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Hard times hit FCMB: profit dips, closes branches & sacks staff

Hard times hit FCMB: profit dips, closes branches & sacks staff

These are not very good times for Mr. Ladi Balogun GMD, First City Monument Bank Limited (FCMB) and its affiliates. The company has been hit by serious hard times.

Not only has it lost over 70 per cent of its profits of last year, it has closed some of its branches and sacked staff too.

It was gathered Monday night that the many of the branches affected were those formerly owned by Finbank, which was acquired by FCMB.

It was gathered that the management of the bank resolved to rationalize some redundant and unviable branches of the acquired bank, especially where there were two or three branches in the same area because of the current state of the economy.
Confirming this sorry state of the bank fortunes was Ladi Balogun who stated that profit for the  year dipped by 78.5 per cent from N22.13 billion in 2014 to N4.76 billion.

Balogun however said, as a silt of various revenue and expense movements, the banking group’s profit before tax declined by 70 per cent from N22.4 billion in 2014 to N6.1 billion in 2015.

Nonetheless, he said, the bank was successful in the planned moderation of its operating expenses.

“This is a medium term exercise over three years that will gather pace in 2016. The early stages of the implementation of the cost curtailing initiative resulted in a modest two per cent growth in operating expenses in 2015, (well below inflation rate), as against 11.7 per cent growth in 2014. We anticipate absolute reduction if N5 billion in 2016, taking us below our 2014 figure and a further reduction in 2017”, said Balogun.

He added that, despite the disappointing financial performance, the banking group business strategy of building a retail-led commercial bank remains on course, as illustrated by growth in personal banking revenue in 2015.

On the bank’s non-financial goals, it’s Net Promoter Score (NPS), which measures customer satisfaction and advocacy, improved to +44 per cent in 2015, against +32 per cent I. 2014.

The Group Managing Director said, in a bid to make banking more convenient and accessible, it grew tie number of ATMs to 689 and PoS to 12,000 in 2015.

Looking ahead, Balogun said, “we are acutely aware that this has been a challenging year for the bank as reflected in the financial results contained in this report. While the results reflect the difficulties our business has faced over the year, I want to assure you that we have moved swiftly and decisively to address these issues, and in the fourth quarter of 2015, we began to see early promising signs from the actions we have taken so far to reset the business and rests our growth”.

Balogun said, 2016 performance improvement is expected to be driven by improvements in operating efficiency, with a goal to achieve about nine per cent in cost savings during the year, continuous move to intensify retail banking investment drive, particularly in alternate channels like ATMs, PoS and agent banking.

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