First Bank Proposes 5kobo/Share Dividend After Underwhelming 2022 Performance
First Bank of Nigeria Holdings has proposed a 50kobo per share dividend for the full year ended December 31, 2022.
This represents a 10.3 percent year-on-year decline in the equities’ earnings per share (EPS) for the period under review, from N4.17 in 2021 to N3.74 in 2022.
The deposit money bank released its audited financial report for 2022 today, June 2, with the result showing underwhelming performance against market expectations of improvements after cleaning up its huge non-performing loans in 2021.
The audited report showed declining profitability despite a 6.3 percent growth in gross earnings to N805.13 billion up from N757.30 billion in 2021.
Profit before tax (PBT) declined -5.3 percent to N157.90 billion lower than N166.66 billion in 2021.
Similarly, profit after tax (PAT) settled 9.8 percent lower at N136.31 billion in 2022 down from N151.15 billion in 2021.
Amid the impact of N5.87 billion loss allowance on its total investment securities holdings issued by the Government of Ghana, the group’s earnings deteriorated due to -37.6 per cent decline in non-interest income, from N364.31 billion in 2021 to N227.18 billion in 2022.
Provision for credit impairment charges stood at N68.62 billion, slightly lower than N91.71 which the bank had provided in the corresponding period of 2021. In addition, operating expenses rose 8.9 per cent to N363.91 billion, up from N334.18 billion in the previous year.
Despite the underwhelming performance, shares of the bank traded on the Nigerian Exchange (NGX) rose by 1.8 percent or 25kobo to high of N14.25 per share on Friday, June 2, 2023.
Total assets increased by 18.4 percent from N8.93 trillion in 2021 to N10.5 trillion in the period under review just as total liabilities grew by 19 percent to N9.58 trillion, from N8.05 trillion in 2021.
Interest income grew by 49.6 percent to N551.94 billion, reflecting the higher-yielding environment. Specifically, the group generated higher income from loans and advances to customers (+48.9% y/y to NGN403.62 billion), investment securities (+20.6% y/y to NGN91.88 billion), and loans and advances to banks (+158.3% y/y to NGN56.44 billion).
In the same vein, interest expense advanced by 34 percent to N188.69 billion, primarily driven by the higher fees expensed on customer deposits (+47.1 percent to N117.20 billion), just the bank incurred higher costs on its borrowings (+54.6 percent to N48.51 billion) driven by the expansion of interest-bearing borrowing (+66.7 percent to N675.44 billion).
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