One of the business activities carried out by Infinity Microfinance Bank Limited during the financial year ended December 31, 2013, was the adoption of International Financial Reporting Standard (IFRS).
The adoption is in line with the requirements of the regulators and for the purpose of enhancing the bank’s competitiveness and identity.
“We believe this stride is a pride to our stakeholders as well as our local and international partners,” Peter Asu, chairman said.
Meanwhile, huge financial involvement, running into millions of naira, is scaring the microfinance banks from adopting the IFRS, BusinessDay investigations have shown.
However, the Financial Reporting Council (FRC), the Central Bank of Nigeria (CBN) and the National Association of Microfinance Banks (NAMB) are already in talk on how to get a platform that will enable the microfinance banks to easily convert to IFRS.
Clara Oloniniyi, managing director of the bank, said: “We have adopted IFRS and that is one of the reasons the AGM came late this year, it was supposed to be June this year, and it is because of the requirements of IFRS compliance which is a bit demanding. But we have been able to do that and we are doing our AGM today. Next year, we will be able to do it much earlier.”
Looking at the challenges of microfinance banks, she said: “The environment is still evolving and more people need to know what they can benefit from microfinance banking system. The confidence needs to improve and the microfinance banks need to increase their capacity to meet more customers and provide those services for them.”s
According to her, there is need for increased awareness, increase capacity. “Overall, I will say it is getting better. It is much better than three, four years ago, when there were lots of distress in the system,” she said.
Infinity Microfinance Bank has grown its loan portfolio by 28 percent to N391.7 million at the end of the financial year end December 31, 2013, from a total of N305.5 million in December 31, 2012.
The bank’s gross earning recorded 18 percent increase from N221,471,123 for the year ended December 31, 2012, compared with N262,209,447 for the year ended December 31, 2013. Likewise, the total assets grew by 22 percent from a sum of N484,935,078 for the years ended December 31, 2012, compared with N590,143,114 for the year ended December 31, 2103.
On the profitability index, the bank’s profit before tax increased by 11.4 percent from N70,977,107 as of December 31, 2012, to N81,145,526 as of December 31, 2013, and the profit after tax increased by 11.5 percent from N66,813,941 as of December 31, 2012, to N76, 998,004 as of December 31, 2013.
However, the shareholders at the eigth annual general meeting held in Lagos approved a dividend of 4 kobo per share for every 50 kobo share of Infinity Microfinance Bank as of December 31, 2013, and a bonus issue of 3 shares for every 2 shares held in the register of shareholders as of December 31, 2013.
Asu said during the financial year ended December 31, 2013, the bank continued to build on the solid foundations that had been laid in more than one decade of operating successfully in the microfinance banking sector.
“We have refined our policies and business practices to prepare ourselves for future growth and greater customers satisfaction to our growing customers in all our 11 outposts branches in Lagos State, and new ones to be added in the near future. We have taken a critical look at our risk management procedures and ploughed our experience into building a formidable enterprise risk management that can sustain future growth and stability,” he said.
