FCMB posts N73bn after tax profit amid N144.6bn capital raise

The FCMB Group has revealed that the N144.6bn additional funds that it raised through its public offer had a limited impact on its earnings for the 2024 financial performance.

This was disclosed in its audited accounts and earnings report for the period which was filed with the Nigerian Exchange Limited on Friday.

While the profit before tax of the group saw a modest increase of 7.1 per cent to N111.9bn, the profit after tax declined to N73.34bn from N90.02bn in 2023.

In its earnings report, FCMB stated, “The capital raised in FY 2024 had a limited immediate impact on earnings due to the timing of regulatory approvals (completed in December 2024); however, this will be a key driver of profitability in FY 2025.

“Three strategic initiatives will support the banking group’s earnings growth: optimising net interest margins through a stronger capital position. Expanding digitally enabled payments and collections solutions to achieve a low-cost deposit funding ratio of 80 per cent and deepening our presence in the premium retail and institutional banking segments.”

In line with the Central Bank of Nigeria’s recapitalisation directive, the Group successfully completed the first phase of its capital raising programme, raising N144.6bn through a public offer, which led to an increase in issued shares from 19.8 billion in 2023 to 39.6 billion in 2024.

The group revealed that the subsequent phases of its capital programme are aimed at ensuring that First City Monument Bank Limited meets the minimum capital requirement to retain its International Banking Licence.

The capital injection into the banking subsidiary has enabled First City Monument Bank Limited to not only secure its national banking licence but also raise its capital adequacy ratio to 18 per cent, creating necessary buffers to support asset creation in select segments.

Meanwhile, the group recorded a gross revenue of N794.4bn for the period ending December 2024, a 53.9 per cent growth from N516.4bn in the prior year.

In the period under review, the group said that its earnings continued to be diversified, with non-bank subsidiaries accounting for over 30 per cent of profits. The contributions by other divisions were as follows: Banking Group: 69.5 per cent, Consumer Finance: 11.0 per cent, Investment Management: 5.8 per cent and Investment Banking: 1.6 per cent.

The growth in gross earnings was driven by a 75.2 per cent growth in interest income and an 8.7 per cent growth in non-interest income. The rate of growth in non-interest income was impacted by a 55.7 per cent year-on-year decline in other gains from N89.3bn to N39.6bn. Net interest income grew by 27.6 per cent from N176.6bn in the prior year to N225.3bn at the end of December 2024.

Operating expenses grew by 45.7 per cent to N229.1bn in 2024 due to increased personnel costs, regulatory costs, foreign currency-linked expenses (e.g., technology and foreign subsidiary expenses) and general inflationary pressures.

FCMB Group provides banking and financial services to its wholesale and retail customers through its subsidiaries: FCMB Capital Markets Limited, FCMB Trustees Limited, FCMB Microfinance Bank Limited, Credit Direct Finance Company Limited, CSL Stockbrokers Limited (including its subsidiary FCMB Asset Management Limited) and First City Monument Bank Limited (and its subsidiaries – FCMB (UK) Limited and FCMB Financing SPV).

Plc) and 91.71 per cent of FCMB Pensions Limited.