Fimbank Group’s financial results for the first six months of 2017 extends the profitability trend, reflecting the ongoing success of a transformation strategy hat the group has actively pursued since 2015.

Fimbank registered a net profit of USD 4.12 million, compared to a profit of USD 1.21m for the same six-month period in 2016. These figures emerge from the publication of the group’s interim financial statements for 2017, which were approved at a meeting of its board of directors on August 9.

At June 30, total consolidated assets stood at USD 1.73 billion, in line with the position at end 2016, while total consolidated liabilities stood at USD 1.55bn, also at par with the figure for end 2016. During the period under review, net income rose from USD21.01 million to USD 25.44m.

The group’s operating results before impairments, marked-to-market adjustments, and share-of-equity results, were USD 3.2 million higher when compared with the second half of 2016. The period under review also saw an increase in operating expenses, up by 13 per cent to USD 21.22 million, largely reflecting an increase in regulatory costs.

Meanwhile, in another milestone achievement, the group made a net impairment gain of USD 1.76 million in the period under review, compared to a loss of USD 0.18m in 2016.

Commenting on the financial results, Fimbank Group CEO Murali Subramanian said: “The positive financial results we have announced reflect, even without the one-off gain, progression resulting from the efficiency enhancements, and portfolio quality improvement.

“Throughout the first half of 2017, we sharpened revenue generation without growth, benefitting from the risk management and operational efficiencies we have been undertaking for the past two years, while optimising on our capital and funding resources. It is primarily to these that we owe the significantly higher net profits registered this year to date.”

Mr Subramanian explained that an upgraded asset origination process, as well as product differentiation, remained at the core of the group’s agenda. In addition to these, the group has made significant strides in the implementation of client-centric coverage models, cross-sell initiatives across the different group segments, and the strategic use of offices in key markets, particularly in the Middle East and North Africa region.

He also referred to the development of niche products, including lending instruments for the Malta real estate portfolio, as well as those for funding purposes, especially with the launch of the fully-fledged digital banking platform – Fimbank Direct.

We are confident that this trend will be sustained

He emphasised the importance of robust governance and an effective risk framework in the context of the group’s achievements, highlighting as noteworthy “the strong compliance culture which has enabled the group to maintain a healthy relationship with its correspondent banks”, highlighting that Deutsche Bank is one of the “prime, longstanding relationships in various currencies, including euro and US Dollar”.

Fimbank Group chairman Dr John C. Grech said that the board was very encouraged by the results of the first half of 2017, adding that “we are confident that this trend will be sustained throughout the rest of the year.

“We will build on our strengths and ongoing successes to ensure value creation to all Fimbank stakeholders and to reap the bene­fits of the excellent work undertaken by our senior management in the past critical months.”

With regard to the immediate outlook for the group, Dr Grech said that it is “evolving into a stronger banking institution based on sound business discipline, centrally-aligned operations, and effective management of enterprise risks”. He reiterated that “the dynamics in evidence during the last months will continue, as the group continues to pursue a revenue maximisation approach, maintain portfolio quality, while bolstering its capital position to trigger further asset growth. Success in these areas will allow Fimbank to take its customer experience to a superior level, support scale, and generate enterprise value to its diverse stakeholder platform”.

Fimbank’s board of directors announced that it will not be recommending an interim dividend for the period under review.

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