The board of Access Bank, on Wednesday presented its audited financials for the year ended December 31, 2017, with gross earnings rising by 20.39%, while net profit dropped 13.2%, following which a 40 kobo final dividend was proposed, in addition to interim dividend of 25 kobo paid at half year, even as the management made N63.9bn loan loss provisions.
Gross earnings for the period rose to N459.075bn from N381.32bn, boosted by the 29.3% rise in interest income to N319.854bn from N247.286bn, buoyed by interest on customer loans and advances that rose to N230.824bn, from N198.886bn, while interest securities held for trading grew by the largest margin from N7.896bn to N25.493bn. Interest expense rose faster at 44.6% from N108.138bn to N156.402bn, after deposit from customers attracted N91.365bn interest, up from N77.187bn; while interest on debt securities issued by the bank jumped from N18.369bn to N35.947bn; ahead of the N12.373bn interest bearing borrowings and other borrowed funds, which rose from N5.147bn. This left net interest income of N163.451bn, which was 17.4% better than the previous N139.147bn.
Net impairment charge rose to N34.466bn from N21.952bn, N32.766bn of which came from additional specific impairment charges on customer loans and advances for the period, compared to the prior N17.874bn, following which net interest income after impairment charges stood at N128.984bn, as against N117.194bn.
Fee and commission income was flat at N56.674bn from N55.44bn, the bulk of which was the N24.453bn earned from credit related fees and commission, up from N17.921bn; followed by the N10.043bn from commission on other financial services from N3.324bn. income from channels and other electronic business income (electronic channels, card products and related services) however slumped from N21.296bn to N5.79bn; just as fee and commission expense dropped by 86.6% to N77.017m from N576.697m; leaving fee and commission income climbed to N56.597bn from N54.863bn.
Net loss on financial instruments stood at N33.403bn, from a N555.051bn gain, following the huge N39.272bn loss suffered in derivatives instruments; which wiped off the modest N5.642bn in fixed income securities, that stood at N3.257bn in 2016.
Also, net foreign exchange income soared to N107.932bn from N3.597bn in 2016, after foreign exchange trading income stood at N120.262bn from just N8.844bn, while unrealized forex loss on revaluation climbed to N12.33bn from N5.246bn. Other operating income fell from N19.944bn to N8.018bn, representing a 59.8% decline.
Net interest income after impairment charges notched 10% to N128.984bn from N117.194bn; just as net foreign exchange income jumped 2,900% from N3.597bn to N107.932bn.
Personnel expenses rose to N54.806bn, up from N51.795bn; rent expenses stood at N2.484bn from N2.81bn; just as depreciation climbed to N11.237bn from N9.106bn.
Other operating expenses jumped to N117.119bn from N94.413bn
Profit before tax fell by 11.3% from N90.339bn to N80.072bn; while a flat drop in income tax from N18.9bn to N18.081bn left net profit at N61.99bn, 13.2% less than the N71.439bn of the 2016 financial year.
Total comprehensive income for the year came to N90.99bn, down from N103.5bn, translating to Earnings Per Share of N2.18, down from the previous N2.50; out of which the directors of proposed 40 kobo final dividend for shareholders to approve when they meet on April 25, 2018, same date as payment. Ahead of that, qualification date for the dividend is slated for April 12, 2018, following which the register of members will be closed between April 13 and 18.
On the balance sheet, total assets rose to N4.102tr from N3.483tr, with loans and advances to customers rising from N1.809tr to N1.995tr, from which total regulatory impairment based on prudential guidelines rose to N91.389bn from N65.357bn; just as total liabilities rose to N3.586tr from N3.029tr, the bulk of which was the N2.244tr customer deposits, up from N2.089tr in 2016. Shareholders’ funds rose to N515.447bn from N454.494bn.