Lagos: June 19, 2013 – The shareholders of First City Monument Bank (FCMB) Plc at the 30th Annual General Meeting of the bank held in Lagos yesterday endorsed the script issue recommended by the Bank’s directors.
The shareholders unanimously approved N380.822 million which is capitalized from the share premium account into 761,643,920 ordinary shares of 50 kobo each and appropriated to the members whose names appear in the registrar at the close of business on Tuesday June 4, 2013 in proposition of 1 new share for every 25 shares.
Commenting on the performance of the bank, the Coordinator of Independent Shareholders Association of Nigeria (ISAN), Mr. Sunny Nwosu saluted the management for retuning the bank to profitability. He said the bank had identified a secret way of increasing its profit by double, even in the agricultural sector. According to Nwosu, FCMB increased agriculture loans and advances to customers from N5.816 billion to N13.655 billion which meant that the bank was working to boost the sector.
He therefore urged the management of the bank to continue to identify other means of increasing its profit giving the removal of ATM charges and a gradual move to reduced Cost on Turnover (COT).
Another shareholder and National Chairman of Shareholders’ Trustees Association of Nigeria, Alhaji Murktar Murktar Ismail stated that shareholders were appreciative of the bonus issue recommended by the Board, and called on the Bank to improve on its performance in the coming year, so as to pay out higher dividends and bonuses.
Answering Shareholders’ question at the meeting the Group Managing Director/CEO of the bank, Mr. Ladi Balogun, explained that the bank’s major priorities next three years, include the acceleration of growth in demand deposit and savings account balances, as well as reduction of cost of risk to enable it operate the most valuable retail franchise in the country.
Ladi Balogun noted that this would make the bank become more competitive in the industry and enhance its profitability, which would ultimately create value for shareholders.
He pointed out that the improved performance recorded during the year under review has shown that the bank has recovered strongly, adding that the board is committed to ensuring that the performance improves further in 2013. “We anticipate that by 2015, retail banking should account for 40 per cent of our revenues and 50 per cent of our profits. This implies robust margins and a high efficiency model for the retail bank, driven by alternative channels such as internet, mobile and agent banking.
“Our goal is to ensure that our cost to income ratio is below 50 per cent by 2015 so that we can achieve a group return on equity of about 30 per cent. We are on course for the attainment of a 75 per cent low cost deposit mix by 2015, and with the growth in retail loans, we foresee our net interest margins remaining consistently above eight per cent over the next two years. We look ahead to 2013 with great optimism and resolve that our performance can only get better and we will move from strength to strength.” He assured.
The audited accounts of FCMB for the period under review showed that it recorded a profit after tax of N15.3billion, an increase by 256% over the loss of about N9.24billion in 2011. Total deposits rose from N411billion in 2011 to N646billion in 2012, an increase by 57%. This is an indication of an increasing market share for the bank. In the same vein, FCMB’s loans and advances grew by 11% to N357billion in 2012 compared to N323billion in 2011.
The stellar performance recorded was driven by strong growth in interest income and non-interest income of 39% and 138%, respectively. This was aided by last year’s acquisition and merger with FinBank.
The bank has maintained the momentum of its last year’s performance into this year as the result for the first quarter ended March 31, 2013 showed a profit after tax of N4.2billion. This represents a rise of 3% from the N4.10billion made in the corresponding period of 2012. Gross earnings within the three months period also witnessed a leap from N26.12billion as at March 31, 2012 to N31.41billion as at March 31 last year.