Fidelity Bank (FIDELITYBK) Q4 2024 earnings summary

Executive summary

• Achieved strong financial performance in 2024, with record gross earnings of N1,043.4bn (up 87.7%), PBT up 210% to N385.2bn, and ROAE at 41.7%, driven by balance sheet optimization, margin expansion, and non-interest revenue growth.

• Total assets grew 41.5% to N8,821.7bn, with net loans up 41.9% to N4,387.1bn and customer deposits rising 47.9% to N5,937.1bn.

• Successfully integrated the UK subsidiary, with total assets growing 101% since acquisition, enhancing international reach and customer service.

• Maintained a resilient balance sheet and robust risk management, with NPL ratio declining to 3.1% and NPL coverage at 138.4%.

• Capital adequacy ratio rose to 23.5% following fresh equity and capitalized earnings.

Financial highlights

• Net interest margin improved to 12% from 8.1% year-over-year, supported by higher yields and low-cost deposit mobilization.

• Net interest income surged 127.1% to N629.8bn, with operating income doubling to N773.1bn and cost-to-income ratio improving to 42%.

• Total assets increased by NGN 2.6 trillion, with 83% of growth invested in earning assets.

• Net loans and advances rose 41.9% to NGN 4.44 trillion, with real growth at 10.5% and the rest due to naira devaluation.

• Non-interest revenue saw double-digit growth across most commission lines, though non-interest income (excluding FX gains) declined 3.6% due to lower FX income.

Outlook and guidance

• 2025 targets include PBT of N555bn, loan growth of 10–15%, deposit growth of 15–20%, and ROAE of 35–40%.

• Guidance for cost of risk at a maximum of 2%, with NPL ratio expected to remain well below the 5% regulatory threshold.

• Dividend payout ratio to be sustained between 25% and 40% of profit after tax, with 2024 payout at N2.10 per share.

• Ongoing capital raise, with the first phase oversubscribed and the second phase (private placement) underway, targeting completion by mid-2025.

• Second phase of recapitalization planned, expected to boost CAR by 500–600bps in 2025.