BancABC narrows losses
Isaac Pinielo | Tuesday April 5, 2016 13:33
This is evident from its preliminary group results for the year ended December 31, 2015. In comparison with its previous year’s performance, the group recorded an improvement of attributable loss of $0.6 million (P6.51 million), from the reported loss of $48.6 million (P527.23m) in 2014.
The group’s acting chief executive officer, Blessing Mudavanhu said while challenging, the first year of acquisition has been met with considerable success.
He noted that the group still focuses on the execution of key initiative issues that will continue to support improved performance. The group’s statement of financial position remained stable at $1.8 billion (P19.5bn) in December 2015 compared to December 2014. Loans and deposits declined marginally to $1.18 billion (P12.8bn) and $1.39 billion (P15.08bn) respectively, with currency depreciation across the markets BancABC operates in, contributing to the marginal decline.
The group recorded a net interest income of $95.8 million (P1.04bn) lower than the $102.1 million (P1.10bn) in 2014, due to marginal decline in loans and advances as well as currency depreciation.
Non-interest income of $76.6 million (P830.99m) was up by 10.5 percent compared to 2014, largely driven by strong forex trading revenue, as well as growth in fee and commission revenues that had largely resulted from retail asset growth.
The impairment charge of $11.4 million (P123.7m) in 2015 was substantially lower than the $72.2 million (P783.3m) in 2014, mainly due to asset recoveries in Zimbabwe and Tanzania.
Mudavanhu said the group remains focused on improving the quality of the loan book, noting that total non-performing loans declined marginally to $198 million (P2.2bn) in 2015 compared to $202 million (P2.2bn) recorded in 2014.
“The adequacy of provisioning for all risks within the loan book is considered sufficient given the assessment of risk in the asset book,” said the acting CEO.
Furthermore, owing to the change in the underlying business following the acquisition of ABCH by Atlas Mara with effect from July 1, 2015 the group changed its functional currency from Botswana pula to the U.S dollar.
At December 31, 2014 the group reported a loss of $63.1 million (P684.5m) on an unaudited statutory accounting basis. Excluding non-recurring transaction and integration expenses and including the acquisitions on a full-year basis, reported an adjusted pro forma net profit of $7.2 million (P78.1m). The termination benefits to the previous executive management of ABCH were also reported to have increased the losses incurred by the pan African banking group during 2014.