Wema Bank PLC (Bloomberg: Wema NL) (“Wema” or “the Bank”) announces its audited 2017 full year financial result.
Managing Director/Chief Executive Officer’s review
Gross earnings increased by 20.07% from
N53.82 billion in FY2016 to N65.27
billion in FY2017, supported by the launch of ALAT – Nigeria’s first fully
digital Bank; enhancing our already existing alternate platforms which recorded
a combined growth rate of 205.67% in transactions executed and with circa
30,000 accounts opened monthly. Our target market is the upwardly mobile youth
segment, the young entrepreneurs, the young professionals and the financially excluded,
where we continue to leverage incremental innovation and integral capabilities.
For us, banking should be simple, reliable and convenient.
In view of our commitment to incremental innovation, the Bank was recognized as the Best Digital Bank, Best Mobile Banking app, Digital Banking Platform of the year, Best Digital Bank in Africa, Best & Most Innovative Digital Solution and Excellence in Branchless Banking by World Finance, the Asian Banker and Business Day - reputable organisations located in Africa, Europe and Asia.
We continue to execute our omni channel business model with precision, as we made in-roads to Kaduna, Bauchi, Kano, Mararaba (Nasarawa), Warri, Aba, Sangotedo (Lagos) and Lagos State University (LASU). Furthermore, we recorded increases in the number of strategic partnerships forged and expect this trend to further gain momentum.
In October, the Bank held its Extra-Ordinary General Meeting (EGM) towards its proposed Capital Reorganisation Scheme. I am delighted to announce that the exercise has been concluded, with all relevant regulatory approvals in place and duly passed and reflected in the 2017 financial year accounts. As earlier highlighted, the conclusion of the exercise would lead to an efficient balance sheet, as ploughed back profit can be capitalised to grow the business while positioning the Bank for dividend payment in the near term.
I would like to appreciate our esteemed shareholders for their patience and the trust reposed in us. We are now in the final stage of our three-pronged strategy; stabilise the bank (2009 – 2012), reposition the bank (2013-2017) and grow the Bank (2017& beyond).
We approached the money market in November 2017 to raise
N25 billion in two
Series under a commercial paper Program; Series 1 N10 billion – 182-day
tenor and Series 2: N15 billion- 270-day tenor. Given the relative
decline in interest rates and possible growth within the economy, the Bank will
be re-opening the 2nd series of its N50 billion debt issuance program.
This should commence from the second quarter of the year.
Our commitment to excellence positioned Wema for a top-8 finish at the 2017 KPMG Banking Industry Customer Survey. We remain well positioned and motivated while improving our capabilities towards the attainment of sustainable competitive advantages, a top-5 finish in 2018 and increasing market share.
‘Segun Oloketuyi (MD/CEO)
Chief Financial Officer’s review
Our 2017 result was reflective of our continued resilience alongside certain realities arising from increased impairment charges during the period. Our earnings from non-interest income remained strong, growing by 24.44% from
billion in 2016 to N12.19 billion in 2017; surpassing our 2017 guidance
of a 19% growth rate.
The Bank closed with a Profit before Tax (PBT) of
N3.01 billion (2016; N3.24
billion), despite reporting an increase in impairment charges which
rose from N0.42 billion in 2016 to N2.18 billion in 2017.
Risk management remains at the core of our operations, as we leverage on our prudent risk management practices and reported a Non-Performing Loan (NPL) ratio of 3.52% (2016; 5.01%) while our Capital Adequacy Ratio (CAR), closed at 14.32% (2016; 11.07%). We remain confident, that the Bank’s credit rating will continue to remain affirmed at investment grade level.
We remain focused on sound risk management while leveraging our digital platforms, built capabilities in lowering our cost of service and attaining competitive advantages. In addition, with our positive retained earnings account, the balance sheet has now been repositioned for efficiency.
‘Tunde Mabawonku (CFO)
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