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FBNH 2022FY | Performance Bolstered by Robust Interest Income

The recently released 2022FY results for the Group reflected Gross Earnings grew by 6.32% YoY to NGN805.13bn due to growth in interest income. Interest income grew by 49.56% YoY to NGN551.94bn. On the other hand, non-interest income deteriorated by 34.87% YoY to NGN253.02bn following a plunge in other operating income (-85.01% YoY to NGN22.40bn).  Elsewhere, Operating Expenses grew by 8.89% YoY to NGN363.91bn following a spike in insurance premium (+826.20% YoY to NGN29.44bn). Profit Before Tax (PBT) and Profit After Tax (PAT) decreased by 5.26% YoY and 9.82% YoY to NGN157.90bn and NGN136.31bn respectively. As a result, Net Profit Margin slipped by 3.03% to 16.93% in the period.

Considering the Bank’s prospect in 2023FY, we arrived at a target price of NGN16.41. At its current close price of NGN15.95 as of 20th June 2023, this translates to an upside prospect of 3%. Thus, we put a “NEUTRAL” rating on the stock.

Underlying
FBN Holdings PLC

Provider
ARM Securities Limited
ARM Securities Limited

ARM Securities Limited is a full-service brokerage house that offers best-in-class brokerage services to local as well as foreign private and institutional investors. Formerly known as Hamilton Hammer, the Company commenced operation in 1994 and was acquired by ARM Investment Managers in 2008--an acquisition which has successfully re-positioned the company as a recognized brokerage firm in Nigeria. The Company is a dealing member of the Nigerian Stock Exchange (NSE) and is regulated by Securities and Exchange Commission (SEC). ARM Securities research team provides insightful commentaries on the Nigerian economy and its equity and debt markets using an approach which incorporates a thorough understanding of the fundamentals of the industries and companies under coverage. The research therefore adopts an integrated methodology of top-down analysis and bottom-up stock selection, which focuses on publicly quoted companies on the Nigerian Stock Exchange that are judged to offer the highest potential for earnings growth. In addition, its analysts provide periodic commentaries on a range of topical global and local issues which provide investing clients with a holistic view of the opportunities and risks in today’s financial market landscape. ​

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