News Column

FCMB to Raise U.S.$300 Million for Consumer Lending

June 24, 2014

Obinna Chima with Agency Report



First City Monument Bank Group Plc (FCMB) said it plans to raise about $300 million of funding this year to boost consumer lending.

FCMB, based in the commercial capital, Lagos, may consider issuing Eurobonds if market conditions are favorable, the bank's Chief Executive Officer, Mr. Ladi Balogun informed Bloomberg.

"Our preferred source of funding has been the loan markets as opposed to bond markets due to more stable pricing," he said.

"We will probably get to about 40 per cent of our loan book being personal lending."

The CEO said FCMB plans to increase its loan book by about 20 per cent to N540 billion ($3.3 billion) this year, as it joins other Nigerian lenders in raising debt to boost credit to consumers and fund infrastructure in Africa's largest economy.

The lender acquired FinBank in 2011, one of eight banks bailed out by the Central Bank of Nigeria during a debt crisis in 2009.

The bank is targeting a return on equity of 15 per cent this year and 20 per cent in 2016 compared with 13 per cent in 2013, Balogun said. FCMB plans to increase its customer base to four million by 2016 from 2.5 million, he added.

FCMB's profit rose 21 per cent to N5.05 billion in the three months through March from a year earlier, the company said in April.

Shareholders of the group had approved a total dividend of N5.94 billion earlier recommended by the directors for the 2013 financial year. This translated to a cash dividend of 30 kobo per ordinary share, for the year ended December 31, 2013.

The Coordinator of Independent Shareholders Association of Nigeria (ISAN), Mr. Sunny Nwosu had commended the board and management of the FCMB Group for the feat achieved despite the challenging environment in 2013.

The Chairman of FCMB Group, Dr. Jonathan Long had also explained that the Group, which comprises First City Monument Bank Limited, FCMB Capital Markets Limited and CSL Stockbrokers Limited, has recovered strongly over the past two years and in 2013 made sufficiently strong progress.

He attributed this to the implementation of initiatives that have improved efficiency and the successful integration of FinBank, which he said enhanced FCMB retail banking strategy.

Long added: "The intention to pay dividend signifies the desire of the Board to reward the Group's shareholders for their continued commitment and support."

On his part, the Managing Director of FCMB Group Plc, Mr. Peter Obaseki, noted that the Group is on track to deliver on its promise to shareholders.


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Source: AllAfrica


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