Volksbank Malta has registered a profit after tax of €3.708 million for the year ended December 31, 2009, The Times Business has learnt, despite the Volksbank Group reporting a pre-tax loss of €943.5 million.
Austrian-owned Volksbank Malta’s profit for last year was less than the €8.687 million profit registered in 2008 and is mainly being attributed to the sustained low interest rate scenario during 2009 as the European Central Bank acted to combat growing recessionary pressures and the disruptive impact of the global financial crisis.
As a result earnings per share for the year ended December 31, 2009 dropped to €1.61 as against €3.76 registered in 2008.
Net interest income, which is the main income contributor to the profit of the bank, stood at €8.015 million, representing a decline of € 4.361 million when compared to same period last year.
The bank’s financial results are expected to be officially announced today. Volksbank Malta is today also expected to announce the appointment of Alfred Mallia Milanes, an expert in employment, industrial relations and social affairs as its new non-executive chairman, replacing Winston V. Zahra.
During 2009 Volksbank Malta managed to reduce its overheads by 6.2 per cent compared to previous year’s levels, even after taking on board wage increases during the current financial year.
Even though the bank registered a drop in asset volumes, when compared to the previous year, loans and advances to customers increased by 2.9 per cent with growth in both local and international business. Overall the bank made significant progress in its strategic goal to gradually increase local business, while there wasn’t any significant deterioration in overall credit quality despite the very challenging economic environment both in Malta and in the bank’s other key markets.
The bank has extended its delivery channel by opening an agency in Gozo and it has reported a very good response from the Gozo business community.
The board of directors paid a net interim dividend of €1.65 per share amounting to €3.8 million. The directors are not proposing the payment of a final dividend and are recommending that the paid interim dividend be converted and declared as a final dividend at the bank’s general meeting.
Volksbank Malta Limited, which has a strong capital base of about €175 million, provides a full range of commercial banking services to both residents and non-residents. Its managing director is Herbert Skok.
Volksbank Group’s assets amount to €48.1 billion.