Access Bank reports 34% increase in Q1’15 earnings

Access Bank plc has released its unaudited IFRS results for the three month period (Q1) ended 31 March 2015.

The bank’s Q1 financial performance highlights show gross earnings of N76.7bn in Q1 2015, up 34 percent (Q1 2014: N57.3bn); of which interest income and non-interest income comprised 17 percent and 47 percent growth respectively.

Interest Income grew by 17 percent to N46.4bn in Q1 2015 from N39.6bn in Q1 2014; benefiting from a loan portfolio growth in 2014 and improved yields on fixed income securities.

Non-Interest Income of N30.4bn in Q1 2015 compared with N17.6bn in Q1 2014, increased by 47 percent, supported by growth in net trading income.

Also, the bank’s operating income of N54bn grew by 28 percent in Q1 2015 compared to N42.2bn in the corresponding period.

Profit Before Tax (PBT) for the quarter rose by 21 percent to N16.5bn (Q1 2014: N13.6bn). Profit After Tax (PAT) up 11 percent in Q1 2015 to N13.7bn, compared to N12.3bn in Q1 2014. Return On Average Equity (ROAE) of 19.2 percent in Q1 2015, improved by 50bps from 19.7 percent in Q12014.

Loans and Advances recorded a modest growth of 2 percent to N1.15trn in Q1 2015, from N1.12trn in December 2014. Customer deposits of N1.39trn down 4 percent from N1.45trn in December 2014, resulting from run-off of expensive funds and replacement with stable and lower cost deposits, as we strive to sustain our margins.

Total Assets up 2 percent y/y to N2.14trn in Q1 2015 compared to N2.10trn in December 2014. Capital Adequacy Ratio (CAR)of 19.6 percent (December 2014: 18.4 percent).

The bank’s credit quality was sustained in the first quarter as the percentage of non-performing loans to total gross loans improved to 2.1 percent from 2.2 percent as at December 2014. Coverage Ratio (with regulatory risk reserve) increased to 165 percent in Q1 2015 from 154 percent as at December 2014.

Net Interest Margin (NIM) was 5.9 percent in Q1 2015 from 7.1 percent in Q1 2014; underlined by increased funding costs. Cost to Income Ratio (CIR) improved by 220basis points (bps) to 62.2 percent in Q1 2015 from 64.6 percent in Q1 2014; driven by revenue uplift during the period.

While commenting on the results, Herbert Wigwe, group managing director, noted that the Bank’s financial performance in the first quarter of 2015 marks steady progress towards key strategic objectives: “Our focus remains on the delivery of sustainable value to our shareholders. We continue to deepen and broaden our top-tier corporate relationships whilst optimising and growing our diverse retail customer base to support low-cost liability growth.”