First City Bank Nigeria Falls to 3-Month Low After Loss Forecast
First City Monument Bank Plc (FCMB), a Nigerian lender, fell by the daily limit to a three-month low after it forecast a loss of as much as 9 billion naira ($57 million) for the year through December.
The stock lost 5 percent to 3.80 naira, its lowest closing value since Dec. 7, extending its decline this year to 9 percent. That compares with a 1.7 percent rise in the Nigerian Stock Exchange All-Share Index (NGSEINDX) over the same period.
The loss stems from non-performing loans and “impairments to equity underwriting” for which it made provisions of 29.5 billion naira, the Lagos-based lender said today in an e-mailed statement. FCMB completed the acquisition of Finbank Plc (FIRSTINL), a lender bailed out by the central bank in 2009, in February.
“We expect the market to react negatively to the announcement initially,” FBN Capital Ltd. wrote in an e-mailed note today. “However, we expect the shares to recover ultimately,” it said.
FCMB management expects the first two quarters of 2012 “to see continued improvements” with the lender likely to exceed its forecast for the first half of the year, according to its statement.
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