Date of report 22nd October 2007

Sector:                                                 Banking

Listing Date:                                       21st Dec’04

Issued Shares:                                     9,502,430,142

Pre Offer Shareholder’s fund:N30. 63 BSector:                                                 Banking

Listing Date:                                       21st Dec’04

Issued Shares:                                     9,502,430,142

Pre Offer Shareholder’s fund:N30. 63 B

Auditors:                                                               Akintola Williams & Co

52 week high and low                           N4.05, N18.10

ECONOMIC OUTLOOK

Since the return of Nigeria to democratic rule in 1999 the country has been on the path of growth giving way to the hitherto stagnant years of the military government era. The country’s foreign reserve has grown from a paltry $7billion to about $48 billion in about eight years while Crude oil prices has been on the increase selling at an all time high $90 per barrel. The Nigerian naira has remained stable within the last three years and growth in GDP recorded in progressive dimensions. Similarly the per capital income has witness an up surge in value. Flowing from the increase in crude oil prices the Nation was able to repay the over $ 30 billion national debt haven secure a debt relief from the Paris club and the London club of

creditors.

Accordingly she has been accorded a BB- rating by world leading rating agency- Fitch international consecutively for two years  on a sovereign basis and this has placed her at par with other emerging economies like Venezuela, Turkey and Brazil.

No doubt, the new economic outlook of the nation has not gone unnoticed as foreign direct investment continuous to flow into the nation. A number of Nigerian companies  have attracted offshore financing with many others at near perfection.

The new Government of President Yar’Adua  has increasingly made bold its resolve to uphold the anti corruption crusade that was started by the Obasanjo Government.

A new regime of constitutionalism and insistence on the rule of law is gradually emerging with more reliance now placed on the nations Judiciary as the last hope of the common man.

Following the conclusion of the first phase of the banking reforms, a number of banks have approached the capital market to raise funds from the market to take advantage of emerging opportunities in the market places.

Consequently the banking sector have attracted a number of foreign direct investment, in some parts  to jointly manage the foreign reserves while in other cases equity interest have being indicated by the foreign partners. In the recent past Nigerian companies have began the use of Global Depository Receipts to assess the international market.

The successes recorded by these banks and other companies in assessing offshore financing is a testimony of the confident these arranger and financiers have shown about the nation.

In today’s banking, size has become an issue as most of the industry leaders are big banks in branch networks and balance sheet size.

In order to remain competitive FCMB bank is seeking to raise about N74 billion by way of public offering.

THE BANK

First City Monument bank was incorporated as a private limited liability company on 20th April 1982 and was granted banking licence on 11 August 1983. On 15 July 2004 the bank changed from a private liability bank to a public limited liability bank and was listed on the floor of the Nigerian Stock Exchange by way of introduction on 21st December 2004.

 The bank was the first privately owned merchant bank to be established without foreign technical partners or government support in Nigeria. First City Monument Bank has it’s antecedent in the successful primary issues business of City Securities limited which was established in September 1977 as the first Nigerian financial institution.

In 2001, FCMB obtained the universal banking license having collaborated with a few other banks in the campaign for the adoption of the universal banking system in Nigeria. FCMB successfully raised 16 billion via its Initial Public Officering in 2005. That same year the bank completed its merger with Cooperative Development Bank plc and Nigerian-American Bank ltd and acquired Midas Bank limited.

Board Profile

The Bank’s board is made up of 12 members with Dr A. D Long as Chairman, a seasoned banker with over 34 years banking experience across several continents and Ladi Balogun as the Managing Director/CEO. Other Executive Directors include: Anurag saxena, Henry Semenitari, Maurice Phido

OFFER FORECAST STATISTICS

Analyst comment

FCMB has over the years entrenched itself in the banking arena as the Grandmaster.

While many thought they will not survive the consolidation exercise, they did in grand style and remained as one of the few banks with strong  investment banking competence.

In the recent past, the bank has seamlessly transited from its former owner/Chairman Otunba Subomi to its present crop of young managers.

FCMB bank in her last financial year end reported a profit after tax of N5.94 Billion as against N2.31 Billion a growth of 157% over the preceding year. Total assets grew by 147% from N106 Billion to N262 Billion in 2007

The banks made a significant growth in her deposit liabilities from N12.59 to N 231 Billion in 2007 while the rate of classified assets to total assets stood at 3.10 % which represents a significant improvement from the 31% of the preceding year and over 70% of the total risk assets properly secured.

Growth in earnings and profit after tax has been impressive particularly in the last five years. Average growth rate in earnings and PAT has been 182% and 260%  respectively.

The share price has recorded a total of 330% capital growth since the beginning of the year. The impressive growth in earnings as reported by the bank in her last financials is a reflection of the structural changes being undertaken by the bank.

We are of the opinion that the business model adopted by the bank and coupled with the assemblage of strong human capital as depicted in the banks top management team can only but take the bank higher and position it as one of the dominant players in the industry.

Several foreign investors have seen this potential hence their direct investment in the bank. We believe that in the medium-long term, the bank would occupy it’s deserve place in the Nigerian banking industry and indeed the West Africa market. We therefore encourage investors to take advantage of the on going public offer as we expect that the stock will continue to create wealth for investors both in the medium and long term.

Auditors:                                                               Akintola Williams & Co

52 week high and low                           N4.05, N18.10

ECONOMIC OUTLOOK

Since the return of Nigeria to democratic rule in 1999 the country has been on the path of growth giving way to the hitherto stagnant years of the military government era. The country’s foreign reserve has grown from a paltry $7billion to about $48 billion in about eight years while Crude oil prices has been on the increase selling at an all time high $90 per barrel. The Nigerian naira has remained stable within the last three years and growth in GDP recorded in progressive dimensions. Similarly the per capital income has witness an up surge in value. Flowing from the increase in crude oil prices the Nation was able to repay the over $ 30 billion national debt haven secure a debt relief from the Paris club and the London club of

creditors.

Accordingly she has been accorded a BB- rating by world leading rating agency- Fitch international consecutively for two years  on a sovereign basis and this has placed her at par with other emerging economies like Venezuela, Turkey and Brazil.

No doubt, the new economic outlook of the nation has not gone unnoticed as foreign direct investment continuous to flow into the nation. A number of Nigerian companies  have attracted offshore financing with many others at near perfection.

The new Government of President Yar’Adua  has increasingly made bold its resolve to uphold the anti corruption crusade that was started by the Obasanjo Government.

A new regime of constitutionalism and insistence on the rule of law is gradually emerging with more reliance now placed on the nations Judiciary as the last hope of the common man.

Following the conclusion of the first phase of the banking reforms, a number of banks have approached the capital market to raise funds from the market to take advantage of emerging opportunities in the market places.

Consequently the banking sector have attracted a number of foreign direct investment, in some parts  to jointly manage the foreign reserves while in other cases equity interest have being indicated by the foreign partners. In the recent past Nigerian companies have began the use of Global Depository Receipts to assess the international market.

The successes recorded by these banks and other companies in assessing offshore financing is a testimony of the confident these arranger and financiers have shown about the nation.

In today’s banking, size has become an issue as most of the industry leaders are big banks in branch networks and balance sheet size.

In order to remain competitive FCMB bank is seeking to raise about N74 billion by way of public offering.

THE BANK

First City Monument bank was incorporated as a private limited liability company on 20th April 1982 and was granted banking licence on 11 August 1983. On 15 July 2004 the bank changed from a private liability bank to a public limited liability bank and was listed on the floor of the Nigerian Stock Exchange by way of introduction on 21st December 2004.

 The bank was the first privately owned merchant bank to be established without foreign technical partners or government support in Nigeria. First City Monument Bank has it’s antecedent in the successful primary issues business of City Securities limited which was established in September 1977 as the first Nigerian financial institution.

In 2001, FCMB obtained the universal banking license having collaborated with a few other banks in the campaign for the adoption of the universal banking system in Nigeria. FCMB successfully raised 16 billion via its Initial Public Officering in 2005. That same year the bank completed its merger with Cooperative Development Bank plc and Nigerian-American Bank ltd and acquired Midas Bank limited.

Board Profile

The Bank’s board is made up of 12 members with Dr A. D Long as Chairman, a seasoned banker with over 34 years banking experience across several continents and Ladi Balogun as the Managing Director/CEO. Other Executive Directors include: Anurag saxena, Henry Semenitari, Maurice Phido

OFFER FORECAST STATISTICS

Analyst comment

FCMB has over the years entrenched itself in the banking arena as the Grandmaster.

While many thought they will not survive the consolidation exercise, they did in grand style and remained as one of the few banks with strong  investment banking competence.

In the recent past, the bank has seamlessly transited from its former owner/Chairman Otunba Subomi to its present crop of young managers.

FCMB bank in her last financial year end reported a profit after tax of N5.94 Billion as against N2.31 Billion a growth of 157% over the preceding year. Total assets grew by 147% from N106 Billion to N262 Billion in 2007

The banks made a significant growth in her deposit liabilities from N12.59 to N 231 Billion in 2007 while the rate of classified assets to total assets stood at 3.10 % which represents a significant improvement from the 31% of the preceding year and over 70% of the total risk assets properly secured.

Growth in earnings and profit after tax has been impressive particularly in the last five years. Average growth rate in earnings and PAT has been 182% and 260%  respectively.

The share price has recorded a total of 330% capital growth since the beginning of the year. The impressive growth in earnings as reported by the bank in her last financials is a reflection of the structural changes being undertaken by the bank.

We are of the opinion that the business model adopted by the bank and coupled with the assemblage of strong human capital as depicted in the banks top management team can only but take the bank higher and position it as one of the dominant players in the industry.