Fimbank Group has declared a profit of $7.7 million for the year ended December 31, 2017, compared to $5.4 million for the previous year.
Total consolidated assets stood at $1.64 billion, a decrease of six per cent on the $1.74 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 $127 million, while loans and advances to customers increased by $140 million.
At the end of the period under review, total consolidated liabilities stood at $1.47 billion, down by six per cent from $1.57 billion in 2016. Operating Income before net impairment for 2017 stood at $51.7 million, an increase of 12 per cent over the $46.1 million registered in 2016. During 2017, net interest income rose by $3 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 $3.7 million in net fee income, to $18.5 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 $3.4 million in 2017. Meanwhile, net impairments for the year improved, from a loss of $2.2 million in 2016, to a net recovery position of $2.2 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.
In the year under review, operating expenses rose by $3.7 million, to $42.3 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.
Fimbank chairman John C. Grech said the results “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: “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.”