FCMB Group’s galloping pace of profit growth in the year gained further speed in the final quarter to hit an all-time high of N32.6 billion at the end of the 2022 financial year.
The bank’s full-year financial report at the end of December 2022 yet to be audited shows that after-tax profit accelerated from N5.2 billion in the first quarter to N8.5 billion in the second and from N9.2 billion in the third to N9.7 billion in the final quarter.
The bank’s closing profit for the year stands at 56 percent above the N21 billion after-tax profit it posted in 2021. The outstanding profit growth is the strongest the bank has recorded since its profit tripled to N14.3 billion in 2016.
The performance is despite pressure from rising interest and loan loss expenses. Interest expenses surged upward in the final quarter at 76 percent quarter-on-quarter to about N37 billion for the quarter.
At N97.6 billion in the full year, the cost of funds grew by 37 per cent, ahead of an increase of 34.5 per cent in interest income.
Net interest income still grew strongly by N30 billion or 32.4 per cent to over N120 billion at the end of the financial year.
Despite that loan impairment expenses dropped in the final quarter, the full-year position shows a huge increase of 64 per cent to roughly N25 billion.
The bank however made some cost savings that helped to moderate the cost increases. The cost savings were extracted from personnel expenses, which grew by 14 per cent to about N36 billion.
Also, administrative costs moderated at an increase of 21 per cent to N43 billion and other operating expenses slowed down at an increase of less than 11 per cent to N23.5 billion.
The cost savings enabled the bank’s management to reinforce revenue gains, improve profit margin and drive profit growth.
Strong revenue growth was a key operating advantage of FCMB in the 2022 financial year. Gross earnings advanced by about 33 percent to nearly N282 billion at the end of the 2022 financial year – the strongest revenue growth rate for the bank in nine years.
The revenue growth cut across all the bank’s income lines, which was led by other income that grew by almost 38 per cent to stand at about N7 billion at the end of the year. Net trading income made a similar advance with an increase of 37 per cent to nearly N13 billion.
Interest earnings equally made a big leap of 34.5 per cent to close at N218 billion, marking the strongest growth record for the bank since 2013.
Also, fee and commission income rose by roughly 24 per cent, amounting to N44 billion at the end of the year.
An outstanding growth in income supported by some cost savings underscores FCMB’s impressive earnings story in 2022. Cost increases were more than compensated by cost savings, which enabled gains in margins and accelerated profit growth in 2022.
Net profit margin improved from 9.8 per cent at the end of 2021 to 11.6 per cent in 2022, the highest for the bank since 2015.
The bank closed the year with earnings per share of N1.64, improving from N1.05 per share in 2021. A dividend announcement is expected when the audited accounts are released.
Comments are closed.