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Fidelity Bank posts N2.05bn Profit

By Peter Egwuatu
Despite the difficult operating environment and adjustment to the new accounting period directed by the Central Bank of Nigeria (CBN) for all banks operating in the country, Fidelity Bank Plc has announced a profit of N2.05 billion for the financial year ended December, 2009.

The end-of-year financial result of Fidelity Bank Plc was released to operators at the Nigerian Stock Exchange yesterday following the approval of the accounts by the Central Bank of Nigeria at the weekend.

In the period from July 1- December 31,  2009, the Bank made a profit of N2.05billion, thereby making it one of the few operators in the Nigerian banking industry that has not made a loss all through the turbulent period. These six months represent the transition accounting period in order to comply with the common year end for all banks in the country which took effect by December 2009.

Fidelity Bank has also maintained its tradition of dividend pay out to shareholders, by proposing 2.5kobo for every 50kobo share held in the Bank or a total of N0.724 billion for the period. This makes it five unbroken years that the bank has continually paid dividend to its shareholders, a development that industry sources consider very unique.

According to a statement by the Bank, the profit of N2.05billion(after exceptional items) for the six-month reporting period compares favourably with the N3.98 billion recorded for the twelve month period ended June 30, 2009. On an annualized basis, PBT rose by 3.01 per cent between the periods under review.

In the same vein, the Bank posted N1.50 billion in Profit After Tax (PAT) contrast to the N1.60 billion recorded at the end of the twelve months period ended June 30 2009.

On an annualized basis, the December 2009 PAT represents an increase of 87.5 per cent over the June 2009 figure. The bank’s ability to improve its annualized profit performance is largely attributable to increased efficiency resulting from cost management as the challenging operating environment characterized provisioning and declining interest income put pressure on the earnings of most operators in the industry.

Gross Earnings for the six months period stood at N34.71 billion as against N72.27 billion for the twelve-month period ended June 30, 2009. On an annualized basis, the December figure represents a 3.94 per cent decline against the Gross Earnings recorded in June, which may not be unconnected with the tight lending regime and tough business environment which the banking industry has passed through recently.

The bank succeeded in shielding its shareholders’ funds from the threat posed by the harsh business operating environment as this indicator stood at N130.69billion at the end of 2009 as against N129.42 billion in June.


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