A significant increase in letter of credit (L/C) commissions has helped Nigeria's Fidelity Bank to report robust financial performance for the first quarter of 2025, highlighting a strategic shift by the bank towards enhancing non-interest income streams.

A key driver behind this success is the adoption of Kachasi, an end-to-end trade finance software developed by Union Systems.

Key financial highlights

Fidelity's non-interest income grew in the quarter by 30.1 per cent year-on-year, reaching 23.82 billion naira (₦23.82 billion - US$57.5 million). A significant contributor to this growth was a 23.38 per cent increase in L/C commissions, amounting to ₦4.8 billion.

In terms of overall profitability, the bank's profit before tax soared by 167.8 per cent year-on-year, reaching ₦105.8 billion.

Key trade finance driver

Fidelity's impressive performance is attributed to its deliberate pivot towards optimising income from fee-based services, particularly in trade finance.

Significantly, the bank has adopted the Kachasi end-to-end trade finance software developed by Union Systems.

Digital benefits

By digitising the lifecycle of L/Cs, foreign bills, and related trade instruments, Kachasi has streamlined operations, reduced turnaround times, and improved compliance with regulatory requirements.

The bank's strategic focus on non-interest income, coupled with technological advancements, positions Fidelity as a leading player in Nigeria's banking sector, demonstrating resilience and adaptability in a dynamic financial landscape.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.