By Chinenye Anuforo
Diamond Bank Plc reported strong growth in core financial parameters surpassing analysts’ projections in its half year (H1) 2017 financial results released on the floor of the Nigerian Stock Exchange (NSE) in Lagos last Friday.
The interim report showed that profit before tax surged year-on-year by 2.8 per cent to N10.8 billion. This followed the leapfrogging of gross income over total expenses during the period under review.
The bank’s gross earnings jumped by 16.1 per cent over the previous year to N114.1 billion while interest income also increased by 31.5 per cent to N89.1 billion.
Although impairment charges increased by 6.9 per cent, in tandem with the bank’s continuation of prudent provisioning, its total asset grew by 0.8 per cent year-on-year to N2.065 trillion.
Although loans to customers shrunk by 1.8 per cent from N1.4 trillion to N1.3 trillion, reflecting the cautious optimism employed by the management to stabilise risk assets as the economy wades through and out of recession, the bank’s retail customers grew with over 6 million Diamond Y’ello customers opening accounts in the last two years.
Commenting on the bank’s H1 performance, Uzoma Dozie, its Chief Executive Officer, stated that despite the economic headwind, the bank would remain resilient and sustain the positive growth throughout the two remaining business quarters.
According to him, the bank’s strong liquidity and capital adequacy ratios plus its digital infrastructure have strengthened and rightly positioned it to meet customer obligations and offer service deliveries that are beyond banking, adding that the improving macroeconomic conditions will help stimulate and sustain the growth trajectory of the bank.
“The positive economic signals witnessed at the beginning of the year continued in the second quarter and we believe this will translate to greater productivity in the months ahead. There have been market driven adjustments in the exchange rate of the naira versus other currencies and this has helped supply into these markets. Overdue trade obligations, which were an issue some months ago, have been addressed significantly and demand is generally being satisfied providing the right conditions for trade activities,” he said.
Inflation has continued to recede, with the prospect of some GDP growth by year end, even if marginal. Against this backdrop, our income streams remain resilient and considerable growth was recorded in gross earnings,” said the CEO.
Speaking further, he stated that a core strategic focus in the next business quarters is to continue building on the progress made in H1 2017 by accelerating and entrenching the digitalization of products, services and operations, adding that the management will beam its lights on the loan book with a view to improving the quality and further strengthen the balance sheet.
Commenting about the result on the floor of the Exchange, analysts and industry watchers opined that the Bank has been rightly positioned for accelerated growth in the next business years ahead, noting that with the strong retail strategy, digital infrastructure and focused management, the core fundamentals have continued to look up.