By Peter Egwuatu
DESPITE the challenging environment and ongoing reforms in the Banking sector, Fidelity Bank Plc recorded  a gross earnings of N34 billion for the six months ended December 31, 2009 as against N72.27 billion for the twelve months period ended June 30, 2009.

Specifically, the Bank, in compliance with the new strict format required by the Central Bank of Nigeria (CBN) which was closely tied to the International Financial Reporting Standard (IFRS) as opposed to the Generally Accepted Accounting Principles (GAAP) was able to maintain profitability as it posted N1.75 billion profit as against N1.83 billion recorded at the end of 2008/2009 financial year ended 30th June.

Meanwhile, on an annualized basis, the December figure shows 73 per cent increase over the 12 months full year figure in June, while for gross earnings, the December figure represents a 3.91 per cent decline against the gross earnings recorded in June.

The decrease in revenue was attributed  to the slow down experienced in all segments of the bank’s business, particularly the credit market, as a result of the need to reappraised its lending structures  in compliance with the new threshold in regulatory standards.

This performance considering the global economic slow down as well as the Lamido Sanusi led Central Bank of Nigeria (CBN)’s banking reforms was modest and further demonstrates the success of the Bank’s cost management strategy which emphasized on a low-cost operating model in the face of shrinking revenue flows and strict loan provisioning.

Notwithstanding the challenges in the industry, the Board of Directors of the Bank paid a dividend of 2.5 kobo per share, translating to a total sum of N1.448 billion for the financial year ended December 31, 2009, a development many investors said was understandable. This is in contrast to N8.689 paid in the 12 months period ended June 30, 2009.

The Earnings Per Share (EPS) for the reviewed six months ended December 31, 2009 was 6 kobo as against 46 kobo in the 12 months period of 2008.

Other performance indicators show that the balance sheet side of the total assets dropped within the period under review by 13 .95 per cent from N506.27 billion to N435.67 billion. This notwithstanding, the Bank succeeded in shielding its shareholders’ funds from the threat posed by the business environment as total equity stood at N130.7 billion at the end of 2009, against N129 billion in June 2009.

It should noted that Fidelity Bank scaled through the CBN’s special examination and audit of its account. Following the banking reforms, the Bank had drawn its own framework that will firm up its risk management and loan administration processes to enable it remain at speed with best practices and regulation guidelines

On the area of control, the Bank said it would be putting on control procedure to ensure that infractions are detected at the earliest possible time and appropriately dealt with.

On newly introduced policies to the Banking sector by the CBN, such as tenure of banks’  directors,/Chief Executives, repeal of universal banking model, introduction of holding company concept and other guidelines , Fidelity Bank stated that it has remained alive to the realignments that are required both in its corporate governance and operational structure.
Meanwhile, Managing Director/CEO, Fidelity Bank Plc, Mr. Reginald Ihejiahi has  said that the Bank is currently implementing the ISO/IEC 27001: 2005 Certification Project, which is the world’s highest accreditation for information protection and data security. “ It is an overall security management and control framework for managing an organisation’s information security risk.” he added.
On customer service, Ihejiahi noted the need for banks to offer personalised service.
In his words, “ The task of keeping existing current customers and winning new ones has remained daunting as banks strive to keep costs low in order to improve profitability. It is in this regard and to strengthen our customer service experience and provide more convenience to our customer, that we have deployed a Fidelity Care Centre.