Fidelity Bank Posts N28.1 Billion Profit, Proposes 22 Kobo Dividend
Fidelity Bank Plc has posted N28.1 billion profit for financial year 2020 as lender’s board of directors proposed to pay 22 kobo dividend per share to ordinary shareholders.
In a statement, the lender said strong full year results for the financial year ended December 31, 2020, is a clear demonstration of resilience and stability.
In the results announced Wednesday March 31, 2021 on the Nigerian Stock Exchange (NSE), the Nigerian lender capped a remarkable year, showing strong growth in core operating profits, net revenue and other key financial indices.
The audited statement showed that Fidelity Bank, which has become the clear leader among Tier 2 banks, posted a 50.9% growth in core operating profits from N29.8 billion in 2019 to N44.9 billion.
Meanwhile, Tier-2 lender’s net revenue increased by 15.0% from N111.8 billion in 2019. At the operational level, customer deposit rose by 38.7% from N1.225 trillion to N1.699 trillion in 2020. This signify stronger confidence in the bank’s operational and financial capabilities.
In addition, Fidelity Bank balance sheet expanded as total assets grew by 30.5% from N2.114 trillion in 2019 to N2. 758 trillion a year after.
However, tepid economic performance amidst pandemic-induced stress hit the lender’s profit performance in the year.
Fidelity Bank pretax profit bumps 7.6% to N28.1 billion from N30.4 billion in the corresponding year 2019, due to an increase in its loan provisions.
The management booked higher impairment charges on credit losses to shield lender from any headwinds; a positive move for the Bank especially in the current era of Covid-19 and its attendant effect on business risks.
Encouraged by the healthy results, the Board of Fidelity Bank is proposing a N6.4 billion payout, which translated to 22 kobo dividend per share to its shareholders.
“We are pleased with our financial performance, which clearly showed the resilience of our business model as core operating profit increased by 50.9% to N44.9 billion from N29.8 billion in 2019.
“We also saw a significant improvement in our efficiency indices as cost-to-income ratio moderated downward to 65.1% from 73.4% in 2019.
“However, Profit before Tax (PBT) dropped by 7.6% to N28.1 billion as we proactively increased our provisions on risk assets to N16.9 billion from a net write-back of N0.6 billion in 2019, said Nneka Onyeali-Ikpe, Fidelity Bank Chief Executive
Fidelity Bank Plc.’s Chief said lender took a conservative stance in recognition of the impact of the global pandemic, which has redefined business risks and opportunities in the new normal.
“As seen in recent years, the bank’s digital retail banking approach has continued to yield positive results. Though Digital Banking income dropped by 18.8% due to the revised banker’s tariff, it increased by 19.6% quarter on quarter on account of increased customer adoption as more services were migrated to the bank’s digital channels”.
Onyeali-Ikpe expresses happiness with the progress of its digital banking play stating that over 52.8% of customers are now enrolled on the bank’s mobile/ internet banking compared to 47.4% in 2019.
She noted that 88.4% of Fidelity Bank customers’ transactions were done on the digital platform products and more than 81 % of total transactions done on digital platforms.
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Fidelity Bank Posts N28.1 Billion Profit, Proposes 22 Kobo Dividend
