Slide 1: Fidelity Bank Investor Presentation
Fidelity Bank Investor Presentation Audited Financial Results for the 12 months ended December 31, 2018 www.fidelitybank.ng
Slide 2: Outline
Outline 1. Overview of Fidelity Bank 2. The Operating Environment 3. Financial Highlights 4. Financial Review 5. 2018FY Actual Vs. 2019FY Guidance 2 www.fidelitybank.ng
Slide 3: 1. Overview of Fidelity Bank
1. Overview of Fidelity Bank 3 www.fidelitybank.ng 3
Slide 4: Overview of Fidelity Bank
Overview of Fidelity Bank Ownership 32.0bn Authorized Shares Listings: 28.96bn Shares Total Assets: N1,720bn Issued And 28.96bn Fully Paid $4.8bn 7yr N30bn May 2022 NGN Bonds $400m Oct 2022 Eurobond Professional Staff 2,926 808 ATMs Male: 56% Operations 4.5 Million Female: 44% & Accounts 2m Cards Co
Slide 5: Overview of Fidelity Bank: Retail and Digital Banking Evolution
Overview of Fidelity Bank Retail And Digital Banking Evolution / Progress Report Number of Customer Accounts (#’m) Savings deposits (N’bn) Retail Risk Assets (N’bn) 4.5 228.0 66.0 3.9 57.2 3.6 178.6 52.8 3.3 155.0 44.8 2.8 119.1 37.6 98.0 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 2014 2015 2
Slide 6: 2. The Operating Environment
2. The Operating Environment 66 www.fidelitybank.ng 6 6
Slide 7: The Operating Environment
The Operating Environment MPC maintains CRR at Improving credit to the 22.5% in Dec 2018 Private Sector Improving Foreign Political risk impacts Reserves on the Capital & Money Market Improving yields as Naira has been inflation rate moderates relatively stable Slower growth in Monetary Policy GDP (
Slide 8: 3. Financial Highlights
3. Financial Highlights 8 www.fidelitybank.ng 3
Slide 9: Performance Highlights
Performance Highlights Total Interest Income up by 4.2% to N153.7 billion in 2018FY (2017FY: N147.4 billion) Revenue Operating Expenses up by 8.0% to N72.1 billion in 2018FY (2017FY: N66.8 billion) and Cost to Income Ratio inched up to 71.1% in 2018FY from 68.6% in 2017FY Efficiency Ratio PB
Slide 10: Financial Highlights
Financial Highlights Gross earnings increased by 4.8% to N188.9 billion on account of double digit growth across key income lines: interest income on liquid assets (16.9%), electronic banking income (16.4%), FX Income (11.6%) and account maintenance charge (11.4%) etc. Net interest margin (NIM)
Slide 11: Financial Highlights
Financial Highlights Total customer deposits increased by 26.3% to N979.4 billion from N775.3 billion in December 2017 on account of double-digit growth across ALL low cost deposits which led to the decline in funding costs. Savings deposits increased by 27.7% to N228.0 billion in December 2018
Slide 12: Financial Highlights: Income Statement YoY
Financial Highlights Summary of Income Statement: YoY Change N’million 2017FY 2018FY VAR % VAR Gross Earnings 180,244 188,873 8,629 4.8% Interest Income Loans 114,091 114,711 620 0.5% Interest Income Liquid Assets 33,328 38,971 5,643 16.9% Total Interest Income 147,419 153,682 6,263 4.2% Interest Ex
Slide 13: Financial Highlights: Income Statement QoQ
Financial Highlights Summary of Income Statement: QoQ Change N’million Q1 2018 Q2 2018 Q3 2018 Q4 2018 VAR % VAR Gross Earnings 43,328 48,682 46,735 50,128 3,393 7.3% Interest Income Loans 28,345 29,510 30,473 26,383 (4,090) -13.4% Interest Income Liquid Assets 10,121 12,071 9,879 6,900 (2,978) -30.
Slide 14: Financial Highlights: Statement of Financial Position
Financial Highlights Statement of Financial Position: YTD Change N’million 2017FY 2018FY VAR % VAR Total Assets 1,379,214 1,719,883 340,669 24.7% Earning Assets 977,076 1,198,988 221,912 22.7% Bank Placements 8,475 58,755 50,280 593.3% Treasury Bills 90,223 189,236 99,013 109.7% Bonds 109,641 101,11
Slide 15: Gross Earnings Analysis
Gross Earnings Analysis Key Highlights (N’m) 2017FY 2018FY VAR % VAR Total Earnings: 2017FY Total Earnings: 2018FY Total Earnings 180,244 188,873 8,629 4.8% Maint. Fee, 1% Trade, 1% Trade, 1% Maint. Fee, 2% Interest Income Loans 114,091 114,711 620 0.5% Others, 6% Digital, 4% Others, 5% Digital, 4%
Slide 16: Net Interest Margin Analysis
Net Interest Margin Analysis NIM dropped to 5.8% from 7.0% in 2017FY as the decline in NIM Trend our average yield on earning assets outpaced the improved funding cost in 2018FY. 7.0% 7.1% 6.7% 6.7% Average funding costs dropped to 6.2% on account of 5.8% improved deposit pricing as average cost
Slide 17: Total Expense Analysis
Total Expense Analysis Key Highlights (N’m) 2017FY 2018FY VAR % VAR Total Expenses: 2017FY Total Expenses: 2018FY Total Expenses 66,764 72,128 5,364 8.0% Others Exp., 35% Staff Cost, 37% Others Exp., 36% Staff Cost, 33% Staff Cost 24,535 23,910 -625 -2.5% Depreciation 4,373 6,247 1,874 42.9% NDIC/AM
Slide 18: Cost Dynamics – YoY Breakdown
Cost Dynamics – YoY Breakdown Breakdown of Operating Expenses: 2017FY Vs. 2018FY N’million 2017FY 2018FY VAR % VAR Staff Cost 24,535 23,910 (625) -2.5% Directors' emoluments 370 262 (108) -29.2% Technology cost (excl. depreciation) 2,407 2,366 (41) -1.7% Insurance expenses 396 379 (17) -4.3% Telepho
Slide 19: 4. Financial Review - SFP
4. Financial Review - SFP 19 www.fidelitybank.ng 3
Slide 20: Funding Base Analysis
Funding Base Analysis Key Highlights (N’m) 2017FY 2018FY VAR % VAR Funding Structure: 2017FY Funding Structure: 2018FY Demand Deposits 418,472 571,329 152,857 36.5% Debt, 11% Equity, 13% Debt, 14% Equity, 15% Savings Deposits 178,570 227,970 49,400 27.7% Tenor Deposits 178,234 180,114 1,880 1.1% Dem
Slide 21: Deposits Analysis
Deposits Analysis Total deposits increased by 26.3% to N979.4 billion from Customer Deposits N775.3 billion in 2017FY. N'billion 87.7% 88.5% 87.8% 89.1% 81.6% Double-digit growth across ALL low deposit products 927.9 986.8 979.4 (Demand | Savings | Domiciliary), resulting in higher 859.4 107.4 7
Slide 22: Retail Banking Analysis (Personal Banking)
Retail Banking Analysis (Personal Banking) Savings deposits grew by 27.7% YTD which contributed to Savings Deposits Trend the decline in our funding cost. N'billion 21.9% 21.3% 20.4% 23.3% 23.0% Growth was as a result of the disciplined execution of our 228.0 retail banking strategy and improved
Slide 23: Liquid Assets Position
Liquid Assets Position Short-term Funds Placements Treasury Bills Bonds 25.5% 3.4% 11.0% 5.9% As a % of Total Assets As a % of Total Assets As a % of Total Assets As a % of Total Assets Liquidity Ratio % Total Loans to Customer Deposits 39.0% 84.7% 38.3% 35.9% 36.0% 72.3% 71.0% 70.3% 73.1% 33.2% 30.
Slide 24: Loan Portfolio Analysis
Loan Portfolio Analysis Breakdown of Loans & Advances to Customers: 2017FY Vs. 2018FY N’million 2017FY 2018FY VAR % VAR Communication 37,874 22,463 (15,411) -40.7% Oil and Gas 204,695 207,918 3,223 1.6% - Upstream 148,544 120,489 (28,055) -18.9% - Downstream 27,362 32,950 5,588 20.4% - Services 28,7
Slide 25: Loan Portfolio Analysis
Loan Portfolio Analysis Breakdown of Loans & Advances to Customers Loan Analysis – 2018FY Construction, Agriculture, Others, 5.1% N’million Q1 2018 Q2 2018 Q3 2018 Q4 2018 3.4% 1.9% Communication, Communication 43,562 40,614 36,685 22,463 Oil & Gas: 2.5% Service, 6.0% Oil and Gas 198,068 198,294 219
Slide 26: Loan Book Analysis
Loan Book Analysis Net loans and advances increased by 10.6% to N849.9bn Net Loans and Advances to Customers while gross loans increased by 14.0% to N906.6bn in N'billion 2018FY. 54.0% 53.7% 57.9% 57.5% 58.9% We had a loan write-off of N15.3bn with over 75% coming 830.4 849.9 768.7 5738.7 795.4
Slide 27: NPL Analysis
NPL Analysis NPL ratio declined to 5.7% from 6.4% in 2017FY principally Gross Loans and Advances due to 14.0% growth in total loan book, N15.3 billion loan N'billion 830.4 906.6 write-off and recoveries in some sectors. 852.1 795.3 794.3 53.5 51.6 51.7 50.7 50.3 Major sectors driving recoveries
Slide 28: NPL Portfolio Analysis
NPL Portfolio Analysis Breakdown of Non-performing Loans: 2017FY Vs. 2018FY 2017FY 2018FY VAR % VAR 2017FY 2018FY N'million N'million N'million % NPL Ratio NPL Ratio Communication 1,537 1,155 (381) -24.8% 4.1% 5.1% Oil and gas 13,624 12,374 (1,250) -9.2% 6.7% 6.0% - Oil & Gas Upstream - - - 0.0% 0.0
Slide 29: NPL Portfolio Analysis
NPL Portfolio Analysis Breakdown of Non-performing Loans NPL Analysis – 2018FY N’million Q1 2018 Q2 2018 Q3 2018 Q4 2018 Others, 11.9% Communication, Power, 0.0% 2.2% Construction, Communication 1,557 1,609 1,597 1,155 1.7% Oil & Gas: Upstream, 0.0% Oil and Gas 12,891 13,148 13,299 12,374 Oil & Gas:
Slide 30: Capital Adequacy
Capital Adequacy Fidelity CAR is now 16.7% which is well above the Capital Adequacy Ratio Computation – Basel II regulatory minimum requirement of 15.0%. N‘billion 2017FY 2018FY VAR Regulatory adjustment increased to N16.3 billion due to the Tier 1 Capital 165.3 180.1 14.8 combined impact of the
Slide 31: Strategic Business Units Analysis
Strategic Business Units Analysis Business Description Location Based Analysis Handles the bank’s institutional clients with turnover in excess of ₦5.0bn. PBT Deposits Loans Corporate & Investment Key focus sectors include: Oil & gas upstream Oil & gas downstream 24.5% 12.9% Banking Power
Slide 32: 5. 2018FY Actual Vs. 2019FY Guidance
5. 2018FY Actual Vs. 2019FY Guidance 32 www.fidelitybank.ng 3
Slide 33: 2018FY Actual Vs. 2019FY Guidance
2018FY Actual Vs. 2019FY Guidance GROWTH EXPECTATIONS ON KEY INDICATORS S/N Index 2018FY Actual 2018FY Target Comment 2019FY Target 1 Net Interest Margin 5.8% 6.5% - 7.0% Not Achieved 6.0% – 6.5% 2 Tax Rate 8.6% 10.0% - 12.0% Achieved 10.0% – 15.0% 3 Loan Growth (YTD) 10.6% 7.5% - 10.0% Achieved 7.5
Slide 34: Thank You
Thank You Fidelity Bank Plc 2 Kofo Abayomi Street, Victoria Island, Lagos, Nigeria +234 (01) 4480853 info.investor@fidelitybank.ng www.fidelitybank.ng www.fidelitybank.ng