Banif Bank (Malta) plc has registered a profit before tax of €1.4m for the year ended 31st December 2014 – a five-fold increase on the previous year. The Bank continued to register growth in its lending and deposit portfolio and main income streams while total assets increased by €22.8m, reaching €619m.
Gross loans and advances to customers increased by €41m, reaching €384m. Deposits increased by €25.2m, reaching €579.2m. The Bank managed to improve significantly its deposit into loan transformation ratio, with loans standing at 65.3% of customer deposits.
The Bank generated a total operating income of €13.9m, a 15% increase year on year. Net interest income amounted to €8.7m (2013: €8.1m). The increase is mainly the result of the improvement of the Bank’s financial margin. Net fee and commission income amounted to €2.1m (2013: €1.7m).
All this translated into a higher ratio of net fee income and commissions as a percentage of net interest income, standing at 24.2% (2013: 20.8%). This was mainly attributable to the Bank increasing new revenue through retail banking services. Total operating expenses excluding impairment increased only slightly by 1.6%, from €10.5m in 2013 to €10.7m, a positive result taking into consideration the Bank opened two new Branches during 2014. Trading income amounted to €3.1m (2013: €2.1m).
Total provision for impairment as a percentage of gross loans and advances to customers stood at 1.5% as at end of December 2014 (2013: 1.2%).
Total Capital Adequacy Ratio stood at 8.39% as at end of December 2014, whilst Core Equity Tier 1 Capital ratio stood at 6.68%. The Bank’s regulatory liquidity ratio stood at 72.42%, an increase of 33.09% and well above the required minimum of 30%. The Bank has in place a capital plan that envisages increases in the level of Own Funds, predominantly through Core Equity Tier 1 capital with a view to ensure sound capital adequacy levels in terms of the new Capital Requirements Directive and Regulations.
Banif Chief Executive Officer Joaquim F. Silva Pinto remarked that the results are an important achievement and very significant for the Bank that has performed well in a challenging scenario and highly competitive market. “In 2014, Banif Bank (Malta) plc concluded its seventh year of business activity,” he said. “In a context of a subdued environment across the Eurozone and more favourable economic conditions locally, the Bank has consolidated its position in the local market as a reliable financial services provider.”
“The results confirm that Banif Bank is on target with its business and growth plans,” he said. “2014 was a year of consolidation. The Bank worked on streamlining its practices, improving its cost efficiency and financial margin, while monitoring risk, exposure and impairments. Banif focused on business growth, with an emphasis on strengthening retail business and relationships with customers, with a continued investment in core operations, branch network, technological infrastructures, human resources and product portfolio. Our track record of delivering results is testament to our resilience, ambition and belief in what we do,” he continued. “The upward trend in registering increased profits will continue.”
The Bank’s workforce continued to grow. In line with its expansion strategy, new branches were opened in Paola and Mosta and a Corporate Banking office was also opened in Paola. The Bank’s e-channels platforms and digital infrastructures were further enhanced, with additional ATMs added to the network. The Bank’s dedicated compliance unit was stepped up in the context of new and increased regulatory requirements. Banif is fully compliant with applicable regulations and exercises prudence in ensuring it is well in line with the requisite provisions and reserves.
“The Bank is confident that 2015 will render just the same success and will keep up the practices and processes which have proved so effective in its growth spurt. There will be continued investment in the team and infrastructure, maximization of the potential of its resources in order to deliver the high level of service which differentiates the Bank on the market. Our focus will be on the Bank’s stakeholders – our customers, our staff, the shareholders and the regulators – to ensure that the demands of each are fully satisfied. The Bank owes its positive results to the customers and to the public for reiterating their trust in Banif Bank, and to the team for a fantastic outcome and is looking forward to another successful year in its history “
It is expected that 2015 will see the entry of a new shareholder into the Bank. This will enable the Bank to pursue new areas of business and growth.