Early this week at the Nigerian Stock Exchange (NSE), Diamond Bank plc reported growth in key financial parameters for the year ended December 31, 2014.
Following the result, the bank management affirmed its commitment to continue delivering healthy shareholder returns in 2015 and beyond.
The group recorded a growth of 27.3 percent in total assets from N1.52 trillion recorded in the year ended December 31, 2013, to N1.93 trillion for the year ended December 31, 2014.
The growth was driven by a 23.8 percent growth in deposit liabilities year-on-year (yoy), demonstrating the bank’s strong ability to generate cheap deposits from the retail and middle-market segments.
Deposit from customers grew from N1.21 billion in 2013 to N1.49 billion as of December 31, 2014.
Speaking on the results, Uzoma Dozie, group managing director/CEO, Diamond Bank, said: “We at Diamond Bank are pleased to announce continued success in implementing our strategy across the group, following another year of strong top-line growth and an asset base that grew from N1.5 trillion to N1.9 trillion in 12 months.”
Gross earnings increased by 15 percent from N181.2 billion for the year ended December 31, 2013 to N208.4 billion in 2014, driven by efficient growth in the volume of business represented by increase in loan book, and investment securities following the impressive growth in customer deposits.
Consequently, the group achieved an improvement of 9.6 percent in net operating income from N116.3 billion in 2013 to N127.4 billion for the year ended December 31, 2014. Profit before tax, however, recorded a drop of 12.5 percent from N32.1 billion in 2013 to N28.1 billion during the year under review.
Also in the year under review, group loan to customers recorded a growth of 14.8 percent from N689 billion as of December 31, 2013, to N791 billion at the end of the 2014 financial year.
According to the CEO, “amid regulatory headwinds that characterised the industry, and a dynamic macro-economic environment, growth was recorded in operating income although our profit before tax declined from 2013 levels on the back of higher operating expenses and loan impairment charges.
“For continued growth and profitability in 2015, we will continue to vigorously drive the implementation of our alternative banking channels including digital banking; this will help to drive down operating costs as well as capture a significant share of new and existing bank account holders as well as a large portion of the unbanked. We are encouraged by these positive results and sustenance of our business growth, and affirm our commitment to continue delivering healthy shareholder returns in 2015 and beyond.”
The group’s capitalisation improved significantly by 50.5 percent during the year due to a combination of the impact of its highly successful rights issue concluded in the last quarter of 2014, as well as the capitalisation of profits for the year ended December 31, 2014. In effect, shareholders’ funds increased from N138.7 billion as of December 31, 2013 to N208.8 billion as of December 31, 2014.
The strong capital base reflects the bank’s resilience and its preparedness to grow business in the future despite the implementation of Basel 2 and 3 by the central bank and the related high capitalisation requirement.
Consequent on the enhanced capitalisation, return on average equity declined from 23.1 percent in 2013 to 14.7 percent in 2014. Return on average asset followed the same trend from 2.1 percent in 2013 to 1.5 percent achieved in the year ended December 31, 2014.
Diamond Bank raised $200 million Eurobonds during the year to finance its long-term foreign currency assets. The bank is one of the eight banks designated as systemically important banks by the Central Bank of Nigeria (CBN) in 2013.
It is one of the leading banks in Nigeria, providing reliable and dependable financial services to corporate and individual customers in Nigeria and West Africa. The bank is a leading retail banking franchise and remains the leader in the MSME space in Nigeria.
