By JKNMedia
A WAVE OF misinformation is noted to have been sweeping through Nigeria’s banking sector following the Central Bank of Nigeria’s (CBN) revocation of Heritage Bank Plc’s license on June 3, 2024.
This targeted campaign seeks to undermine Fidelity Bank Plc, a financial institution known for its stability and sound financial practices, according to a released statement.
The CBN’s decision to revoke Heritage Bank’s license was based on the bank’s inability to improve its financial performance, posing a threat to Nigeria’s financial stability.
Mrs. Hakama Sidi Ali, Acting Director of Corporate Communications at the CBN, confirmed that the action was in line with the CBN’s mandate to ensure a sound financial system under Section 12 of the Banks and Other Financial Act (BOFIA) 2020.
Following this, misleading information has been spread by anonymous groups, suggesting that other banks, including Fidelity Bank, are facing similar troubles.
These claims have been bolstered by the recirculation of a CBN circular from January 10, 2024, which discussed the dissolution of boards for Union, Keystone, and Polaris banks. This circular has been misrepresented as being issued in June 2024, adding to the confusion.
Despite the CBN’s clarification that the situation with Heritage Bank was an isolated incident and no further license revocations were imminent, the rumors have persisted. Fidelity Bank, in particular, has been targeted in these unfounded claims, raising questions among the banking public.
The timing of this misinformation campaign is notable, coinciding with Fidelity Bank’s recent move to raise approximately N127.1 billion through a public offer and rights issue. The bank plans to secure N97.5 billion from a public offer and N29.6 billion from a rights issue, aimed at strengthening its capital base in accordance with the CBN’s new capitalisation directive.
During the signing ceremony on June 5, 2024, Fidelity Bank’s Managing Director and CEO, Nneka Onyeali-Ikpe, explained that the funds would be used for investments in IT infrastructure, business and regional expansion, and product distribution channels. The bank, which holds an international operating license from the CBN, aims to raise its capital base to N500 billion within the next two years.
Fidelity Bank’s journey since its incorporation in 1987 has been one of consistent growth and strategic expansion. Initially operating with a Merchant Banking license, it transitioned to a commercial bank in 1999 and later became a Public Limited Company.
The bank’s acquisitions of FSB International Bank Plc and Manny Bank Plc in 2005 solidified its position as one of Nigeria’s top 10 banks. By 2011, it had secured an international banking license and, following its retail and digital banking initiatives, was ranked the fourth best bank in Nigeria’s retail market by KPMG in 2017.
Currently, Fidelity Bank operates nationwide and ranks among the top ten Nigerian banks by tier-one capital, nearing $1 billion. A Proshare report from April 2024 praised the bank’s asset management and earnings growth, highlighting its diverse income streams and digital innovation.
Fidelity Bank’s impressive financial performance was also noted by Nairametrics, which reported a 120% increase in pre-tax profit to N39.5 billion in Q1 2024, along with a 90% YoY growth in net interest income. The bank’s gross earnings for the quarter reached N192.1 billion, with a net income of N31.4 billion.
Investor’s Business Daily recognized Fidelity Bank as the most trusted wealth management company for 2023, citing its financial soundness, product quality, privacy and security measures, and customer sensitivity.
The attempt to destabilize Fidelity Bank through misinformation is not only unfounded but also harmful to Nigeria’s banking sector. The CBN and stakeholders in the financial ecosystem must address these tactics promptly to maintain stability and trust in the industry.
