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FCMB Reports Record Net Profit of N22.92 billion

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First City Monument Bank (FCMB) Group Plc has reported its highest net profit in history of N22.92 billion for the first nine months of 2022.

That represents a 66.03 percent uptick from 2021’s N13.80 billion as at September 2021.

The improvement in earnings is largely due to rising interest rates that bolster the spread as the central bank embarks on aggressive tightening to tame red-hot inflation and stabilise the economy.

It is worth noting that banks make half their money or more through what they call a spread, i.e. the difference between what they lend a customer money at and what they pay on the deposits, and the money customers give them or we can borrow on the market.

So, when interest rate rises lenders make more money on interest they charge on loans.

The monetary policy rate (MPR) has been increased to 16.5 percent from 15.5 percent in line with analysts’ consensus and the International Monetary Fund, IMF, expectation in a fight to curb the worsening consumer price index.

FCMB’s net interest income, the difference between interest revenues and interest expenses, spiked by 42.30 percent to N93.05 billion as at September 2022 from N65.39 billion as at September 2021.

The bank said its Capital (long term and short-term capital) will be deployed to facilitate economic activity and growth of players its our ecosystem.

The lender’s non-interest income also grew by 29% year on year (YoY) to N38.56 billion, largely driven by growth in service fees and commissions and trading income.

Fees and commission income was up 34.20 percent to N27.17 billion as at September 2022 from N20.24 billion the previous year.

As a result of increased regulatory costs, investment in technology, and general inflationary pressures, FCMB’s total operating costs were up 18.01 percent to N86.41 billion as at September 2022.

The bank has a total deposit of N1.97 trillion as at September 2022, which is 15.20 percent higher than 2021’s N1.71 billion.

The lender said that increased cross selling of digital products, digital lending products in the retail and SME Sectors continues to drive increased adoption of digital channels by customers.

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