.In business, the real risk is not failing. It is refusing to think differently while the world moves on. Banks that define competitiveness as cutting costs, define strategy as copying last year’s playbook, and define leadership as avoiding mistakes will not die overnight. They will die slowly — by stagnation. They will keep posting profits, keep raising capital, and keep getting left behind by smaller, bolder rivals who chose to compete for foresight, for competencies, and for the future instead of just for today’s deposits. That is the implication of the old thinking: you try become efficient, but irrelevant. You become big, but bloated. You become profitable, but cheap.
First City Monument Bank Plc ,FCMB Group, is one of the clearest victims of that refusal. FCMB, was a model brand on arrival in 1982 ; when it was established by the banking legend and trailblazer ,Otunba Subomi Balogun , one of its core values was to pursue excellence. A fleet footed corporate organization, it was nurtured to make a difference with superior service delivery and impressive financial performance from its inception. But today , it is a different ball game .The bank with stunted steps , cyclical profitability and lethargic speed , has been overtaken by younger ones miles away. A bank founded before many of today’s tier-1 names like Access, GTCO and Stanbic IBTC, and once ranked ahead of them, has watched those same banks overtake it in valuation, relevance and market imagination. Even Wema Bank, once demoted to regional status, has now leapfrogged it. The reason is not lack of resources. It is lack of imagination from the top. This, no doubt , is raising serious concerns and questions
Conceptually, every bank must walk a tightrope between five conflicting demands: give surplus units maximum liquidity, give deficit units cheap and instant credit, deliver shareholders maximum profitability, satisfy regulators’ demand for prudence, and meet the community’s expectation of good corporate citizenship. FCMB has, for two decades, continued to live up to these expectations in textbook fashion — balancing liquidity against returns, staying within regulatory lines, and presenting itself as the responsible, steady challenger. But therein lies the irony: the very discipline that kept it credible has also kept it stuck. While younger banks chose to stretch goals, leverage constraints, and preempt new competitive space , FCMB remained on the treadmill of optimization — refining today’s lending, deposit, and compliance playbook rather than architecting tomorrow.
In trying to satisfy all five constituencies equally, it optimized the present at the cost of the future, treating strategy as risk management rather than as imagination. The result is that the challenger that once defined ambition has been overtaken by upstarts willing to trade some liquidity and short-term prudence for speed, knowledge, and new competencies. FCMB stayed solvent and respectable, but in banking, respectability without preemption is how incumbents become followers.
The Two Lenses That Expose Shareholder Concerns Over FCMB
The above view aptly captures the miserable position of FCMB in the Nigerian banking industry relative to its peers . Unfortunately , some ignorant observers of this bank still doubt the above narrative . Such people measure its progress and financial health under a historical basis . However , that could be disingenuous as it showcases it often as a corporate leader with immense value despite its challenges ; under this lens , the gullible see it as a bank making big progress. But to think so is to deprive its stakeholders the truth. The reason is clear :.bench-marking is not just about looking backward, but about looking outward and upward if an organization truly wants to stay competitive. While historical comparison helps firms track their own improvement over time and spot internal progress or decline, its danger lies in complacency: a company can celebrate beating its past self while still falling behind rivals and shifting customer expectations.Those viewing FCMB simply from the above perspective are merely gullible . Even benchmarking FCMB on historical basis reveals an organization moving out and in from one misfortune to another .
Sequel to the above , a wise stakeholder that goes for Industry norms/standards or best in class basis , no doubt , is better informed . This may not be farfetched . Industry norms/standards widen the lens by measuring performance against peers using agreed indicators, offering useful context on where a firm stands in its sector. Yet this too is risky because an entire industry may be under-performing or being disrupted by other sectors, and because industry boundaries are increasingly blurred by convergence. This is why many forward-thinking organizations are moving beyond both historical and industry bases to best-in-class bench-marking, which compares performance against the best practices anywhere, regardless of sector. The advantage of these broader bases is that they force managers to confront real competitive standards rather than comfortable ones.
Unknown to many shareholders , some organizations still “hide” behind historical improvement figures to avoid tougher external comparisons, using internal gains as an excuse while competitors and other industries redefine what excellence looks like. In today’s market, survival depends less on being better than you were yesterday, and more on being good enough to beat the best — wherever they are.
When FCMB performances over the years are subjected to any other basis of measuring values outside historical basis its unimpressive position is better exposed by smart shareholders and other stakeholders . Shareholders require maximum or adequate returns on their investments in order to remain invested in the bank and to be willing to continue to provide additional resources and when needed . Fr FCMB , that has remained a mirage and its shareholders have remained at the receiving end , worst hit by its inability to relatively live up to the above expectation .
FCMB Group Plc’s dividend narrative in 2026 is growth on paper that fails to translate into real shareholder value. The headline numbers look encouraging: DPS jumped to ₦0.55 for FY2025 from ₦0.25 in 2023, a 17.6% growth rate, with a 2.9% yield that is thoroughly covered by an 8.1% payout ratio and an analyst forecast of 8.7% in three years — the most aggressive payout in over a decade. Yet context exposes the weakness. That yield still trails the 7.0% banking industry average and the 3.4% top-quartile NG market, while FCMB’s ₦791.5b market cap and -28.2% total shareholder yield pale next to Zenith’s +70.9% and GTCO’s +40.4% one-year returns. The bank also carries a 10-year record of volatility — payouts of just ₦0.10-₦0.30 between 2017-2022 — which undermines trust with income investors who prize predictability over spikes. Compounding this, with inflation above 25% and the naira down 60%+ since 2023, the nominal increase from ₦0.25 to ₦0.55 equates to only ∼12% in USD terms, meaning purchasing power has actually eroded as food, rent and FX costs doubled. In essence, FCMB is doing the right things on coverage and growth intent, but doing the wrong things on competitiveness, consistency and real returns. Until it can close the gap to peers and prove this dividend rise is sustainable rather than a catch-up from years of underpayment, it risks remaining a “notable” but ultimately uncompelling value trap in a sector where investors now demand both yield and capital appreciation.
The miserable fate of its shareholders may not spring any surprise . The bank has remained stunted and inefficient in all ramifications relative to the younger ones . FCMB’s percentages of revenue converted to profit after tax or net profit margins are not impressive, and that is exactly why its share price in absolute terms remains miserable and its dividends lag peers. For every ₦100 of gross earnings, the bank only managed to retain ₦9.6 on average from 2016-2020, and ₦12.8 from 2021-2025, with brutal years like -₦10.28 in 2011, ₦2.00 in 2009 and ₦3.06 in 2015 where costs, impairments and mismatches consumed everything. Even in its “best” recent year, 2023, it kept just ₦18.02, and in 2025 only ₦15.66, despite gross earnings hitting ₦1.13trn. That tells you the problem isn’t top-line growth, it’s what happens between revenue and profit retained. Costs are too high, asset quality leaks too often, and funding mismatches force the bank to give back most of what it earns. For shareholders, this is fatal: low conversion means PAT is thin, EPS is volatile, dividends are inconsistent and well below tier-1 peers, and the market prices the stock accordingly at a discount. Until FCMB can prove it can hold 15%+ margins for several years without the 50%+ profit collapses, revenue growth will keep flowing straight out the door, leaving investors with a high-risk, low-reward story instead of a compounding bank.
Between 2007 and 2025, FCMB’s Earnings Per Share tells the story of a mid-tier bank fighting to stay consistent, not an outsized performer relative to peers. From ₦123k in 2008, EPS collapsed to ₦6k by Dec 2009, turned into a ₦0.57 loss in 2011, and only briefly recovered to ₦1.12 in 2014 before falling 78.6% to ₦0.24 in 2015. The 2016-2020 period was flat, with EPS stuck between ₦0.43 and ₦0.98, reflecting deeper issues with cost control and asset quality. The 2021-2025 jump to ₦3.99, with a peak of ₦4.48 in 2023, looks strong on paper, but it was largely driven by revenue scale and high interest rates, not efficiency. Underlying factors remain a concern: margins are volatile, cost-to-income ratios have stayed elevated, asset quality pressures show up in sudden profit drops like 2015 and 2024, and balance sheet mismatches make earnings fragile when rates or credit cycles turn. The implication for an average investor: FCMB can grow EPS when the macro tailwinds are right, but it has not proven it can protect it. The repeated 50%+ EPS declines in 2009, 2011, 2015 and 2024 show a bank that is still struggling with cost discipline, loan losses, and funding mismatches. Until FCMB delivers stable margins and cleans up asset quality for 3-4 years straight, EPS growth will remain cyclical and below tier-1 peers, making the stock more a macro bet than a compounding dividend story.
Where peers have moved to compete for foresight and new competencies, FCMB appears to be optimizing the present. Stanbic IBTC trades near ₦166.90 with a 67% one-year gain on the back of wealth management and corporate banking depth. Wema’s ALAT-driven digital push and AccessCorp’s volume dominance show banks leveraging constraints to create new markets. Even Zenith, with an 8.77% dividend yield and 21.7% ROE, and GTCO with strong liquidity, are being priced for both earnings and strategic positioning. FCMB, by contrast, is delivering exceptional earnings but without the same narrative of industry reshaping. Its valuation recovery is real, but it remains the challenger that has not yet converted performance into premium. The implication is clear: unless FCMB translates its earnings surge into a visible strategic architecture — new core competencies, digital scale, or market redefinition — it risks remaining the cheapest bank in a sector that is rewarding ambition more than efficiency. The market is saying it believes in FCMB’s numbers, but not yet in its future first
The Q1 2026 results prove the point and expose the paradox. FCMB delivered ₦76.53 billion in profit after tax on ₦320.22 billion in gross earnings. It sits on ₦7.96 trillion in assets, ₦1.14 trillion in equity, and ₦4.68 trillion in customer deposits. Those numbers are bigger than Wema’s . Yet as of July 20, 2026 the market priced FCMB at ₦11.80 per share, valuing it at roughly 2.4x annualized earnings with a dividend yield above 3%. In the same period Zenith, GTCO, Access and Stanbic all trade at multiples 3 to 5 times higher. Wema, with *₦5.23 trillion in assets and ₦63.13 billion in Q1 PAT*, trades at ₦30.90 — 2.6 times FCMB’s price.
The market is telling us what leadership has refused to hear. FCMB chose to shrink loans by 4.6% to ₦2.26 trillion, pile ₦1.81 trillion into cash, and lock ₦2.17 trillion in securities while peers lent, built platforms, and expanded across Africa. It chose caution over stretch, defense over growth, and efficiency over difference. The implication is now priced in: a bank can be stunted not because it lacks money, but because its leadership lacks the capacity to think differently. Until that changes, FCMB will keep winning the earnings quarter and losing the decade.
Leadership As a Curse?
FCMB competitive debacle could be traced to the quality of its leadership . At its heart, banking remains unchanged: it is risk taking through maturity transformation, using short-term deposits to fund long-term loans that generate profit through interest spreads. This makes bank management inseparable from risk management. Lending is both the most profitable and the riskiest activity, and the true test of leadership. When loans fail, banks don’t just lose money — they lose the liquidity needed to pay depositors, and they lose market confidence. A leadership that ignores credit, liquidity and interest-rate mismatches risks turning growth into collapse. In banking, failure to manage risk is failure of the bank itself.
Not only that . Too often, a failed bank leadership frames competition only as a fight for deposits, loans, and market share in the goods-and-services market, but that view is dangerously narrow. Real competitiveness today also demands winning in extramarket arenas: the competition for foresight to see where payments, credit, and regulation are heading before others do; the competition to build distinctive competencies in technology, risk management, and talent that rivals cannot copy quickly; and the competition to shape industry evolution by forming coalitions with fintechs, regulators, telcos, and development partners. For FCMB, ignoring these nonmarket battles means preparing to fight yesterday’s war. With sharper leadership, FCMB must exploit foresight to anticipate shifts in customer behavior and policy, invest deliberately in capabilities that turn size into leverage rather than obesity, and build coalitions that allow it to influence standards, infrastructure, and ecosystems instead of just reacting to them. In banking, the winners will not be those who only sell better products, but those who see the future first, build the skills to deliver it, and shape the rules of the game — and that is where FCMB’s leadership must choose to compete if it wants lasting relevance.
The leadership of FCMB until recently appeared to ignore the critical importance of size . World-class corporate leaders , no doubt, know a size advantage is one of the weapons of competitiveness. While they believe competitiveness is won not by size alone, but by what a company does with its size, they also believe there is no honor in choosing to stay small. In other words, bigness without stretch and leverage is obesity, just as smallness without stretch and leverage is impotence. Bloated and slow corporate entities are prone to collapse when management sleeps at the switch, while small ones lacking the capital, distribution, and training capacity to turn ideas into wealth at scale make no sense. FCMB unfortunate smallness relative to the younger banks that have overtaken it is raising concerns but more concerns are raised by its impotence which is driven by lack of stretch and leverage .
. Banks like GTCO and Zenith with the above understanding prefer to gain size advantage because of better potentials associated with it . Large companies matter precisely because they create the ecosystem in which growth and jobs happen: they provide global distribution that startups like Intel and Microsoft rode to world markets, they invest disproportionately in training the entrepreneurs of tomorrow, they have the resources to build the next generation of infrastructure from interactive TV to global trading networks, and they remain significant employers whose failure costs society hundreds of thousands of jobs. The symbiosis is clear — small firms generate innovation, but that innovation only creates broad wealth when it is combined with the complementary skills and global reach of big firms. The goal, therefore, is not bigness for its own sake, but growth driven by ambition. Companies must stretch their resources and leverage them creatively; otherwise they drift either into obese irrelevance or impotent marginality. In a competitive economy, scale creates employment, wealth, and opportunity for societal advancement, and refusing to pursue it is to accept limited impact by design.
The above are the critical success factors in banking and they remain critical hard nuts for the leadership of FCMB under the leadership Ladi Balogun to break either by commission or omission for decades ; And the negatives impacts are critical . It affected the bank’s profitability deeply .Poor profitability strikes directly at the two metrics shareholders watch most: net profit margin and earnings per share highlighted above . When a bank cannot convert revenue into profit efficiently, the net profit margin compresses, signaling that costs, impairments, or weak pricing are eating away at every naira earned. That weakness then flows through to EPS, because lower profit spread across the same number of shares leaves less for each shareholder. The implication is immediate and severe: without a healthy margin and growing EPS, a bank cannot sustain meaningful dividends, reinvest in growth, or command investor confidence. Over time, poor returns erode the stock’s valuation, as the market discounts future earnings and treats the bank as a low-yield, high-risk asset. In effect, weak profitability doesn’t just hurt current returns — it undermines the bank’s ability to raise capital, attract investors, and defend its share price, turning size and deposits into empty growth without real shareholder value.
Fortunately , certain signals from FCMB show the leadership is now waking up at the switch . In appointing Bismarck Rewane as Non-Executive Director and Board Chairman, FCMB has made a deliberate, high-stakes bet on credibility to steady and reposition the bank. Bringing in one of Nigeria’s most respected economists, with over 40 years spanning macro research, investment banking and board roles at Guinness Nigeria, BAT, Henkel and others, signals that the lender is trying to trade perception for performance at a time when confidence and capital are everything in banking. The CBN-approved move puts a voice known for policy insight and market discipline at the head of governance, precisely as FCMB leans on a stronger capital base and pushes into its next growth phase across banking, consumer finance, investment management and fintech. By naming Rewane, the board is essentially telling investors, regulators and customers that strategy will now be anchored to data, governance and long-term macro judgment, not just expansion. It reads as a turnaround play: use Rewane’s reputation to attract institutional trust, sharpen risk and strategic oversight, and convert that into lending, fee income and market share, betting that a chairman who has advised governments and sat on blue-chip boards can give FCMB the gravitas it needs to compete harder in a crowded, recapitalized sector.
The Power of Thinking Differently and The Fate of FCMB
The Power of Thinking Differently
For too long, Nigerian banking was run on a simple formula: size equals safety, and competition happens at the cash register. In that world, strategy meant beating the rival next door on price today, and organization meant cutting costs when profits slipped. Big banks were either “too big to fail” or bloated dinosaurs to be slimmed down. Leverage was never considered. The choice was only caution or contraction. That mindset is what has left institutions like FCMB stunted. Its balance sheet has not scaled with the market. Assets, loans, deposits, equity and profit have grown slower than the industry because the bank kept competing on the same terms it used 20 years ago: branch presence, relationship banking, and collateralized lending. While liquidity and customers moved to platforms and ecosystems, FCMB optimized the old channels. Strategy became an annual exercise in protecting margins. Organization stayed hierarchical, built for control not learning. The result is not insolvency, but irrelevance. A bank that is solid, but no longer central to where growth is happening. Younger Tier-1s and even some newer Tier-2s have passed it because they stopped asking “how do we do better with what we have” and started asking “what must we become to own what’s next.”
GTCO and Zenith understood that question early, and they are exploiting the power of thinking differently across all three fronts. Competitively, they stopped limiting the fight to products and price. They moved to compete for foresight and for a position inside the flow of money. Instead of waiting for customers to walk into branches, GTCO built HabariPay, Squad, and a suite of APIs that embed banking into commerce, while Zenith pushed agency banking and fintech partnerships deep into informal markets and micro-transactions. They used bigness as leverage, not weight. That scale gave them the capital to invest disproportionately in technology before it was profitable, and to shape industry rules through coalitions rather than just comply with them. Strategically, both banks rejected the “rain dance” of tweaking marketing and costs. They built a strategic architecture with a 10-year view. GTCO treated itself as a platform company that happens to have a banking license, deliberately creating non-interest revenue streams that do not depend on interest rate cycles. Zenith treated capital as fuel for reinvention, not just a buffer, placing patient bets on digital infrastructure, data, and fee-based services. They set stretch goals that forced them to multiply resources, not just allocate them, and they measured progress in knowledge accumulated about customers and technology. Organizationally, they broke the silos. Product, risk, engineering and data teams work in the same room with authority to test, learn and scale. Innovation is not a department. It is how work gets done. Talent is hired from outside banking and rewarded for what they build, not just for tenure. Failure is mined for signals about future demand. That boundary-less structure let them move faster than a control-driven hierarchy ever could.
The payoff shows up in the fundamentals. GTCO and Zenith are not just bigger, they are growing where the market is growing. Their deposit bases are cheaper because customers live in their ecosystems. Their loan books are expanding into segments traditional models could not underwrite because they are using data, not just collateral. Their equity is being built aggressively to fund the next option, not only to protect the last one. Meanwhile, banks that failed to make the shift are still on the treadmill: efficient, stable, and slowly falling behind. They compete by being slightly better at yesterday’s business, define strategy as risk avoidance, and organize for compliance. In an industry built on relevance, that is how leadership is lost without a single crisis. The divide is conceptual, not operational. One side asks how to defend the present. The other asks how to invent the future. GTCO and Zenith chose discomfort through ambition. FCMB and others chose efficiency through caution. And that is why the gap will keep widening until the old thinking is abandoned.
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