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Excitement In Shareholders’ Camp As FirstBank Sheds NPL Burden

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Excitement In Shareholders' Camp As FirstBank Sheds NPL Burden

EXCITEMENT IN SHAREHOLDERS’ CAMP AS FIRSTBANK SHEDS NPL BURDEN 

Olushola Okunlade Writes

With a significant cut in its impairment charges (which translates into a clean loan book) in its first quarter (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 the 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 appetizer 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.

Dr. Adesola Adeduntan, Chief Executive Officer (CEO) FirstBank Limited.

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 effects of headwinds that may materialize given current macroeconomic pressures.

“Looking ahead, we will continue to maximize 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

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Dangote-Led Flood Committee Commences Distribution Of N1.5bn Relief Items To Victims Nationwide 

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Dangote-Led Flood Committee Commences Distribution Of N1.5bn Relief Items To Victims Nationwide

Olushola Okunlade Writes

The Dangote-led Presidential Committee on Flood Relief and Rehabilitation (PCFRR), known as Dangote Flood Committee has commenced the distribution of relief materials, worth N1.5 billion to victims of flooding nationwide.  

The PCFRR, which was established by the Federal Government following the 2012 flooding, is co-chaired by Africa’s foremost industrialist Aliko Dangote, and Dr. Olisa Agbakoba.  

The flagging off ceremony for the relief materials distribution for this year started in Borno State and was conducted by the State Governor, Professor Babagana Umara Zulum Tuesday in Maiduguri, Borno State capital. The Governor thanked the Dangote Flood Committee and promised that he will ensure that the items get to the victims.

Dangote-Led Flood Committee Commences Distribution Of N1.5bn Relief Items To Victims Nationwide
Left-Right: Assistant Secretary (PCFRR) Umar Musa Gulani, Who Represent the Chairman Presidential Committee On Flood Relief Rehabilitation (PCFRR) Aliko Dangote, Borno State Governor, Prof. Babagana Umar Zulum, Director General (NEMA) Ahmed Mustapha Habib, Representative of King Salman Humanitarian Aid and Relief Center, Al-Yousuf Abdulkarim, during the visit to the Governor office before the Flag Off ceremony for Distribution of Presidential Committee on Flood Relief Rehabilitation donated relief materials to Flood Victims in Borno State on Tuesday 6th December 2022 at NEMA Zonal Office, Maiduguri, Borno State.
Dangote-Led Flood Committee Commences Distribution Of N1.5bn Relief Items To Victims Nationwide
Left-Right: Assistant Secretary (PCFRR) Umar Musa Gulani, Who Represent the Chairman Presidential Committee On Flood Relief Rehabilitation (PCFRR) Aliko Dangote, Borno State Governor, Prof. Babagana Umar Zulum, Director General (NEMA) during the visit to the Governor office before the Flag Off ceremony for Distribution of Presidential Committee on Flood Relief Rehabilitation donated relief materials to Flood Victims in Borno State on Tuesday 6th December 2022 at NEMA Zonal Office, Maiduguri, Borno State

UNICEF revealed that the 2022 flood killed 600 people, displaced 1.3 million, and destroyed more than 82,000 homes in Nigeria, therefore making it the worst in decades.   

The Representative of the Dangote-led Presidential Committee on Flood Relief and Rehabilitation (PCFRR), Alhaji Umar Musa Gulani assured at the flagging off for the Northeast zone that the exercise would also be conducted in the other five geopolitical zones of the country.

Gulani said the items from the Committee have been officially handed over to the Borno State Government and the National Emergency Management Agency (NEMA). He said the exercise would be conducted across the six geo-political zones, beginning from the northeastern State of Borno.   

The breakdown of items donated includes 86 bags of rice, 34 bags of beans, 34 bags of maize, 34 bags of millet, 34 bags of Guinea Corn, 34 bags of Garri, 86 cartons of noodles, 86 cartons of spaghetti, 86 cartons of macaroni and 86 bags of sugar, and 857 bags of cement, among several food and non-food items.   

Gulani said over N10 billion has been expended by the committee to mitigate the effect of flooding since inception in 2012, adding that no fewer than 84 Hostels have been built for flood victims in 24 states of Nigeria. According to him: “This private sector-led project is highly commendable and it has been sustained in the past ten years. It is a selfless service from the private sector and Nigerians should appreciate their selfless service to humanity”

Director General of NEMA Alhaji Mustapha Habib Ahmed described the Committee’s intervention as a milestone for Nigeria in general, and flood victims in particular. “Responding to the humanitarian outcomes of this nature requires concerted effort,” the DG said and added that the donation by the Dangote Flood Committee would eventually be made available to flood victims across the affected states in Nigeria.   

Dangote-Led Flood Committee Commences Distribution Of N1.5bn Relief Items To Victims Nationwide
Left-Right: Borno State Governor, Prof. Babagana Umar Zulum, Director General (NEMA) Ahmed Mustapha Habib, Assistant Secretary (PCFRR) Umar Musa Gulani, Who Represent the of Chairman Presidential Committee On Flood Relief Rehabilitation (PCFRR) Aliko Dangote, at Flag Off ceremony for Distribution of Presidential Committee on Flood Relief Rehabilitation donated relief materials to Flood Victims in Borno State on Tuesday 6th December 2022 at NEMA Zonal Office, Maiduguri, Borno State
Dangote-Led Flood Committee Commences Distribution Of N1.5bn Relief Items To Victims Nationwide
Left-Right: Assistant Secretary (PCFRR) Umar Musa Gulani, Who Represent the Chairman Presidential Committee On Flood Relief Rehabilitation (PCFRR) Aliko Dangote, Director General (NEMA) Ahmed Mustapha Habib, Borno State Governor, Prof. Babagana Umar Zulum, at Flag Off ceremony for Distribution of Presidential Committee on Flood Relief Rehabilitation donated relief materials to Flood Victims in Borno State on Tuesday 6th December 2022 at NEMA Zonal Office, Maiduguri, Borno State.
Dangote-Led Flood Committee Commences Distribution Of N1.5bn Relief Items To Victims Nationwide
Left-Right: Assistant Secretary (PCFRR) Umar Musa Gulani, Who Represent the Chairman Presidential Committee On Flood Relief Rehabilitation (PCFRR) Aliko Dangote, Director General (NEMA) Ahmed Mustapha Habib, Borno State Governor, Prof. Babagana Umar Zulum, at Flag Off ceremony for Distribution of Presidential Committee on Flood Relief Rehabilitation donated relief materials to Flood Victims in Borno State on Tuesday 6th December 2022 at NEMA Zonal Office, Maiduguri, Borno State

Speaking on behalf of the victims, Khalifa El-Miskin said the victims were extremely appreciative of the gesture. 

It would be recalled that the Committee also recently, during the spread of the COVID-19 pandemic, donated N1.5 billion to fight the virus. Announcing the donation, Dangote said it was imperative for well-meaning Nigerians to help the Federal Government in fighting the virus.

The Committee also recently provided N250 million as relief assistance to victims of the devastating floods in Benue State. Aside from the donation in Benue, the Dangote-led committee also revealed that it had also donated the sum of N150 million (in kind) to provide relief assistance to flood victims in Anambra State.

It also released the sum of N118 million to NEMA to augment the N1.6 billion released by the Federal Government for procurement of food and non-food relief materials in aid of the flood victims in the following 16 states: Abia, Akwa-Ibom, Bayelsa, Ebonyi, Edo, Ekiti, Enugu, Abuja FCT, Kebbi, Kwara, Lagos, Niger, Ondo, Oyo, Plateau, and Sokoto.

It would be recalled that the Committee at its inauguration by former President Goodluck Jonathan raised a whopping N11.35 billion for flood victims. Top on the list of donors at the event was Dangote and the Federal Government, who donated N2.5 billion each.

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Nigerian Breweries Holds Extra-Ordinary General Meeting, Recommends 2.1 Billion Bonus Shares To Shareholders

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we look forward to the dividends that this initiative will bring to the various areas where the beneficiaries live

Olushola Okunlade Writes

Nigerian Breweries Plc, the foremost brewing company in Nigeria is set to hold an Extraordinary General Meeting (EGM) on Thursday, December 8, 2022, at the Grand Ball Room, Oriental Hotel, Victoria Island, Lagos State.

At the meeting, the Board of Directors of the Company is proposing a bonus issue of one (1) new share for every four (4) shares held by qualifying Shareholders, that is those on the Register of Members at the close of business on Tuesday, 6th December 2022.

The Board’s proposed bonus share scheme is expected to be implemented upon the receipt of the Shareholder’s approval at the EGM. In view of the Company’s huge Share Premium Account, the Board decided to reward the company’s shareholders with the bonus share scheme as the best option to close the gap between the issued and unissued shares as required by the Corporate Affairs Commission.

Other items proposed by the Board for Shareholders’ approval at the EGM include an increase in the Company’s share capital to accommodate the bonus shares, a change in that regard in the share capital clause in the Memorandum of Association, and updates to some provisions in the Articles of Association to align with the 2020 Companies and Allied Matters Act.

In furtherance of the Company’s commitment to continue to deliver value to its Shareholders, an interim dividend of 40 kobo per ordinary share of 50 kobo each was paid on 1st December 2022 to Shareholders whose names appeared in the Register of Members of the Company as at close of business on 23rd November 2022.

Speaking on the bonus issue proposal and the interim dividend payment, the Company Secretary/Legal Director, Uaboi Agbebaku explained that both actions clearly demonstrate the commitment of the Board to continue to reward Shareholders for their investment in the Company.

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LASAA Launches 2023 Mobile Advert Stickers For Branded Vehicles

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LASAA Launches 2023 Mobile Advert Stickers For Branded Vehicles

…promises improved and efficient process

By Moninuola Sulaiman

Lagos State Signage and Advertisement Agency (LASAA), the agency saddled with the mandate to regulate advertisement displays in Lagos State, has announced the release of its 2023 mobile advert stickers for branded vehicles in the state.

Managing Director of LASAA, Prince Adedamola Docemo, in a statement in Ikeja yesterday, stated that the new and improved mobile advert e-sticker will be in force effective from the 1st of January 2023, a development that will render the 2022 sticker invalid.

He reiterated that, just like last year, the agency has fully deviated from the yearly tradition of launching the stickers with pomp and would rather focus on improving the efficiency of the new process.

He explained that the new e-sticker, which was introduced last year, has attracted a lot of commendation from stakeholders. He said LASAA has continuously reviewed and improved the mobile advert e-sticker product throughout the year to assess the process and fix all barriers for better and more efficient performance.

LASAA Launches 2023 Mobile Advert Stickers For Branded Vehicles
Prince Adedamola Docemo, Managing Director, LASAA.

Prince Docemo disclosed that the 2023 e-sticker continues to experience constant upgrades with a Quick Response (QR) code scanner application, which is readable with a simple smartphone.

He said, “The e-sticker has been enhanced with internal control mechanism, which comes with specialised bar codes and embedded details, including vehicle particulars and serial numbers for authentication.”

He explained that the new e-sticker comes with new and improved security features such as anti-counterfeit properties and an authentication system against fraud.

Prince Docemo emphasised that the level of security implemented for ease of confirmation has improved the process of compliance for the agency’s clients. He stressed that all branded vehicles state-wide will be effectively captured on a mobile advert database, thereby making the agency’s ability to monitor compliance and enforcement work efficiently.

He noted that the incidence of fraud has been hugely minimised, adding that non-compliant vehicles will be impounded and grounded. He assured clients that upon registration, the e-stickers will be available to them within 48 hours.

According to him, LASAA continues to monitor the activities of unscrupulous persons parading themselves as staff of the Agency as well as those working to frustrate its efforts by selling mobile advert stickers belonging to other States. This act LASAA believes is an attempt to cause confusion and conflict within Lagos territory. He added that LASAA has already taken bold steps to reverse this anomaly.

He, however, assured us that LASAA is always a step ahead in ensuring that all vehicles branded with logos and adverts are properly registered in Lagos State. He warned that the agency would arrest those who fail to comply.

He also warned clients and customers who are in the habit of patronising touts to desist from the such act because LASAA’s operation is fully automated and any forged registration will be easily detected.

He urged all registered clients to install the LASAA verifier app on their smart devices to verify the status of registration of their branded vehicles. The LASAA e-sticker Verification App is a reliable platform that allows LASAA field officers or law enforcement agencies to verify the authenticity of brand publications on automobiles in the state.

With the verifier app, all information regarding the organisation or individual name, plate number (where applicable), brand type, vehicle type, and branding type will be displayed seamlessly to verify the authenticity of the sticker.

The platform has been developed to ensure that branded automobiles have authorised stickers and to eradicate any occurrence of falsified brand information.

Prince Docemo expressed appreciation to Governor Babajide Sanwo-Olu for his immense support towards the agency’s initiatives while also stressing that clients’ satisfaction is at the heart of the agency’s business.

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