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CIB'S Q1 net jumps 64 percent as provisions decrease
Commercial International Bank (CIB) , Egypt's biggest private bank by assets, said on Wednesday that first- quarter net income leapt 64 percent year-on-year, beating analyst forecasts after provisioning surprised positively.
May 12, 2012 7:54 by kippreport
Consolidated net profit for the quarter rose to 505 million Egyptian pounds ($83.64 million) from 308 million pounds in the first quarter of 2011.
“The primary reason is lower impairments or loan-loss provisions,” said Nancy Fahmy, an analyst with Beltone. “2011 was a bad year (politically) and they booked provisions aggressively.”
The bank said it took 17 million pounds in provisions during the quarter, down from 123 million pounds in the first quarter of 2011.
“They were quite aggressive in 2011 without seeing NPLs (non-performing loans) happen. There was some increase, but not much. It was slight,” Fahmy said.
CIB said net loans and overdrafts to customers slipped to 40.05 billion pounds as of March 31 from 41.07 billion pounds as of the end of 2011.
This was “due to regular business seasonality, a slowdown in general market demand for loans and a renewed management focus on margins,” the bank said in an emailed statement.
Customer deposits rose 13.7 percent year-on-year and 3.9 percent quarter-on-quarter.
Four analysts polled by Reuters had forecast on average a net income of 409 million pounds. The highest forecast was 465 million pounds.
“This outstanding performance was achieved alongside a decrease in expenses and maintenance of our high-quality portfolio, reflecting management’s strict focus on costs and asset quality,” CIB Chairman Hisham Ezz Al-Arab said in the statement.
“These results put us well along the way to achieving our 2012 targets by continuing to build momentum across consumer and institutional banking.” ($1 = 6.0375 Egyptian pounds) (Reporting by Patrick Werr; editing by Andre Grenon)
By Patrick Werr