MCB Group Limited has announced its unaudited results for the nine months ended 31 March 2019.
Commenting on the results, Pierre Guy Noël (Chief Executive – MCB Group Ltd) said:
‘‘The Group maintained its strong performance for the nine months to 31 March 2019, with profit growing by 23.9% to reach Rs 6,748.6 million with improved earnings posted across all core activities of the Group.
Operating income increased by 16.8% to reach Rs 14,638 million. This performance was mainly driven by a rise in net interest income of 23.2%, reflecting growth in the foreign lending activities of MCB Ltd and higher average yields on investment securities for the period under review. For its part, net fee and commission income registered a growth of 6.0% on the back of enhanced revenues from payment and regional trade financing activities in the banking cluster as well as from MCB Capital Markets Ltd. ‘Other income’ went up by 6.4%, supported by a 10.3% rise in profit on exchange and fair value gains on financial instruments, while higher contribution from some non-banking activities compensated for the lower gains realised on the disposal of investments by our Equity Fund.
In line with ongoing capacity building initiatives across the Group, operating expenses rose by 9.6%, with our cost to income ratio declining to 38.8% from 41.3%. Net impairment charges rose by Rs 71 million to reach Rs 1.1 billion, representing an annualised cost of risk of 58 basis points of gross loans and advances, while asset quality improved further with the gross non-performing loan ratio declining to 4.0%.
Although better performances were recorded at the level of Promotion and Development Group and SG Moçambique, the share of profit of associates fell by Rs 52 million following reduced profitability at the level of BFCOI.
Shareholders’ funds recorded a rise of 8.5% to reach Rs 55.0 billion, with our capital adequacy ratio remaining comfortable at 17.6%, of which 16.0% in the form of Tier 1.
On current trends, Group results for the financial year ending 30 June 2019 should record a healthy growth compared to last year, primarily underpinned by the appreciable performance of international operations. Looking ahead, whilst remaining cautious in view of the increasingly uncertain and challenging context, both on the global and regional fronts, the Group is expected to continue to reap the benefits of its ongoing diversification and capacity-building initiatives.’’