Thursday, April 27, 2017/ 1:32 PM /NSE
Access Bank Plc., (Bloomberg: ACCESS NL / Thomson Reuters: ACCESS.LG) (“Access Bank” or the “Bank”), the full service commercial bank with headquarters in Nigeria and with operations across Sub-Saharan Africa, the UK, Asia and the Middle East, announces its unaudited results for the first quarter ended 31 March 2017.
Group Managing Director / Chief Executive Officer’s Review
“The Group’s first quarter performance in 2017 demonstrates the effective execution of our strategy in a challenging but recovering economy. The Bank posted total revenue of ₦116.0 billion and profit before tax of ₦31.2 billion, driven by solid growth in net interest income of ₦43.0 billion (+23% y/y) and non-interest income of ₦36.4 billion (+47% y/y).
Our statement of financial position at the end of the quarter is reflective of our cautious approach to growth resulting in stable asset quality of 2.2%. The Group‘s capital and liquidity ratios of 21.0% and 46.3% respectively, remain in excess of the minimum regulatory requirement, adequate to support our business.
2017 marks the end of our third five-year transformation journey and in the coming months, we will focus our priorities on the delivery of our strategic objectives.
We will continue to improve on profitability and shareholder value by maintaining our capital and liquidity positions, assiduously implementing our cost management strategy, and exploiting retail business opportunities using our digital platforms and deepening market share of the wholesale business.”
– Herbert Wigwe, GMD/CEO
Financial Performance Review
Revenue and Profitability
· Gross Earnings rose 44% y/y to ₦116.0 billion as against ₦80.3 billion recorded in Q1’16, with interest income and non-interest income contributing 68% and 31% respectively
· Interest Income grew by 43% y/y to ₦79.3 billion in Q1 2017 from ₦55.4 billion in Q1 2016
· Non-Interest Income of ₦41.4 billion (+67% y/y) compared with ₦24.8 billion in Q1 2016, underlined by strong net gains on the trading portfolio
· Operating Income increased to ₦79.2 billion (+38% y/y) compared with ₦59.3 billion in the corresponding period in 2016
· Profit Before Tax (PBT) for the period rose to ₦31.2 billion, representing a 38% y/y growth when compared to ₦22.6 billion in Q1 2016
· Profit After Tax (PAT) up 34% y/y to ₦26.0 billion in Q1 2017 from ₦19.4 billion in Q1 2016
· Improved profits resulted in higher Return On Average Equity (ROAE) of 22.6% in Q1 2017 from 20.7% in Q1 2016
· Loans and Advances totaled ₦1.85 trillion as at March 2017 (December 2016: ₦1.86 trillion)
· Customer Deposits declined marginally by 4% to ₦2.02 trillion in the period, from ₦2.09 trillion in December 2016
· Total Assets stood at ₦3.54 trillion during the period, up 2% from ₦3.48 trillion in December 2016
· Capital Adequacy of 21.0% and Liquidity ratios of 46.3%, remain consistently above the regulatory minimum requirement
· Non-performing loans to total gross loans stable at 2.2% as at March 2017 (December 2016: 2.1%)
· Coverage Ratio (with regulatory risk reserves) stood at 164.3% as at March 2017 (December 2016: 169.0%)
· Cost of risk increased marginally to 0.7% in Q1 2017 from 0.6% in Q1 2016 on the back of prudent risk management practices during the period
· Cost-to-Income Ratio (CIR) down 140bps to 56.5% in Q1 2017 (Q1 2016: 57.9%) driven by stronger income growth
· Operating Expenses up 30% y/y to ₦44.7 billion (Q1 2016: ₦34.4 billion), however, declined 70bps q/q from ₦45.4 billion in Q4 2016 reflecting the increasing impact of our cost containment measures
· Net Interest Margin (NIM) increased by 150bps q/q to 6.7% from 5.2% in Q4 2016: but declined y/y from 7.1% in Q1 2016. Cost of Funds (CoF) of 5.1% increased from 4.7% in December 2016 and 3.8% in Q1 2016
Operational Highlights during the Quarter
· Obinna Nwosu resigned as the Group Deputy Managing Director of the Bank
· Roosevelt Ogbonna succeeded Obinna Nwosu as the Group Deputy Managing Director
· Gregory Jobome appointed as the Executive Director, Risk