FBN Holdings Plc has announced a significant 118.46% increase in gross earnings for the first half of 2024, totaling ₦1.40 trillion, compared to ₦641.99 billion in the same period of 2023. This impressive growth was driven by a robust performance across key revenue streams, despite rising costs and economic pressures.
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Interest Income: Interest income soared by 155.39% to ₦947.69 billion, up from ₦371.08 billion in H1 2023. However, interest expenses also rose sharply by 218.96%, leading to a net interest income of ₦514.93 billion, reflecting an 118.75% increase.
Fee and Commission Income: The bank saw a 49.14% rise in fee and commission income, which reached ₦129.93 billion. After accounting for expenses, net fee and commission income grew by 54.01% to ₦110.84 billion.
Net Gains: Net gains on the sale of investment securities and financial instruments at fair value through profit or loss (FVTPL) were notable contributors, with increases of 72.66% and 89.53%, respectively.
Profitability:
FBN Holdings recorded a 100.92% increase in profit before tax (PBT), which stood at ₦411.99 billion, compared to ₦205.05 billion in H1 2023. Despite a 171.89% rise in income tax expenses, the bank’s profit after tax (PAT) grew by 93.67% to ₦360.27 billion, up from ₦186.02 billion. Basic earnings per share also saw a significant rise, increasing by 97.29% to ₦10.18 from ₦5.16.
Operating Expenses and Provisions:
Operating expenses nearly doubled, increasing by 95.02% to ₦445.69 billion, reflecting higher staff costs, depreciation, and other operating expenses. The bank also recorded a 63.95% increase in loan provisions and impairment charges, which amounted to ₦92.99 billion.
Balance Sheet Highlights:
FBN Holdings’ total assets grew by 38.30% to ₦23.43 trillion as of June 30, 2024, compared to ₦16.94 trillion at the end of December 2023. This growth was primarily driven by a 45.59% increase in loans and advances, which reached ₦12.25 trillion, and a 43.33% rise in investment securities to ₦4.01 trillion.
On the liabilities side, total liabilities increased by 39.64% to ₦21.21 trillion, while shareholders’ equity rose by 26.70% to ₦2.21 trillion, reflecting the bank’s improved financial stability.
Market Performance:
FBN Holdings’ share price stood at ₦29.05 as of the report date, with a market capitalization of ₦1.04 trillion. The bank’s price-to-earnings ratio was recorded at 2.17x, with a price-to-book ratio of 0.36x, indicating a strong position in the market despite the economic challenges.
Outlook:
FBN Holdings Plc has demonstrated remarkable growth and resilience in the face of economic headwinds, driven by strong revenue generation and effective cost management. The bank is well-positioned to continue its upward trajectory, although it must remain vigilant in managing rising costs and loan provisions to sustain profitability.
