Shareholders have expressed their willingness to massively support and mobilize for the ongoing recapitalization of Fidelity Bank Plc amid commendations for the bank’s impressive performance over the years.
Shareholders were unanimous that Fidelity Bank has shown strong resilience over the years and demonstrated its investors’ friendliness with significant dividends and capital gains.
Shareholders, under the auspices of Nigeria’s leading shareholders’ associations, said they would buy into any share offering by Fidelity Bank, as the bank holds an exciting future for above-average returns.
The sundry shareholders’ endorsements underlined market pundits’ expectations that Fidelity Bank would easily raise additional funds and retain its status as one of Nigeria’s leading commercial banks with international authorization.
Fidelity Bank, with nearly 400,000 shareholders, has the most diversified retail shareholder base among Nigerian banks. No single shareholder held up to 5.0% of the issued share capital of the bank. 5% and above are considered the material shareholding under extant laws and market regulations.
The highly diversified shareholding base, while it has its challenges of corporate register management and stock volatility, shows Fidelity Bank as a popular stock. Its huge free float also underscores the pricing efficiency of the stock in the stock market, ensuring that the share price is a reflection of the bank’s fundamentals and investors’ expectations.
With an average annual return of more than 81 percent over the past five years, comparative analysis shows that Fidelity Bank outperforms all other major market indices, with the bank’s average annual return for the period being twice the average return of the overall market and almost four times the average return in the banking sector.
Shareholders said Fidelity Bank’s performance has endeared them to the bank, expressing optimism that it is poised for a major leap in the emerging Nigerian financial services sector.
Mr. Boniface Okezie, the National Coordinator of the Progressive Shareholders Association of Nigeria, said Fidelity Bank’s growth has been “very amazing, as it has delivered good returns in terms of dividends to shareholders.”
According to him, shareholders are proud of the bank’s balance sheet, which gives them hope for better rewards in the years ahead.
“All that average investors look for in a company is fundamental, and Fidelity Bank is very strong in this. They are poised to surpass what they have projected. I should say the sky is their limit, despite the headwinds.
“Fidelity Bank remains one of the best stocks that investors should look forward to investing in for better returns. I’m very optimistic about the bank’s healthy, strong assets. With its good corporate governance and excellent customer service, there is every reason to hope for a more promising future,” Okezie said.
The bank’s interim report and account for the first quarter ended March 31, 2024, showed that the bank started the current business year on stronger footing, with three-digit growths across key performance indicators.
The three-month report, released at the NGX, showed that gross earnings increased by 89.9% to N192.1 billion in the first quarter of 2024. The bank’s top-line performance continued to be driven by broad-based growth across income lines, with interest income rising by 90.7% and non-interest income growing by 84% in the first quarter of 2024.
Growth in interest income was primarily spurred by a higher yield environment and strong earning assets base, while the increase in non-interest income was led by double-digit growth in account maintenance charges, foreign exchange (forex)-related income, trade, banking services, and remittances, supported by increased customer transactions.
Profit before tax doubled by 120% to N39.5 billion in the first quarter of 2024, as against N17.9 billion in the first quarter of 2023. The bank’s performance was driven by expanding market share, with total deposits rising by 17% within the three months to N4.7 trillion, compared with N4 trillion recorded at the end of 2023.
The bank also increased its support for national economic growth, with net loans and advances rising by 21% from N3.1 trillion at the end of 2023 to N3.7 trillion by March 2024.
