www.fidelit ybankplc.com Fidelity Bank Plc: Management Presentation Half Year 2012 Financial Results July, 2012
www.fidelit ybankplc.com Fidelity Overview 1
Our Guiding Philosophy www.fidelit ybankplc.com Mission SHARE D VALUE S To make Financial Services Easy and Accessible Custome r F irst Re spe c t E xc e lle nc e Sha re d Vision a mbition T e na c ity To be No.1 in every market we serve and for every branded product we offer
One of Nigeria’s Safest and Strongest Financial Institutions www.fidelit ybankplc.com Capital Adequacy Ratio 141.7 150.0 50.0% 133.0 120.0 40.0% 37.5% 90.0 30.0% 29.0% 60.0 20.0% Fidelity may not be the 30.0 10.0% - 0.0% biggest, but we are one Jun 2011 Jun 2012 Total Capital (N'bn) Capital Adequacy Ratio of the strongest, most Liquidity Ratio stable, safe and 70.0% 56.7% consistent 55.0% 47.2% banks in Nigeria. 40.0% 25.0% 10.0% Jun 2011 Jun 2012 Fidelity LR Regulatory Minimum The Banker Magazine’s 2012 Report ranks Fidelity as “The Soundest Bank” in Nigeria. Fidelity has been consistent in making profit and issuing dividend in the last 8 Years.
Over 24 Years . . . Still Counting www.fidelit ybankplc.com The Most Socially Responsible Bank in Africa 2008 – The African Banker Fidelity Registered as Licensed to Raised Equity Resolved all incorporated as a Public operate as a to N22bn Merger a Private Limited universal bank (Rights, IPO integration Limited Liability Liability and Private issues Accepted into Company Placement) Company Raised Equity and Quoted on Acquired FSB Commenced Converted to the Nigeria to US$1bn Int’l Bank Plc operations as a Commercial Stock through GDR and Manny Merchant Bank Bank Exchange & Public Offer Bank Plc 1989 2001 1987 1999 2005 2006 2007 6 th Biggest Bank in Nigeria - 2012 Today, Fidelity is one 17 th Biggest Bank in Africa - 2012 of the safest, soundest and most stable 618 th Biggest in the World - 2012 financial institutions in The Soundest Bank in Nigeria - 2012 Nigeria.
Over 24 Years . . . We Keep Getting Better www.fidelit ybankplc.com Awards and Recognitions: Africa’s Most Socially Responsible Bank – The Banker Magazine, Washington DC, 2008 The Most Efficient Bank in Clearing Data Transmission – Nigerian Interbank Settlement Scheme 2011 The Most Punctual Bank – Nigerian Interbank Settlement Scheme 2011 The Most Socially Responsible Bank in Nigeria – SERA Awards – 2007, 2008, 2009, 2010 Award for Error- Free Transaction Processing– Deutsche Bank - 2011 Mandated by Debt Mgt Nominated: Appointe d Whole sale De ale r in Office (DMO) in 2006 as: F or e ign Cur r e nc ie s - 2006 Dealer in FGN Bonds Most Improved Bank – 2005 CBN Mandate d Manage r of Dealer in Pensioners Best Fund Manager – 2005 Sove r e ign Re se r ve – 2006 Bond Best Stock Offer - 2005 Dealer in Contractors CBN appointe d Pr imar y De ale r in Bond T r e asur y Bills and Mone y Mar ke t Best Bond Dealer and Instr ume nts - 2007 Market Maker in 2006, 2008
Strategic Alliances and Global Partnerships www.fidelit ybankplc.com A partner of strategic choice for global financial institutions. Our strategic partnerships provide us global reach and the benefit of knowledge transfer in our quest to implement best practices.
Shareholding Structure www.fidelit ybankplc.com Diverse Shareholder Distribution Shareholder Distribution Diverse shareholder base wit h no cont rolling 73.3% 80.0% shareholder; over 400,000 shareholders No single shareholder owns more t han 5% of 60.0% t ot al share capit al 40.0% Diversificat ion of shareholding and absence 19.4% of concent rat ion has enabled Fidelit y t o 20.0% 3.5% 3.1% 0.4% 0.4% operat e under world class corporat e 0.0% governance pract ices and t he professionalizat ion of it s Management and corporat e cult ure. Limited Insider Ownership Insiders have relatively small shareholder ownership and control Total Fidelity is led by a stable, experienced and well Insider regarded management team that has successfully Holding grown a company that is built on quality and 5% driven by a managed risk philosophy. Outsiders 95% S ince inception in 1987, Management has guided the Bank through several key industry changes and market developments.
www.fidelit ybankplc.com Group Financial Highlights
Group H1-2012 - Summary F inanc ial Re sults www.fidelit ybankplc.com HALF YEAR FINANCIAL HIGHLIGHTS (Naira in million) H1-2012 H1-2011 % Change Gross Earnings 51,898 29,917 73.5% Net Interest Income 20,179 12,417 62.5% Non-interest Income 13,338 9,677 30.7% Impairment Charges (720) (1,801) -60.0% Profit Before Tax 9,878 3,818 160.0% Cost/Income ratio 70% 82% RoE (Pre-tax) 13.9% 5.8% RoA (Pre-tax) 2.7% 1.5% Jun 2012 Jun 2011 % Charge Equity 141,651 133,000 6.5% Deposits 554,097 554,097 61.0% Net Loans to Banks 85,569 126,162 -32.2% Net Loans to Customer 274,482 201,376 36.3% Total Assets 736,935 502,596 46.6% NPL / Loans 6.1% 16.0%
www.fidelit ybankplc.com Revenue
Re ve nue www.fidelit ybankplc.com Gross Earnings Interest Income N'million N'million 51,899 45,000 40,241 54,000 45,000 36,000 36,000 29,917 27,000 19,884 27,000 18,000 18,000 9,000 9,000 - - H1-2011 H1-2012 H1-2011 H1-2012 Revenue sustained positive growth on the back Profit Before Tax (PBT) of increased loan book, non interest income and N'million activity in the inter-bank market. 9,878 10,000 Gross Earnings grew by 79% 8,000 which is in tandem with the 102% growth recorded in Interest 6,000 Income. 3,818 4,000 PBT to Gross Earnings moved up from 13.2% to 2,000 19% underpinning improved efficiency in the - deployment of resources. H1-2011 H1-2012
Non-inte re st Inc ome www.fidelit ybankplc.com Non-interest Income Composition of Non-interest Income N'million 15,000 13,338 Other FX Income, 34% Income, 24% 12,000 9,677 9,000 6,000 3,000 Fees & - Com, 42% H1-2011 H1-2012 H1-2012 Other About 90% of Non-interest Income came from Income, 13% FX Income, 54% core business activity with Fees and Commission accounting for the largest share. As we continue to explain growth in our customer count and pass-through volumes, we expect the effect of refined payment systems to continue to increase our activity based income. Fees & Com, 33% H1-2011
www.fidelit ybankplc.com Efficiency Ratios
Profitability Dynamic s www.fidelit ybankplc.com Net Interest Income Return on Assets and Return on Equity N'million 14.2% 15.0% 22,200 20,179 12.0% 18,500 9.0% 14,800 12,417 5.8% 11,100 6.0% 2.7% 7,400 3.0% 1.5% 3,700 0.0% - H1-2011 H1-2012 H1-2011 H1-2012 RoA (pre-tax) RoE (pre-tax) Alongside the recorded growth in Net Loans to customers, Net-interest Income increased by 66% to N20.2 billion. RoE and RoA (annualised) recorded significant improvement between H1-2011 and H1-2012. Continued implementation of our process rescheduling initiatives and expansion in trading volumes from existing and new relationships would continue to reflect in improved returns to our shareholders.
Cost Dynamic s www.fidelit ybankplc.com Interest Expense Operating Expense & Cost-Income Ratio N'million N'million 23,182 20,062 25,000 96.0% 21,000 20,000 16,535 17,500 88.0% 81.2% 15,000 14,000 70.3% 80.0% 10,500 10,000 7,738 72.0% 7,000 5,000 3,500 - 64.0% 0 H1-2011 H1-2012 Operating Expense Cost-Income Ratio H1-2011 H1-2012 The increase in Monetary Policy Rate (MPR) to 12.0% Breakdown of Operating Expense in October 2011 raised cost of funds and reward for deposits across maturities. 100% 42% 44% S 75% ustained branch expansion activity also kept cost- income ratio at high levels above our target band. 10% 8% 50% Our target is to trend it down to the mid-60 range by financial year end 2012. 25% 49% 48% S taff cost, which constitutes 48% of total operating 0% expenses in 2012, is trending downwards on the H1-2011 H1-2012 back of continued extraction of value from our Other Opex Depreciate S taff Cost process rescheduling and technology deployment despite growing branch network.
www.fidelit ybankplc.com Balance Sheet Structure
F unding Struc ture www.fidelit ybankplc.com Total Assets Total Capital N'billion N'billion 850 141.7 736.9 150 46.9% 133.0 680 120 502.6 510 90 340 60 170 30 - - Jun 2011 Jun 2012 Jun 2011 Jun 2012 Composition of Funding Sources 100% 5.1% 5.6% Fidelity would continue to emphasis a self 19.2% 26.5% funded balance sheet. 80% 60% Balance sheet growth was largely from 61.0% increase in customer deposits. 40% 75.2% 68.5% In the last 12 months, we switched on 10 new 20% branches which has helped to push our deposit 0% numbers while maintaining a balanced mix. Jun 2011 Jun 2012 Other Liabilities Equity Deposits
Analysis of L oans and De posits www.fidelit ybankplc.com Net Loans and Advances Customer Deposits Other Demand, 47.1% Advances, 1% Lease Tenure, 31.9% Finance, 11% Overdraft, 3 1% Term Savings, 21.0% Loans, 57% N'billion 600.0 554.1 N'billion 36.3% 61% 300.0 274.5 250.0 450.0 201.4 344.2 200.0 300.0 150.0 100.0 150.0 50.0 - - Jun 2011 Jun 2012 Jun 2011 Jun 2012
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