First Bank of Nigeria Plc’s net profit fell by 66 per cent to N12.6bn for the year ended March 2009, down from N36bn in March 2008 due to capital market-related losses at its asset management arm, First Trustees Limited.Gross earnings, however, rose by 40 per cent to N218bn, just as deposits rose by 71 per cent to N1.2tn to put the bank on solid footing in spite of the difficult market conditions.According to the audited group results for the year ended March 31, 2009, a record N26.1bn provision was made as an exceptional item to make up for “the decrease in value of shares held on behalf of clients under a guaranteed principal fund agreement on account of the company’s propriety investments.”The N26bn provision is one billion naira above the minimum capitalisation requirement to operate a commercial bank in the country.
According to the report, the profit before the exceptional item and taxation stood at N53bn, an increase of 12 per cent compared to the N47.9bn recorded within the same period last year.
The bank also posted gross earnings of N218.3bn, an increase of 40 per cent, compared with previous year’s N155.7bn. The profit before tax fell to N27.7bn, a decrease of 42 per cent compared to N47.9bn recorded in March 2008. The bank has proposed a dividend of N1.35k and a bonus of one share for every six already held.Commenting on the results, the Group Managing Director, Mr. Stephen Onasanya, said, “Despite the challenging market conditions, First Bank continues to capitalise on its well established value chain in Nigeria’s financial services sector and has achieved another year of strong organic revenue growth.”He said the recognition of the bank as one of the strongest and most dependable banks in Nigeria, especially in a time of global downturn, had driven considerable growth in the bank’s deposit base with the total group’s deposit liabilities increasing by 71 per cent to N1.2tn.He said strong year-on-year growth was recorded across all business lines, saying it was a fantastic achievement and that the bank was well positioned to continue to grow its asset base supported by a sustained robust capital position with a strong capital adequacy ratio of 24.69 per cent and stable funding.
According to him, “Going forward, our growth aspirations will be driven by our commitment to attain the full benefits of scale and scope by accelerating growth and diversification of assets, revenue and profit. At the strategic level, we have identified three pillars that we believe are integral to our objective.“They are acceleration of growth by diversification of assets, revenue and profit; service and operational excellence via a single-minded commitment to operational excellence; the design of appropriate institutional processes, systems and capabilities necessary to deliver world class service levels; performance management and people to deliver unmatched results by creating a performance culture with clear individual accountability at all levels as the foundation of all that we shall be doing over the medium-term.“There is no doubt that the trajectory going forward would encounter pockets of turbulence. Within this prognosis, our challenge at First Bank is to build positive momentum around these three pillars and to build on our progress to date.” |