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Monday, June 5, 2023

FBN Holdings Repositioning to Retake Number one Crown

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FBN Holdings is thriving, and is only some steps away from regaining its position as the largest lender by total assets.
There have been remarkable improvements in key performance metrics, an unprecedented impressive performance that validates the focus and market penetrating strategies deployed by management and board of directors.
The combination of an excellent risk management strategy in recent times and contribution from electronic banking helped FBN Holdings surmount the headwinds caused by a precipitous drop in crude oil price of mid-2014 that tipped the country into a recession in 2016.
A cursory look at the financial statement of the largest banks in Nigeria showed FBN Holdings recorded the largest expansion in profit and return on equity.
The lender’s net profit spiked by 59.33 percent as at March 2020, that compares with United Bank for Africa (UBA), (+5.01 percent); Guaranty Trust Bank (GTBank), (+1.55 percent); Zenith Bank, (0.58 percent), and Access Bank (-0.53 percent).
FBN Holdings has used the resources of shareholders in generating higher profit more than peers as return on average equity (ROAE) was up by 4.15 percent as at March 2020.
That compares with Zenith Bank (-2.20 percent); Access Bank, (-3.26 percent); UBA, (-0.94 percent), and GTBank, (-1.53 percent).

During the period of the lockdown imposed by government to curb the spread of the coronvirus pandemic, FBN Holdings cardholders carried out transactions worth N1.18 trillion.
The bank’s 53,000 agents processed transactions worth N512 billion with differing values during the Covid-19 lockdown. Approximately 12.6 million withdrawals to the tune of N156 billion were carried out across First Bank’s ATMs nationwide.
What this means is that customer satisfaction is paramount to the lender, as it continues to spend on latest technology so as to reduce cost, improve profit, and increase its share of the market.

There has also been improvement in the banks’ asset quality, as Non-Performing Loans (NPLs) improved to 9.29 percent as at March 2020, from 25.30 percent as at March 2019.
The improvement in asset quality can be attributed to tight control measures and recovery efforts of the risk management team.
FBN Holdings has total assets of N7.02 trillion as at March 2020, the third largest in the banking industry.
At the moment, the coronavirus pandemic that hindered customers from caring out big ticket transactions means Nigerian banks should brace for a surge in bad loans, especially in the oil and gas sector as the price of oil has more than halved due to slowdown in global demand.
Brent crude, the international benchmark, fell 1 per cent to $34.38 per barrel and West Texas Intermediate, the US marker, dropped 1.4 per cent to $32.34 a barrel.

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