Inve stor Pre se nta tion Unaudite d IF RS F inanc ial Re sults - - PowerPoint PPT Presentation
Inve stor Pre se nta tion Unaudite d IF RS F inanc ial Re sults for the 6 Months E nde d June 2014 Outline 1 F ide lity Ove r vie w (MD/ CE O) 2 Nig e ria n E c o no my Ove rvie w (He a d, Stra te g y) 3 F ina nc ia l Hig hlig
Inve stor Pre se nta tion
Unaudite d IF RS F inanc ial Re sults for the 6 Months E nde d June 2014
1 F ide lity Ove r vie w (MD/ CE O)
2 Nig e ria n E c o no my Ove rvie w (He a d, Stra te g y) 3 F ina nc ia l Hig hlig hts (He a d, Stra te g y) 4 F ina nc ia l Re vie w (DH, SI BT ) 5 L
BT )
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Outline
Ove r vie w of F ide lity Bank
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A full se rvic e b a nk with I nte rna tio na l Autho risa tio n e sta b lishe d in 1987 a nd lic e nse d b y the Ce ntra l Ba nk o f Nig e ria T he Ba nk c urre ntly ha s o ve r 400,000 sha re ho lde rs with the ma jo rity b e ing Nig e ria n c itize ns a nd c o rpo ra tio ns. One o f the hig he st C AR a mo ng st Nig e ria n b a nks a t 27%, we ll a b o ve the CBN re q uire me nt o f 15% Ove r 85% o f the b ra nc h ne two rk is lo c a te d in ke y b usine ss c e ntre s a nd the mo st e c o no mic a lly via b le re g io ns o f Nig e ria A le a ding pa rtne r to the Nig e ria n po we r, o il a nd g a s a nd te le c o m industrie s
Bac kgr
Ke y Highlights
Busine ss Offic e s L a g o s 75 So uth We st 11 So uth So uth 40 So uth E a st 42 No rth We st 15 No rth E a st 7 No rth Ce ntra l 11 F CT Ab uja 16 E le c tr
AT Ms 640 POS 9,156
T
1,058 millio n T
quity 166.4millio n Busine ss Offic e s
217
No of Ac c ounts 2.6millio n T
3,840
Consume r Sale s Age nts 848 Ratings B/ B (S&P)/ F itc h Auditor s E rnst & Yo ung / PK F Distr ibution Ne twor k
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Ove r vie w of F ide lity Bank
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Re c e nt Awar ds and Re c ognitions
Busine ssWor ld: Cor por ate Ac hie ve me nt Awar d Gr e at Plac e to Wor k Awar d Nige r ian Chambe r
itime Bank E ur
inanc e : Afr ic a Oil & Gas De al of the Ye ar De utsc he Bank: Str aight-T hr
(ST P) E xc e lle nc e Awar d Nige r ia T e le c om awar ds: Be st T e le c om financ ing Bank of the Ye ar We b Jur ist Awar ds: Be st Bank We bsite Conte nt SE RA Awar d: Most Soc ially Re sponsible Bank Busine ssday Banking Awar d: Be st Bank in Suppor t of SME s
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12KLD0346_Client template1
Outline
1 F ide lity Ove rvie w 2 Nig e ria n E c o no my Ove rvie w 3 F ina nc ia l Hig hlig hts 4 F ina nc ia l Re vie w 5 L
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E c onomy: Strong funda me nta ls, solid g rowth
8.0% 7.7% 7.8% 7.9% 8.0% 8.2% Ja n F e b Ma r Apr Ma y Jun
He adline Inflation (2014)
He adline Inflation He a dline infla tio n inc he d up to 8.2% yr-o n-yr in June 2014, the hig he st sinc e Se p 2013, fro m 8.0% in Ma y 2014 I nc re a se in fo o d pric e s a c c o unte d fo r the jump whic h re fle c te d o n the 10b ps rise in fo o d sub -inde x Ac tivitie s a ro und the g e ne ra l e le c tio n a re the b ig g e st upside risk to infla tio n
7.7% 7.9% 5.3% 4.2% 5.5% 6.2% 2009 2010 2011 2012 2013 Q1-2014
Re al GDP Growth Rate
150 156 162 168 174
F
e ig n E xc ha ng e Ra te
sDAS Ra te Inte r-b a nk Mkt Pa ra lle l Mkt 43 40 38 38 37 37.5 105 105 104 104 105 108 100 103 106 109 32 36 40 44 Ja n F e b Ma r Apr Ma y Jun
E xte r na l Re se r ve s ($bn) Oil Pr ic e
E xte rnal Re se rve s & Oil Pric e
E xte rna l Re se rve s Oil Pric e (OPE C Ba ske t Pric e )
Gr
T
he re vise d GDP fig ure puts the size o f Nig e ria 's e c o no my a t $514billio n, ma king it the la rg e st e c o no my in Afric a
Se rvic e Se c to r e me rg e d a s the la rg e st se c to r in the e c o no my; a c c o unte d fo r
Curre ntly, the fa ste st g ro wing industry is Che mic al a nd Pha rma c e utic al a t 41.6% E xte r nal Re se r ve s & Cr ude Oil Pr ic e E
xte rnal re se rve s sta b ilize d in June 2014, g re w a t 1.4% m-o n-m to $37.48b illio n o n a c c o unt o f inc re a se d c rude o il pric e
Nig e ria’ s e xte rnal re se rve s re ma ins so lid and c o uld c o ve r up to 10 mo nths o f
impo rts
Big g e st thre a t to e xte rna l re se rve s is lo w c rude o il pro duc tio n a nd hig h o il the ft F
e ign E xc hange Rate I n the la st 3 mo nths, F X ra te s a c ro ss ma rke ts have b e e n vo la tile e xc e pt in the CBN RDAS ma rke t whe re ra te s ha ve re ma ine d re la tive ly sta b le a t N155.73/ $ I n the I nte r-bank ma rke t a nd the Pa ralle l Ma rke t, USD F X ra te mo ve d within the b a nd o f N161.74 +/ -1.9%, a nd N168.50 +/ -2.1% re spe c tive ly We ma y witne ss a n uptic k in ra te s a s the e c o no my b e g ins to fe e l e le c tio n pre ssure
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Outline
1 F ide lity Ove rvie w 2 Nig e ria n E c o no my Ove rvie w 3 F ina nc ia l Hig hlig hts 4 F ina nc ia l Re vie w 5 L
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Pe r for manc e Highlight
F ide lity Br and Re ve nue and E ffic ie nc y Ratio Asse t Quality Capital Ade quac y and L iquidity
Gro ss E
a rning s up b y 0.6% to N63.3b illio n in H1- 2014 (H1-2013: N62.9b illio n)
Ne t Inte re st Inc o me inc he d up b y 32.3% to N24.8b illio n (H1-2013: N18.7b illio n) PBT
dro ppe d b y 15.7% to N9.4b illio n in H1-2014 (PAT c a me in a t N8.0b illio n)
ROE
(pre -ta x) a t 11.4% in H1-2014; ROA (pre -ta x) a t 1.9% in H1-2014
NPL
Ra tio : 3.96% a s a t Jun 2014, fro m 3.65% in Jun 2013 a nd 6.10% (Jun 2012)
NPL
Co ve ra g e o f 95.6%
E
a rning Asse ts re ma ine d hig h a t N718.4b illio n
Ca pita l Ade q ua c y Ra tio o f 27.0%, we ll a b o ve re g ula to ry minimum o f 15.0% Go o d L
iq uidity Ra tio o f 35.3% c o mpa re d to re g ula to ry minimum o f 30.0%
Impro ve d Ne t L
T
q uity g re w to N166.4b illio n fro m N164.6b illio n
7th la rg e st b a nk in Nig e ria b y E
q uity, 17th la rg e st in Afric a a nd 622nd in Wo rld
One o f the sa fe st Nig e ria n b a nk with stro ng Ca pita l Ba se Suc c e ssful issue o f $300 millio n E
uro b o nd, whic h wa s o ve r sub sc rib e d
Sta b le , e xpe rie nc e d a nd we ll re g a rde d ma na g e me nt te a m
Asse t Quality
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Summa ry of Inc ome Sta te me nt H1 - 2014 Vs H1 - 2013
F inanc ial Highlights
H1 - 2014 H1 - 2013 VAR % VAR
Gross E arnings
63,258 62,904 354 0.6%
Inte re st Inc o me L
33,487 28,023 5,464 19.5%
Inte re st Inc o me L iq uid Asse ts
18,041 17,791 250 1.4% T
51,528 45,814 5,715 12.5%
Inte re st E xpe nse Custo me r De po sits
(24,971) (26,605) 1,634
Inte re st E xpe nse Bo rro wing s
(1,770) (469) (1,301) 277.7% T
xpe nse
(26,741) (27,073) 332
Ne t Inte re st Inc ome
24,787 18,740 6,047 32.3%
F X Inc o me
5,974 8,528 (2,554)
COT
2,156 2,331 (174)
Othe r F e e Inc o me
4,848 4,193 656 15.6% T
e e Inc ome
12,978 15,052 (2,073)
Ope rating Inc ome
37,765 33,792 3,974 11.8%
T
xpe nse s
(26,247) (23,724) (2,523) 10.6%
Ne t g a ins / (lo sse s) fro m F
(1,248) 2,039 (3,287)
Ne t Impa irme nt L
(838) (917) 79
Profit be fore T ax
9,432 11,190 (1,758)
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Summa ry of Inc ome Sta te me nt Q2 - 2014 Vs Q1 - 2014
F inanc ial Highlights
(Nair a in million) Q2 - 2014 Q1 - 2014 VAR % VAR
Gross E arnings 32,303 30,955 1,347 4.4%
Inte re st Inc o me L
16,763 16,724 40 0.2% Inte re st Inc o me L iq uid Asse ts 8,497 9,544 (1,047)
T
25,261 26,268 (1,007)
Inte re st E xpe nse Custo me r De po sits (12,487) (12,484) (3) 0.0% Inte re st E xpe nse Bo rro wing s (886) (884) (2) 0.2%
T
xpe nse (13,373) (13,368) (4) 0.0% Ne t Inte re st Inc ome 11,888 12,899 (1,011)
F X Inc o me 3,056 2,918 138 4.7% COT 1,015 1,141 (125)
Othe r F e e Inc o me 2,903 1,945 958 49.2%
T
e e Inc ome 6,974 6,004 970 16.2% Ope rating Inc ome 18,862 18,903 (41)
T
xpe nse s (13,518) (12,728) (790) 6.2%
Ne t g a ins / (lo sse s) fro m F
68 (1,316) 1,384
Ne t Impa irme nt L
(437) (401) (36) 8.9%
Profit be fore T ax 4,975 4,458 517 11.6%
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Sta te me nt of F ina nc ia l Position: H1 - 2014 Vs H1 - 2013
F inanc ial Highlights
(Nair a in million) H1 - 2014 H1 - 2013 VAR % VAR
T
1,058,235 965,793 92,442 9.6% E arning Asse ts 718,383 732,031 (13,648)
Ba nk Pla c e me nts 23,450 3,000 20,450 681.7% T re a sury Bills 190,807 261,909 (71,102)
Bo nds 65,997 99,146 (33,149)
Custo me r L
316,283 285,295 30,988 10.9% Custo me r L
CY) 121,846 82,681 39,165 47.4%
Non-E arning Asse ts 339,852 233,762 106,090 45.4%
Ca sh 22,157 31,927 (9,770)
Ba la nc e s with CBN/ Se ttle me nt Ac c t. 188,947 81,257 107,689 132.5% Ba la nc e s with o the r Ba nks 56,100 57,014 (914)
F ixe d Asse ts 37,025 36,583 442 1.2% All Othe r Asse ts 35,623 26,980 8,643 32.0%
Inte re st Be aring L iabilitie s 842,617 768,618 73,999 9.6%
De ma nd 368,597 385,773 (17,175)
Sa ving s 82,301 71,805 10,496 14.6% T ime De po sits 314,877 248,591 66,286 26.7% Bo rro wing s 29,340 15,731 13,609 86.5% E uro b o nd 47,502 46,719 783 1.7%
All Othe r L iabilitie s 49,241 32,592 16,649 51.1% E quity 166,377 164,583 1,794 1.1%
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Sta te me nt of F ina nc ia l Position: Q2 - 2014 Vs Q1 - 2014
F inanc ial Highlights
(Nair a in million) Q2 - 2014 Q1 - 2014 VAR % VAR
T
1,058,235 1,042,962 15,273 1.5% E arning Asse ts 718,383 698,829 19,554 2.8%
Ba nk Pla c e me nts 23,450 9,500 13,950 146.8% T re a sury Bills 190,807 187,940 2,867 1.5% Bo nds 65,997 74,888 (8,891)
Custo me r L
316,283 306,917 9,366 3.1% Custo me r L
CY) 121,846 119,584 2,262 1.9%
Non-E arning Asse ts 339,852 344,134 (4,281)
Ca sh 22,157 24,518 (2,361)
Ba la nc e s with CBN/ Se ttle me nt Ac c t. 188,947 183,675 5,272 2.9% Ba la nc e s with o the r Ba nks 56,100 73,417 (17,316)
F ixe d Asse ts 37,025 36,945 80 0.2% All Othe r Asse ts 35,623 25,579 10,044 39.3%
Inte re st Be aring L iabilitie s 842,617 825,416 17,202 2.1%
De ma nd 368,597 373,935 (5,338)
Sa ving s 82,301 82,842 (540)
T ime De po sits 314,877 295,496 19,380 6.6% Bo rro wing s 29,340 23,100 6,240 27.0% E uro b o nd 47,502 50,043 (2,541)
All Othe r L iabilitie s 49,241 50,172 (931)
E quity 166,377 167,374 (998)
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F inanc ial Highlights
H1 2014 PBT
de c line d de spite the str
e st inc ome in H1 2014 due to losse s on financ ial Instr ume nts (Inve stme nt se c ur itie s) disc ounte d on the bac k of the inc r e ase in CRR to 75%
PBT
in Q2 ne gative ly impac te d by de c lining yie lds on liquid asse ts and inc r e ase in Pr ivate Se c tor CRR to 15%
Inc r
e ase d mone tar y tighte ning has le d to an inc r e ase of ove r N107bn in non- e ar ning c ash r e se r ve s ove r the last 12 months
Impr
e duc tion in non- e ar ning asse ts (Cash and Bank Balanc e s) whilst inc r e asing the volume of e ar ning asse ts
F
unding c ost fr
e st be ar ing liabilitie s r e maine d flat in Q2 2014 de spite inc r e ase d mone tar y tighte ning and a r ising inte r e st r ate e nvir
liabilitie s
NIM has impr
6.5% in H1 2014 on the bac k of balanc e she e t manage me nt initiative s
F
X inc ome impac te d by r e gulator y spr e ads on some F CY Pr
we c ontinue to se e impr
ansac tion volume s fr
busine ss offic e s in c omme r c ial mar ke ts (E vide nc e d by the De utc he Bank ST P Awar d)
Gr
fe e inc ome in Q2 2014 lar ge ly dr ive n by divide nd inc ome of ove r N0.5bn
Ke y e xpe nse dr
ive r s r e main Staff/ De pr e c iation/ NDIC/ AMCON Re solution whic h ac c ount for c ir c a 70% of total e xpe nse s
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12KLD0346_Client template1
Outline
1 F ide lity Ove rvie w 2 Nig e ria n E c o no my Ove rvie w 3 F ina nc ia l Hig hlig hts 4 F ina nc ia l Re vie w 5 L
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Gr
ar nings Analysis
Ke y Highlight (N’million) H1-2014 H1-2013
Gr
ar nings 63,258 62,904
Inte re st Inc o me L
33,487 28,023 Inte re st Inc o me L iq uid Asse ts 18,041 17,791 F X Inc o me 5,974 8,528 Co mm. o n T urno ve r (COT ) 2,156 2,331 Cre d it Re la te d F e e 334 310 E
1,208 831 Othe r Inc o me 3,306 3,052 Ne t Ga ins/ L
(1,248) 2,039 Ke y Highlight (N’million) Q2-2014 Q1-2014
Gr
ar nings 32,303 30,955
Inte re st Inc o me L
16,763 16,724 Inte re st Inc o me L iq uid Asse ts 8,497 9,544 F X Inc o me 3,056 2,918 Co mm. o n T urno ve r (COT ) 1,015 1,141 Cre d it Re la te d F e e 217 117 E
645 564 Othe r Inc o me 2,041 1,265 Ne t Ga ins/ L
68 (1,316)
I
nc o me L
I
nc . L iq uid Asse ts, 28.5% F X I nc o me , 9.4% COT , 3.4% E
Othe rs, 3.8%
Gross E arnings :H1-2014 Gross E arnings :H1-2013 Gross E arnings :Q2-2014 Gross E arnings :Q1-2014
I
nc o me L
I
nc . L iq uid Asse ts, 28.3% F X I nc o me , 13.6% COT , 3.7% E
Othe rs, 8.6% I
nc o me L
I
nc . L iq uid Asse ts, 26.3% F X I nc o me , 9.5% COT , 3.1% E
Othe rs, 7.2% I
nc o me L
I
nc . L iq uid Asse ts, 30.8% F X I nc o me , 9.4% COT , 3.7% E
Othe rs, 0.2%
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E ffic ie nc y Ratio
Re tur n on Avg. Asse ts and Avg. E quity Inte r e st & Disc ount Inc ome / Non- inte r e st Inc ome
15
Gr
ar nings Susta ine d g ro wth in g ro ss e a rning s o n the b a c k o f 12.5% g ro wth in inte re st & disc o unt inc o me . No n-inte re st inc o me dro ppe d d ue to tig hte ne d ta riff re g ime o n fo re ig n e xc ha ng e e a rning s, fe e s a nd c o mmissio ns, whic h summe d up to N2.1b iliio n. F uture no n-inte re st inc o me is e xpe c te d to impro ve sig nific a ntly a s e -b a nking drive n a c tivity-b a se d-inc o me tic k up in ne w b ra nc he s a nd re vise d AT M inc o me po lic y
62.90 63.26 H1-2013 H1-2014 N'b illio n 2.6% 1.9% 14.6% 11.4% H1-2013 H1-2014 Ro AA (pre -ta x) Ro AE (pre -ta x) 45.8 51.5 17.1 11.7 H1-2013 H1-2014
N'billion
Inte re st & Disc o unt Inc o me No n-inte re st Inc o me
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E xpe nse Analysis
Ke y Highlight (N’million) H1-2014 H1-2013
T
xpe nse s
26,247 23,724 Sta ff 11,944 10,229 De pre c ia tio n 1,904 1,802 Re g ula to ry (NDIC/ AMCON) 3,887 3,555 T e c hno lo g y Co st 627 634 Po we r 486 452 Se c urity 578 421 Ad ve rt 435 445 Othe r E xpe nse s 6,386 6,185 Ke y Highlight (N’million) Q2-2014 Q1-2014
T
xpe nse s 13,518
12,728 Sta ff 6,385 5,559 De pre c ia tio n 959 945 Re g ula to ry (NDIC/ AMCON) 2,079 1,807 T e c hno lo g y Co st 311 316 Po we r 259 227 Se c urity 295 282 Ad ve rt 292 143 Othe r E xpe nse s 2,937 3,449 Ope rating E xp.: H1-2014 Ope rating E xp.: H1-2013 Ope rating E xp.: Q2-2014 Ope rating E xp.: Q1-2014
Sta ff Co st, 46% De pre c ia tio n, 7% Re g ula to ry, 15% T e c hno lo g y Co st, 2% Othe rs E xp., 30% Sta ff Co st, 43% De pre c ia tio n, 8% Re g ula to ry, 15% T e c hno lo g y Co st, 3% Othe rs E xp., 32% Sta ff Co st, 44% De pre c ia tio n, 7% Re g ula to ry, 14% T e c hno lo g y Co st, 2% Othe rs E xp., 32% Sta ff Co st, 47% De pre c ia tio n, 7% Re g ula to ry, 15% T e c hno lo g y Co st, 2% Othe rs E xp., 28%
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Cost Dynamic s
Cost – Inc ome Ratio Cost of F unds
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Ope r ating E xpe nse s & Staff Cost E
xpa nsio n d rive a nd the pro mo tio n o f 446 c o re sta ff in April 2014 he lpe d to ra ise o pe ra ting e xpe nse s a nd c o st- inc o me ra tio
T
ho ug h o pe ra ting e xpe nse s inc he d up by 10.6% yr-o n-yr, the Ba nk ha s c o ntinue d to wo rk d o wn its o ve ra ll c o st o f fund s whic h sto o d a t 6.3% fro m 7.0%
With inc re a se d fo c us o n e -b ra nc he s, a uto ma tio n o f
pro c e sse s a nd ne w po lic ie s o n c o st o p timiza tio n, c o st will b e b ro ug ht within me d ium te rm ta rg e t b a nd o f 60 - 65%
Co st o f funds is to tal inte re st e xpe nse s / c usto me r de po sits plus lo ng te rm de b t
23.7 26.2 43.1% 45.5% 0% 25% 50% 75% 100% 10 20 30 H1-2013 H1-2014 % Sha re N'b illio n Ope ra ting E xpe nse % Sha re o f Sta ff Co st 7.0% 6.3% H1-2013 H1-2014 H1-2013 H1-2014 71.9% 66.2%
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F unding Str uc tur e
Ke y Highlights (N’m) H1 - 2014 H1 - 2013
De ma nd De po sits 368,597 385,773 Sa ving s De po sits 82,301 71,805 T ime De po sits 314,877 248,591 Bo rro wing s 29,340 15,731 E uro b o nds 47,502 46,719 E q uity 166,377 164,583
T
1,008,994 933,202 F unding Struc ture : H1-2014 F unding Struc ture : H1-2013 F unding Struc ture : Q1-2013 Ke y Highlights (N’m) Q2 – 2014 Q1 - 2014
De ma nd De po sits 368,597 373,935 Sa ving s De po sits 82,301 82,842 T ime De po sits 314,877 295,496 Bo rro wing s 29,340 23,100 E uro b o nds 47,502 50,043 E q uity 166,377 167,374
T
1,008,994 992,790
De ma nd, 37% Sa ving s, 8% T ime De po sits, 31% Bo rro wing s, 3% E uro b o nd, 5% E q uity, 16% De ma nd, 41% Sa ving s, 8% T ime De po sits, 27% Bo rro wing s, 2% E uro b o nd, 5% E q uity, 18% De ma nd, 38% Sa ving s, 8% T ime De po sits, 30% Bo rro wing s, 2% E uro b o nd, 5% E q uity, 17%
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Str
unding Base
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F
ide lity ha s c o nsiste ntly de live re d a we ll struc ture d fund ing b a se suita b le fo r sho rt a nd lo ng te rm risk a sse ts pla y
Custo me r de po sits re pre se nt o ve r 72% o f to ta l
lia b ilitie s with e q uity c o ming in a t 15.7% a nd de b t a t 7.3%
T
ho ug h hig h c o st o f funds re ma ins a c o nc e rn to F ide lity, the c o mb ina tio n o f lo w c o st de b t a nd de po sits ha s he lpe d in driving do wn o ve ra ll c o st o f funds to 6.3% fro m 7.0% Custome r De posits Custome r De posits by T ype
706.2 765.8 Jun 2013 Jun 2014 N'b illio n 48.1% 10.7% 41.1% De ma nd De po sit Sa ving s De po sit T e no r De po sit
Sound L iquidity Position
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12KLD0346_Client template1
L iquidity Ratio Composition L iquid Asse ts Ne t L
De posits Re a llo c a tio n o f N25.8b n sta b iliza tio n se c uritie s in De c 2013 a c c o mpa nie d b y a dro p in q ua lifie d inve stme nt se c uritie s, c a use d a dro p in F ide lity liq uidity ra tio Ho we ve r, liq uid ity ra tio re ma ins a b o ve re g ula to ry minimum o f 30.0% Curre ntly 90.8% o f q ua lifie d liq uid a sse ts is inve ste d in tre a sury b ill, g o ve rnme nt b o nd s a nd the inte r-b a nk se c uritie s
50.7% 35.3% 30.0% 30.0% Jun 2013 Jun 2014 F ide lity L R Re g ula to ry Minimum 64.6% 5.0% 21.2% 9.2% T re a sury Bills Inte rb a nk Pla c e me nts Go vt. Bo nds Sho rt-te rm F unds 52.1% 57.2% Jun 2013 Jun 2014
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Bre a kdown of L
Por tfolio Analysis
(Nair a in million) H1 - 2014 H1 - 2013 VAR % VAR
T e le c o ms
87,229 86,271 958 1%
Oil a nd g a s
72,451 74,760 (2,309)
Po we r
50,306 10,870 39,436 363%
Ma nufa c turing
37,321 27,263 10,058 37%
Ge ne ra l Co mme rc e
36,391 29,304 7,087 24%
T ra nspo rt
33,396 18,921 14,475 77%
Co nsume r (I ndividua ls)
31,604 25,702 5,902 23%
Go ve rnme nt
25,344 37,007 (11,663)
Co nstruc tio n
14,927 16,953 (2,026)
Ag ric ulture
12,010 6,935 5,075 73%
Re a l E sta te
8,028 4,329 3,699 85%
E duc a tio n
1,631 1,788 (157)
F ina nc e a nd I nsura nc e
784 1,311 (527)
Othe rs
43,932 40,861 3,071 8%
T OT AL
455,354 382,276 73,078 19%
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Bre a kdown of L
Por tfolio Analysis
(Nair a in million) Q2 - 2014 Q1 - 2014 De c 2013 T e le c o ms
87,229 87,973 86,550
Oil a nd g a s
72,451 68,272 75,336
Po we r
50,306 48,645 45,441
Ma nufa c turing
37,321 33,232 34,095
Ge ne ra l Co mme rc e
36,391 39,579 34,905
T ra nspo rt
33,396 27,036 24,086
Co nsume r (Individua ls)
31,604 29,471 27,604
Go ve rnme nt
25,344 26,130 31,859
Co nstruc tio n
14,927 14,637 16,052
Ag ric ulture
12,010 10,402 8,810
Re a l E sta te
8,028 7,203 6,476
E duc a tio n
1,631 2,045 2,237
F ina nc e a nd Insura nc e
784 1,003 637
Othe rs
43,932 47,847 48,561 T OT AL
455,354 443,475 442,649
T e le c o ms, 19% Oil a nd g a s, 16% Po we r, 11% Ma nufa c turing , 8% Ge n. Co mme rc e , 8% T ra nspo rt, 7% Co nsume r, 7% Go ve rnme nt, 6% Co nstruc tio n, 3% Ag ric ulture , 3% Re a l E sta te , 2% Othe r Se c to rs, 10.2%
Portfolio Analysis – Q2 - 2014 Portfolio Analysis – De c 2013
T e le c o ms, 19.6% Oil a nd g a s, 17.0% Po we r, 10.3% Ma nufa c turing , 7.7% Ge n. Co mme rc e , 7.9% T ra nspo rt, 5.4% Co nsume r, 6.2% Go ve rnme nt, 7.2% Co nstruc tio n, 3.6% Ag ric ulture , 2.0% Re a l E sta te , 1.5% Othe r Se c to rs, 11.6%
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Bre a kdown of Non- pe rforming L
Por tfolio Analysis
(Nair a in million) Q2 - 2014 Q2 - 2013
N’million % Contr. % NPL N’million % Contr. % NPL
T e le c o ms 3,089 17.1% 3.5% 3 0.0% 0.0% Oil a nd g a s 2,345 13.0% 3.2% 2,811 20.1% 3.8% Po we r 0.0% 0.0% 0.0% 0.0% Ma nufa c turing 6,797 37.7% 18.2% 5,207 37.3% 19.1% Ge ne ra l Co mme rc e 2,065 11.5% 5.7% 1,800 12.9% 6.1% T ra nspo rt 1,246 6.9% 3.7% 1,891 13.5% 10.0% Co nsume r (Individua ls) 58 0.3% 0.2% 10 0.1% 0.0% Go ve rnme nt 44 0.2% 0.2% 102 0.7% 0.3% Co nstruc tio n 499 2.8% 3.3% 586 4.2% 3.5% Ag ric ulture 1 0.0% 0.0% 0.0% 0.0% Re a l E sta te 94 0.5% 1.2% 279 2.0% 6.4% E duc a tio n 56 0.3% 3.4% 35 0.2% 1.9% F ina nc e a nd Insura nc e 220 1.2% 28.1% 97 0.7% 7.4% Othe rs 1,512 8.4% 3.4% 1,150 8.2% 2.8%
T OT AL 18,026 100% 3.96% 13,970 100% 3.65%
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Dive r sifie d L
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12KL D0346_Clie nt te mpla te 1
T
ype Ne t L
s Susta ine d g ro wth in
lo a n po rtfo lio with c o rpo ra te lo a ns a c c o unting fo r 71.8% o f to ta l lo a n b o o k a nd 90.0% o f the o ve ra ll g ro wth.
Drive n b y the utiliza tio n o f E
uro b o nd pro c e e ds, fo re ig n c urre nc y de no mina te d lo a ns dro ve risk a sse ts g ro wth; g re w b y 47.4% c o mpa re d to 11.3% g ro wth re c o rde d in do me stic c urre nc y de no mina te d lo a ns.
Whilst we will c o ntinue to e xplo it o ppo rtunitie s in the
c o rpo ra te ma rke t, the b a nk is po ise d fo r a stro ng a nd lo ng pla y in the re ta il c re dit ma rke t.
L e a se F ina nc e , 10.0% T e rm lo a ns, 71.8% Ove rdra ft, 15.6% Othe r Adva nc e s, 2.6% 368.0 438.1 Jun 2013 Jun 2014
N'billion
Impr
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12KL D0346_Clie nt te mpla te 1
Gr
NPL Cove r age Ratio Non- pe r for ming L
Gro wth in lo a ns a nd a dva nc e s ha ve b e e n mo re in
struc ture d fa c ilitie s se c ure d a g a inst re a l e sta te s a nd tra de d se c uritie s; Ove r 97.0% o f lo a ns a re fully se c ure d
NPL
ra tio ha s b e e n c o nsiste ntly ke pt a t b e lo w the CBN minimum re q uire me nt o f 5.0% sinc e De c 2012. Pla n is to susta in NPL b e lo w 4.0%
Ma nufa c turing se c to r a c c o unts fo r 38% o f to ta l NPL Ade q ua te pro visio n ma de o n c la ssifie d risk a sse ts with
a c o ve ra g e ra tio o f 95.6%.
14.0 18.0 102.4% 95.6% 0% 30% 60% 90% 120% 5 10 15 20 Jun 2013 Jun 2014 % Co ve ra g e Ra tio N'b illio n No n-pe rfo rming L
Co ve ra g e Ra tio Jun 2013 Jun 2014
3.96% 3.65%
382.3 455.4 Jun 2013 Jun 2014
N’billion
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Capital Ade quac y
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12KL D0346_Clie nt te mpla te 1
Capital Ade quac y Ratio E quity to T
Composition of E quity
F
ide lity is we ll c a pita lize d a nd ha s ma inta ine d a stro ng Ca pita l Ade q ua c y Ra tio (CAR) a b o ve re g ula to ry minimum
At c urre nt CAR, c a pita l is a de q ua te to suppo rt
b usine ss risks a nd g ro wth o b je c tive s a s we ll a s c ushio ning a g a inst a ny une xp e c te d b usine ss sho c k.
164.6 166.4 27% 27% 10% 15% 0% 10% 20% 30% 40% 60 120 180 Jun 2013 Jun 2014 % Ra tio N'b illio n T
q uity F ide lity CAR Re g ula to ry Minimum 8.8% 8.7% 61.5% 60.9% 29.7% 30.4% Jun 2013 Jun 2014 Re se rve s Sha re Pre mium Sha re Ca pita l 965.8 1,058.2 17.0% 15.7% 14% 15% 16% 17% 18% 800 900 1,000 1,100 Jun 2013 Jun 2014 % Ra tio N'b illio n T
% E q uity to T
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12KLD0346_Client template1
Outline
1 F ide lity Ove rvie w 2 Nig e ria n E c o no my Ove rvie w 3 F ina nc ia l Hig hlig hts 4 F ina nc ia l Re vie w 5 L
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12KLD0346_Client template1
Update on Str ate gic Initiative s
Automate d Sale s MIS Platfor
m is now fully ope r ational, we now have a be tte r insight into the ke y dr ive r s of our busine ss and it pr
fac t base d de c isions
We ar
e alr e ady se e ing impr
asse t and liability manage me nt as busine ss dr ive r s now have ac c e ss to online r e al- time infor mation whe n taking busine ss de c isions
Se nior
le ve l appointme nts made to dr ive the Re tail and E le c tr
manage me nt staff appointme nts to be announc e d ve r y soon
L
aunc he d our c omme r c ial suppor t loan pr
the SME se gme nt in Q2 2014, initial signs ar e ve r y positive with ove r 250 loans or iginate d e ac h month and the fac ilitie s have a 30 days c le an- up c yc le
Our
inte r ne t banking platfor m is be e n r e vampe d into an Online Banking Suite that c ombine s inte r ne t and advanc e d mobile banking fe atur e s
E
le c tr
vic e s for
c omme r c ial and c or por ate c lie nts will also be suppor te d by the ne w Online Banking Platfor m
Advanc e d pr
ie tar y CRM Platfor m will be c ome ope r ational by Q4 2014
MIS Platfor
m for busine ss suppor t gr
ational by Q4 2014, this will impr
ational e ffic ie nc y, c ost manage me nt and dr ive inte r nal c ustome r se r vic e
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12KLD0346_Client template1
L
he F utur e
Inc r
e ase d pipe line de als in the oil and gas se c tor as the suc c e sse s of pr e vious tr ansac tions se r ve s as a spr ingboar d for winning ne w c ustome r s
We still se e sc ope for
impr
e as of c ash manage me nt and optimizing the for e ign c ur r e nc y balanc e she e t on inc r e ase d dollar tr ansac tions in the Oil and Gas se c tor
We will impr
SME and Consume r Str ate gy as de c lining yie lds on liquid asse ts ne gative ly impac ts e ar nings
We ar
e r e wor king our str ate gy for unive r sity loc ations whic h c onstitute 10% of our br anc h ne twor k in vie w of c ur r e nt mone tar y polic y and r e vise d tar iffs on e - banking se r vic e s
We e xpe c t to se e a gr
r e tail low c ost de posits fr
banking initiative s slowly gathe r mome ntum
F
m, Inve stor pr e se ntations will inc lude the F inanc ial Pe r for manc e of the busine ss dir e c tor ate s fr
E
xe c utive Dir e c tor s will also pr e se nt an ove r vie w of the ir busine ss se gme nts to e nable the inve stor c ommunity have a be tte r unde r standing of our busine ss str ate gy
We will c ontinue to e xplor
e both or ganic and inor ganic oppor tunitie s to ac hie ve our tar ge t mar ke t aspir ations
We r
e main optimistic on our ROE tar ge t of 10% for the 2014F Y as our tr ansfor mational initiative s slowly gathe r mome ntum
20 40 60 80 Coverage N’billion 110 165 220 275 NPL Ratio N'billion
GROWT H E XPE CT AT IONS ON KE Y INDICAT ORS
S/ N INDE X T ARGE T 2013 – 2015 RAT IONAL E 1 Ne t Inte r e st Mar gin
T a rg e ting 6% Ba se d o n lo w c o st d e po sits a nd e a rning a sse ts g ro wth e xpe c ta tio ns 2
T ax Rate
T a rg e ting a n e ffe c tive ta x ra te b e twe e n 15% a nd 20% Ba se d o n the impa c t o f a me nd e d ta x la ws o n Go vt. Se c uritie s a nd Ag ric ulture F ina nc ing 3
L
15% - 20% a ve ra g e g ro wth pe r a nnum Princ ipa lly fro m e xisting , ne w a nd upc o ming g ro wth se c to rs in the c o rpo ra te b a nking b usine ss se g me nt e .g . Po we r, Ag ric ulture , Oil & Ga s, Pro d uc tio n e xpa nsio n, e tc a nd the c o rre spo nd ing va lue c ha in 4
De posit Gr
20% a ve ra g e g ro wth Ne w b ra nc he s, fla tte ne d sa le s o rg a niza tio na l struc ture tha t ha s impro ve d o ur spe e d to ma rke t a nd d e e pe ne d c usto me r inte ra c tio n 5
Othe r Non- inte r e st Inc ome
15% - 20% a ve ra g e g ro wth pe r a nnum Ba se d o n e xpe c te d g ro wth in c usto me r b a se , e a rning a sse ts, d e po sits a nd se rvic e d e live ry c ha nne ls 6
Cost - Inc ome Ratio
60-65% b a nd E xpe c te d to b e c o nta ine d within the b a nd a s g ro wth in inc o me line s a re e xpe c te d to o utstrip inc re a se s in o pe ra ting c o sts. 7
Pr
30-50% (o f PAT ) b a nd Ba se d o n PAT g ro wth tra je c to ry a nd sub je c t to Sha re ho ld e rs’ a nd re g ula to ry ra tific a tio n 8
NPL Ratio
T a rg e t Ma ximum o f 4% On the b a c k o f impro ving ma rke t c o nd itio ns, a sse t q ua lity, lo a n g ro wth a nd stre ng the ne d le nd ing c o nd itio ns. 9
ROE
2014 T a rg e t o f 10% a nd 17% - 20% in me d ium te rm Alig ns with the Ba nk’ s pro fit pe rfo rma nc e o utlo o k a nd c a pita l po lic y, a nd g uid e d b y liq uid ity e xpe c ta tio ns a nd c a pita l a d e q ua c y.
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Gr
xpe c tations
20 40 60 80 Coverage N’billion 110 165 220 275 NPL Ratio N'billion
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