Market sentiment unchanged as FCMB Group posts N136bn gross earnings in 9 months

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Market sentiment towards FCMB remained the same today as the group announced a 2.2 percent increase in gross earning at the end of the third quarter ended September 30, 2019. FCMB Holdings’ share price closed at N2.01 per share. On Friday last week, investors traded 967,495 units of shares of FCMB Holdings worth N1.94 million.  Year to date, the stock has appreciated by 6.3 percent, emerging as one of the few banking stocks that gained year to date.

Results announced by FCMB Holdings showed that gross earnings rose to N135.82 billion in nine months as against N132.87 billion it realised same period in 2018. Interest and discount income increased from N95.42 billion in 2018 to N101.80 billion this year’s September.

Net fee and commission income was flat at N15.31 billion compares with N15.46 billion in comparable period in 2018. Profit before tax was down by 13.3 percent to N12.80 billion as at September this year as against N14.77 billion the group made in similar period in 2018.

Profit after tax at the end of the third quarter was N10.79 billion in contrast to N11.34 billion last year September, a decline of 4.8 percent during the reference period.

Cash and bank balances fell by 19.4 percent to N149.25 billion in September 2019, as against N185.15 billion last year September. Net loans and advances were flat at N638.07 billion whereas they were worth N633.04 billion in September 2018. Deposits from customers rose by 5.1 percent from N821.74 billion in Q3 2018 to N863.44 billion in Q3 2019.

Only the FCMB Microfinance Bank recorded growth in its profitability, albeit, this only accounted for 1 percent of the group’s profit after tax.

The bank’s PAT fell by 12 percent to N7.99 billion in September 2019 as against N9.06 billion in September 2018. This is as the bank’s profit contributed 75 percent of the group’s PAT as at the end of Q3 2019 whereas in 2018, its contribution was 88 percent. FCMB Pension contributed 6 percent  to the group’s profit by third quarter ended September 2019 whereas it was 8 percent that the same business contributed to the group’s PAT in 2018. Credit Direct contributed 16 percent to the group’s profit in 2019.

In October 2019, the FCMB Limited Olufemi Badeji as an executive director, corporate and investment banking with effect from October 2, 2019 following the approval from the Central Bank of Nigeria (CBN).

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