Fidelity Bank eyes oil, gas

Fidelity Bank Limited (FBL) says it is well-placed to take advantage of the emerging opportunities in the economy, especially the oil and gas sector.

“By 2013, the Bank would have moved closer to becoming world-class bank among the top-five banking institutions in the country,” Mr. Edward Effah, Managing Director of the bank, told shareholders at its annual general meeting in Accra.

“In line with government policies, we expect 2011 to be more active in terms of government spending and payments. This is expected to have a positive impact on the economy and we will position Fidelity Bank to take advantage of the numerous opportunities that will arise. The production of oil will further increase the growth of business opportunities available in the economy.

“The economic environment and banking climate were arguably more challenging last year, but on the wings of sound business strategy and determination of purpose we delivered on most of our set goals and objectives for 2010,” he said.

The balance sheet of the bank grew significantly, by 80 percent over the position at the beginning of the year.

Its Total assets at the end of 2010 stood at GH¢650million compared to GH¢362million at the end of 2009. The expansion of the balance sheet was founded largely on the increase in customer deposits from GH¢295million to GH¢548million, representing a year-on-year growth of 86 percent.

This growth further increased the bank’s market share of deposits to four percent from 3.5 percent in the previous year.

Net interest income was up 92 percent over 2009 in spite of reducing interest rates during the year, while operating cost increased from GH¢21million to GH¢33.5million which was driven largely by branch expansion cost. 10 new branches were added to the bank’s footprint, bringing total outlets in the network to 25.

Shareholders’ funds at year-end 2010 was GH¢37million, growing from GH¢31.8million at the beginning of the year. This was largely due to increased profit during the year.

“The balance sheet structure remains healthy, with 87 percent of total assets in earning assets. The composition of these assets at the end of 2010 was 33 percent in loans and advances, 67 percent in government bills and bonds, interbank placements and cash - thus underscoring our status as a conservative, high liquidity bank,” Mr. Effah stated.

Mr. William Panford Bray, Chairman, Board of Directors of FBL, said the bank plans to become the preferred gateway and banking facilitator for trade and financial transfers between Ghana and Asia.

The objective, Mr. Bray explained, is to utilise the growing corporate and trade activity between Asia and Africa as a key driver towards accelerated growth.

“To further leverage our network and strengthen the bank’s position in international transactions involving Asia, the bank has established an Asia Desk within its corporate banking outfit to utilise the growing cooperation and trade activity between Africa and Asia towards accelerated growth.

“Global political and economic power is shifting towards the East, and Asia's economic power has been raised in tandem with the trade flows into Africa.

“We are confident that we will continue to invest in our key businesses for the benefit of our stakeholders, as we do the right thing for our customers and for the communities we serve,” Mr Bray remarked.