EXIM Group record 67 percent earnings in Q1/2016

09May 2016
Our Reporter
Business
The Guardian
EXIM Group record 67 percent earnings in Q1/2016

EXIM Group has posted a pre-tax profit of 53bn/- in the first quarter of this year with a capital gain of 45bn/- following equity holding divestment.

Exim Bank Chief Finance Officer (CFO) Mr Selemani Ponda (c) addresses a press conference in Dar es Salaam. Looking on is the bank’s Senior Finance Manager Mr Issa Hamisi (r), the bank's Marketing Manager Abdulrahman Nkondo (l) and the bank’s Chief Internal Auditor Mr George Binde (2rd l)

A normalized operating profit for the quarter was 8.4bn/- reflecting a robust growth of 67 percent over similar period last year.

“Our strong business momentum from last year carried into the first quarter enabling us to post a robust growth of earnings in the first quarter of the year”, said Selemani Ponda, Exim Bank’s oChief Finance Officer.

The earnings were generated through a balanced mix of net interest income and non-interest revenue. The growth of profit is attributed to the efficient management of funds resulting into a sustained growth rate of Net interest income and a higher non-interest income getting contributed by forex gains and fee income.

“This is reflective of the strength of our diversified business model and the success of our customer centric approach, which focuses on delivering relevant and convenient products and services to our clients”, the CFO added.

The net interest income for the quarter grew by 24 percent to 21bn/- from 17bn/- recorded the same period last year. The growth was largely driven by bank’s focus on low cost deposits, banking on its large presence through 45 branches and effective management of funds.

Further, fees and commission income during the quarter increased by 21 percent to 9bn/- from 7.5bn/- recorded from corresponding period last year. The growth was led by efficient delivery to the corporate and SME business segments.

Foreign exchange income for the quarter increased by 11 percent to 2.5bn/- driven by increased trading volumes. The financial released on last Friday shows that total expenses were up 35 percent due to transformation phase which the Bank is going through of which huge investment is made to the people, process and technology.

Most of the technology-based projects have already started and are expected to be completed by the third quarter of this year. With process streamlining and modern technology, the bank will be able to exceed customer expectations with assured quality service delivery.

The Group’s normalized annualized return on average equity amounted to a sharp growth at 20 percent compared with 7 percent in 2014whereas return on average assets jumped up to 2 percent from 1.2 percent same period last year.

As the bank gradually extends regionally by acquiring a newly formed entity in Exim Bank Uganda Limited, assets have recorded a sharp growth of 14.63 percent during the quarter to 1.44trn/- compared to 1.25trn/- recorded last December.

Likewise, the net advances to customers went up by 12.61 percent to 754bn/- during the same period compared to 670bn/- recorded in December 2015. On the other hand, customers deposits posted a significant growth of 16.80 percent to gross 1.02trn/- from 870bn/- end of last quarter.

Group saw its international business continues to record improved profitability performance, now doubled contribution to 13 percent of normal business income from posted 7 percent the same period last year.

Djibouti and Comoros posted a robust pre-tax profit growth of 282 percent to 1.3bn- in total from the same period last year with sharp increase attributable to both funded and non-funded income streams.

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