First Bank of Nigeria Plc, the West African nation’s largest lender, has post N218 billion gross earning at the end of 2008 financial year.

However, Net income dropped to 12.6 billion naira ($85.2 million) in the 12 months through March, from 36.7 billion naira a year earlier, the Lagos-based bank said in a statement distributed by the Nigerian Stock Exchange recently. Revenue climbed 40 per cent to 218.3 billion naira, it said.

The decline in project was a result of the ‘diminution in value of investments occasioned by the situation in the capital market,” the company said in the statement. It didn’t elaborate.

First Bank’s result come after Eurasia Group, a New York-based research Company, said in May that banks in Nigeria may have as much as $10 billion of toxic assets. The bad debt is partly the result of at least 1 trillion naira ($6.8 billion) of so-called margin loans used by speculators to buy shares as equities soared almost 13-fold since 2000, according to Bank of America Corp Nigeria’s All Share Index tumbled 70 per cent in 12 months through March.

First Bank shares advanced the daily limit of 5 per cent to 21 naira on the bourse today. The company declared a dividend of 1.35 naira per share and said it will award one bonus for every six held.

Commenting on the results, Stephen Olabisi Onasanya, Group Managing Director of First Bank said, “Despite the challenging market conditions, First Bank continues to capitalize on its well established value chain in Nigeria’s financial services sector and has achieved another year of strong organic revenue growth.

Recognition of the bank as one of the strongest and most dependable banks in Nigeria, especially in a time of global downturn, has driven considerable growth in our deposit base, with the total group’s deposit liabilities increasing by 71 per cent to N1.2 trillion. Furthermore, strong year-on-year growth was recorded across all business lines. This is a fantastic achievement and First Bank is well positioned to continue to grow its asset base supported by a sustained robust capital position with a strong capital adequacy ratio of 24.69 per cent and stable funding.

“Going forward, our growth aspirations will be driven by our commitment to attain the full benefits of scale and scope by accelerating growth and diversification of assets, revenue and profit. At the strategic level, we have identified three pillars that we believe are integral to our objective: they are acceleration of growth by diversification of assets, revenue and profit; service and operation excellence via a single-minded commitment to operational excellence; the design of appropriate institutional processes, system and capabilities necessary to deliver world class service levels; performance management and people to deliver unmatched results by creating a performance culture with clear individual accountability at all levels as the foundation of what we shall be doing over the medium-term.

“There is no doubt that the trajectory going forward would encounter pockets of turbulence. Within this prognosis, our challenge at First Bank is to build positive momentum around these three pillars and to build on our progress to date”.

Mr Boye Adebayo, acting MD of the Group’s mortgage banking subsidiary commented that, “First Bank’s mortgage business was underpinned by significant income growth from property trading and development in 2008 as our continued IT and HR initiatives enabled us to maintain our competitive edge and grow market share.

This resulted in a 70 per cent rise of our profit before tax for the year. Growth in the medium term will, however depend on a clear focus on servicing the middle market, which we believe will be indispensable.