[ 2015-04-27 ]

Fidelity Bank posts 90% profit after tax
Indigenous bank, Fidelity Bank Ghana Ltd, has
posted an impressive end of year results for 2014
that have seen all its performance indicators,
including assets, profit, interest income and
loans increase by over 50 per cent each on the
average, entrenching its strategic goal to be
among the top five banks in the country.

The bank’s profit after tax increased by about
90 per cent from GH¢43.86 million in 2013 to
GH¢83.38 million at the end of last year, buoyed
by about a 71 per cent growth in operating income
from GH¢197.1 million in 2013 to GH¢336.7
million in 2014.

Fidelity Bank, which acquired ProCredit Ghana last
year, leveraged on the transaction to increase its
deposits from GH¢1.35 billion in 2013 to GH¢1.89
billion at the end of last year, a jump by about
40 per cent.

The Managing Director of the bank, Mr Edward
Effah, said notwithstanding macroeconomic
challenges, the bank continued to deliver on key
targets.

“Over the period, the bank grew its balance
sheet size by 79 per cent to close the year with
an asset base of a little over GH¢3 billion,”
he said, adding that the growth was propelled by a
93 per cent increase in loans and advances.

Fidelity Bank also increased its investments in
risk-free government securities by 28 per cent
from GH¢460.8 million in 2013 to GH¢593.84
million at the end of last year. Its placements
with other banks also saw a 246 per cent jump from
GH¢124.6 million to GH¢463.8 million.

Income statement analysis
The Daily Graphic’s calculations showed that the
Fidelity Bank and its other operations saw profit
before tax increase from GH¢62.72 million in 2013
to GH¢114.28 million in 2014, indicating a
positive variance of 82.2 per cent.

This was buoyed by a 70.8 per cent increase in
operating income from GH¢197.1 million to
GH¢336.72 million within the period under review.


With operating expenses contained at GH¢192
million, the group was able to grow its profit
after tax to GH¢83.38 million, about 90.1 per
cent rise from the GH¢43.87 million recorded the
previous year.

Balance sheet analysis
Fidelity Bank’s positive numbers do not stop
here, as it also includes a 151.9 per cent
increase in shareholders’ funds from GH¢155.87
million in 2013 to GH¢392.68 million. This gave
rise to an increase in shareholders’ value from
GH¢2.48 per share in 2013 to GH¢3.57 per share,
a year-on-year increase of 43.95 per cent in the
value of every share held.

Assets of the group also soared significantly by
85 per cent from GH¢1.69 billion in 2013 to
GH¢3.14 billion in 2014.

In accordance with Bank of Ghana guidelines on
dividends, the bank’s shareholders approved a
final dividend of GH¢0.83 per share, amounting to
a payout of GH¢21.9 billion.

Chairman on ProCredit
The bank acquired 100 per cent shares in ProCredit
last year, an acquisition the Chairman of the
board of directors, Mr William Panford Bray, said
had helped the bank to increase its footprint
across the country with an extended network of 75
branches and 109 automated teller machines.

With the integration of processes and credit
methodology well integrated, Fidelity has also
migrated all customers of ProCredit and is hoping
to complete rebranding by the middle of the year.

“Our customer base has also increased from
485,000 to 621,829 helping to improve our deposit
base by 31 per cent to GH¢1.8 billion. It is
worth noting that this growth was primarily driven
by current and savings accounts,” Mr Bray
stated.

Source - Daily Graphic

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