Byyomide Otitoju
FCMB Group has reported a significant 68.1 per cent increase in profit for the first half of the year, reaching N59.5 billion, up from N35.4 billion in the same period last year. This impressive growth was disclosed in the group’s quarterly report and financial statements for the period ended June 30, filed with the Nigerian Exchange Limited on Wednesday.
The group’s gross earnings soared to N374.5 billion, marking a 57.2 per cent rise from N238.2 billion in the same period last year. This growth was driven by increased customer deposits, higher loan disbursements, and the diversification of revenue streams.
Interest and discount income saw a remarkable 80.6 per cent jump to N269.2 billion from N149.0 billion the previous year. However, interest expenses also rose sharply by 112.4 per cent to N162.9 billion, up from N76.7 billion in H1 2023, due to higher interest rates and increased customer deposits.
Net interest income increased by 46.8 per cent to N106.2 billion from N72.3 billion. Meanwhile, fee and commission income grew by 27.1 per cent to N36.2 billion compared to N28.5 billion in the same period last year, benefiting from improved digital banking services, higher transaction volumes, and new product offerings.
Other income streams, including trading income and gains from financial instruments, contributed to the overall revenue with a combined total of N68.5 billion, representing a 13.4 per cent increase from N60.4 billion.
Total comprehensive income for the period stood at N84.3 billion, a 57.9 per cent increase from N53.4 billion, driven by increased profitability and favourable foreign currency translation differences.
The group managed to cut net impairment losses on financial instruments by 33.4 per cent to N31.3 billion from N47.1 billion.
Operating expenses, including personnel costs and administrative expenses, rose to N104.8 billion, up 48.4 per cent from N70.6 billion. The increase was attributed to investments in technology, branch network expansion, and staff training.
The group’s taxation charge for the period was N4.3 billion, 80.4 per cent higher than the previous year’s N2.4 billion.
Shareholders’ equity rose by 16.1 per cent to N535.2 billion from N460.9 billion, driven by retained earnings and improved financial performance. Additionally, FCMB’s total assets expanded by 34.4 per cent to N5.95 trillion from N4.42 trillion, fuelled by increased customer deposits, loan growth, and investments in securities.
Notably, the firm reported a net trading income of N31.4 billion for the period, representing a 281.6 per cent surge from the N8.2 billion recorded in the corresponding period in 2023. This growth was primarily driven by significant gains in foreign exchange trading, which rose to N15.5 billion from N921.8 million, alongside FGN bonds and treasury bills trading.
However, foreign exchange gains declined to N35.2 billion from N51.0 billion in the same period last year. Dividends on unquoted equity securities brought in N1.9 billion, up from N1.2 billion in 2023.
In May, FCMB Group announced plans to raise N150 billion in additional capital, following the Central Bank of Nigeria’s directive for banks to raise fresh capital. The apex bank, in a statement signed by its Acting Director of Corporate Communications, Sidi Ali, in March, mandated that commercial banks with international authorisation increase their capital base to N500 billion and national banks to N200 billion.
