Jaiz Bank’s profit surges on innovative product development
Jaiz Bank Plc has recorded a stellar performance amid an economic downturn as the non-interest and Islamic lender’s half year profit surged on the back of innovative and excellent products.
The lender has broken a new ground by becoming the first Islamic bank to make a profit within the first three years of its existence, a rare feat that has never been achieved by a lender of its kind.
Jaiz Bank has been consistently improving margins while utilizing the resources of its owners in generating higher profit.
For the first six months through June 2017, Jaiz Bank’s net income surged by 254 percent to N540.21 million from N152.67 million the previous year.
Total revenue jumped 45.97 percent to N3.08 billion, underpinned by a 46.24 percent rise in total income from Murabaha Transactions to N1.14 billion.
The Islamic lender was able to translate sales to profit growth as net margin, a measure of efficiency, increased to 17.82 percent in June 2017 as against 6.95 percent as at June 2016.
Jaiz Bank’s cost to income ratio (CIR), another measure of efficiency, fell to 84.74 percent in the period under review as against 94.47 percent as of March 2016.A lower ratio means a lender is keeping costs in check while bolstering profit.
Return on equity (ROE) improved to 3.55 percent in June 2017, from 1.36 percent the previous year, which means the lender has been able to deploy shareholders resources in generating a higher profit.
Speaking on the impressive results, the managing director and chief executive officer of the bank, Hassan Usman, attributed the success to the support from the board, management and staff, in addition to ‘our commitment to the business model which is hinged on a better life for all our stakeholders’.
He said: “the results attained so far already prove we are doing better than 2016. This year will define how we move forward; we are in the process of creating a five-year plan that will further define our identity in the Nigerian banking space. We have ambitious ideas about what we would like to be, and the Board and the shareholders are committed to ensuring we become a formidable player in the market”.
Jaiz Bank started with a share capital of about N5billion in 2012, but today its capital has hit N14.73 billion.
The non-interest lender had three branches in 2012. Today it has about 30 branches. Total customer current deposit increased by 65.10 percent to N31.09 billion in June 2017 from N18.83 billion as at June 2016.
Jaiz bank’s balance sheet has been growing at an average of about 30 per cent since 2012. For instance, the Islamic lender’s total assets increased by 23.65 percent to N80.66 billion in June 2017, as against N65.23 billion recorded the previous year.
The bank’s shareholders’ fund was up 35.05 percent to N15.24 billion in June 2017 from N11.30 billion as at June 2016.
“Our strategy is to provide retail banking to a large segment of the society who are desirous of our products and services.” “We are focused on building on our culture of ethics and taking the necessary decisions to align our perspective with client expectations.” Usman summed.
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