WEMA BANK'S 2015 SAVING GRACE.

For Wema Bank PLC two things offered the grace with which it finished 2015 stronger than it started it: Decrease in impairment provision and increased income from non-core banking operations.
According to the audited accounts for the year released recently, there was not only a drop in interest income but also interest expense rose in double digit. Thus watering down the contribution of core banking to Wema's state of affairs in 2015.
Interest income dropped by 12.2% to N31128.1m from N35453.2m but interest expense rose by 14.8% to N19408.5m from N16901.3m.
This however, only led to about 5.68% decrease in total income to N39791.8m from N42186.8m due to far better income flow from other activities.
In particular, net trading income more than doubled to N1781.8m from N850.6m, Other income increased by 83.3% to N1217.6m and net fee and commission came to N5664.3m from N5218.5m.
With net impairment provision coming to N77.6m, down 12%; operating income increased by 5.01% to N26461m from N25197.4m thus reversing the tone set by interest income as major earning stream.
However even this slipped out of Wema's grip as its operating expenses closed the year 15% up at N11374.9m although personnel cost eased by 2.42% to N9790.5m.
Consequently, Wema Bank settled for marginal 1.56% drop in profit before tax (PBT) to N3045.5m.
Because this drop was less than the one recorded in gross income, the bank's gain on each N100 income was N7.65 compared to N7.33 in 2014.
SO:
* This is hoping that Wema Bank's loan portfolio is as strong as the decrease in impairment provision implies.
* Apparently. the centralisation of Federal agencies accounts in the Central Bank did not impact negatively on Wema because its customers deposits grew by 10% to N284977.8m from N258958.5m.

WEMA BANK PLC. (Nm)
                         2015.            2014
Gross Income 39791.8.    42186.8
Int. Income.    31128.1.    35453.2
Int. Expense.  19408.5.    16901.3
Impairment.         77.6.          88.2
Commission.   5664.4.      5218.5
Net trading.      1781.8.       850.6
Other income.  1217.6        664.5
Op. Income.    26461.0.   25197.4
Personnel.         9790.5.   10032.9
Op expenses.  11374.9.     9889.8
PBT.                    3045.5.     3093.9
Profit margin %       7.65.       7.33

Comments

Post a Comment

Popular posts from this blog

2018: TWO BLOWS TO UNITED CAPITAL PLC.

When a child who in a previous examination scored 80%, comes home with a new report in which he now scores 67.2%, the parents have a right to sit him down and ask how come. So it must be between Nigeria's United Capital Plc and its discerning shareholders since the release of the company's 2018 audited figures. In 2018, all said and done, says the annual report, United Capital ended with 67.2 % profit margin compared to 80.2% in 2017. How come? What comes across from the figures was that the company received 2 blows to the jugular in 2018: Sharp drops in Investment income and fair value gain. Investment income dropped by 10.8% to N4422.8m from N4965.2m while fair value on financial assets plunged by 79.7% to N6.173m from 2017's N30.387m. In view of both drops, the group's gross earnings grew by only 33.9% to N9259.4m despite strong growths in net trading income, and net operating income leap to N757.5m from N143.5m  Other income streams ended with single digit increase....
Read more

KENYA AUCTIONS Ksh 13.84bn Treasury Bonds.

The Central Bank of Kenya (CBK) will from Tuesday December 18 to 27th 2018_ auction Ksh 13.84bn worth of fixed income Treasury Bonds with issue date December 17, 2018. According to official statement from the Director of Financial Markets Irene Njiru on Monday December 17, auction will continue throughout the stated period or close once the target money to be raised is reached, whichever comes first. Bid value will be paid for at most by 2pm December 31, 2018 while auction results will be made public on December 28, 2018 after the scheduled closing date. The bonds are being issued at 12.502% fixed interest at an adjusted average price of Ksh 100.468 for Ksh 100 bond. However, price payable after auction results publication will be average of successful bid prices based and allotment will be on first come first served basis. Meanwhile, the monetary operations and debt management department has released the interest payment schedule for 13 Treasury Bonds due January and February 2019. Th...
Read more

NAIROBI SE's HIGH PRICED EQUITIES.

In the wake of Nigeria's high priced quoted companies posted in this blog a while ago, Henates took a look to at Nairobi Securities Exchange June 23 official list to identify its high priced equities and the outcome was interesting too. Of the 66 companies quoted on the market by June 23, 15 or 22.7% were valued averagely at above 30 times nominal value. A word of caution though: There are two clear differences between the Nigerian stock market list and that of Nairobi: In the Nigerian one most listed companies have par or nominal value of N0.50 as is there is an implied agreement on this. On the other hand, at Nairobi most of the equities do not share common par value, they differ greatly. Then another thing, Nigerian equities are not valued below par, Nairobi ones can and many are so valued. Of the top 15 high priced equities at the Nairobi market, Safaricom topped with because by June 23, at 23.25 Ksh average price, it was valued 465 times its nominal value of just 0.0...
Read more