FBN Holdings Plc.
Separate and Consolidated Financial Statements for the year ended 31 December 2022
FBN Holdings Plc.
Index to the separate and consolidated financial statements for the year ended 31 December 2022
Note | Page | Note | Page | ||
Directors and advisors | 1 | 8 | Interest expense | 115 | |
Corporate Governance Report | 2 | 9 | Impairment charge for credit losses | 115 | |
Director's report | 23 | 10a | Fee and commission income | 116 | |
Responsibility for annual financial statements | 27 | 10b | Fee and commission expense | 116 | |
Statement of corporate responsibility | 28 | 11 | Foreign exchange income | 116 | |
Statement of compliance with NSE listing rule on Securities | 29 | ||||
Trading Policy | 12 | Net gains/(losses) on sale of investment securities | 116 | ||
Report of the Audit Committee | 30 | 13 | Net (losses)/gains from financial instruments at FVTPL | 117 | |
Report of the Independent Auditors | 31 | 14 | Dividend income | 117 | |
Separate and consolidated statement of profit or loss | 36 | 15 | Other operating income | 117 | |
Separate and consolidated statement of comprehensive | 37 | 16 | Personnel expenses | 117 | |
income | |||||
Separate and consolidated statement of financial position | 38 | 17 | Other operating expenses | 118 | |
Separate statement of changes in equity | 39 | 18 | Taxation - income tax expense and liability | 118 | |
Consolidated statement of changes in equity | 40 | 19 | Cash and balances with central banks | 119 | |
Separate and Consolidated statement of cash flows | 41 | 20 | Cash and cash equivalents | 120 | |
21 | |||||
Notes to the separate and consolidated financial statements | Loans and advances to banks | 120 | |||
1 | General information | 42 | 22 | Loans and advances to customers | 120 |
23 | Financial assets and liabilities at fair value through profit or | 123 | |||
2 | Summary of significant accounting policies | 42 | loss | ||
2.1 | Basis of preparation | 42 | 24 | Investment securities | 125 |
2.2 | Changes in accounting policy and dislosures | 43 | 25 | Asset pledged as collateral | 126 |
2.3 | Consolidation | 43 | 26 | Other assets | 127 |
2.4 | Segment reporting | 45 | 27 | Investment in associates | 128 |
2.5 | Common control transactions | 45 | 28 | Investment in subsidiaries | 129 |
2.6 | Foreign currency translation | 45 | 29 | Asset Held for Sale: Discontinued operations | 133 |
2.7 | Income taxation | 46 | 30 | Property and equipment | 135 |
2.8 | Inventories | 47 | 31 | Intangible assets | 138 |
2.9 | Financial assets and liabilities | 47 | 32 | Deferred tax assets and liabilities | 141 |
2.10 | Revenue recognition | 53 | 33 | Deposits from banks | 142 |
2.11 | Impairment of non-financial assets | 55 | 34 | Deposits from customers | 142 |
2.12 | Discontinued operations | 55 | 35 | Other liabilities | 143 |
2.13 | Collateral | 56 | 36 | Borrowings | 144 |
2.14 | Leases | 56 | 37 | Retirement benefit obligations | 146 |
2.15 | Property and equipment | 59 | 38 | Share capital | 149 |
2.16 | Intangible assets | 59 | 39 | Share premium and reserves | 149 |
2.17 | Cash and cash equivalents | 60 | 40 | Non-controlling interests | 150 |
2.18 | Employee benefits | 61 | 41 | Cashflow workings | 150 |
2.19 | Provisions | 62 | 42 | Commitments and contingencies | 152 |
2.20 | Fiduciary activities | 62 | 43 | Offsetting financial assets and financial liabilities | 153 |
2.21 | Issued debt and equity securities | 62 | 44 | Related party transactions | 154 |
2.22 | Share capital | 62 | 45 | Directors' emoluments | 155 |
2.23 | Financial guarantees | 62 | 46 | Compliance with regulations | 155 |
3 | Financial risk management | 64 | 47 | Events after statement of financial position date | 155 |
3.1 | Introduction and overview | 64 | 48 | Dividends per share | 155 |
3.2 | Credit risk | 66 | 49 | Earnings per share | 156 |
3.3 | Liquidity risk | 91 | 50 | Restatement note | 156 |
3.4 | Market risk | 95 | |||
3.5 | Equity risk | 102 | Other National Disclosures and Other Information | ||
3.6 | Fair value of financial assets and liabilities | 103 | Evaluation of the impact of COVID-19 | 158 | |
4 | Capital management | 108 | Statement of value added | 160 | |
5 | Significant accounting judgements, estimates and | 111 | Five year financial summary | ||
assumptions | 162 | ||||
6 | Segment information | 113 | |||
7 | Interest income | 115 |
FBN Holdings Plc. | |
DIRECTORS AND ADVISORS | |
DIRECTORS | |
Ahmad Abdullahi | Non-Executive Director (Group Chairman) |
Nnamdi Okonkwo | Group Managing Director - with effect from January 1, 2022 |
Oyewale Ariyibi | Executive Director (Appointed on August 16, 2022) |
Adesola Adeduntan | Non-Executive Director |
Abiodun Oluwole Fatade | Non-Executive Director |
Alimi Abdul-Razaq | Non-Executive Director |
Peter Aliogo | Non-Executive Director |
Ahmed Modibbo | Non-Executive Director |
Kofo Dosekun | Non-Executive Director |
Khalifa Imam | Non-Executive Director |
Julius B. Omodayo-Owotuga | Non-Executive Director |
AG. COMPANY SECRETARY: | Adewale Arogundade |
REGISTERED OFFICE: | Samuel Asabia House |
35 Marina | |
Lagos | |
AUDITOR: | KPMG Professional Services |
KPMG Tower, Bishop Aboyade Cole Street, | |
Victoria Island, Lagos | |
Telephone: +234 271 8955 | |
Website: www.kpmg.com/ng | |
REGISTRAR: | Meristem Registrars & Probate Services Limited |
213 Herbert Macaulay Way | |
Yaba | |
Lagos | |
BANKERS: | First Bank of Nigeria Limited |
35 Marina | |
Lagos | |
FBNQuest Merchant Bank Limited | |
10 Keffi Street, Ikoyi | |
Lagos | |
TAX IDENTIFICATION NUMBER: | 15562790-0001 |
RC NUMBER: | 916455 |
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CORPORATE GOVERNANCE REPORT
Introduction
FBNHoldings is dedicated to upholding high standards of corporate governance across the Group to maintain the company's long-term business sustainability and create value for all its stakeholders. As a Group, we are committed to defining frontiers for market dominance in the highly competitive and dynamic financial services industry. Thus, the principles of accountability, strong risk management, transparency and integrity are inherent in the Group's values, culture, processes and operating structures
The Board recognises the importance of operating in a manner that is consistent with best corporate governance practices. As a result, the Board provides purpose-driven and ethical leadership by setting the tone from the top in how it conducts itself and oversees the operations and management of the Group. It ensures good governance principles are adopted across the Group to achieve its imperatives.
Our governance framework is designed to ensure compliance with international best practices and the Companies and Allied Matters Act 2020, the Nigerian Code of Corporate Governance 2018 issued by the Financial Reporting Council (FRC), the Code of Corporate Governance for Banks and Discount Houses in Nigeria 2014 issued by the Central Bank of Nigeria (CBN), the Securities and Exchange Commission's (SEC) Corporate Governance Guidelines 2020 and Corporate Governance Guidelines issued by the National Insurance Commission (NAICOM). At the Group and across the operating entities, the Boards operate through various Committees. FBNHoldings' governance framework ensures a dynamic blend of Board autonomy and Group coordination at the operating company level.
Diversity
Through robust policies and procedures, FBNHoldings creates an environment that promotes equal opportunity, diversity, fairness, respect and inclusion for better decision-making and effective governance. Diversity ensures the Group assembles a healthy mix of people from different backgrounds, cultures and experiences to balance the voices, perspectives, insights and empathy required to thrive. We believe recruiting employees from diverse backgrounds, experiences, expertise and knowledge will improve innovation, the quality of our products and service offerings and employee productivity. This ultimately supports the values created. Diversity within FBNHoldings is reflected not only in the gender mix, which aligns with CBN's recommendations but also through the Group's various viewpoints, experiences, cultures, nationalities, religions, social and academic backgrounds and inclusive policies that prevent any form of discrimination.
Shareholder and Regulatory Engagement
Our stakeholders, which include customers, shareholders, employees, regulators, partners and the community are crucial to the success of our business. They provide the patronage, capital, skills, guidance, support and regulatory framework that shape our operations. While their interests and concerns are often diverse and may conflict, our ability to build sustainable relationships and open lines of communication is vital to success. The Board and Management remain committed to effective stakeholder engagement and interact through shareholder groups and other platforms. Engagement sessions provide valuable opportunities for the Board and Management to listen to external perspectives and gain insight into stakeholders' concerns. We are committed to engaging regulators to foster an atmosphere of trust and goodwill and ensure the highest level of compliance with relevant extant regulations across the Group.
Appointment Philosophy
The appointment philosophy of FBNHoldings is guided by regulatory guidelines, laws, and global best practices. The Company selects Directors based on their skills, competencies and experience. The Board Governance and Nomination Committee identifies and recommends candidates to the Board. In accordance with legal and regulatory requirements, the Board then deliberates and decides on the appointment of the most qualified candidates, subject to the approval of the applicable regulatory authorities and the shareholders at the Annual General Meeting (AGM).
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Board Composition
There are eleven Directors: seven Independent Non-Executive Directors (INED), two Non-Executive Directors (NED) and two Executive Directors. This composition aligns with global best practices that encourage a higher ratio of Independent Non-Executive Directors to Executive Directors. All Directors are distinguished by their professional ability, integrity, and independence of opinion.
Board Changes
In 2022, the FBNHoldings' Board of Directors appointed Samson Oyewale Ariyibi as Executive Director, Finance, Investment Management and Oversight with effect from August 16, 2022.
Leadership
Alhaji Ahmad Abdullahi
Group Chairman
Alhaji Ahmad Abdullahi was appointed Group Chairman of the Board of Directors of FBN Holdings Plc on 17 December 2021. He is a seasoned economist and an accomplished professional with extensive experience in banking operations, financial regulation and banking supervision; corporate governance and ethics; and academia.
Alhaji Abdullahi started his academic career in 1985 as a Lecturer in the Department of Agricultural Economics & Rural Sociology, Usman Danfodio University, Sokoto. In 1990, he joined the services of Central Bank of Nigeria (CBN), where he rose through the ranks from being a Manager in Retail Banking Services at the Ibadan, Kano and Katsina branches to becoming a Director and Head of the Banking Supervision Department of CBN where he retired in 2020. He garnered a wealth of experience in business reengineering and performance management, corporate governance, ethics and compliance, supervision of banks and financial institutions.
Prior to his appointment to the Board of FBNHoldings, Alhaji Abdullahi served on the Boards of several institutions, including Africa Finance Corporation, Financial Market Dealers Quote (FMDQ), Financial Institutions Training Centre (FITC), Chartered Institute of Bankers of Nigeria (CIBN), Nigeria Deposit Insurance Corporation (NDIC) and Asset Management Corporation of Nigeria (AMCON).
Alhaji Abdullahi graduated from the prestigious Ahmadu Bello University in 1983 with a Bachelor of Science Degree in Agricultural Economics and went further to bag an MSc in Agricultural Extension from Nigeria's premier institution, the University of Ibadan. He also obtained another Master's degree in Banking & Finance from Bayero University, Kano, Nigeria. Alhaji Abdullahi is a member of several professional bodies such as the Nigerian Institute of Management (NIM), Chartered Institute of Bankers of Nigeria (CIBN), Society of Corporate Compliance and Ethics (SCCEC), Certified Compliance & Ethics Professionals International (CCEPI), and Institute of Directors (IoD). He attended several local and international training programmes as a professional in all his roles. As an academic, he has to his credit a journal publication titled "Training and Visit Model", a tool to extend improved farming techniques among rural communities around Sokoto. He is married with children and enjoys spending his leisure time in the company of his family.
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FBN Holdings plc published this content on 01 June 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 June 2023 23:42:06 UTC.