Fidelity, Unity banks first-half profits rise

Fidelity Bank Plc and Unity Bank Plc have reported an increase in their profits after tax for the first half of 2015.

Fidelity Bank’s first-half pre-tax profit rose by 2.4 per cent to N9.66bn from N9.43bn in the same period last year, while its post-tax profit stood at N8,21bn, compared N8.01bn in 2014.

The lender’s unaudited results for the period ended June 30, 2015, which it filed with the Nigerian Stock Exchange, showed that its gross earnings also rose to N71.89bn from N63.26bn last year.

Unity Bank saw its profit before tax rise by 11.10 per cent to N8.77bn in the first half of the year, compared to N7.90bn in the same period last year.

Its profit after tax increased to N7.90bn from N7.11bn, while gross earnings stood at N33.56bn, up from N30.85bn.

Analysts at FBN Capital Limited, in their first reaction to Fidelity Bank’s second quarter 2015 results, said the result showed that PAT grew 39 per cent year on year to N4.3bn despite PBT coming in flat y/y at N4.96bn.

“The growth on the PAT line was down to base effects in the prior year as Fidelity had reported a negative result of -N1.2bn on the other comprehensive income line in Q2 2014 vs N39m in Q2 2015.

“Although profit before provisions was up by 20 per cent y/y, a 4.9x expansion in loan loss provisions and a 15 per cent y/y rise in operational expenses resulted in PBT coming in flattish y/y. Fidelity’s sizable impairment charges is similar to the high levels of loan loss provisioning reported by a number of the banks that have reported their Q2 2015 results and confirms our view of a worsening asset quality position for most banks due to the weak macro conditions.”

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Source : Punch

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