WEMABANK Declares N1.22bn PAT in Q2 2017 Results,(SP:N0.55k)


Tuesday, July 18, 2017/ 9: OO AM /NSE


Wema Bank Plc (Bloomberg: Wema NL) (“Wema” or “the Bank”), announces its unaudited H1’2017 financial results. 

•         Launched 1st Digital Bank in Nigeria on 2nd May 2017.

•         Reports a 25.17% growth in gross earnings, driven by a 25.84% and 21.92% in interest and non-interest income.

•         Year-on-Year PBT growth of 10% 

Managing Director/Chief Executive Officer’s Review 

Commenting on the results, the MD/CEO, Segun Oloketuyi provided further insights into the performance of the Bank during the period. 

In the first half of the year the Bank operated, in an uncertain and challenging domestic economic environment. While we recorded notable improvements in the second quarter of the year, especially around foreign currency management, the execution of fiscal policies and the continued tight monetary policy impacted on consumers’ disposable income and invariably on banking sector performance. 

Despite the relatively tough climate, Wema Bank recorded success on a number of financial and non-financial priorities. Specifically, Gross Earnings recorded stable growth, increasing by 25.17% from N24.26 billion (H1’2016) to N30.37 billion (H1’2017). This growth resulted from a 25.84% increase in interest income to N25.37 billion and a 21.92% rise in non-interest income where we continue to see impressive growth, led by income from our mobile and digital banking offerings. The impact of the growth in gross earnings was however muted by the higher cost of funds within the sector. Despite this, we still maintained a decent interest margin. 

The Bank also further optimized its loan book in the first half of the year by focusing on recoveries and supporting transaction with good and steady cash flows. This resulted in a 9.38% decline in the volume of Loans and Advances, while yield on assets improved. The Bank’s Capital Adequacy Ratio (CAR) increased to 12.71% (H1’2017) from 11.06%, as at FY2016, whilst NPL remained below the 5% mark at 4.91% as at H1’2017. 

Wema Bank’s growth strategy – Project LEAP – revolves around the Bank’s Retail business and this was further strengthened by the May 2017 launch of ALAT, Nigeria’s first fully digital Bank. ALAT is the first of its kind with its end-to-end digital offering and customer interaction. The Bank’s target is to onboard an average of 1,000 new customers per day and we are on track to achieve that. The Bank also continues to improve its customer acquisition through the launch of its Agency Banking initiative and the impressive performance of its USSD platform (*945#).  Indeed with this 3-pronged strategy, Wema Bank is poised to be Nigeria’s leading Retail Bank.  

We have commenced the second half of the year with cautious optimism, especially around the implementation of the needed economic reforms and execution of the 2017 budget to ensure stimulation of economic growth. The expectation is that the country will exit recession in the 2018 financial year, but this will be dependent on a diligent execution of the reform programme. 

Further discussions with Ademola Adebise, the Deputy Managing Director, revealed that for Wema Bank, the emphasis in the next six months is to build and consolidate on the gains within the Digital Banking space, where the Bank presently leads and to improve on customer acquisition and invariably cost of funds. In sharing the Bank’s growth plan, the Deputy Managing Director revealed that the Bank has opened three (3) branches in the North. The Bank will expand further with two (2) other branches within the North Central Region and at least one in the East before the end of the year. 

“We continue to improve on the brand perception of the Bank, both across physical channels and through social media engagement,” according to Adebise. The Bank has renovated more than 70% of its branch network to make these service channels more contemporary both in look and feel, and in in the provision of infrastructure. This will continue as the economic climate improves. 

On the Bank’s growth plan and capital raise, Tunde Mabawonku, the Chief Finance Officer stated that, “we are also closely watching interest rates in the money market and relevant government policies to determine the timing of the second tranche of our Debt Capital issue, to further boost our ability to grow our franchise. We have continued to engage both local and international fund providers and have improved on our capacity to do business especially within the Trade Finance space. 

The Bank is rated by two rating agencies (Fitch & GCR) and our credit rating remains investment grade and a stable outlook

Related News
Wema Bank Plc. Appoints Mr. Babatunde Kasali as New Chairman
WEMABANK Declares N711.17 million PAT in Q1 2017 Results,(SP:N0.50k)
WEMABANK Declares N2.56 billion PAT in 2016 Audited Results,(SP:N0.50k)
Wema Bank reopens Kaduna branch
Wema Bank Appoints Babatunde Kasali as Non-Executive Director
WEMABANK Declares N1.27 billion PAT in Q3 2016 Result,(SP:N0.65k)
WEMABANK Declares N1.10 billion PAT in Q2 2016 Result,(SP:N0.73k)
Fitch Rating Affirms Wema Bank’s Long-Term National Rating at (BBB-) With a Stable Outlook
Fitch Rating Actions on Nigerian Banks on Sovereign Downgrade
Nigeria Banks Absorb Effective Devaluation
Fitch Downgrades Nigeria to 'B+'; Outlook Stable
WEMABANK Declares N429.53 million PAT in Q1 2016 Result SP N0.75k
WEMABANK Declares N2.33 billion PAT Profit Drops by 1.9 in 2015 Audited Result SP N0.80k
NSE Delists 913 907 131 Units of WEMABANK Shares Representing an Unpaid Portion 

Related News