4th Nov 2008 14:19
Diamond Bank Plc
Interim Results for the six months ended 31 October 2008
DIAMOND BANK PLC REPORTS 69.3% INCREASE IN PROFIT AFTER TAX AND 65.3% INCREASE IN CUSTOMER DEPOSITS
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LAGOS, NIGERIA - 4 November 2008 - Diamond Bank Plc, (Bloomberg: DIAMONDB NL) ("Diamond Bank" or the "Bank"), the provider of comprehensive banking and other financial services to corporate and individual customers across Nigeria and Africa, announces its interim results for the six months ended 31 October 2008.
Speaking from Lagos, Emeka Onwuka, Managing Director of Diamond Bank plc, commented: "Our continued focus on maintaining a strong balance sheet to ensure our growth is well funded, combined with prudent lending and strict controls, positions us well. While the current global market conditions are incredibly tough, the Nigerian banking sector continues to demonstrate good growth prospects as demonstrated by the ever increasing demand for banking services by all our clients. Our profitable growth remains on target supporting our positive outlook for the Bank."
Financial Highlights
Profit & Loss
Net Interest Income of N16.8 billion, an increase of 73.5% (N9.7 billion H1 07)
Gross earnings of N46.0 billion, an increase of 81.5% (N25.3 billion H1 07)
Profit after tax of N9.8 billion, an increase of 69.3% (N5.8 billion H1 07)
Balance Sheet
Total Assets up 74.6% to N575.4 billion (N329.3 billion H1 07)
Customer Deposits up 65.3% to N366.0billion (N221.4 billion H1 07)
Shareholder's equity up 117.1% to N117.0 billion (N49.7 billion H1 07)
Key ratios
Cost/income ratio stable at 59.6%, compared to 58.7% for the prior year period
Improvement in NPL ratio to 3.7% (4.0% H1 07)
Strong Tier 1 ratio of 20.1%
Basic EPS up 9.9% to 136 kobo (124 kobo H1 07) and ROAE of 16.8% (10.9% H1 07)
Strong Growth driven by all Strategic Business Units (SBUs):
Retail Banking profit before tax ("PBT") of N4.1 billion for the six months to 31 October 2008. The implementation of a transformation project under the Retail Banking SBU is boosting customer service and sales within this business segment. In addition, the growth in business locations from 167 to 185 within the last six months has expanded market reach and driven customer base growth.
Corporate Banking PBT of N2.5 billion for the period. Cash management solutions helped the Corporate Banking SBU to be very effective in tracking the value chain of its customers, encompassing their suppliers and distributors. In addition, we have applied our competence in deal structuring and increased lending capacity to significantly increase our presence in the Corporate Banking sector, especially in the areas of project finance relating to power supply, coastal shipping, and oil and gas sectors.
National Corporate Banking PBT of N4.4 billion for the period. The Diamond Trade Centre state-of-the-art facility allowing back to back international trade advisory services to customers drove growth in this business segment. The middle market remains the backbone of the economy, constituting the bulk of the non-oil sectors driving the growth in recent years.
Public Sector PBT of N1.2 billion for the period.
Overall the Bank's loan book grew 93.0% in the six months to 31 October 2008 driven primarily by the National Corporate and the Corporate Banking SBUs. The focus on the mid-size enterprises and highly successful relationships in the National Corporate SBU, and deal structuring competence in the Corporate Banking SBU continue to drive loan book growth.
Improving asset quality and strong funding mix
Consistently improving coverage ratio up from 86.1% to 90.6% reflecting prudent controls and processes
NPL ratio decreased to 3.7%
Over 95% of loan portfolio secured by real estate or other forms of collateral, reflecting cautious approach to lending
Customer deposits continue to remain the key source of funding accounting for over 60% of funding
Positive outlook
The growth of the Nigerian economy at an average of 6.2% over the last 3 years has been driven by the non-oil sectors, which grew at an average of 9.2% over the same period. The growth prospects of the non-oil sectors remain very bright. In addition, the huge external reserves at $63 billion at end-September 2008 and the focus of the Government on improving the state of the nation's infrastructure bodes well for the economy, despite the current global financial crisis.
The Nigerian banking industry has strong fundamentals in terms of capital base, liquidity, and systems/control, and should remain strong considering regulatory emphasis on transparency, anti-corruption and anti-money laundering standards, and corporate governance. The industry has also been growing very rapidly - total assets amounted to N10.1 trillion ($85.6bn) at end-2007, up 57.9%, while total loans stood at N4.5 trillion ($38.4bn) in 2007, up 93.9%. The growth prospects remain very high as loans to GDP (2007) in Nigeria were just 22% while deposits to GDP were also 23% compared to over 100% in South Africa.
Diamond Bank is well positioned to exploit the business opportunities emanating from the growing non-oil sectors based on the strategy of leveraging its position as a leading bank to SMEs to create a leading universal bank. The Bank is also implementing strategic initiatives in cost management, competency development, process re-engineering and risk management to boost customer service delivery and operational efficiency.
- ENDS - Investor Forum for Presentation of Results
Diamond Bank Plc (Bloomberg: DIAMONDB NL) will be hosting an investor forum at the London Hilton, Park Lane to present the interim results for the six months ended 31 October 2008.
Details of the investor forum are below:
London Hilton, Park Lane
22, Park Lane, London, W1K 1BE
Date:
6th November 2008
Time:
10.30am - 1.30pm
Please respond to:
Chiugo Ndubisi, Head of Investor Relations, at [email protected] +234 (1) 262 6322 or
Alex Boycott, APFD, at [email protected]
+44 (0)20 7269 7272
A recording of the forum will be available from Monday 10 November on Diamond Bank's website at www.diamondbank.com
- ENDS -
For further information please contact:
Chiugo Ndubisi [email protected] +234 (1) 262 6322
Africa Practice / Financial Dynamics
London:
Alex Boycott [email protected] +44 (0)20 7269 7272
Azim Datardina [email protected] +44 (0)20 7462 7550
Lagos:
Nick Chambers [email protected] +234 703 232 3089
Tim Newbold [email protected] +234 805 494 9866
Notes to editors:
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 one of the leading banks in Nigeria* - respected for its excellent service delivery, driven by innovation and operating on the most advanced banking technology platform in the market. Diamond Bank has over the years leveraged on its underlying resilience to grow its asset base and to successfully retain its key business relationships.
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 Citibank; HSBC Bank; ANZ Banking Group; ING BHF Bank AG; Standard Chartered Bank; Belgolaise Bank S.A; Deutsche Bank; Commerzbank; and Nordea Bank Plc.
In 2007, in order to ensure we grow with the needs of our customers, we streamlined our operations into five distinct strategic business segments: Retail banking, National Corporate, World Corporate, Diamond Capital and Public sector.
* Diamond Bank's A- rating by Fitch Ratings, A rating by Augusto & Co , and AA- rating by GCR, reflects the bank's sustainable liquidity, sound and professional practices and good standing as a high investment grade institution.
More information can be found at www.diamondbankplc.com
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