FIMBank Announces USD7.7 Million Profit for 2017

14.03.2018

The FIMBank Group’s sustained run of profitability is the outcome of a successful consolidation and operational strategy, coupled with a solid business performance.

The FIMBank Group’s Consolidated Audited Financial Statements show that for the year ended 31 December 2017, the Group registered a profit of USD7.7 million, compared to a restated profit of USD5.4 million in 2016.  At 31 December 2017, total Consolidated Assets stood at USD1.64 billion, a decrease of 6 per cent on the USD1.74 billion reported at end 2016. The drop in assets is attributed to a reduction in business assets aimed at achieving better capital requirements, partly offset by increases in treasury balances as a result of higher liquidity requirements. In fact, Trading Assets decreased by USD127 million, whilst Loans and Advances to Customers increased by USD 140 million.  

At the end of the period under review, Total Consolidated Liabilities stood at USD1.47 billion, down by 6 per cent from USD1.57 billion in 2016.  Operating Income before net impairment for 2017 stood at USD51.7 million, an increase of 12% over the USD46.1 million registered in 2016.  During 2017, net interest income rose by USD3.0 million as a result of overall improved interest yields and increased efficiency in cost of funds and funding volumes. This rise was also mirrored in an increase of USD3.7 million in net fee income, to USD18.5 million, on improved fees on documentary credits and forfaiting. 

During 2017, the Group changed its accountancy policy and started measuring owned properties at their fair value.  This resulted in a fair value gain of USD3.4 million in 2017. Meanwhile, net impairments for the year improved, from a loss of USD2.2 million in 2016, to a net recovery position of USD2.2 million in 2017, a result of significant recoveries made by the Bank and its subsidiaries, which also assisted with increases in coverage on other impaired legacy credits. This is considered another major milestone for FIMBank, as legacy misadventures of prior years have been dealt with firmly.

In the year under review, operating expenses rose by USD3.7 million, to USD42.3 million, largely as a result of an increase in mandatory regulatory costs. Rising regulatory costs is a growing phenomenon across the industry, with further increases expected in the coming years.

Commenting on FIMBank’s financial results for 2017, the Group’s Chairman, Dr John C. Grech, stated that these “are a clear indicator of the sound strategic path adopted over the past years, and highlight our commitment and resolve in ensuring a strong and sustainable growth trajectory for FIMBank.”

Discussing the outlook for the Group, FIMBank Group CEO Murali Subramanian said that “For 2018, we expect to continue building on the business verticals we have transformed and strengthened over the past years.  2018 will be characterised by a capital injection allowing the business to grow and achieve improved economies.”

Mr Subramanian added that “The spirit of entrepreneurship and pursuit of excellence across businesses, products and markets will remain at the heart of the Group’s strategy. This will be achieved through superior client service, best in class and tested risk management, and governance stability, as well as efficiency in funding and cost structures. The scaling up of the business, supported by an expert management team and staff in key trade hubs across different regions, will enable the Group to maintain a flexible business model.  Our results during the past years demonstrate our ability to adapt to changing circumstances whilst driving sustained profitability and growing shareholder value.”

---