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Event
Following the bottom-line weakness recorded in Q1 2025, Q2 did not provide much relief as profit after tax declined 26% year on year to N116.16bn from N156.47bn in Q2 2024. The pressure came largely from a 45% contraction in non-interest income, as the N143.38bn gains recognised on financial instruments at fair value through profit or loss (FVTPL) in Q2 2024 reversed into a N5.75bn loss in Q2 2025. Despite this, gross earnings rose 33% year on year to N913.72bn from N686.67bn as interest income remained strong, accounting for 89% of gross earnings compared with 73% in Q2 2024.
Valuation
Our fair value estimate has been revised upward to N32.49 per share, from N30.75 in our previous report. At the market price of Friday’s close at N31.60, this implies a capital appreciation potential of just 3%. Factoring in dividend yield, total return rises modestly to around 7%, which we view as insufficient to sustain our BUY case as we now recommend a HOLD.
Please follow the link “FBNH Plc Q2 2025 – Earnings Normalises as FX-Linked Windfall Disappears” to view the whole report.
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