FCMB Profit increases to N20bn

FCMB Group Plc has declared an improved performance for the year ended December 2019 and recommended a dividend of 14 kobo per share for the shareholders.

According to the bank, the details of the audited results showed gross earnings of N181.249 billion in 2019, indicating a growth of 2.2 per cent, compared with N177.248 billion in 2018.Net interest income rose from N72.573 billion to N75.975 billion, net fee and commission income fell from N21.606 billion to N20.722 billion.

Profit before tax rose from N18.442 billion to N20.130 billion showing an increase of 9.1 per cent, while profit after tax grew faster by 15.8 per cent to print at N17.337 billion, compared with N14.972 billion in 2018.

Based on the performance, the board has recommended a dividend of 14 kobo per share, which is the same paid the previous year. A further analysis of the results, showed that deposits improved by 14.7 per cent to N943.085 billion, up from N821.147 billion. Similarly, loans and advances increased by 13 per cent to N715.88 billion, from N633.035 billion in 2018.

Commenting on the results, analysts at FBNQuest said on a full year basis, FCMB’s 2019 PAT beat theirs and consensus PAT forecasts of around N10 billion.

It stressed further that, “The bank’s PAT implies a return on average equity (ROAE) of 10.4 per cent. Management did not provide a ROAE guidance for 2019. Although the 10.4 per ent ROAE is an improvement over the 9.0 per cent that the bank delivered in 2018, it is the lowest within our universe of banks coverage. Management has proposed a dividend per share of N0.14, same as our N0.14 forecast (N0.15 consensus) and implies a yield and payout ratio of 9.3 per cent and 14 per cent respectively. Despite the strong results, we believe that the market’s reaction is likely to be subdued due to negative investor sentiment”.