In the first nine months of last year, FBN Holdings Plc, the parent company of First Bank of Nigeria Limited, saw its earnings per share (EPS) and profits increase by 125% year-on-year.
But there’s a lot more to the major bank’s core banking business, and its profitability is not just an increase in transaction fees but also an increased commitment to financial intermediation. In three quarters, its interest income grew 165% to N1.63 trillion, a clue to sustainable profit operations.
These are not just random developments, nor are they the product of white noise in the enterprise journey. The company has shown consistent growth in both revenue and profit metrics over the past few years, reflecting its post-crisis label of 2015, which has been dubbed the “miracle decade” in investment markets.
For example, its earnings per share more than quadrupled from 2019 to 2023 (its latest audited financials) – from 195 kobo to 859 kobo, making it one of the fastest growing capital markets in Nigeria. During the same period, the company’s annual operating profit grew by more than 320%, from a mere N73.8 billion to N310.5 billion.
In terms of revenue, its profits have nearly tripled, from N623 billion to N1.6 trillion in five years, while its total assets jumped by N10.7 trillion during that period to close at N16.94 trillion last year. . In those five years, its total shareholders’ equity grew even faster – expanding from N661 billion to N1.75 trillion, or 163%, according to its books.
As a key growth driver, the company’s loans to customers increased significantly by 243% to N6.36 trillion as of December 2023. .
While the five-year cycle showed strong growth, last year’s operations showed greater resilience, with promising full-year results expected to exceed previous results. On key profitability indicators, last year’s nine months significantly exceeded the same period in 2023 or the full year.
For example, its revenue for the first nine months of 2024 was N2.25 trillion, which was N655 billion higher than the overall figure for 2023 and 134% higher than the same period, with annualized total revenue of N2.8 trillion. While interest income has grown significantly, its non-interest income has also increased by 82% from 320.5 billion naira in the third quarter of 2023.
The bank’s recent transformation into transaction-led banking is paying off through the reinvention of its digital payments system. As of the end of September last year, First Mobile had 6.9 million subscribers, while more than 23 million subscribers subscribed to many online platforms.
The new 10-year vision proposed in 2023 aims to consolidate these achievements, and the “miracle decade” may become the launch pad for the new FirstBank. But recent boardroom intrigue and a dispute with General Hydrocarbons Ltd (GHL) are costly disruptions the bank cannot afford. As a result, many stakeholders are seeking faster, less confrontational solutions to the crisis.
Amid the conflict, First Bank Group CEO Olusegun Alebiosu described the bank’s 10-year vision as a key position of “Vision 2033” that will drive the Nigerian bank The major financial institution ranks among the top three universal banks in the retail sector in Africa.
“Given that the ten-year vision remains relevant to the market and that I was an integral part of its creation, I intend to focus on ensuring its rigorous execution during my tenure as CEO.
“As CEO, I have a clear vision for FirstBank Group and I am confident that with the strong support of the management team and other members of the Board, we will deliver a franchise that continues to be the pride of Nigeria and Africa. The executive Officials told markets his risk management background meant sustainable growth.
At the 12th Annual General Meeting of FBNHoldings on November 14, 2024, shareholders approved another N350 billion financing exercise, which the bank said will be executed in a variety of ways this year. Furthermore, with a previous N150 billion rights issue, FirstBank is expected to well exceed the new N500 billion minimum capital requirement ahead of the 2026 deadline to retain its international license.
A major factor in the slowdown of traditional banks today is that digital-first banks like Opay, MoniePoint and others are all natural advantages of being cloud-native. Sadly, the physical robe creates legacy limitations for traditional banks. But as the first achievement of a traditional bank, FirstBank has already begun digital transformation activities.
Today, more than 90% of FirstBank’s customer-induced transactions occur on digital channels – FirstMobile, FirstOnline, Lit App, *894#, FirstDirect and ATMs – where the company has a comparative advantage, the CEO said.
Alebiosu believes: “As the bank implements its cloud strategy, we are committed to building a more agile, always-on and resilient financial services group that leverages its rich heritage to meet the current and emerging needs of its clients.”
Interestingly, 2025 is the take-off year of the bank’s strategic planning cycle from 2025 to 2029. The bank intends to “double down” on its dominant position in all markets in which we operate. Part of the plan is strategic investments to improve customer experience, make it easier for existing and potential customers to interact and do business on its offline and digital platforms, deploy new technologies and enhance artificial intelligence deployment to expand digital operations.
But it turns out that FirstBank and its sister organizations also have a responsibility to immediately put aside the current distractions and continue to build on the gains of the Miracle Decade.
