28 Apr 2016 17:18
Diamond Bank Plc
Unaudited Results for the First Quarter ended 31st March 2016
DIAMOND BANK PLC REPORTS FIRST QUARTER PROFIT BEFORE TAX OF N7 BILLION
First Quarter highlights
· Profit before Tax of N6.7 billion from operations in first quarter of 2016.
· Interest and similar income of N35.7 billion, is down by 12% year on year as economic challenges continue.
· Impairment charge of N8.8 billion, an increase of 36% year on year, reflects continued prudent provisioning.
· Operating costs and interest expense down by 2.8% and 10.3% respectively in Q1 2016 compared to Q1 2015.
· Focused action continues to address impact of economic headwinds with prospects for improved earnings and lower operating costs for the rest of the year.
· Organizational restructuring commenced in Q1 2016 to improve operations, and service offerings to clients.
· Ongoing implementation of technology-led retail strategy to drive customer acquisition, activation and retention.
· Continued focus on digital and IT infrastructure providing scale and efficiencies.
Commenting on the results, the Chief Executive Officer, Mr. Uzoma Dozie said: "Although the economic challenges witnessed in 2015 did not abate in the first quarter of 2016, our streams of income remained resilient and considerable growth was recorded in non-interest revenue, which provides comfort about the sustainability of planned growth from this stream.
Our projections of the macro conditions and other external factors for the rest of the year is that these will remain challenging, and it has led to higher impairment charges than for the same period in 2015. This very conservative approach to managing our loan book assures of its quality in the long run and in general should deliver the numbers that are consistent with our long term plans."
Strategic overview
In Q1 2016 Diamond Bank continued to progress with the roll out of its technology-led retail strategy, which included reconfiguring its operating model. The Bank also focused on extracting value from the significant investments made in building its branch network and digital platforms.
The first quarter of 2016 was marked by persisting difficulties in the wider economy that continue to have an impact on the banking sector. To address these challenges, Diamond Bank has continued a diligent implementation of its focus on curtailing cost, resulting in a 2.8% reduction of operating costs when compared Q1 2015. The Bank also further integrated its retail offering and the supporting infrastructure with the opportunities created by its value chain marketing approach in the corporate and business banking segments.
As a result, Diamond Bank is better positioned for the future and expects to see improved financial performance in 2016.
Mr. Dozie also said:
"Moreover, there are reassuring signs that the new strategy and initiatives to reduce costs are proving successful and are reflected in certain financial indicators. Quarter on quarter, costs came in lower and as incremental measures are put in place, the benefits will be magnified. By taking the first steps to reconfigure the operating structure of the bank we have deployed more resources to provide improved services to customers and having done this, we are optimistic about performance in the quarters ahead."
Group Statement of Comprehensive Income
31 Mar. 2016 N'000 | 31 Mar. 2015 N'000 | YoY Change | |
Interest and similar income | 35,708,593 | 40,487,320 | (11.8%) |
Interest expense | (10,444,105) | (11,641,622) | 10.3% |
Net interest income | 25,264,488 | 28,845,698 | (12.4%) |
Net fee and comm. and other income | 14,138,833 | 10,183,760 | 38.8% |
Impairment Charge | (8,812,309) | (6,467,525) | (36.3%) |
Net operating income | 30,591,012 | 32,561,933 | (6.1%) |
Employee benefit expenses | (8,416,509) | (8,581,121) | 1.9% |
Operating expenses | (15,480,541) | (15,613,560) | 0.9% |
Profit/(loss) before tax | 6,693,962 | 8,367,252 | (20.0%) |
Income tax | (933,521) | (1,199,709) | 22.2% |
Profit/(loss) after Tax | 5,760,441 | 7,167,543 | (19.6%) |
Other comprehensive income (net) | 28,125 | 2,075,088 | (98.6%) |
Total comprehensive income | 5,788,566 | 9,242,631 | (37.4%) |
Group Statement of Financial Position
31 Mar. 2016 N'000 | 31 Dec. 2015 N'000 | YoY Change | |
Cash and bal. with central banks | 358,884,246 | 361,166,936 | (0.6%) |
Financial assets held for trading | 13,044,261 | 13,116,843 | (0.6%) |
Derivative assets | - | 161,622 | (100.0%) |
Assets pledged as collateral | 167,907,397 | 172,100,785 | (2.4%) |
Loans to banks | 98,863,149 | 60,103,340 | 64.5% |
Loans and advances to customers | 780,149,016 | 763,634,827 | 2.2% |
Investment securities | 287,216,358 | 267,337,206 | 7.4% |
Assets held for sale | 4,475,911 | 4,409,085 | 1.5% |
Fixed and intangible assets | 67,641,244 | 67,518,381 | 0.2% |
Deferred tax | 4,984,544 | 4,984,544 | 0.0% |
Other assets | 38,389,878 | 38,698,711 | (0.8%) |
Total assets | 1,821,556,004 | 1,753,232,280 | 3.9% |
Deposits from Banks | 101,799,647 | 115,819,590 | (12.1%) |
Deposits from Customers | 1,276,186,800 | 1,233,591,063 | 3.5% |
Current income tax liability | 2,754,392 | 1,697,816 | 62.2% |
Other liabilities | 61,866,531 | 46,217,258 | 33.9% |
Borrowings | 118,054,664 | 102,719,571 | 14.9% |
Long term debt | 38,933,284 | 38,577,527 | 0.9% |
Equity | 220,410,686 | 214,609,455 | 2.7% |
Total equity and liabilities | 1,821,556,004 | 1,753,232,280 | 3.9% |
Key Ratios & Per Share Data
• Capital Adequacy Ratio of 16.2% (16.3% Dec 2015)
• Loan to deposit ratio at 66.2% (66.5% Dec 2015)
• Liquidity ratio (Bank) 52.4% (53.8% Dec 2015)
• Cost of risk 4.2% (6.7% Dec 2015)
• Coverage Ratio of 107.2% (100.4% Dec 2015)
• Net Interest Margin of 5.8% (6.1% Dec 2015)
• Cost to income ratio of 59.4% (61.0% Dec 2015)
• NPL ratio of 7.1% (6.9 % Dec 2015)
• ROAE of 11.4% (2.7% Dec 2015)
• EPS of 25(k) (24k Dec. 2015)
The investors' conference call will hold on Tuesday May 10, 2016 by 2.00pm. Call details will be circulated shortly.
For the detailed Profit and Loss account, Balance Sheet, Cashflow statement and notes to accounts, please visit our website - http://www.diamondbank.com
About Diamond Bank Plc
Diamond Bank Plc began as a private limited liability company on March 21, 1991 (the company was incorporated on December 20, 1990). Ten years later, in February 2001, it became a universal bank. In January 2005, following a highly successful Private Placement share offer which substantially raised the Bank's equity base, Diamond Bank became a public limited company. In May 2005, the Bank was listed on The Nigerian Stock Exchange.
Today, Diamond Bank is the fastest growing retail bank in Nigeria with a track record of high quality banking solutions for customers. It's the lead driver of financial inclusion and enhanced customer experience through innovation and technology. Regarded as supporter of lifestyle trends, it mobile banking app, "Diamond Mobile" currently has over 1 million active subscribers on its platform. Diamond Bank has over the years leveraged on its underlying resilience to grow its asset base and to successfully retain its key business relationships.
It has also played a leading role in partnering with domestic and International bodies such as Women's World Banking, Bill and Melinda Gates Foundation, MTN etc. to create easy access to financial services for the unbanked.
We have retained excellent banking relationships with a number of well-known international banks, allowing us to provide a bouquet of world class banking services to suit the business needs of our clients. These international banking partners include Diamond bank UK, Bank of Beirut; BanqueLibano-Francaise, BHF Bank, BNP Fortis, BNP Paribas, Byblos Bank, Citibank, Commerzbank, Credit Suisse, Deutsche Bank, FBN (UK) Limited, HSBC Bank, ING Bank, KBC Bank, Mashreq Bank, Nordea Bank, SMBC Ltd, Standard Bank, Standard Chartered, SvenskaHandelsbanken, UBS Zurich.
Please click on the link below to view the associated PDF Document
http://www.rns-pdf.londonstockexchange.com/rns/7300W_-2016-4-28.pdf
More information can be found at www.diamondbank.com
Investor Relations Contacts Chiugo Ndubisi Cndubisi@diamondbank.com Ag. Chief Financial Officer +234 (1) 448 9832
Ifeatu Onwuasoanya IOnwuasoanya@diamondbank.com Head, Investor Relations +234 (1) 448 9866
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