First Bank pre-tax profit rises by 125% in Q2
First Bank of Nigeria Plc has announced 125 per cent increase in its profit before tax for the half year ended 30th June, 2012.
A breakdown of the bank’s unaudited results for the period filed with the Nigerian Stock Exchange, NSE, showed that the pre-tax profit rose to N54.1 billion, as against N24.1 billion in equivalent period of 2011.
The bank also reported 26 per cent in gross earnings to N182.3 billion from N145.1 billion in 2011, while non-interest income rose by 48 per cent to N44.5 billion compared to N30.1 billion in 2011.
The operating income grew to N153.3 billion compared to N126.3 billion in 2011, representing 21 per cent increase over the period.
Cost to income ratio witnessed 58.3 per cent within the period, as against 69.3 per cent growth in 2011, while impairment charges for credit losses stood at N9.1 billion compared to N14.4 billion reported in the same period of 2011.
Commenting on the results, Bisi Onasanya, Group Managing Director of the bank explained that growth in pre-tax profit was driven by strong revenue growth, lower impairment charges and modest growth in operating expenses, saying “This translated into annualised after tax return on equity of 25 per cent.”
He noted that the result was a demonstration of the resilience of the bank’s business. He said, “Given the backdrop of global economic uncertainty, declining oil prices and its resulting impact on the domestic economy, FirstBank recorded 125 per cent growth in the Group’s profit before tax. It was particularly pleasing to see the strength of the Group’s retail franchise, as we were able to grow deposits over the half year period by 13 per cent, in an environment of tight liquidity management, high interest rates and higher velocity of money as a result of the increasing deployment of electronic channels across various segments of the economy. Notwithstanding these headwinds, we were able to moderate the impact on our cost of funds.
“We are pleased with the continuing progress in our transformation agenda, which is focused on driving efficiencies in our business. The focus over coming periods will be to consolidate and build on those gains as we refine our business and operational platform to ensure we achieve our set objective of excellent service delivery as a basis to expand business volumes. We will continue to stratify our customer base, provide bespoke products across our various customer segments and with the needs of our customers being of primary concern. We strongly believe that this customer centric focus will increase the productivity of our staff as well as optimise our asset base as we focus on performance and results.”
Other highlights of the results showed that it recorded Year-on-year increase of 17 per cent in net loans and advances to customers to N1.5 trillion from N1.2 trillion in the same period of 2011 and year to date growth of 17 per cent to N1.3 trillion in December, 2011.
Year-on-year deposit growth of N2.2 trillion was 15 per cent increase over N1.9 trillion reported in the previous year, while Non-Performing Loans, NPL, ratio stood at 2.7 per cent, as against 4.0 per cent in the previous year.