Wema Bank PLC (“Wema” or “the Bank”), announces Unaudited 2015 First Quarter financial results. Gross Earnings recorded growth of 5% to close at N10.63 billion while Profit Before Tax (PBT) grew by 4% YoY to N615 million. The downward trend in the Non-Performing Loan ratio continued closing the quarter on 2.3%. There was a marked reduction in Other Operating Expenses, which reduced by 11%, year on year largely attributable to improved operational efficiency.
Highlights of the result:
- Gross Earnings: N10.63 billion, up from N10.16 billion in 2014Q1 (5% YoY growth);
- Interest Income: N8.9 billion, up from N8.3 billion in 2014Q1 (8% YoY growth);
- Other Operating Expenses of N2.15 billion, compared to N2.4 billion in 2014 Q1 (down 11% YoY)
- Profit Before Tax: N615 million, up from N591 million in 2014Q1 (4% YoY growth);
- Non-Performing Loan ratio: down to 2.3% (3.4% recorded in 2014 Q1);
- Return on Average Equity: 6.4%, compared to 6.1% in 2014 Q1.
Commenting on the results, Mr. Segun Oloketuyi, Managing Director/CEO of Wema Bank PLC, said;
“The sustainability of our earnings and the resilience of the Bank’s income growth, in spite of the harsh economic environment since the middle of last year are particularly encouraging. We have streamlined our balance sheet in order to achieve efficiencies in our sourcing and deployment of funds. The year started slowly as a result of the uncertain political environment as well as the economic constraints brought about by the impact of declining oil prices. In spite of this, we were still able to record sustainable growth in all our critical performance indices.
Opportunities for growth and efficiency optimization in our operations are being recognized. We will continue to drive innovative customer acquisition techniques and focus on our niche markets that have benefitted from our banking products.
In general, our outlook for the next few months is that of cautious optimism; we will continue to grow our business in our area of comparative advantage – Retail & SME while at the same time pushing for further gains in operating efficiency. We will be engaging our customers, shareholders and the investing community over the next few weeks as the Bank rolls out a number of initiatives to mark its 70th Anniversary.
Tunde Mabawonku, the Chief Finance Officer said:
“Our financial performance in Q1 2015 shows continuous improvement in the key balance sheet indicators as we continue to build on the business transformation project (Project LEAP). By optimizing our cost of funds through the accelerated phase-out of public sector and other expensive deposits, we have been able to streamline our balance sheet, making it leaner and positioning us to take advantage of opportunities within the Retail and Commercial Banking space. Our Total Assets shrank by 10.21% due to our deliberate strategy of squeezing out inefficiencies. As the economy opens up in the 2nd to 3rd quarter of the year, we expect more measured growth driven by better yields and lower cost of funds.
While our focus remains on keeping our profitability growth stable, risk management continues to be at the heart of our operations, particularly given the general headwinds in the macro-economic environment.”
- Upgrade of the Bank’s Corporate Internet Banking Solution, designed to be the best in the industry with respect to the user experience, security and functionality.
- Appointment of Folake Sanu as an Executive Director of the Bank. Folake is an astute finance professional and banker of repute with over 32 years’ experience in banking, accounting and auditing.
- Addition and appointment of two Non-Executive Directors: Mrs. Bolanle Matel-Okoh, an attorney with over 20 years of experience in Nigeria and the United States of America; and Mr. Babatunde Kasali, a professional with over 3 decades of experience in Audit, Risk Management and Compliance.
Download the Q1 2015 results here.