Business
Fidelity Bank outperforms banks, stock market with 507% gain in 5 years
AJAGBE ADEYEMI TESLIM
SPONSORED BY: H&H
Investors in Fidelity Bank Plc have earned more than 507 per cent in capital gains over the past five years, ranking above all other major return benchmarks at the Nigerian stock market and the entire banking sector.
Trading reports at the Nigerian stock market for the five-year period between May 31, 2019 and May 31, 2024 showed that Fidelity Bank outperformed all key indices at the stock market.
Fidelity Banks share price rose by 507.14 per cent over the period, representing average annual capital gain of 101.43 per cent.
These returns underscore Fidelity Banks immense value as a stock for all times, helping investors to hedge against inflation while preserving significant long-term value.
With 507 per cent capital gain in five years and average annual gain of more than 100 per cent, the return analysis implies that investment in Fidelity Bank is more attractive than other class of assets, including fixed-income securities such as government and corporate bonds; real estate investment and mutual funds among others.
The high divisible nature of shares investment and high free float of Fidelity Bank, which makes the banks shares easily available, underline the bank as a most attractive investment option for all cadres of investors- small, medium and high networth; retail and institutional investors.
Comparative analysis showed that Fidelity Bank outperformed all other major market indices with the banks average annual return for the period twice the average return by the overall market and almost four times of average return in the banking sector.
The All Share Index (ASI) – the common, value-based index that tracks all share prices at the Nigerian Exchange (NGX), which is widely regarded as Nigerias benchmark for equities market, recorded a five-year return of 219.61 per cent, an average annual return of 43.9 per cent.
Contrary to the significantly above average performance of Fidelity Bank, the NGX Banking Index-which tracks the banking sector, doubled by 120.53 per cent over the five-year period, representing average annual return of 24.11 per cent, more than 77 percentage points below Fidelity Banks average return.
Two other major price indices- the NGX 30 Index and NGX Main Board Index, recorded five-year cumulative return of 185.73 per cent and 265.6 per cent respectively, representing average annual gain of 37.15 per cent and 53.1 per cent respectively.
The NGX 30 Index tracks share prices of the 30 largest companies at the stock market while the NGX Main Board Index represents the largest and most diversified group of listed companies at the stock exchange. Fidelity Bank is quoted on the main board, like most other major banks and companies at the stock market.
The average annual return of 101.43 per cent underlines that Fidelity Bank provides substantial return for investors, even where such investors had borrowed money at the ruling interest rate and the invested fund was adjusted for impact of inflation rate.
Nigerias inflation rate peaked at a high of 33.69 per cent in April 2024 while the Central Bank of Nigeria (CBN)s Monetary Policy Committee (MPC) recently increased the Monetary Policy Rate (MPR), otherwise known as benchmark interest rate, to 26.25 per cent.
Fidelity Banks share price, which closed May 31, 2019 at N1.68 per share, rose successively to N10.20 per share by the end of May 2024. The ASI had, during the period, rose from its opening index of 31,069.37 points to close weekend at 99,300.38 points. The NGX Banking Index rose from 361.57 points to 797.37 points. The NGX 30 Index, which opened the period at 1,286.68 points, closed the period at 3,676.44 points. The NGX Main Board Index appreciated from 1,267.54 points to close weekend at 4,634.31 points.
Market analysts are unanimous that share prices are illustrative of the fundamental values of quoted companies.
Managing Director, HighCap Securities Limited, Mr. David Adonri, said the price of any stock in the market is a correct reflection of the market value for the stock.
Managing Director, Globalview Capital Limited, Mr. Aruna Kebira, explained that the market price of a stock represents the disposition of the investing public to the stock at a given period, noting that there should be consideration for both the market value and the book value or fundamentals of a stock.
It could be summarized that the market price of a stock is premised on the psychology of the market, the markets mood as well as market sentiments, Kebira said.
Chief Executive Officer, Sofunix Investment and Communications, Mr. Sola Oni, said the stock market shows both the current and future prospects of shares.
Share price reflects the current value of a company but also reveals the future prospects, Oni said, noting that investment analysts traditionally combine market price and book values to determine the possible outlook of a stock.
Five-year review of the audited reports and accounts of Fidelity Bank showed strong correlation between the banks upwardly share pricing trend and expansive growth in its business operations.
The banks pre-tax profit had risen from N30.35 billion in 2019 to N124.26 billion in 2023, an increase of 309.4 per cent. Net profit after tax also grew by 203.3 per cent from N42.80 billion in 2019 to N129.80 billion in 2023. Earnings per share has risen successively from 98 kobo in 2019 to N3.11 per share in 2023.
The banks balance sheet had expanded by 195.26 per cent from N2.11 trillion in 2019 to N6.23 trillion in 2023, within the fastest growth in the industry. Customers deposits, which underlines the competitive market share, more than tripled from N1.225 trillion in 2019 to N4.01 trillion in 2023, an increase of 227.35 per cent. Shareholders funds had also grown from N234.03 billion to N437.31 billion.
Market pundits expected Fidelity Banks share price continue to rise, citing several factors that illustrated the upside potential for the stock.
Independent investment research reports by many market pundits showed that Fidelity Bank was assigned buy ticker, a recommendation to investors to consider the potential attractive returns of the bank.
The research reports were based on the historical and current operational performances of the bank as well as the clear-sighted implementation of the banks growth plan. The reports also considered the quality of board and management and the general human capital and resources of the bank.
The investment advisory reports included those of Afrinvest Group, FSDH Capital and CardinalStone among others.
Analysts were unanimous that Fidelity Banks share price could double in the period ahead given professional assessment of top traditional performance parameters including the companys operational reports, investors preference and projections.
Already, interim report and account of the bank for the first quarter ended March 31, 2024 showed that the bank started the current business year on stronger footing with three-digit growths across key performance indicators.
The three-month report, released at the NGX, showed that gross earnings increased by 89.9 per cent to N192.1 billion in first quarter 2024.
The banks top-line performance continued to be driven by broad-based growths across income lines with interest income rising by 90.7 per cent and non-interest income growing by 84 per cent in first quarter 2024.
Growth in interest income was primarily spurred by a higher yield environment and strong earning assets base, while the increase in non-interest income was led by double-digit growth in account maintenance charges, foreign exchange (forex)-related income, trade, banking services, and remittances, supported by increased customer transactions.
Profit before tax doubled by 120 per cent to N39.5 billion in first quarter 2024 as against N17.9 billion in first quarter 2023. The banks performance was driven by expanding market share with total deposit rising by 17 per cent within the three months to N4.7 trillion, compared with N4 trillion recorded at the end of 2023. The bank also increased its supports for national economic growth with net loans and advances rising by 21 per cent from N3.1 trillion at the end of 2023 to N3.7 trillion by March 2024.
Business
Analyst Predict Fidelity Bank to meet Recaptalization Threshold ahead of Regulatory Deadline
AJAGBE ADEYEMI TESLIM
SPONSORED BY: H&H
Fidelity Bank Plc is making impressive strides on its path to fulfilling the recapitalization targets set by the Central Bank of Nigeria (CBN). With the successful completion of the first phase of its capital-raising initiative that was oversubscribed by 238% and its share price growth of over 100%, investor confidence in the bank is at an all time high.
Following the successful completion of phase 1 of its capital raise, the bank is exceptionally well-positioned to not only meet the regulatory threshold but to also fuel its growth trajectory in the long-term.
With the conclusion of its equity capital raise, the response has been nothing short of extraordinary, with the Public Offer oversubscribed by an astounding 237.92%. This translates to 107,588 valid applications for a total of 23,768,724,000 ordinary shares, amounting to ₦231.7 billion. The Rights Issue also shone brightly, achieving a remarkable 137.73% subscription rate with 6,903 valid applications for 4,407,252,795 ordinary shares, totaling ₦40.7 billion.
Dr. Nneka Onyeali-Ikpe, the Managing Director and CEO of Fidelity Bank, expressed heartfelt gratitude for the overwhelming support from investors, stating, “The positive results recorded in our Combined Offer are a testament to the strength of the Fidelity Bank franchise in the capital market.” Such a robust response not only underscores investor confidence but also reaffirms the bank’s unwavering commitment to delivering innovative financial solutions and sustainable returns to its stakeholders.
Following this remarkable success, Fidelity Bank has secured shareholder approval to launch the second phase of its capital-raising initiatives. This includes a significant increase in the bank’s issued share capital from ₦26.7 billion to ₦36.7 billion. Shareholders endorsed this expansion during an Extraordinary General Meeting on February 6, 2025, approving the creation of an additional 20 billion ordinary shares of ₦0.50 each.
This strategic capital boost positions Fidelity Bank to meet the CBN’s new minimum regulatory capital requirement of ₦500 billion for banks with international authorization before March 31, 2026. This ambitious goal aligns seamlessly with the bank’s vision for sustainable growth and exceptional service delivery, setting the stage for a dynamic future.
Fidelity Bank’s stock performance has further solidified its status as a top contender in the financial sector. From an initial offer price of ₦9.75 per share during the Public Offer, shares soared to a high of ₦21.15 on February 7, 2025, representing an impressive growth rate of over 116%. This positions Fidelity Bank as one of the best-performing financial institutions in the market, with analysts from Apel Asset Limited noting an impressive 80% return on investment for shareholders who have held shares since 2023.
Market analysts project a considerable upside potential of 28.88%, establishing a fair value of Fidelity Bank at ₦23.15 against a reference price of ₦19.50. Such promising indicators not only enhance investor confidence but also position Fidelity Bank as a compelling investment opportunity within the Nigerian banking landscape.
The funds raised from the initial phases of the capital-raising exercises are earmarked for several key initiatives. Fidelity Bank plans to utilize these resources for local and international business expansion, enhancing technology infrastructure, and improving customer service initiatives. This proactive approach showcases the bank’s commitment to innovation and operational excellence.
As the bank gears up for the next phase of its capital-raising initiative, the primary focus remains on achieving its recapitalization targets while consistently delivering value to stakeholders. The bank’s leadership is confident that, with sustained investor support and a robust financial strategy, it will adeptly navigate the evolving landscape of the Nigerian banking sector.
Fidelity Bank’s recent achievements in capital raising signal a pivotal moment in its journey toward strengthening its financial foundation. With robust investor backing, strategic capital allocation, and a clear vision for growth, Fidelity Bank is not just on track to meet its recapitalization target—it is poised to exceed it.
The road ahead promises to be one of sustained growth and innovation, reinforcing Fidelity Bank’s position as a leader in the Nigerian financial sector. As the bank looks toward the future, it remains steadfast in its commitment to fostering strong relationships with investors and delivering on its promise of financial excellence and exceptional customer satisfaction.
Fidelity Bank’s proactive measures and impressive market performance pave the way for a brighter, more prosperous future—one where it continues to lead with integrity and vision in the ever-evolving financial landscape.
Business
GTCO Plc Launches Initiative to Improve Quality of Life for Households and Empower Women
AJAGBE ADEYEMI TESLIM
Guaranty Trust Holding Company Plc (GTCO), a leading financial services institution renowned for its innovative approach to corporate social responsibility (CSR) and stakeholder engagement, today announced the launch of its “Waste for Gas” project to improve quality of life for households and empower women in underserved communities.
This transformative initiative aims to distribute 3,000 3kg gas cylinders with burners to low-income households in Obafemi Owode Local Government, Mowe, Ogun State.
The Waste for Gas project underscores GTCO’s unwavering commitment to improving outcomes for people and communities. By providing households with gas-powered cooking, the initiative simplifies daily routines, freeing up time for essential activities that support financial resilience.
The initiative also introduces a structured “waste for gas” exchange programme that promotes responsible waste management, fostering a culture of sustainability.
The project will unfold in two key phases, ensuring that it reaches those most in need.
In the first phase, teams from GTCO, in collaboration with local government representatives, will conduct door-to-door visits across 12 wards in Obafemi Owode Local Government from Monday to Friday, February 18th – 21st, 2025.
These visits will help identify beneficiaries who currently rely on firewood and charcoal for cooking. Participating households will collect and return plastic waste in exchange for gas cylinders and burners.
In the second phase, scheduled for Saturday and Sunday, February 22nd and 23rd, 2025, efforts will be shifted to monitoring and increasing adoption of the new cooking method among the beneficiaries.
Speaking on the initiative, Mr. Segun Agbaje, Group Chief Executive Officer of GTCO Plc, stated: “At GTCO, we are committed to driving progress, not just through innovative financial solutions but by creating real impact in the communities where we operate.
Waste for Gas is about making life easier for families, giving them more time for what truly matters—whether it’s education, meaningful work, or personal development.
Beyond this initiative, our goal is to continually evolve sustainable platforms that empower people, strengthen communities, and contribute to socioeconomic progress.”
As GTCO continues to expand its CSR footprint, the Waste for Gas project serves as a blueprint for future interventions that drive meaningful, long-lasting impact in underserved communities.
Business
Dr. Owen Omogiafo Transcorp Group President to Deliver Keynote at Women in Energy Forum, NIES 2025
Dr. Owen Omogiafo Transcorp Group President to Deliver Keynote at Women in Energy Forum, NIES 2025
AJAGBE ADEYEMI TESLIM
SPONSORED BY: H&H
Dr. Owen D. Omogiafo, OON the President and Group Chief Executive Officer of Transcorp Plc, is set to deliver a keynote address at the Women in Energy Forum during the Nigeria International Energy Summit (NIES) 2025. The summit is scheduled from February 24th to 27th, 2025 in Abuja.
The Women in Energy Forum, themed “Advancing Africa’s Energy Transformation and Inclusion,” aims to highlight the pivotal role of women in Africa’s evolving energy landscape. Dr. Omogiafo’s keynote, titled “Leadership, Innovation, and the Future of Women in Energy,” will delve into the significance of innovative leadership and the increasing contributions of women in the sector.
Dr. Omogiafo has been a prominent advocate for equitable energy access and gender-inclusive leadership. Her participation underscores the importance of diversity and innovation in driving Africa’s energy transformation.
The NIES 2025 serves as a premier platform for international energy discourse, uniting stakeholders to foster innovation and unlock value across the continent. The inclusion of forums like the Women in Energy Forum highlights the summit’s commitment to comprehensive and inclusive discussions on Africa’s energy future.
Dr. Omogiafo’s insights are expected to inspire and influence strategies for leadership and innovation, emphasizing the critical role of women in shaping the future of energy in Africa.
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