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EXCITEMENT IN SHAREHOLDERS’ CAMP AS FIRSTBANK SHEDS NPL BURDEN 

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With a significant cut in its impairment charges (which translates into a clean loan book) in its 1Q, 2022 results, after it successfully brought down its non-performing loan to 6.1 per cent in 2021 full year performance, analysts say the repeat of the impressive performance of FirstBank in the first quarter did not only show the consistency in its rebound, but that it demonstrated the fact that the recovery is real. 

For the shareholders of the Nigerian banking behemoth, First Bank of Nigeria Limited, it is a season of celebration and a period to shower praises on the board and management of the bank for successfully working its way back into reckoning, after a long period of operational challenges mostly blamed on rising cases of non-performing loans.

The shareholders, who joined other stakeholders of the bank and its parent company, FBN Holdings Plc., in appraising its first-quarter 2022 results made public last week, said it is a great relief that the organisation has put the issue of non-performing loans behind it.

 

According to them, the outstanding results for the bank’s full-year 2021 is an appetiser to the first-quarter 2022 results and that the repeat of impressive results for the first quarter did not only show the consistency of its restructuring but that it demonstrated the fact that the recovery is real.

SHAREHOLDERS’ ENDORSEMENT

The founder and pioneer National Coordinator, Independent Shareholders Association, Sunny Nwosu, in an interview with THISDAY, at the weekend, said the management of FirstBank deserves praise for working the bank back to profitability and clean loan book.

He believes the ability of the FBNHoldings, the parent company, to significantly cut the exposure to non-performing loans to 6.1 percent showed that the bank has shut the door against future delinquent debtors, a development he said will consolidate the bank.

Nwosu said many of the shareholders were pleasantly surprised first, by the performance in the 2021 full results, saying the first quarter 2022 results came as a confirmation of the readiness of the bank to take its leadership position in the nation’s banking industry.

“Considering all the provisions they had made in the past two years and for them to have come out clean shows it is not a bad result and for them to have agreed to pay 35 kobo dividend to shareholders, it is encouraging because most shareholders did not know the company was going to pay anything, especially with all the challenges going on in the economy.

“We are indeed excited that they have been able to bring down non-performing loans, which means they will have more money to do business with and I’m quite sure they will be more careful this time when it comes to giving out loans,” Nwosu stated.

He maintained that FirstBank can still return to the leadership position in the Nigerian banking industry, saying the current leadership should keep an eye on the business and encourage the staff with a good incentive to compete in the industry.

1Q 2022 RESULTS

Analysts said the bank has remained dazzling in virtually all its performance metrics, a development they attributed to the NPL improvements which restored investors’ confidence. And success with NPL means the quality of assets is bound to rise.

An analysis of the bank performance gleaned from the group Q1, 2022 results showed that its exposure to bad loans has substantially reduced given the fact that the amount set aside as impairment charges has come down from N13.175 billion in the first quarter of 2021 to N8.75billion in 1Q 2022.

In the period under review, First Bank of Nigeria Limited recorded gross earnings of N170.4 billion, up by 33 per cent as against N128.1billion in the previous year.  

The bank’s net interest income was put at N72.9 billion, a 42.1 per cent from N51.3 billion generated in the same period of 2021, while non-interest income was N58.8 billion, up by 21.7 per cent from the 2021 figure.

Profit After Tax for the first quarter of 2022 was N31billion, whereas N16.3 billion was the figure declared for 1Q, 2021. The bank declared total assets of N8.8 trillion, a 3.5 per cent rise from N8.5 trillion in the preceding year.

To show the bank was in a serious business of lending, its customers’ loans and advances (net) totaled N2.999 trillion, up by 5.8 per cent, year-to-date as of December 2021, which was put at N2.835 trillion, while customers’ deposits were N5.9 trillion, as against N5.6 trillion in the first quarter of 2021, a 5.4 per cent increase.

BUILDING CONFIDENCE IN OPERATION

Analysts believed the recent turnaround and improvement in the Non-performing loans of First Bank of Nigeria Limited (FirstBank) have been a major boost in the bank’s quest to reinforce its leadership in the financial services industry in Nigeria.

For instance, it has been observed that the current leadership of its Chief Executive Officer, Dr Adesola Adeduntan has been instrumental in building stakeholders’ confidence and trust in the bank’s financial viability with analysts left to ponder and perhaps, understudy the pace of such feat has been achieved. They said answers to these have been provided by the bank’s consistent improvements in its Non-performing Loans (NPL) ratio and position.

For instance, by June 2020, when improvements were noted in the bank’s NPL ratio, the NPL ratio stood at 8.8 per cent. By March 2021, this figure had impressively dwindled to 7.9 per cent, and going by the 2021 results, the figure only stood at 6.1 per cent.

Non-performing loans, or ‘NPLs’, are bank loans that are subject to late repayment or are unlikely to be repaid by the borrower. The inability of borrowers to pay back their loans was aggravated during the financial crisis and the subsequent recessions.

For a bank that was almost brought to its knees by the burden of non-performing loans, it came as a great relief to both the shareholders and the regulatory authorities that for the first time in a long while, FirstBank’s NPLs came down to 6.1 per cent, a significant progress for the bank when compared to other Tier 1 banks and the regulatory threshold of 5.0 per cent.

Analysts also attributed the significant fall in the NPL rates from 40 in 2016 to 6.5 per cent in 2021, to a new culture of corporate governance currently in place in the group and which has successfully revamped the company’s risk management capabilities.

According to the bank, the recent turnaround and improvement in the non-performing loans have been a major boost in FirstBank’s quest to improve profitability and reinforce its leadership in the financial services industry in Nigeria.

Analysts said with the impressive results for its 2021 operations, the board and management of FBN have proven to the investing community that the company is ready to take its leadership role in the nation’s banking sector and that the years of locusts have been put behind the institution.

MAINTAINING FAIRLY MANAGEABLE NPL RATIO

For a sector already under pressure as a result of a sluggish economy, a challenging operating environment, and increased competitive intensity, the year 2022 came with a lot of fears for the Nigerian banking industry.

As economic realities dawned on Nigerians, especially in a pre-election year, many investors struggled to get decently priced loans in Nigerian banks, and their plight is not helped when a bank is risk-averse because it already has lots of bad loans on its books.

It is interesting to note that amidst the huge pressure placed on Nigerian banks by the prevailing sluggish economy, what the management of FirstBank did was diversify its loan books and maintained a fairly manageable Non-Performing Loan (NPL) ratio.

This is because the percentage of non-performing loans in Nigeria reflects the health of the banking system. A higher percentage of such loans shows that banks have difficulty collecting interest and principal on their credits. That may lead to less profits for the banks in Nigeria and, possibly, bank closures.

FirstBank recorded the highest NPL ratio in four years with 24.7 per cent in 2018 which dropped to 9.9 per cent, 7.7 per cent, 7.2 per cent in the period of 2019, 2020, and 6.1 per cent in the 2021 full-year results.

ADEDUNTAN: ‘WE ARE READY TO IMPROVE BOTTOM LINE PERFORMANCE’

Chief Executive Officer of FirstBank Group, Dr. Adesola Adeduntan, who expressed the determination of the bank to aim higher said, “At FirstBank, we have historically been interwoven with the fabric of this nation with a full-service commercial banking offering catering to every segment of the economy.

“We believe we are now in a good position to translate this unique revenue generating potential into improved bottom-line performance.

“Our first-quarter results demonstrate that we have commenced our journey of Quantum Profitability Leap in earnest with profit before tax doubling to N34.1 billion as the Bank begins to reap the dividends of the successful restructuring of its balance sheet, revamped risk management, robust technology, and innovative service offerings.

“Our gross earnings are also up 33.0 per cent YoY to N170.4bn and Net Interest Income up 42.1 per cent YoY to N72.9bn. Furthermore, our strengthened risk management capabilities equip us with the ability to mitigate any negative effect of headwinds that may materialise given current macroeconomic pressures.

“Looking ahead, we will continue to maximise all opportunities presented by our large network, and support our customers with innovative value-adding solutions through these uncertain times while investing in strengthening our digital banking offerings to deliver a better customer experience.”

Culled from Vanguard

 

Business

The Address Homes deliver another project, Ikoyi Crescent on Record time

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In line with its tradition of providing regal and lavishly built luxury housing brands in its bid to bridge the gap in the housing deficit in the country, The Address Homes Limited, Nigeria’s leading real estate development firm dedicated to the attainment, development, and management of bespoke deluxe contemporary homes, has completed and delivered yet another project in Ikoyi Crescent in a very efficient and timely manner.

Known as The Address Homes Wemabod Estate and located on Ikoyi Crescent, Lagos, the property uniquely designed to give homeowners that serene environment and luxury taste, is on two non-contiguous plots of land designated 37A, Ikoyi Crescent (measuring 2,343m2) and 37C, Ikoyi Crescent (measuring 2,130m2).

Speaking on the completion of the project, the Chairman and founder of The Address Homes Limited, Dr. Bisi Onasanya stated that the company is committed to delivering luxury homes that meet the highest standards of quality and functionality on record time.

He also stated that the company’s attention to detail and commitment to customer satisfaction have earned them a reputation as one of the country’s leading real estate development firms.

“At The Address Homes, we believe in the power of real estate as a tangible asset that builds equity and sets you up for long-term success.

“We evolve concepts that take account of each customer’s taste, budget, time frame, market environment, and the opportunities available.

“We have successfully delivered numerous contemporary homes in the Ikoyi, Banana Island area and another fabulous four, namely; The Luxuria by The Address Homes, Dan and Dan Apartments by the Address Homes, Aunty Ayo, Manuwa Park and Harold Shodipo, GRA are at finishing stages,” Onasanya stated.

On his part, the Managing Director, Wemabod Limited, Mr. Oluyemi Ejidiran commended The Address Homes for delivering quality housing to Nigerians as he described the engagement with The Address Homes as the best fit given its pedigree in the built industry.

He said, “The choice of The Address Homes on this project is quite strategic given its experience and professionalism in the built sector. We are glad that they’ve not only delivered in record time, but notably, the delivery is even coming earlier than they promised.”

Located in a very serene environment directly opposite the official residence of the State Deputy Governor, the roundabout around the area, which serves as the meeting point of Gerrard Road and Ikoyi Crescent, off Alfred Rewane Road, Ikoyi, Lagos, affords good access to Lagos Island, the Third Mainland Bridge, Victoria Island and the Lekki-Ajah axis through the Lekki Link Bridge. This makes the property an attractive option for those seeking a well-connected and tranquil living environment in Lagos.

The property, with a total of 18 units of luxury apartments comprising: 10 units of four-bedroom terrace houses (each with one maid’s apartment); four units of five-bedroom (each with an additional two maid’s apartments) semi-detached buildings; and four units of five-bedroom (each also with additional two maid’s apartments) fully-detached buildings, interestingly, has been sold out already.

The Address Homes Wemabod comes with world-class amenities such as Wet and Dry Kitchen, Ample Parking Space, Double Volume Master Bedroom, Communal Swimming Pool and it is fully Secured.

Buoyed with its unwavering reliability and dedication to quality, custom-tailored homes, which have made The Address Homes one of the highly respected companies in the property development business, the company’s commitment to excellence and customer satisfaction has earned them numerous awards and recognition in the real estate industry.

The Address Homes is a luxury brand known for integrity, professionalism, excellence and timely delivery of excellent jobs.

The firm has delivered over 250 homes to Lagosians on Bank Road in Ikoyi, Banana Island Ikoyi close 107, Banana Island Road, Ikoyi, Banana View, Femi Okunu, Victory Park Lekki, Alma Beach Lekki, Banana Island Ikoyi close, Elegushi-Ikate Lekki, Taiye Olowu and Wemabob Estate.

The firm has extended construction to Ikeja and some parts of Ajah. Currently, the projects in Harold Shodipo, Ikeja GRA, and Aunty Ayo, Keffi Street, Ikoyi aimed at contributing 101 units to South West Ikoyi by 2023 are at finishing points.

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FirstBank UK Adopts Bloomberg TOMS to Optimize Fixed Income Workflow

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Bloomberg announced today that FirstBank UK Limited (FirstBank UK), the UK subsidiary of First Bank Nigeria Limited, the premier West African bank,
has adopted Bloomberg’s Trade Order Management System (TOMS). By integrating TOMS into
its workflow, FirstBank UK will have access to a comprehensive suite of data and analytics,
communications, as well as order and execution management solutions, enabling it to
streamline its fixed-income bonds business.

 

FirstBank UK is a niche market-maker to its customers in Africa. The business provides market
liquidity in cash bonds, primarily in Nigerian, Angolan, Egyptian and Ghanaian Eurobonds to
manage risk and optimize its inventory. Thanks to Bloomberg’s coverage, TOMS enables the
trading desk of FirstBank UK to support its client base and to monitor its positions, profit and
loss (P&L) and Risks.

 

“By integrating with our existing systems, Bloomberg TOMS provides FirstBank UK with a
complete end-to-end trading workflow covering African bonds in most of our home markets,”
said Olukorede Adenowo, CEO-designate at FirstBank UK.“ The solution enables us to focus on
expanding our footprint in the African Fixed Income landscape and delivering a first-in-kind service
to our customers in Africa.“We are pleased to help FirstBank UK enhance operational efficiency across its enterprise with
our award-winning sell-side order management solution TOMS,” said Lisa Bravo, Global Head
of Sell-Side OMS at Bloomberg.

“TOMS empowers firms to create a seamless workflow from
their front and middle-office, through to their operations and enterprise applications, while
concurrently delivering their front office users with real-time execution, risk and P&amp analytics.”
FirstBank UK has further digitized its order management workflow by offering clients access to
liquidity on its own Eurobond Single-Dealer Platform. The application has been integrated with
Bloomberg TOMS to centralize order handling and aggregated custom analytics and
liquidity tools within a single interface, to be hosted and connected to multiple trading venues.
“The integration of TOMS with our custom-built electronic trading platform, allows our customers
real-time access to liquidity in our markets, something unique to the majority of our customers,”
said Robert Hagenaars, Head of Markets at FirstBank UK.

For additional information about Bloomberg’s sell-side solutions, please click here.
About Bloomberg Bloomberg is a global leader in business and financial information, delivering trusted data,
news, and insights that bring transparency, efficiency, and fairness to markets. The company
helps connect influential communities across the global financial ecosystem via reliable
technology solutions that enable our customers to make more informed decisions and foster
better collaboration. For more information, visit Bloomberg.com/company or request a demo.

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Elated Polaris Bank Customer commends Bank for excellent customer service

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Polaris BAnk

 


Polaris Bank customer, Ife Michael, who recently aired her concerns on X (formerly Twitter) on a school fees transaction, has commended the Bank for resolving her Complaint swiftly as promised.

 

Ife Michael tweeting via her X handle @V_Ifemichael had called out the Bank for ‘seizing’ her funds as sent from a UK University where she had sought admission.

Polaris Bank reacted promptly to her Complaint and engaged her to explain the process and promised to resolve the issue which the Bank did swiftly.

An apparently elated Ife Michael went back to the micro blogging site to recount her experience with an update on her earlier thread of how the Bank swiftly resolved her Complainant.

The Bank, according to her update “responded and reached out to explain in details the guidelines underpinning FX transaction as it relates in particular to International payment.

In her tweet, Ife Michael expressed gratitude to Polaris Bank’s swift action and transparent communication. According to her, the Bank clarified that the situation was complex but assured her that the funds would be promptly refunded to the school. And Polaris Bank did exactly as it promised as it promptly refunded the money to Roehampton University and initiated necessary processes to streamline the refund.

The engagement began when Polaris Bank’s headquarters made the first contact at 11:48 am, and by 3:41 pm on the same day, Ife Michael confirmed that the Bank had successfully refunded the funds and

fulfilled all required procedures. The Bank also took the extra step of writing to the school to facilitate the process.

This positive outcome highlights Polaris Bank’s commitment to customer satisfaction, responsive and excellent customer service, and adherence to regulatory policies. The incident not only showcases effective conflict resolution but also underscores the power of a Bank fostering transparent communication between it and her customers.

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