… FBNH’s profit before tax grew by 325.1% y/y to N238.53 billion in Q1-24.
…A marked 153.3% y/y growth in interest income to N454.98 billion
…Non-interest income advanced by 267.3% y/y to N265.64 billion
MON MAY 27 2024-theGBJournal| FBN Holdings Plc (FBNH) published its Q1-24 unaudited financial report this morning, revealing stellar expansions across its core (+153.3% y/y) and non-core (+267.3% y/y) income lines. Consequently, the group’s EPS surged by +317.4% y/y to N5.76 in Q1-24.
The group recorded a marked 153.3% y/y growth in interest income to N454.98 billion, driven by higher interest earned on loans and advances to customers (+118.7% y/y) and investment securities (+199.4% y/y).
We note that the gains on these contributory lines were due to a combination of elevated yields in the debt market and surge in the group’s interest-earning assets (+31.8% YTD to N12.07 trillion).
Similarly, interest expense grew to N226.42 billion (+234.1% y/y) owing to the higher interest paid on deposits from customers (+182.8% y/y) and financial institutions (+357.2% y/y).
We highlight that the increase in the bank’s deposits (+26.8% YTD to NGN15.81 trillion) coupled with the deterioration of its CASA mix (Q1-24: 77.7% vs 2023FY: 81.2%) triggered the higher interests incurred in the review period.
Notwithstanding, the group recorded an expansion in net interest income (+104.4% y/y). Furthermore, higher credit impairment charges (+153.9% y/y) in Q1-24 led to a moderation in net interest income ex-LLE (+95.5% y/y).
Also, non-interest income advanced by 267.3% y/y to N265.64 billion, underpinned by increased income from the group’s investment securities (+863.6% y/y) and net fees and commission income (+52.8% y/y) in the period. Consequently, operating income rose by 169.8% y/y to N451.31 billion.
Operating expenses grew by 91.4% y/y, triggered by increases in the group’s personnel and regulatory costs. Precisely, the group recorded increased expenses on personnel (+107.5% y/y), NDIC premium (+207.0% y/y), and AMCON levy (+26.2% y/y) in Q1-24.
Nonetheless, the faster growth in operating income relative to expenses ensured significant improvement in operational efficiency, as the cost-to-income ratio (ex-LLE) settled at 47.1% (vs 66.5% in the prior year).
Finally, FBNH’s profit before tax grew by 325.1% y/y to N238.53 billion in Q1-24. After accounting for a higher tax charge (+404.5% y/y) in the period, PAT settled at N208.16 billion (+315.6% y/y).
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