ACCESS BANK'S 2015 LIFE LINE

That in spite of tough 2015 Access Bank PLC did not have to issue any alert about its profitability was due mainly to two life lines it held on to within the year: Gain on its investment securities and net gain from foreign exchange.
According to the audited figures released not too long ago, both bank and the group did not score well in cost management and as provision for impairment rose by 22.1% and 25.2% for the group and bank respectively, the saving grace came from both life lines.
Interest income had risen by 17.5% for the group to N207802.8m from N176918.2m but this had been overwhelmed by 33.2% increase in interest expense to N102421m from N76801m.
At 15.3% the growth in the bank's interest income was even less while interest expense increase at 32.6% was almost level with the group's.
It was within the same 2015 the bank outpaced  the group in most costs in terms of growth.
The group's personnel cost rose by 35.2% to N42347m compared to 39.9% increase by the bank, while group other operating expenses rose by 45.8% to N91384m from N62698m under pressure from the bank's own 50.5% increase to N83403m.
With fee and commission income rising by only 8.66% for the group to N33463.9m from N30796.8m heralded by 12.4% increase recorded by the bank, and group other operating income dropping by 46.7% to N6897.9m, the two life lines came in very handy.
On its part, net gain on investment securities more than doubled across the board with the group's own closing at N62738m from N23406.4m in 2014.
Net gain from foreign exchange deals was even more handy as it rose to N26501.7m from a mere N563.9m in 2014 for the group while for the bank the N3398.1m loss reported here in 2014 closed 2015 with a handsome N23205.3m gain.
Thus, all said and done Access Bank ended 2015 with 44.2 increase in group profit to N75038.1m from N52022.3m ahead of 41.3% increase recorded by the bank to N65177.9m.
In some other areas too, blows from 2015 failed to hit target. For example, customers deposits ended the year at N1683244.2m from N1454419.1m in spite of the bundling of government agencies accounts to the central bank and loans and advances too rose to N1365830.8m from N1110464.4m.
SO:
* Naturally, even in war, there are profit makers and profit losers. So, with foreign exchange still continuing to be scarce, many banks may continue to reap gold from it.
* However, there is no doubt at all that in 2016, Access Bank must have to devote time to managing its costs better to survive the times even better

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