The Group Managing Director of FBN Holdings Plc, Mr. UK Eke has said the company was committed to delivery sustainable long-term performance following continuous improvement in non-performing loan (NPL).
FBN Holdings recently reported a profit of N39.8 billion for the half year ended June 30, 2019, up from N38.85 billion in the corresponding period of 2018. The company also reduced its impairment charges by 58.3 per cent from N52.8 billion to N22 billion in 2019. As a result, its non-performing loan (NPL) ratio has dropped to 14.5 per cent from 25.3 per cent as of March 2019 and 25.9 per cent at the end of 2018 financial year.
The decline is underscores the progress of the bank in cleaning-up its balance sheet.
Commenting on the development, Eke said: “Despite the difficult operating environment, we remain resolute in delivering on our guidance across key metrics including our commitment towards a single digit NPL ratio by the end of year, as evidenced by the reduction in NPLs from the last quarter. Essentially, Atlantic Energy – our largest NPL, was written off, translating to a decline in the NPL ratio from 25.9 per cent in December 2018 to 14.5 per cent as at June 2019, a step that brings us closer to our FY 2019 target and creates more headroom for quality asset growth. This is paving the way for sustained improvement in asset quality and a further reduction in impairment charges that will allow us to take advantage of enhanced earnings opportunities when they arise. Furthermore, we have remained focused on deepening our transaction-led income and are uniquely positioning for stronger revenue growth and value creation.”
According to him, they confident in the group’s ability to deliver stronger results sustainably as they execute our strategy and unlock earnings potential from recent investments in innovation and digital transformation.
“This will enhance our future earnings capacity and drive operational efficiencies that will enable generation of superior returns to our shareholders,” he said.
Also commenting on the Chief Executive Officer of First Bank and Subsidiaries, Dr. Adesola Adeduntan, said: “In line with our commitment to address the legacy asset quality challenges, exposure to Atlantic Energy was written off in the quarter. This is a material progress in our legacy NPL resolutions and clearly reflects our resolve towards achieving a single digit NPL ratio by year end. In addition, this step creates significant headroom for increased business opportunities and enhanced earnings especially in the oil & gas sector of the economy.”