First Bank to Cut Jobs to Boost Profit

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First Bank to Cut Jobs to Boost Profit

By Correspondent

 Information coming from the stable of FBN Holdings Plc, the umbrella body of First Bank Limited says it has no choice than to cut jobs and also focus less on loan provisions to the oil industry apparently in a move to reverse last year’s 82 percent slump in profit. This was made known by the bank’s Managing Director/Chief Executive, Mr Adesola Adeduntan who also stated that the financial institution plans to boost its return on equity, a key measure of profitability, to between 11 percent and 14 percent in 2016 from last year’s really bad figure of 3 percent. He also said, “The bank is also targeting a cost-to-income ratio of 55 percent in two years time from 59 percent. “At a minimum, we should triple it. We do not shy away from taking difficult decisions. We used to have above 8,000 people. We’ll push it down, gradually, to 7,000. “FBN Holdings’ Net profit fell to N15 billion ($76 million) from N84 billion naira in 2014, as impairments soared and Africa’s biggest economy slowed amid a crash in the price of crude, the biggest source of government revenue and export earnings. “First Bank’s non-performing loans ratio stood at 22 percent at the end of March, compared with 3.8 percent a year earlier. Reducing that figure is the number one priority. “The bank will do that by reducing the proportion of it’s lending to the oil and gas sector, currently at about 39 percent of total loans, and focusing more on blue-chip companies in other industries.”

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