Fidelity Bank Posts Triple Earnings Growth in 2023

Fidelity Bank Plc has bolstered earnings performance as the top Tier-II lender grew profit by about 207% year on year, according to its recent unaudited financial statement filed with a regulator on Wednesday. Earnings triple as Fidelity Bank increase lending appetite with strong support from non-interest related revenue.

Details from its unaudited financial statement showed that profit after tax rose by more than three times to an all-time high of N142.8 billion, resulting in an earnings per share of N4.93 from N1.460 in 2022.

The bank’s non-interest revenue and interest income came stronger than amounts posted in the comparable year in 2022. Specifically, non-interest income increased by 3.8x to N104.6 billion as policy reforms in the FX market led to a net foreign exchange gain of N44.1 billion, according to analysts.

The bank’s 54.8% increase in interest income masked the 25.8% rise in interest expense, raising net interest income by 81.9% to N277.8 billion. As a result, operating income surged by 112.5% to N382.3 billion, which offset the growth in operating expenses by 111.9% to N194.2 billion and moderated the cost-to-income ratio by 16.3 percentage points to 50.8%.

The bank posted a material jump in impairment charges, up by 1114.1% to N66.1 billion in 2023. The rise in impairment charges was driven by the 9.1x jump in loan loss expenses to N61.9 billion. This drove cost-of-risk to 1.9%. Also, there was a surprise tax write-back of N20.8 billion for the year. IMF Estimates 3.1% Global Economic Growth for 2024