Fidelity Bank Plc · NSENG:FIDELITYBK
Fidelity Bank — Standard Bank 2018 African Investor Conference, London
41 slides from Fidelity Bank's conference presentation, Jun 19, 2018
Slide 1: Fidelity Bank Presentation
Fidelity Bank Presentation Standard Bank 2018 African Investor Conference, London June 19 – 21, 2018 www.fidelitybank.ng
Slide 2: Profile of Fidelity Bank Road-Show Team
Profile of Fidelity Bank Road-Show Team Nnamdi Okonkwo Managing Director / Chief Executive Officer Appointed Managing Director of Fidelity Bank PLC in January 2014 Over 28 years banking experience Banking career includes managerial and leadership positions in Retail, SME, Commercial and Corpor
Slide 3: Outline
Outline 1. Overview of Fidelity Bank 2. Our Strategic Focus 3. Financial Performance Review 4. 2018FY Guidance 5. Appendix 3 www.fidelitybank.ng
Slide 4: Overview of Fidelity Bank
1. Overview of Fidelity Bank 4 www.fidelitybank.ng 3
Slide 5: Overview of Fidelity Bank
Overview of Fidelity Bank Ownership 32.0bn Authorized Shares Listings: 28.96bn Shares Total Assets: N1,480bn Issued And 28.96bn Fully Paid $4.4bn 7yr N30bn May 2022 NGN Bonds $400m Oct 2022 Eurobond Professional Staff 3,106 778 ATMs Male: 57% Operations 4.1 Million Female: 43% & Accounts 2m Cards Co
Slide 6: Evolution of Fidelity Bank
Evolution of Fidelity Bank …Giant strides in our 30 years of existence 1987 - 1998 2005 2006 2010 - 2012 Fidelity Bank Accepted by Finalized merger Deployed Capital incorporated as a and quoted on and integration to develop retail Private Limited the Nigerian infrastructure and Grew branch
Slide 7: Our Story
Our Story Key Player in the Nigerian banking industry Ranks amongst the top 10 banks in the banking industry based on total assets, total deposits and capital adequacy Market share of about 5% on key performance metrics; Total Assets, Loans, Deposits, Customer Base A leading mid-tier bank with
Slide 8: Experienced And Credible Board of Directors
Experienced And Credible Board of Directors Ernest Ebi Kings Akuma Chairman Non-Executive Director Non-Executive Director, Dangote Cement Head, Non-Oil & Gas at ALCON Nigeria PLC; Director Venture, Garden Group Ltd Former Deputy Governor, CBN Former Managing Director, Hammakopp Consortium Lt
Slide 9: Strong Management Team With Extensive Experience
Strong Management Team With Extensive Experience Nnamdi Okonkwo Mohammed Balarabe Managing Director Deputy Managing Director 28+ years experience in banking 26+ years experience in banking Chijioke Ugochukwu Aku Odinkemelu Nneka Chinwe Onyeali-Ikpe Executive Director, Shared Services & Executive Dir
Slide 10: Robust Risk Management Framework in Place
Robust Risk Management Framework in Place Three-tiered approach for enterprise-wide risk management Level 1 Board/Executive Board of Directors Mgt. oversight Board Finance & General Board Corporate Board Audit Committee Board Risk Committee Board Credit Committee Purpose Committee Governance Committ
Slide 11: Our Strategic Focus
2. Our Strategic Focus 11 www.fidelitybank.ng 3
Slide 12: Proven Track Record Of Disciplined Execution
Proven Track Record Of Disciplined Execution Previous Strategic Aspirations : 2014 - 2017 Current Strategic Aspirations : 2018 – 2022 Become a Tier 1 Bank and a Domestic Systematically Important Redefined strategy to focus on Niche Sectors in Corporate Bank (D-SIB) in Nigeria Banking, Deepen our
Slide 13: ……And Solid Platform For Growth
……And Solid Platform For Growth Strong management team and Consistent financial performance corporate culture and profitability Strong and consistent growth in top line Varied, stable and well-experienced top earnings management with 3 CEOs in the bank’s over Healthy PBT and PAT margins amidst
Slide 14: Retail & Digital Banking Evolution & Progress Report
Retail & Digital Banking Evolution & Progress Report Number of Customer Accounts (#’m) Savings deposits (N’bn) Top 5 Retail Banks (KPMG Rating) 75.7 1st Zenith 4.0 188.2 74.8 2nd GT 3.9 178.6 3.6 Bank 3.3 155.0 3rd 2.8 73.6 StanbicIBT 119.1 C 98.0 73.3 4th Fidelity 73.1 5th Access 73.1 5th FCMB 2014
Slide 15: From Nigeria To The Global Skies - Air Peace
From Nigeria To The Global Skies - Air Peace Fidelity Bank Collaborating with FINTECHs To Digitally Disrupt The Airline Industry Air Peace Flight Routes Sokoto Kano Kaduna Yola "Our vision is to be ever dependable through the creation of Lagos Abuja seamless connections and network options for our
Slide 16: Digital Transformation Global Awards – Infosys 2017
Digital Transformation Global Awards – Infosys 2017 Commentary Innovative Custom Component Award: At the 2017 Infosys Finacle Client Innovation Awards in Bangalore India, Fidelity received the award as the 2nd most innovative bank in the mid-tier segment for a proprietary customisation which allowed
Slide 17: Key Financial Highlights
Key Financial Highlights Gross Earnings (N’bn) Operating Expenses (N’bn) Profit Before Tax (N’bn) 179.9 64.2 67.2 65.7 20.3 146.9 152.0 136.1 54.8 15.5 14.0 11.1 43.7 15.1 5.0 2014 2015 2016 2017 Q1 2018 2014 2015 2016 2017 Q1 2018 2014 2015 2016 2017 Q1 2018 Loans and Advances (N’bn) Customer Depos
Slide 18: Financial Performance Review
3. Financial Performance Review 18 www.fidelitybank.ng 3
Slide 19: Financial Highlights
Financial Highlights Summary of Income Statement N’million 2016FY 2017FY VAR % VAR Q1 2018 Gross Earnings 152,021 179,896 27,875 18.3% 43,680 Interest Income Loans 92,715 114,091 21,376 23.1% 28,345 Interest Income Liquid Assets 30,438 36,651 6,213 20.4% 10,121 Total Interest Income 123,153 150,742
Slide 20: Gross Earnings Analysis – Key Drivers Of 2017FY Growth
Gross Earnings Analysis – Key Drivers Of 2017FY Growth Gross earnings increased by 18.3% (N27.9bn) to Contribution to N27.9bn Growth In Gross Earnings N179.9 billion in 2017FY on account of double digit growth across key income lines: N0.3bn N6.2bn N21.4bn Trade income by 61.6% 76.7% Account m
Slide 21: Gross Earnings Trend
Gross Earnings Trend Breakdown of Gross Earnings Total Revenue by Segments 179.9 Investment Banking, Retail Banking, 147.0 152.1 21.4% 41.9% 136.1 29.2 25.8 28.9 31.8 150.7 43.7 104.3 121.2 123.2 5.2 38.5 Corporate Banking, 36.7% 2014 2015 2016 2017 Q1 2018 Interest Income Non-interest Income Intere
Slide 22: Electronic Banking Income Analysis
Electronic Banking Income Analysis Breakdown of E-banking Income – 2017FY Breakdown of E-banking Income – Q1 2018 Total Income: N6.8bn Payments Solutions, 8% Total Income: N1.6bn Payments Solutions, 8% POS, 3% POS, 2% ATM, 26% ATM, 26% Transaction Alert, 16% Transaction Alert, 20% Cards, 29% Online
Slide 23: Profitability And Efficiency Ratios
Profitability And Efficiency Ratios Profit Margin Cost to Income Ratio 11.7% 11.3% 11.4% 73.4% 76.4% 77.3% 72.7% 9.5% 67.5% 7.3% 2014 2015 2016 2017 Q1 2018 2014 2015 2016 2017 Q1 2018 Return on Equity (pre-tax) Return on Assets (pre-tax) 8% 29% 23% 31% 56% 66% 76% 74% 11.2% 1.5% 10.0% 1.3% 1.4% 9.0
Slide 24: Net Interest Margin Analysis
Net Interest Margin Analysis NIM dropped to 6.7% in Q1 2018 from 7.3% in 2017FY Net Interest Margin (Q1 2017: 6.9%) due to a combination of increased funding cost and a decline in yields on earning assets. 7.4% 7.3% Average funding cost inched up to 7.4% as we grew the 6.6% 6.7% 6.7% deposit boo
Slide 25: Financial Highlights
Financial Highlights Statement of Financial Position N’million 2016FY 2017FY VAR % VAR Q1 2018 Total Assets 1,298,141 1,379,214 81,073 6.2% 1,479,665 Earning Assets 970,213 977,076 6,863 0.7% 1,027,853 Bank Placements 13,011 8,475 (4,536) -34.9% 44,125 Treasury Bills 126,823 90,223 (36,600) -28.9% 1
Slide 26: Funding Base Analysis
Funding Base Analysis Total deposits increased across all deposit products Customer Deposits (including FX deposits) by 10.8% YTD to N859.4 billion from N775.3 billion in 2017FY 820.0 859.4 769.6 793.0 775.3 Further growth witnessed in retail deposits as savings 25% 36% 23% 23% 42% deposits incr
Slide 27: Loan Portfolio Analysis
Loan Portfolio Analysis Breakdown of Loans & Advances to Customers N’million 2015FY 2016FY 2017FY Q1 2018 VAR % VAR Communication 48,298 43,566 37,874 43,562 5,688 15.0% Oil and Gas 147,407 188,217 204,695 198,068 -6,628 - 3.2% - Upstream 97,568 136,161 148,544 137,401 -11,142 - 7.5% - Downstream 23
Slide 28: IFRS 9 Impact Analysis
IFRS 9 Impact Analysis Further to the adoption of IFRS 9 in Jan 2018 by Nigerian Banks, banks were expected to reflect the impact of the adoption in Q1 2018 The impact of the adoption is calculated as Total Provisions using IFRS 9 minus Actual Total Provisions using IAS 39 For Fidelity Bank, A
Slide 29: Loan Portfolio Analysis
Loan Portfolio Analysis Net loans declined by 3.9% YTD to N738.7 billion on Net Loans & Advances to Customers (N’bn) account of the IFRS 9 implementation which impacted net 900.0 100% 768.7 738.7 loans by over N28bn and also some loan pay-downs 800.0 718.1 90% 80% 578.2 700.0 FCY loans declined
Slide 30: NPL Portfolio Analysis
NPL Portfolio Analysis Breakdown of Non-performing Loans 2015FY 2016FY 2017FY Q1 2018 VAR % VAR 2017FY Q1 2018 N'million N'million N'million N'million N'million % NPL Ratio NPL Ratio Communication 1,919 1,492 1,537 1,557 20 1.3% 4.1% 3.6% Oil and gas 2,319 2,184 13,624 12,891 -733 -5.4% 6.7% 6.5% -
Slide 31: NPL Portfolio Analysis
NPL Portfolio Analysis Though we only have a syndicated loan to 9 Mobile with no bilateral exposures, we have made a very conservative provision of 50% on our exposure to 9 Mobile The sale to a core investor is progressing with $50m already paid and we expect this sale and loan resolution to be
Slide 32: NPL Portfolio Analysis
NPL Portfolio Analysis Gross Loans and Advances NPL Coverage Ratio 795.3 794.5 60.0 140.0% 743.1 49.4 50.7 50.3 115.9% 50.7 50.3 120.0% 599.0 50.0 559.1 49.4 92.4% 109.4% 111.7% 100.0% 26.1 40.0 24.4 26.1 80.0% 30.0 24.4 83.0% 744.7 744.0 60.0% 693.7 534.8 572.8 20.0 40.0% 10.0 20.0% - 0.0% 2014 201
Slide 33: Liquid Assets Position
Liquid Assets Position Short-term Funds Placements Treasury Bills Bonds 24.6% 3.0% 9.6% 7.0% 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 84.7% 38.0% 36.0% 35.9% 36.0% 78.0% 33.2% 69.8% 72.6% 40.0% 50%
Slide 34: Capital Adequacy
Capital Adequacy Fidelity CAR was unchanged at 16.0%, which remains Capital Adequacy Ratio Computation – Basel II above the regulatory minimum requirement of 15.0%. N‘billion 2017FY Q1 2018 VAR The single obligor charge dropped to N14.6 billion due to Tier 1 Capital 165.3 165.3 0.0 an absolute r
Slide 35: 2018FY Guidance
4. 2018FY Guidance 42 www.fidelitybank.ng 3 35
Slide 36: 2018FY Guidance
2018FY Guidance GROWTH EXPECTATIONS ON KEY INDICATORS S/N Index 2017FY Actual Q1 2018 Actual 2018FY Target 1 Net Interest Margin 7.3% 6.7% 6.5% - 7.0% 2 Tax Rate 7.1% 7.1% 10.0% - 12.0% 3 Loan Growth (YTD) 7.0% -3.9% 7.5% - 10.0% 4 Deposit Growth (YTD) -2.2% 10.8% 10.0% - 15.0% 5 Cost - Income Ratio
Slide 37: 2018FY PBT Assumptions – Roadmap To N25bn
2018FY PBT Assumptions – Roadmap To N25bn 10% expansion in earning assets (N100bn growth) @ 7% 2018FY RoE Guidance NIM will generate additional N7.0bn income. N11.1bn N20.3bn N25.0bn 12.5% (N3.0bn) growth in fee income driven by 630k new mobile banking customers, Trade and FX Trading Income 12.5
Slide 38: Appendix
5. Appendix 38 www.fidelitybank.ng 6 6
Slide 39: Summary Of Income Statement
Summary Of Income Statement (N’millions) 2015FY 2016FY 2017FY Q1 2018 Gross Earnings 146,948 152,021 179,896 43,680 Interest and similar income 121,158 123,153 150,742 38,466 Interest and similar expense (60,294) (61,225) (79,278) (21,499) Net interest income 60,864 61,928 71,464 16,967 Impairment c
Slide 40: Summary Of Balance Sheet
Summary Of Balance Sheet (N’millions) 2015FY 2016FY 2017FY Q1 2018 ASSETS Cash and balances with central bank 185,332 207,061 269,625 303,444 Due from banks 79,942 49,200 52,287 103,995 Loans and advances to customers 578,203 718,401 768,737 738,727 Investments: • Held for trading (fair value throug
Slide 41: 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
Fidelity Bank — Standard Bank 2018 African Investor Conference, London on 6ix