Access Bank Plc 2017FY Conference Call and Earnings Presentation - The Key Takeaways

Proshare

Monday, March 26, 2018 03:55 PM / Proshare Markets 


Access Bank
Plc held its 2017FY Investors and Analyst Conference Call Earnings Presentation. Proshare NG participated along with leading market analysts and professionals. 

In reviewing its operating environment, the bank in its presentation highlights key macro themes that influenced the banking landscape which includes increase in oil prices; FX liquidity and stability; declining inflation and equity market rally.
 

The bank recorded 17% growth in Gross Earnings to close FY2017 with N459.1bn as against N381.3bn in 2016. The strong earnings reflected income growth from core business and increased returns on investments while the bank’s PBT dropped by 11% to N80.1bn in 2017 from N90.3bn in 2016 due to the conservative provisions made in its loan book. The bank continued to record strong capital position as its Capital Adequacy Ratio (CAR) grew by 150bps to 22.5%.
 

The bank’s asset quality remains very strong. The prudent classification of a single but significant exposure in the information & communication sector, in addition to a few names in manufacturing  led to increase in NPL ratio of 4.8% in 2017 from 2.1% in 2016. Its NPL ratio still contained within regulatory limits.
 

The ba
nk’s focus on digital and mobile banking continues to gain traction with YoY increases in mobile revenue and app usage showing tangible results as it recorded 138% growth in mobile and internet banking transactions volume and 25% growth in ATM’s transaction volume. 

In a nutshell, below are the key takeaways from the 2017FY earnings presentation made by the bank’s management;
 
1. The bank plans to focus on its loan book in 2018 by strengthening focus on asset quality and achieve controlled loan growth within approved guidance

2. Increase distribution network, optimize branches to boost profitability and gain traction on all retail partnerships

3. To improve its asset quality, the bank set a 2018 target of 1.5% for cost of risk and NPL ratio of less than 4.5%

4. Its NPL ratio above guidance largely due to classification of a single obligor in the Info & Comm. sector

5. The bank’s ROE in 2017 (12.8%) is behind the 2017 guidance of 20% resulting from negative impact of  increase in loan loss provisions
 

Proshare Nigeria Pvt. Ltd.

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