FBN Holdings, the parent company of First Bank of Nigeria, demonstrated remarkable financial growth in the 2024 fiscal year, achieving a 113% surge in gross earnings, reaching N3.33 trillion. This significant increase highlights the group’s resilience and strategic adaptability within a dynamic market landscape. The growth was propelled by a substantial rise in both net interest income and non-interest income, reflecting a diversified revenue stream and successful exploitation of prevailing economic conditions. The group’s profit before tax (PBT) also witnessed a substantial increase of 142%, reaching N862.38 billion compared to N356.15 billion in the previous year. This impressive PBT growth further underscores the efficacy of the group’s financial strategies and its ability to capitalize on market opportunities. Notably, the report emphasizes that without a N411 billion impairment charge, the PBT would have been even higher, reaching N1.3 trillion, further emphasizing the underlying strength of the group’s financial performance.
The robust growth in net interest income, reaching N1.39 trillion compared to the previous year’s figure, is attributed to the group’s resilience and strategic positioning within the competitive financial services sector. This substantial increase indicates the effectiveness of the group’s lending and investment activities, capturing the benefits of the prevailing economic environment. Concurrently, non-interest income also experienced notable growth, rising to N846.9 billion from N255.8 billion in 2023. This diversification of income streams demonstrates FBN Holdings’ ability to leverage multiple avenues for revenue generation, contributing to overall financial robustness and stability. The combination of strong performance in both interest and non-interest income streams highlights the group’s balanced approach to revenue generation and its ability to adapt to changing market dynamics.
The group’s loan portfolio expanded significantly, with loans to customers increasing by N2.79 trillion to reach N9.4 trillion. This reflects a robust lending strategy and a growing customer base, further driving the growth in net interest income. Customer deposits also witnessed a significant rise of 62%, reaching N17.29 trillion, showcasing the strong trust and confidence customers place in the FBN brand. This substantial increase in customer deposits provides the group with a solid foundation for future lending and investment activities, further fueling its growth trajectory. The simultaneous growth in both loans and deposits signifies a healthy and expanding financial ecosystem within the group, indicative of sustainable growth potential.
FBN Holdings attributed the strong performance in net interest margin, which improved to 9.61% from 6.11% in the previous year, to the prevailing high-interest rate environment. This environment, characterized by hikes in the Central Bank of Nigeria’s Monetary Policy Rate, which rose from 18.75% in December 2023 to 27.25% by the end of 2024, contributed significantly to the group’s profitability. The group successfully capitalized on these higher interest rates, increasing the profitability of its lending activities. The ability to effectively manage interest rate risk and leverage favorable market conditions played a crucial role in the group’s overall financial success.
The substantial growth in non-interest income was primarily driven by increased fee and commission income, particularly from fund transfers, intermediation services, and fees generated through digital channels. This reflects the group’s strategic focus on expanding its digital banking capabilities and its success in attracting a growing number of customers utilizing these platforms. The impressive transaction volumes recorded across digital channels highlight the effectiveness of the group’s investment in technology and its ability to capitalize on the growing adoption of digital banking services. This focus on digital banking positions FBN Holdings favorably for future growth in a rapidly evolving financial landscape.
The 42% growth in loans and advances to customers was attributed to new loans disbursed by the commercial banking group and the impact of naira depreciation on foreign currency-denominated loans. This demonstrates the group’s proactive approach to lending and its ability to manage currency risk effectively. The group’s strong risk management practices ensured the resilience of its business operations, particularly in the volatile economic environment. The careful balance between new loan disbursement and managing the currency risks associated with foreign currency-denominated loans contributed significantly to the group’s overall financial stability and growth. Furthermore, the focus on continuous deposit mobilization, supported by investments in digital banking and brand recognition, contributed to the 62% growth in deposit liabilities. This reinforces the group’s commitment to building a sustainable financial institution that surpasses stakeholder expectations. The group also emphasized the impact of naira depreciation on the translation of foreign currency-denominated deposits, highlighting the complexities of operating in a volatile currency market.
