Fidelity Bank Financial Overview

Financial Highlights ☐ Gross earnings increased by 3.5% to N152.0bn primarily due to 9.3% increase in interest income on loans and 41.3% increase in e-banking income as the bank deepens its business recruitment strategy in the retail and e-banking space. ☐ PBT declined by 21.1% due to a N4.8bn increase in Gratuity/Retirement costs in the 2016FY as the bank discontinued its legacy Gratuity and Retirement schemes. Excluding this one-off charge, PBT for the year would have been N15.8bn. □ Interest expense on customer deposits declined by 13.1% despite a 3.0% growth in total deposits, which reflects our improved deposit mix; low cost deposits now represent 78.7% of total deposits. However, total interest expense (deposits and debt) grew by 1.5% due to the impact of naira devaluation on interest expense on foreign currency borrowings. ☐ Operating income increased by 3.9% while total operating expenses increased by 4.7% driven by increased advert cost, depreciation charge, and energy cost etc. (though cost growth is still significantly below the rate of inflation). Though average funding cost dropped from 6.2% to 5.8% on account of improved deposit mix, NIM declined to 6.4% in 2016FY from 6.9% in 2015FY due to a drop in average yield on earning assets which outpaced the decline in average funding cost. 9 www.fidelitybank.ng

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