year (H1) ended June 30, 2021 result and accounts.

The holding financial institution on the Nigerian Exchange Limited (NGX) on Wednesday reported N7.56billion profit in H1 2021 from N9.7billion reported in H1 2020.

The decline is coming on the heels of decline in impairment losses on financial instruments and hike in total operating expenses.

The Group in its financial statement disclosed that Operating expenses rose by nine per cent YoY to N47.95 billion in H1 2021 from N44.05 billion, largely due to increased Asset Management Corporation (AMCON) and NDIC (Nigeria Deposit Insurance Corporation) costs.

On the flip side, net impairment loss on financial assets decreased by 48 per cent YoY performance to N4 billion in the period under review from N7.7 billion for the same period prior year.

Other financial parameters revealed that FCMB Group gross revenue closed H1 2021 at N94.2 billion four per cent increase over N98.2 billion reported in H1 2020.

The group reported an increase in cost of funds, led to a five year on year drop in net interest income from N45.4 billion for H1 2020, to N43billion for H1 2021.

The group in a statement said, “Non-interest income of N17.9 billion, for the six months ended June 2021, rose two per cent YoY from N17.5 billion for the same period prior year. Fees and Commissions income increased 33.5per cent YoY, as a result of an increase in customers’ transacting activities.

“However, this increase was muted by an 32.8per cent YoY drop in trading income, caused by lower volumes of fixed income instrument trades during the quarter. There was also a non-recurrence, in H1 2021, of the level of FX revaluation income seen in H12020.”

Financial position of FCMB Group showed loans and advances increase of 15 per cent YoY to N916.7 billion as at June 30, 2021 from N822.77billion reported in full year ended December 31, 2020 .

Total assets increased by 14 per cent YoY to N2.24 trillion as at June 30, 2021 from N2.06trillion reported in 2020 financial year.