Grows deposit by 162% in nine months

First City Monument Bank (FCMB) Plc, one of Nigeria’s foremost deposit money banks has continued to shore up depositors’ confidence as it grows deposit liability by 162 percent in the last nine months.

A review of the bank’s nine-month financial report recently rectified by the central Bank Of Nigeria (CBN), shows that FCMB's deposits mobilization efforts have been satisfactory in the current year.

Deposit liability grew by over 162 percent from N41.2-billion in January 2006 to N107.8-billion in January 2007. “Our continued expansion into the various parts of the country coupled with our consumer banking offerings will contribute immensely to the expected growth in the deposit liabilities,” management stated.

The bank’s third quarter result also shows that the bank recorded a profit before tax of N4.47-billion, representing a 112 percent increase over the 2005 (corresponding period) profit before taxation (PBT), of N2.11-billion.

Gross earnings grew by over 68 percent from N310.1-billion in 2006 to N16.9-billion in January 2007, an evidence of a moderate growth in market share.

Whilst, gross earnings have increased by 68 percent in the past nine months, PBT grew appreciably by over 112 percent reflecting efficiency.

Total assets stood at N127.7 billion as at the end of January 2007 whilst risk assets surged up by 116 percent from N39-billion to N85-billion.

The Shareholders funds was over N29-billion as at the end of January 2007 and we expect to grow to grow our balance sheet size significantly as we approach the end of the financial year.

The bank’s liquidity position remains healthy at 46 percent. Cost Income ratio stood at 74 percent due to several capital intensive projects including the completion of the bank’s re-branding exercise.

Return on equity on annualized profits returned to double digits at over 17 percent, while management intensifies effort towards accelerated improvement. “As our new branches break even and new product lines and relationships gather momentum, we expect to improve ROE significantly. We expect to begin realisation of the branding benefits by next financial year,” management assures. FCMB has recently signed a memorandum of understanding to form a strategic partnership with Sabre Capital Worldwide – a specialist financial services private equity and management firm, led by experienced and prominent emerging markets bankers.

This wide-ranging agreement will include Sabre Capital assisting FCMB in raising capital internationally. In addition, Sabre Capital will provide management support to FCMB, especially in the areas of consumer banking, operations, customer service, IT and risk management, with an objective to ensure that FCMB becomes the leading consumer banking franchise in Nigeria, a competitive regional player and delivers substantial shareholder value within the next five years.

Management also says this partnership will also see FCMB become the African banking partner to an imminent pan-African financial services private equity fund to be managed by Sabre and focused on acquiring and managing banks and other financial services businesses in other African countries.

End of Statement