First Holdo earned N625.281 billion in interest income for the first three months of 2024, marking a 40.15% increase compared to the N446.146 billion recorded in Q1 2024
According to the unaudited financial statements for the quarter, the bank’s loan book grew to N13.205 trillion, representing a 9.40% increase from N12.07 trillion as of December 2024.
This translates to additional loans of N1.134 trillion within the quarter.
Loans and advances to banks increased by N700.621 billion, while loans and advances to customers rose by N434.069 billion during the period.
The expansion in the loan book, coupled with the still elevated interest rate environment, likely contributed to the significant increase in interest income, which is broken down as follows:
- Interest income from loans and advances to customers stood at N364.172 billion, up 42.43%, and accounted for 58.24% of total interest income.
- Interest income from loans and advances to other banks came in at N38.780 billion, down 17.01%, contributing 6.20% of total interest income.
- Interest income from investments in securities totaled N222.329 billion, up 54.69%, and made up 35.56% of total interest income.
However, the cost of maintaining its large deposit base continued to weigh on interest income.
Interest expenses rose by 18% to N260.089 billion, consuming about 42% of total interest income, a slight improvement compared to 49% in Q1 2024.
Interest expenses on customer deposits accounted for the largest portion, totaling N156.434 billion, or 60% of total interest expenses.
This increase reflects a N99.217 billion rise in customer deposits in Q1 alone, bringing total customer deposits to N17.27 trillion.
Despite these rising costs, net interest income remained strong at N365.192 billion, a 60.99% increase year-on-year.
This figure already represents more than 26% of the bank’s full-year 2024 net interest income.
Coupled with an 11.17% decline in impairment charges for losses, the bank reported a 286.20% YoY increase in net interest income after impairment charges, reaching an impressive N327.941 billion over 33% of the 2024 full-year total.
The bank also posted strong non-interest income, highlighted by a 26% YoY growth in fees and commission income, driven largely by:
- E-business transactions: N20.139 billion, up 19% YoY
- Letters of credit commissions: N12.374 billion, up 69.11% YoY
- Funds transfer and intermediation fees: N11.507 billion, up 37.10% YoY
Despite these gains, high operating expenses put pressure on profitability, with operating income declining by 20% to N186.695 billion, compared to N234.168 billion in Q1 2024.
Similarly, pre-tax profit declined by 20.37% year-on-year to N186.479 billion, mirroring the drop in operating income and highlighting the impact of elevated operating expenses on the bank’s bottom line.
Balance Sheet
First Holdco’s balance sheet remained robust at N26.52 trillion, with customer deposits making up over 65% of total liabilities.
This underlines the bank’s strong retail and corporate funding base, which continues to support its lending capacity and overall financial stability.
Shareholders’ funds remained strong at N2.738 trillion, largely driven by retained earnings.
This represents 10.52% of the group’s total balance sheet size, signaling a solid capital position.
The growth in retained earnings reflects profit accumulation and earnings resilience, providing a strong buffer for future growth, dividend payouts, and expansion.
Share price performance
First Holdco’s share price has been bearish in 2025, closing at N24.55 as of April 29, representing a year-to-date (YtD) loss of 12.5%.
This contrasts with a positive YtD gain of 19.11% recorded at the end of 2024,
Insight and perspective
First Holdco’s Q1 2025 results reflect a solid topline performance, with interest income up 40.15% to N625.3 billion, driven by loan book expansion and high interest rates.
Net interest income rose 60.99%, and post-impairment income surged 286.20% YoY, highlighting core earnings strength and improved asset quality.
Non-interest income also grew on the back of increased digital and trade finance activity.
However, rising operating costs dragged operating and pre-tax profits down by over 20%.
While its robust balance sheet and earnings resilience position it well for long-term growth, the muted investor sentiment reflected in the share price decline suggests caution.
