Diamond Bank’s growth stable as H1 profit surges 2.8%

In its H1 2017 financial results released on the floor of the Nigerian Stock Exchange (NSE) in Lagos, Diamond Bank Plc showcased strong growth in core financial parameters surpassing analysts’ projections for the period.
The interim report and accounts for the bank’s operations for the first six months of the 2017 financial year showed significant growth in all key financial parameters as profit before tax surged year-on-year by 2.8 per cent to N10.8 billion; this followed the leapfrogging of gross income over total expenses during the period under review.

Most significantly and against industry expectations, the Bank’s gross earnings jumped by 16.1 per cent over the previous year to N114.1 billion as interest income increased by 31.5 per cent to N89.1 billion, reflecting the success of the management’s strategic efforts targeted at improving and boosting this income line.
Although the impairment charge increased by 6.9 per cent in line with the bank’s continuation of prudent provisioning, its total assets grew by 0.8 per cent year-on-year to N2.065 trillion, making the bank one of the top six biggest banks in the country by asset size.

Loans to customers shrunk by 1.8 per cent from N1.4 trillion to N1.3 trillion, reflecting the cautious optimism employed by the management to stabilise risk assets as the economy struggles to come out of recession. The bank’s retail customers grew exponentially with over 6 million Diamond Y’ello customers opening accounts in the last two years.
Deposit liabilities from customers shrunk by 1.8 per cent from N1.4 trillion to N1.3 trillion within the period, reflecting the effect of the inflationary pressures on savings. Deposit from other banks surged by 31.9 per cent to N136.4 billion, from N103.4 billion the previous period.
Commenting on the Bank’s H1 performance, Uzoma Dozie, chief executive officer stated that despite the economic headwind, the Bank would remain resilient and sustain the positive growth throughout the two remaining business quarters.
According to him, the Bank’s strong liquidity and capital adequacy ratios in addition to its digital infrastructure, have strengthened and rightly positioned it to meet customer obligations and offer service deliveries that are beyond banking. He added that the improving macroeconomic conditions will help stimulate and sustain the growth trajectory of the Bank.

“The positive economic signals witnessed at the beginning of the year continued in the second quarter and we believe this will translate to greater productivity in the months ahead,” Dozie said. “There have been market driven adjustments in the exchange rate of the naira versus other currencies and this has helped supply into these markets.”

He said that overdue trade obligations, which were an issue some months ago, have been addressed significantly and that demand is generally being satisfied providing the right conditions for trade activities.

“Inflation has continued to recede, with the prospect of some GDP growth by year end, even if marginal. Against this backdrop, our income streams remain resilient and considerable growth was recorded in gross earnings,” said the CEO.

Diamond Bank’s price stood at N1.28 when trading closed on The Nigerian Stock Exchange on Friday, putting the bank’s market capitalisation at N29.65 billion.

 

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