Last Update07 Aug 25
FCMB Group Plc has emerged as one of the most dynamic financial institutions in Nigeria’s mid-tier banking space, delivering robust revenue growth, expanding margins, and digital-led transformation. In H1 2025, the Group reported strong top-line momentum (+41.3% YoY), efficient balance sheet management, and resilient profitability despite macroeconomic headwinds. With a diversified business mix, ongoing capital raise to meet regulatory requirements, and rapid growth in digital income, FCMB is well-positioned for sustainable long-term value creation.
Financial Highlights: H1 2025
Metric H1 2025 YoY Growth
Gross Revenue ₦529.2B +41.3%
Net Interest Income ₦207.4B +95.3%
Profit Before Tax (PBT) ₦79.3B +23.0%
Profit After Tax (PAT) ₦73.4B +23.0%
Operating Expenses ₦153.2B +46.1%
Digital Revenue ₦73.6B +60.0%
Net Interest Margin (NIM) 9.1% ↑ from 6.3%
Total Assets ₦7.54T +6.9% (YTD)
Customer Deposits ₦4.55T +5.6% (YTD)
Loans & Advances ₦2.38T +1.1% (YTD)
Assets Under Management ₦1.58T +15.5%
Shares Outstanding (Proj.) 42.8B ↑ via capital raise
Key Strengths
Strong Core Banking Performance
FCMB’s PBT of ₦79.3B was driven largely by a 95.3% growth in net interest income, showing significant improvement in asset yields and NIM (9.1%). This was achieved through a favorable shift in deposit mix (low-cost deposits now 69.3%) and stronger asset pricing.
Rapid Digital Transformation
Digital income surged 60% YoY, contributing 13.9% of total earnings. Growth in payments, lending, and wealth-tech platforms indicate sustainable non-interest income diversification.
Improving Cost Discipline
Despite inflationary pressures, cost-to-income ratio improved to 57% (vs. 59.9% in FY 2024). Operational leverage and balance sheet efficiency contributed to this improvement.
Diversified Business Segments
- Banking Group: 82% of PBT, +41.3% YoY
- Consumer Finance: 11.6% of PBT, +54.5% YoY
- Investment Management: 4.8% of PBT, +10% YoY
- Investment Banking: 1.4% of PBT (declined due to 2024 one-time gain)
Key Weaknesses & Risks
Decline in Non-Interest Income
Non-interest income dropped 35.1% YoY, mainly due to a sharp ₦36.6B fall in currency revaluation gains. While recurring revenue streams are improving, this reveals FCMB’s prior reliance on FX windfalls.
Rising Impairments
Net impairment losses grew to ₦36.2B following the exit from the CBN’s forbearance programme, pushing cost of risk to 2.8% (from 1.8%). Loan quality pressures could persist.
Capital Dilution Risk
The issuance of N22.5B in mandatory convertible notes and ongoing capital raise may result in shareholder dilution. However, this is essential to meet the new CBN minimum capital requirement for international banks.
FCMB Group Plc H1 2025: Robust Growth in Core Banking Operations Despite Rising Costs
Key Highlights:
- 📈 Gross Earnings Surge: FCMB posted a 41% YoY increase in gross earnings to ₦529.2 billion in H1 2025, reflecting improved interest income and a solid performance across its business units.
- 💰 Strong Net Interest Income: Net interest income nearly doubled to ₦207.4 billion (up 95%) driven by a 70% growth in interest and discount income to ₦458.4 billion. This indicates strong loan book growth and better pricing in a high-interest environment.
- 🏦 Profitability Growth: Profit before tax rose 23% to ₦79.1 billion, while profit after tax grew to ₦73.4 billion from ₦59.5 billion in H1 2024 (+23.5%), underscoring earnings resilience.
- 💼 Diversified Non-Interest Income: Net fee and commission income rose 51% to ₦37.9 billion, while other income and trading gains contributed ₦22.9 billion, although this was lower than the ₦68.5 billion recorded in the prior year—due to reduced market-related gains.
- ⚠️ Cost Pressures Intensify: Personnel expenses (+34%) and general & administrative expenses (+59%) rose significantly, with total operating expenses expanding rapidly. This reflects inflationary pressure, regulatory compliance costs, and expansion-related spending.
- ⚖️ Asset Quality: Net impairment losses grew by 16% to ₦36.2 billion, suggesting increased provisioning, possibly from new loan disbursements or a slight deterioration in asset quality.
- 🌍 Foreign Operations: A ₦407 million foreign currency translation loss contrasts with a gain of ₦29.9 billion in H1 2024, indicating currency headwinds across its non-Naira operations.
- 📊 Earnings per Share (EPS): EPS dropped from ₦6.00 to ₦3.70 despite higher profits, due to share dilution or restatement, warranting further review by investors.
🔍 Investment Thesis
FCMB Group Plc delivered a strong operating performance in H1 2025, driven primarily by net interest income growth and improved fee income. The Group is clearly benefitting from a higher interest rate regime, effective asset repricing, and increased loan volumes. It continues to maintain momentum in its core banking business while expanding its financial services footprint.
However, the growth story is tempered by rising operating costs and a notable decline in non-core gains (especially market trading and FX-related income). Moreover, the spike in impairments and currency translation losses signal risks related to macroeconomic volatility and portfolio quality.
✅ Strengths
- Strong top-line and bottom-line YoY growth
- Resilient interest income performance
- Improving fee-based income from diversified services
- Sustained profitability and strong core business operations
⚠️ Weaknesses/Risks
- Rising operating and personnel costs are pressuring margins
- Growing impairment charges raise concerns about asset quality
- EPS compression despite profit growth needs clarification
- Exposure to FX volatility impacting foreign operations
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