Fidelity Bank Ghana sustains profitability, growth amid COVID-19 Pandemic

Accra, April 29, GNA - Despite the challenges posed by the COVID-19 pandemic, Fidelity Bank Ghana recorded a remarkable profit before tax of GH₵382 million in 2020.

The remarkable profit represents a 19 percent increase from the GH₵322 million recorded in 2019.

The Bank also grew its operating income by 8 percent over the prior year to GH₵978 million.

A statement issued in Accra by the Bank said operating expenses were well managed, growing at a relatively lower rate of 6 percent to GH₵498 million in line with the Bank’s efficiency drive.

It said the performance was anchored on digitization, expenditure reprioritization and the adoption during the year of cost-containment measures aimed at mitigating the impact of COVID-19 on the Bank’s business.

The overall growth in revenues outpaced the increase in operating expenses, resulting in the Bank’s cost-to-income ratio declining to 51 percent.

The statement said the cost to income ratio measures a bank’s operating expenses as a percentage of its operating income.

"The low cost of operations as compared to the impressive increase in revenue shows the Bank’s efficiency and profitability despite the negative effects of COVID-19," it said.

It said several key balance sheet items posted strong performance with deposits increasing by 25 percent to GH₵6.51 billion and investment securities growing by 15 percent to GH₵4.93 billion, exceeding the industry average in both cases.

The Bank’s gross loans and advances declined by 2 percent year-on-year to GH₵2.4 billion, reflecting the impact of settlements during the year.

The statement said the Bank remained well-capitalized closing the year with total equity of GH₵1.0 billion and a capital adequacy ratio of 21.43 percent which it said was well above the regulatory minimum of 13 percent (reduced to 11.5 percent during the year by the Bank of Ghana as a policy response to the COVID-19 pandemic).

"Fidelity Bank’s capital remains adequate for its current risk profile and planned growth of its business," it said.

It said the Bank’s market-leading platforms and channels continue to attract customers, resulting in significant growth in digital and electronic transaction volumes during the year.

Mr Julian Opuni, Managing Director of Fidelity Bank Ghana, speaking on the Bank’s 2020 financial performance, said “2020 was a challenging year for everyone.

We are fortunate that our financial performance in 2020 revealed that we continue to make strong progress across all areas of our business.

Moreover, we understand that our success is a function of the unwavering support that we receive from our loyal customers and we are grateful to them for their continued business.”

He said concerning the first quarter of 2021 financial performance, the Bank recently published its unaudited financial results for the quarter ended March 31, 2021.

It, therefore, declared a profit before tax of GH₵104.5 million, 16 percent above the equivalent figure for the same period last year.

Profit after tax recorded a growth of 30 percent over Q1 2020 to GH₵89.5 million, driven by this strong profitability, the Bank’s capital adequacy ratio rose to 21.73 percent in Q1 2021 compared to 20.07 percent in Q1 2020.

The Bank’s capital position remained robust and adequate for planned expansion and growth.

He said the Bank closed the quarter with a total deposit base of GH₵6.9 billion, growing by 13 percent over the position recorded in Q1 2020.

Although the Bank’s balance sheet declined by 8 percent against the position recorded in Q1 2020, it maintained its average loans and advances book at GH₵2.3 billion while increasing its investment in government securities by 38 percent.

Consequently, despite a much lower interest rate environment, net interest income rose to GH₵197.4 million, a 7 percent growth over Q1 2020 while non-interest income increased by 29 percent to GH₵ 68.4 million.