Net profit at the banking holding company FCMB Group fell by more than one-fifth last year amid galloping cost pressures even though revenue grew by as much as 53.9 per cent.
According to Premium Times, these details are contained in the group’s newly released audited earnings report.
The result bucks the trend of record profitmaking by the majority of Nigerian lenders that have so far published their financial statements for 2024 as a dramatic rise in the benchmark interest rate during the year sharply boosted the income banks earned from granting loans.
Gross earnings for FCMB Group climbed to ₦794.4 billion from ₦516.4 billion, with interest and discount income alone contributing almost four-fifths.
Even though interest income expanded by 75.2 per cent to ₦621.8 billion, the chunk of that was eroded by interest expense as the cost the financial services group incurred from keeping the deposits of savers jumped more than twofold.
Net interest income grew by 27.6 per cent during the period, compared to 44.8 per cent a year ago.
Boosting revenue, net trading income increased almost six times to ₦53.8 billion, riding on the back of much-improved returns from the group’s investment in FGN bonds.
A major pressure point on profit was operating expenditure, which soared by 45.7 per cent, the key drivers being higher personnel costs, regulatory costs, foreign currency-linked expenses as well as inflation.
Likewise, other gains fell to ₦39.6 billion from ₦89.3 billion following a slump in foreign exchange gains. Cost-to-income ratio was as high as 59.9 per cent for the year.
