FCMB nearly doubled its profit. Each share got 14% more.
Pre-tax profit rose 98.8% to ₦157.3bn. Earnings per share rose 14.3%. In the second quarter alone, per-share earnings actually fell. The gap is the ₦237.9bn of new shares the bank sold — and that is the whole story of this filing.
| Gross earnings | ₦676.2bn |
| Earnings per share | ₦4.23 |
| Impairment charge | ₦85.9bn |
Five things you need to know
- Gross earnings reached ₦676.2bn for the six months, up 27.8%, and pre-tax profit rose 98.8% to ₦157.3bn.
- Earnings per share rose only 14.3%, to ₦4.23, because the bank sold ₦237.9bn of new shares during the period.
- In the second quarter on its own, earnings per share fell — ₦3.84 against ₦4.17 a year earlier.
- The charge for loans expected to go bad more than doubled, from ₦36.2bn to ₦85.9bn.
- Interest paid to depositors and lenders actually fell, from ₦251.0bn to ₦244.2bn, even as the bank's interest income grew 31%.
Profit growth, measured two ways
The bank earned ₦157.3bn before tax against ₦79.1bn a year earlier. But there are far more shares now sharing it. Share capital went from ₦21.4bn to ₦33.0bn and share premium from ₦267.6bn to ₦483.0bn — ₦237.9bn of new money raised in six months.
Statement of profit or loss, page 1, and statement of changes in equity, page 4.
So did the bank have a good half or not?
A very good one, on almost every measure that describes the business itself. Gross earnings reached ₦676.2bn against ₦529.2bn. Every division grew. The single most impressive line is one most coverage skipped: interest paid out fell, from ₦251.0bn to ₦244.2bn, while interest earned rose 31% to ₦600.5bn.
That combination is what a bank exists to achieve. It pushed up 71.8%, from ₦207.4bn to ₦356.3bn.
Then why did each share earn so little more?
Because the profit is divided among far more shares than it was a year ago. FCMB raised ₦237.9bn by issuing new shares during the half, part of the recapitalisation every Nigerian bank is working through.
Across the half, profit before tax rose 98.8% and earnings per share rose 14.3%.
In the second quarter taken alone, profit rose 53.8% — and earnings per share fell, from ₦4.17 to ₦3.84.
New shares arrive all at once; the profit they are meant to generate arrives over years. In the quarter the money landed, the share count jumped before the earnings did, so each share's slice shrank.
That is the ordinary arithmetic of raising capital, not a sign of anything going wrong. What it means for an existing shareholder is simple: you now own a smaller fraction of a bigger bank, and whether that was worth it depends on what the ₦237.9bn earns over the next few years — which no half-year filing can tell you.
Rainingmoney's reading. The filing reports the share issue and the per-share figures; it offers no commentary connecting them.
Where did every ₦100 the bank earned actually go?
Derived from the statement of profit or loss, page 1. Gross earnings here are interest, fee, trading and other income as the filing defines them. Bars are scaled to ₦40 so the smaller lines stay readable.
What changed since last year?
The bank swapped expensive money for cheap money
Money borrowed from other banks fell from ₦1.01 trillion to ₦607.9bn, a drop of 39.8%. Over the same six months, deposits from ordinary customers rose from ₦4.42 trillion to ₦4.92 trillion. Interbank funding is the costly kind; customer deposits are the cheap kind. That swap is the most plausible reason interest expense fell while the balance sheet grew — though the filing does not say so.
The bad-loan charge more than doubled
The provision for loans expected to go bad rose from ₦36.2bn to ₦85.9bn. Almost all of it landed in the second quarter: ₦73.6bn of the total, against ₦26.7bn in the same quarter last year. No explanation appears in the statements.
Trading income collapsed
Net trading income fell from ₦22.2bn to ₦7.6bn, and other items swung from a ₦0.7bn gain to an ₦8.9bn loss. Together that is roughly ₦24bn of income that simply did not repeat — absorbed entirely by the growth in lending.
What caught our attention
Of every ₦100 FCMB earned this half, ₦12.71 went into provisions for loans that may not be repaid.
A year ago the figure was ₦6.84.
This is the number to watch as every other Nigerian bank reports. A rising provision can mean two very different things: that more borrowers are in trouble, or that the bank has chosen to set aside more against loans that are still performing. The first is bad news. The second is prudence, and it depresses this year's profit to protect next year's.
The statements do not distinguish between the two. Until they do — or until the audited full-year accounts arrive — a reader can only note that the charge doubled and that ₦73.6bn of it arrived in a single quarter.
One more figure worth holding on to. Total equity rose 40.4% to , against total assets of ₦8.36 trillion. The bank is meaningfully better capitalised than it was in January, which is the entire point of the exercise that diluted its shareholders.
The Scorecard
Each label comes from a fixed rule applied the same way to every company we cover. Strong means the measure improved materially against the same period last year. Steady means it held. Watch means it moved against shareholders, or moved without explanation. The eighth category is chosen for the sector; for banks it is cost of risk. We publish no single score out of 100, because these categories don't trade off against each other in any honest way.
Did you follow all that?
Pre-tax profit rose 98.8%. Why did earnings per share rise only 14.3%?
Because the bank issued ₦237.9bn of new shares during the half. The profit is bigger, but it is divided among many more shares, so each one's slice grew far less than the total did. In the second quarter alone, when most of the new shares arrived, per-share earnings actually fell.
Interest income rose 31% but interest expense fell. How does a bank manage that?
By changing where its money comes from. FCMB cut borrowing from other banks by ₦402bn — expensive money — while customer deposits rose by ₦504bn, which is far cheaper. The filing doesn't spell this out, but the two movements sit side by side on the balance sheet.
The charge for bad loans doubled to ₦85.9bn. Is that automatically bad news?
Not necessarily. It can mean more borrowers are struggling, or that the bank is deliberately setting aside more against loans that are still being repaid — which lowers this year's profit to protect future years. These statements don't distinguish between the two, so the honest position is to note the size of the jump and wait.
The Bottom Line
FCMB ran its core business better this half than it has in years. It lent more, paid less for the money it lent, and kept its costs from following its income upward.
Its shareholders own a smaller fraction of that improved bank than they did in January, and in the second quarter each share earned less than it did a year ago. Whether the ₦237.9bn raised justifies the dilution is a question the next several filings will answer, not this one.
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