Friday, October 23, 2015 5:22 PM / Research
The macro-economic challenges remain daunting; with corresponding strict industry regulations, which have capacity to adversely impact both liquidity position and lending capacity of the industry. In addition to this, the new policy by Federal Government to fully implement Treasury Single Account compounded the liquidity challenges within industry. However, the reduction in harmonized CRR on private and public sector deposit to 25% from 31% is expected to ease the anticipated liquidity challenges.
In the face of the above overwhelming challenges, Access Bank delivered strong earnings growth and improved quality assets while the bank is seen to be well on track towards achieving its targets for the year on ROE, Cost efficiency (CIR) and Loan Growth.
In addition, the bank sustained growth in its profitability posture by 43% (yoy), with strong contribution from mainly non-interest income, just as trading income significantly impacted the top-line performance and earning profile in the quarter.
Also, we observed improved cost management and operating efficiency as cost-to-income ratio moderated at 59.6% against 61.2% recorded in Q3’14- though, our fingers remain crossed as we saw feeble growth when compared with 59.2% recorded in last quarter .
However, the impairment charges closed at N11.6billion against N7.0billion recorded for 9Mths in 2014. Nonetheless, NPL ratio improved to close lower at N1.7% against 1.8%, 2.2% and 2.5% recorded H1’15, Q4’14 and H1’14 respectively.
Summarily, below are the key takeaways from the 9Moonths earnings presentation as presented by the management of the bank;