March 21, 2018 /04:28 PM / NSE
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Group Reports Resilient Audited Results for the Full Year Ended 31
operating performance in 2017 was impacted by the residual effects of
macro-economic conditions of 2016, characterized by slow economic expansion and
adverse credit conditions, which resulted in making conservative provisions on
our loan book. Despite the macro and regulatory headwinds, our underlying
business remained strong as reflected in the gross earnings growth of 20% to
N459bn in 2017. We grew our loan book to position it for improved earnings,
whilst driving deposit mobilization from targeted segments to diversify our
year 2017 was pivotal for our Bank, as we concluded our 2013-2017 corporate
strategic plan. Its successful implementation was hinged on discipline, hard
work, and an unwavering commitment to our set objectives. I am particularly
excited about the next phase of the Bank’s evolution centred on an integrated
global franchise. The execution of the 2018-2022 strategy commences with focus
on deepening our retail offerings, underpinned by strong digital and payment
solutions. Throughout the next phase, we will continue to invest in technology
as we establish a universal payments gateway with an ecosystem of local and
the coming periods, we will focus on the disciplined implementation of our
strategy to drive efficient and operational excellence across all segments,
expand revenue and increase profitability, with enhanced focus on risk
management practices and a disciplined cost containment structure.
Financial Review for Year Ended 31 December 2017
asset base of the Bank remained strong and robust
with sustained growth of 18% y/y in total assets to H4.1otrn from N3.48trn in
December 2016. Maintained healthy growth in customer deposits with 7% y/y increase
to N2.25trn, from H2.09trn in December 2016, and Loans and Advances (+11% y/y)
to N2.06trn in December 2017, from H1.86trn in December 2016.
Earnings increased to a total of N459.1bn in FY 2017, a 20% increase y/y (FY 2016: N381.3bn), of which interest income and
non-interest income comprise 70% and 30% respectively indicating a stable
revenue base. Interest Income grew by 29% y/y to N319.9bn in FY 2017 from
N247.2bn in FY 2016 reflecting income growth from core business driven by a
higher interest environment, Non-Interest Income was up 4% to N139.1bn, in FY
2017 from N133.4bn in FY 2016; driven by growth in FX-related gains.
in impairment charges contributed to the decrease in PBT to N80.1bn, representing a 11% y/y decline compared to N90.3bn in 2016.
Impairments were up 57% y/y and 780% q/q due to significant provision of
N19.1bn taken in Q4’17. Profit After Tax (PAT) fell -13% in FY 2017 to N62.obn
from N71.4bn in FY 2016 bringing Return on Average Equity (ROAE) to 12.8% in FY
2017, from 17.4% in FY 2016 and Return on Asset to 1.6% from 2.4% in FY 2016.
Net Interest Margin (NIM) of 5.8% in FY 2017 from 6.2% in FY 2016, and Cost of
Funds (CoF) increased 8obps y/y to 5.1% from 4.3% in FY 2016 due to high yield
environment. Yield on Asset rose to 11.3% by 2obps from 11.1% in FY 2016 and
Cost-to-Income Ratio (CIR) stood at 62.1 % in FY 2017 (FY 2016: 58.8%).
ratios remained strong and well above the regulatory limits with Capital Adequacy Ratio (CAR) at 22.5% (FY 2016: 21 .1%). Liquidity
ratio of 47.3% providing adequate buffers and headroom for growth.
Non-performing loan ratio of 4.8%, an increase from 2.1% reflecting the impact
of the macro on asset quality.
1. Successfully concluded the 2013-2017 strategy,
unveiled the new five-year roIIing strategy spanning 2018 - 2022 aimed to
position the Bank as "Africa’s Gateway to the World" in addition
to its vision of being the world’s most respected African bank.
2. Awards and Recognition:CBN
Sustainability Awards 2017:
• Sustainable Bank of the Year
• Sustainable Transaction of the Year (Oil and Gas
• Sustainable Transaction of the Year (Agriculture)
• Excellence in Women Economic Empowerment
World Finance Awards 2017:
• Most Sustainable Bank, Nigeria
• Best Corporate Governance, Nigeria
Karlsruhe Sustainable Finance Awards, 2017:
• Outstanding Business Sustainability Achievement Award
3. Retirements during the year: Ojini Olaghere
retired as Executive Director, IT & Operations, and Obinna Nwosu
resigned as the Group Deputy Managing Director.
4. Appointments during the year: Roosevelt Ogbonna
was appointed Group Deputy Managing Director, Hadiza Ambursa was appointed
Executive Director, Commercial Banking and Gregory Jobome appointed as the
Executive Director, Risk
5. The Group received a national scale rating
upgrade to AA- (previously rated A+) from Agusto and Co.
6. Redeemed $245.01 million outstanding principal
and final coupon on the 5-year $350 million Eurobond