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Renaissance Capital (RenCap), a leading emerging and frontier markets investment bank, has recorded a surge in profit, thanks to contributions of derivatives business and fixed income security segment.
The investment bank also recorded impressive growth in key financial ratios while providing a unique offering to its global investor client base.
For the year ended December 2017, RenCap’s net income surged by 43 perent to $15.60 million, from $8.89 million the previous year.
Sales increased by eight percent to $145 million, supported by its fixed income, currencies and commodities (FICC) division (revenue up 78 percent year on year (YoY), cash equities (21 percent) and healthy growth in the investment banking business (up 43 percent YoY), with debt capital markets part being the main driver.
“We are pleased to report strong 2017 results, which come after an excellent year for Renaissance Capital’s capital markets activity, highlighting our unrivalled market offerings in emerging and frontier economies,” said Ruslan Babaev, Co-CEO at Renaissance Capital.
Babaev said that the company led and executed a number of unique transactions, including the first corporate issue for a foreign borrower in the Russian domestic rouble market for Kazakhstan Temir Zholy, the state railway company of the Republic of Kazakhstan; the first-ever local currency international bond issue out of Georgia for Bank of Georgia.
He stated that others are the debut $350 million issue for Eurotorg, a privately owned retailer in Belarus; a $400 million international bond issuance for Fidelity Bank plc, a leading commercial bank in Nigeria; and the debut corporate infrastructure bond for Viathan Group, Nigeria’s largest captive and embedded power producer among others.
Renaissance Capital’s operating expenses were up by eight percent YoY to $121.7 million in the period under review, as a result of investment in personnel and new hires to meet growing client demand and to capitalise on market opportunities.
The firm’s equity-to-assets ratio stood at a healthy 15 percent as at December 2017. In other words, the investment bank is lowly geared and is less susceptible to financial risk.
The assets-to-equity ratio measures a firm’s total assets in relation to the total stockholder equity. Because assets are equal to liabilities and stockholders’ equity, the assets-to-equity ratio is an indirect measure of a firm’s liabilities. By analysing this ratio, you can tell to what extent a business is financed by equity or debt.
Total assets and equity amounted to $3.26 billion and $486 million, respectively, as of 31 December 2017.
“Our strong financial performance is a result of a continuous campaign for providing career development opportunities, promoting internal people and strengthening our team globally with the best professionals,” said Anna Vyshlova, Co-CEO at Renaissance Capital.
BALA AUGIE
