According to a recent unaudited financial statement that the top Tier-II lender submitted with a regulator on Wednesday, Fidelity Bank Plc has strengthened its earnings performance as profit increased by almost 207% year over year. Fidelity Bank’s earnings quadruple as lending demand increases, bolstered by non-interest related revenue.
Information gleaned from its unaudited financial statement revealed that profit after tax increased to an unprecedented N142.8 billion, more than double the company’s 2022 profits per share of N1.460.
The bank reported higher non-interest revenue and interest income in 2022 compared to the same year the previous year. In particular, a net foreign currency gain resulting from policy improvements in the FX market caused non-interest income to surge by 3.8 times to N104.6 billion.
The bank’s 54.8% increase in interest income masked the 25.8% rise in interest expense, raising net interest income by 81.9% to N277.8 billion. As a result, operating income surged by 112.5% to N382.3 billion, which offset the growth in operating expenses by 111.9% to N194.2 billion and moderated the cost-to-income ratio by 16.3 percentage points to 50.8%.
The bank posted a material jump in impairment charges, up by 1114.1% to N66.1 billion in 2023. The rise in impairment charges was driven by the 9.1x jump in loan loss expenses to N61.9 billion. This drove cost-of-risk to 1.9%. Also, there was a surprise tax write-back of N20.8 billion for the year.
