Al-Sisi reviews Egypt's food security, strategic commodity reserves    Egypt signs strategic agreements to attract global investment in gold, mineral exploration    Syria says it will defend its territory after Israeli strikes in Suwayda    Egyptian Exchange ends mixed on July 15    Suez Canal vehicle carrier traffic set to rebound by 20% in H2: SCA chief    Tut Group launches its operations in Egyptian market for exporting Egyptian products    China's urban jobless rate eases in June '25    Egypt's Health Minister reviews drug authority cooperation with WHO    Egypt urges EU support for Gaza ceasefire, reconstruction at Brussels talks    Pakistan names Qatari royal as brand ambassador after 'Killer Mountain' climb    Health Ministry denies claims of meningitis-related deaths among siblings    Egypt, Mexico explore joint action on environment, sustainability    Egypt, Mexico discuss environmental cooperation, combating desertification    Needle-spiking attacks in France prompt government warning, public fear    Foreign, housing ministers discuss Egypt's role in African development push    Korea Culture Week in Egypt to blend K-Pop with traditional arts    Egypt, France FMs review Gaza ceasefire efforts, reconstruction    CIB finances Giza Pyramids Sound and Light Show redevelopment with EGP 963m loan    Greco-Roman tombs with hieroglyphic inscriptions discovered in Aswan    Egypt reveals heritage e-training portal    Three ancient rock-cut tombs discovered in Aswan    Egypt condemns deadly terrorist attack in Niger        Sisi launches new support initiative for families of war, terrorism victims    Egypt's GAH, Spain's Konecta discuss digital health partnership    Egypt expands e-ticketing to 110 heritage sites, adds self-service kiosks at Saqqara    Egypt's Irrigation Minister urges scientific cooperation to tackle water scarcity    Palm Hills Squash Open debuts with 48 international stars, $250,000 prize pool    Egypt's Democratic Generation Party Evaluates 84 Candidates Ahead of Parliamentary Vote    On Sport to broadcast Pan Arab Golf Championship for Juniors and Ladies in Egypt    Golf Festival in Cairo to mark Arab Golf Federation's 50th anniversary    Germany among EU's priciest labour markets – official data    Cabinet approves establishment of national medical tourism council to boost healthcare sector    Egypt's PM follows up on Julius Nyerere dam project in Tanzania    Paris Olympic gold '24 medals hit record value    A minute of silence for Egyptian sports    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



CIB continues to grow healthy profits: Beltone
Decrease in financing expenses supports profitability; improved corporate lending is major positive factor
Published in Daily News Egypt on 06 - 02 - 2020

Beltone Financial said the consolidated net income of the Commercial International Bank (CIB) increased in the fourth quarter (4Q) of 2019 by 27.6% compared to 4Q2018, and by 2.4% compared to 3Q2019, recording EGP 3.26bn.
This strong growth in profits is mainly due to the increase in net interest income to about EGP 4.8bn, representing 91% of the bank's core business income. The increase in net interest income is due to the growth of the bank's financial position, contributing 55% of the total increase. The remaining part was supported by the widening net interest margin (NIM) by about 68 bp annually.
According to Beltone, operating expense witnessed a healthy decline of 9% on an annual basis, which led to a decrease in the cost-to-income ratio of about 585 basis points (bp) to 18.5%, while the decline in credit losses recorded a favourable decrease of 16.3% on an annual basis.
On a quarterly basis, the net interest income saw 12.6% increase supported by NIM (+60 bp), which was mainly due to the decrease in financing costs. In addition, the commission income increased by 3% on a quarterly basis, however, its contribution is still weak despite strong growth in lending during the quarter.
At the same time, the decline in credit losses decreased by 45% on a quarterly basis, which led to a decrease in the cost of risk by 73 bp, registering 76 points, according to Beltone.
Other operating expenses showed a major increase of about EGP 426m due to losses in currency exchange difference and to the increase in assets in foreign currency over liabilities.
Strong recovery in corporate lending and surprising positive performance of asset quality
Regarding the financial position, Beltone Financial said the CIB recorded a total growth of 13% since the beginning of the year, and 3.4% on a quarterly basis, recording EGP 386.7bn in 4Q2019.
It explained that the bank's financial position growth was supported by an increase in individual deposits to EGP 183bn, in addition to a coherent growth of 63% in correspondent bank balances, while the CIB's total deposits grew 6.7% on an annual basis, and -1.1% on a quarterly basis, scoring EGP 304.4bn.
At the same time, total loans witnessed positive growth of 9.9% on an annual basis, and 7.3% on a quarterly basis, registering EGP 131.2bn as of December 2019. This is a result of corporate loan growth of 8.1% on an annual basis, and 8.9% on a quarterly basis, recording EGP 26.9bn, according to Beltone.
It pointed out that the loan-to-deposit ratio witnessed a slight increase from 41.9% in 4Q2018 to 43.1% in 4Q2019.
Moreover, Beltone Financial said the CIB managed to increase its investments in treasury bills by 26% since the beginning of the year, despite the negative impact of tax adjustments, while employment in the Interbank declined by 39% since the beginning of the year.
It pointed out that the measures of asset quality witnessed a noticeable improvement, with the rate of non-performing loans declining from 5.3% in September 2019 to 4% in December, and the value of non-performing loans witnessed a decline of 19% on a quarterly basis, registering EGP 5.2bn.
Decrease in financing expenses improves NIM despite the decrease in return on assets
Beltone said the NIM witnessed a strong improvement, as it increased by 68 bp on an annual basis, following a decrease in financing expenses by 164 bp on an annual basis, thanks to a decrease in the interest on deposits by 96 bp, while the return on assets fell by 97 bp year-over-year (YoY).
On a quarterly basis, the NIM witnessed a healthy increase by about 60 bp due to a decrease in the interest on deposits by about 86 bp, but the decrease in return on assets by about 42 bp on a quarterly basis offset partially this surge. Beltone attributed this to the decrease in net interest income (loans) by about 158 bp on a quarterly basis.


Clic here to read the story from its source.