First bank profit took a hit as forex scarcity and global slowdown continue to wipe-off banks’ profits.

The earnings report released on Tuesday showed the bank’s profit after tax stood at N15.1bn for the full year ended December 31, 2015. This represents a decline of 82 percent when compared with N84bn reported in December 2014.

Total profit before tax was N21.5bn, down by 77.1 percent year-on-year. However, gross earnings rose 4.9 percent to N505.2bn from N481.8bn reported a year earlier.

The bank also posted a net interest income of N265bn, up by 8.7 percent from N243.9bn recorded in December 2014, and operating expenses of N223.6bn, down by 5.6 percent year on year.

The bank’s total assets stood at N4.2tn, down by 4.1 per cent year-on-year (December 2014: N4.3tn); its customer deposits was N2.97tn, down by 2.6 per cent year-on-year (December 2014: N3.1tn); while customer loans and advances (net) were N1.8tn, down 16.6 per cent year-on-year (December 2014: N2.2tn).

Commenting on the bank’s financial results, the Group Managing Director, FBN Holdings, Urum Eke, said, “This has been a very difficult time in the history of our institution. Despite the tough macroeconomic and regulatory backdrop during the year, our underlying business remains strong as reflected in the gross earnings growth of 4.9 per cent to N505.2bn.

“Furthermore, the holding company platform has provided support in mitigating the impact of credit losses and the vulnerabilities experienced by our commercial banking business.”

“In coming periods, our primary focus is to drive efficiency and operational excellence across all operating companies. Key initiatives in achieving this, as we eliminate the value eroding factors and seek to reposition the group towards a new growth path, include enhanced focus on moderating risk appetite; risk management practices and culture; disciplined cost containment; asset optimisation; and synergy realization.”

http://investorsking.com/first-banks-profit-plunges-82-in-2015/

Welcome to the new era.

hence the sustained mass sacking to improve?

What are they implying in other words? Sack workers?...I guess no

Lies inorder not to pay Dividends...
Corruption abounds in the private sectors too

OP where did the GMD mention scarce forex as a reason for decline in his company's profits? These are financial results from the entire 2015 fiscal year. Forex scarcity began at the end of last year.

By the way, you did not ask yourself the question: which bank makes 82% of its profit by trading forex? You forgot to include the major reasons why banks are seeing a decline in profits. They are no longer keeping government money due to TSA which was implemented last year.

It's also happening with other banks
http://www.vanguardngr.com/2016/04/profits-5-banks-drop-n10-52bn-first-quarter/

It's just worst with first bank because they were the biggest beneficiary of Govt officials stashing MDA money in accounts to generate interest

Upon all their high rates on naira - dollar exchange they are using to steal from us?

This criminal bank is manipulating the accounts of all it's customers ,stealing everyday with their criminal and outrageous charges!

Interesting.

First bank too dey carry last.

Obviously not a Waffi company

c money...

YoursGEJ:
OP where did the GMD mention scarce forex as a reason for decline in his company's profits? These are financial results from the 2015 fiscal year. Forex scarcity began at the end of last year.

By the way, you did not ask yourself the question: which bank makes 82% of its profit by trading forex? You forgot to include the major reasons why banks are seeing a decline in profits. They are no longer keeping government money due to TSA which was implemented last year.

It's also happening with other banks
http://www.vanguardngr.com/2016/04/profits-5-banks-drop-n10-52bn-first-quarter/

It's just worst with first bank because they were the biggest beneficiary of Govt officials stashing MDA money in accounts to generate interest

@Bolded, yet their gross earnings surged 4.9 percent without MDA money.

Where did the statement says scarce forex is the sole reason? The statement simply says scarce forex and global slowdown, if you are a student of economics you should know that all these banks rely on oil companies (huge fund)a lot and a plunge in that industry is meant to affect them.

Another cogent fact you are missing is that in 2014 the bank recorded N481.8bn gross earnings, when conditions were more favourable and in 2015 that things were more difficult their gross earnings surged 4.9 percent to N505.2bn.

Now lets factor in exchange rates during the two period, naira was 150-155 to a dollar in 2014 and was raised 5 times in 2015 to 197-199 a dollar, that is around 33 percent increment. Which translate to higher exchange rate for the same transactions in 2015, so forex play pivotal role in this report. Again forex scarcity began in July, it was on 3rd of August that CBN restricted 41 items from accessing forex at official rate in order to reduce pressure on foreign reserves.

Sir I don't just write, I look into facts and analyse it to the best of my ability.

May I ask, how does it affect the people who has shares in the bank?

They should manage that profit abeg. No one or business is smiling in Nigeria now self.

Since the time they've been making profit of N80b and above, who have they help? All they are out there for is making interest on customers. Bloody bankers and their board of directors. All of them naa thief.

Thinking how this one affect me.

God knows I hate anything banking
The poster above me though

merrycent:
May I ask, how does it affect the people who has shares in the bank?

In a market with no form like ours, the worth of a company is the present value of the future streams of cashflows i.e dividend to the shareholders. Although dividend is paid from cash and not profit...the dividend is determined by the profit after tax of the company. With a reduction in profit, the prices of the shares should drop as shareholders wealth has declined, you would expect people to sell their shares and the market price of the shares will drop (theory of demand and supply).

But if the market believes it a one off event, either from the chairman's statement in the financial statement or from 2016 figures, the prices may only fall slightly and increase subsequently.

Should I stop already....?

P.S: Don't believe what you see as reported profit it's a scam, look at the statement of cashflow

merrycent:
May I ask, how does it affect the people who has shares in the bank?

The value of their stocks will drop a bit, not for long though. Remember its profit that plunged, the bank is still in profit.

So they have been trying to augment profit by nearly killing me with charges? Account maintenance (grease or oil I no know) withholding tax, sms charge on birthday msg, vat on all charges on top!
I go soon transfer ma small change sha

Y

checking my signature will pluge you up more than this #winks

surestakes:
First bank too dey carry last.

Obviously not a Waffi company

Epic response

SamuelAnyawu:
Lies inorder not to pay Dividends...
Corruption abounds in the private sectors too

Given the amount of Non-performing loans in the Economy now. I'd say thats true

Lie lie bank

Adonis3:
Y

For [url]Yify-torrent.org[/url]

This result is not encouraging at all. First Bank is now lagging behind.

I suspect some form of mismanagement especially from the immediate board and management.

First bank should set the pace in Nigeria. This is sad.

Thats their cup of tea...look at the digits involved

E be lyk sey dis Saraki, Metuh and co no deposir their ill gotten wealth for first bank,if not why wouldnt their profit dive head first

Is dis why they are now deducting #105 monthly?

Chidizman:




Given the amount of Non-performing loans in the Economy now. I'd say thats true

I've worked in a bank... just forget all these bank Directors/ MD stories...

merrycent:
May I ask, how does it affect the people who has shares in the bank?

oh! You still dey ask? They're trying to tell you say una own don finish kpatakpata. Them say make una forget about una money, if na police or army una wan go call for them dem say dem dey ready for una.