Diamond Bank new technologies drive financial inclusion, N7bn profit in Q1
Diamond Bank’s continued deployment of new technologies and digital applications is responsible for its financial inclusion drive and convenient banking amidst a decline in the pace of economic activities and weak economic fundamentals.
Consequently, despite the inclement operating business environment, which dulled industry average performance, Diamond Bank demonstrated its ability to sustain growth in the top lines in its unaudited financial statement for business activities ended Thursday, March 31, 2016.
The result of the bank’s three months business operations presented to the Nigerian Stock Exchange (NSE) and released to media executives in Lagos, show that Diamond Bank resiliently buoyed itself above these sundry industry turbulences and posted PBT of N6.7bn, averaging monthly PBT of N2.3bn, thus scaling industry expectations and meeting the minimum target for its shareholders for the period under review.
The bank displayed the strong will to continue to reduce operating costs and interest expense, which shrunk by 2.8 percent and 10.3 percent respectively compared to Q1 2015.
Speaking from the Bank’s Corporate Head Office in Lagos, the Chief Executive Officer, Uzoma Dozie, stated that the Bank’s continued success in spite of regulatory headwinds, is hinged on implementing strategies that promote sustainable growth and profitability in the long term.
“Although the economic challenges witnessed in 2015 did not abate in the first quarter of 2016, our streams of income remained resilient and considerable growth was recorded in non-interest revenue, which provides comfort about the sustainability of planned growth from this stream”.
According to him, the Q1 of 2016 was marked by persisting difficulties in the wider economy that continue to have an impact on the banking sector, pointing that Diamond Bank has continued a diligent implementation of its focus on curtailing cost, resulting in a 2.8 percent reduction of operating costs when compared to the same period last year.
He said: “our projections of the macro conditions and other external factors for the rest of the year is that these will remain challenging, and it has led to higher impairment charges than for the same period in 2015.
This very conservative approach to managing our loan book assures of its quality in the long run and in general should deliver the numbers that are consistent with our long term plans.”
As part of the strategic roadmap to a sustainable growth and profitability, the Bank has continued to introduce aggressive innovations, enhanced customer friendly services, and retail banking strategy that will enable it focus on driving non-interest income and strengthen explored opportunities to grow its market share. As a result, he stated that the Bank is better positioned for the future and expects to see improved financial performance in the rest of the business year.
Although Interest and similar income shrunk by 12 per cent to N35.7 billion year on year with impairment charge rising by 36 per cent to N8.8 billion, reflecting its continued prudent provisioning, Diamond Bank’s focus remains on retail banking and providing convenient and easy banking to the micro, small and medium-scale enterprises (MSME) segment. The Bank is also focused on growing its corporate and mid-tier market segment even as the regulatory headwinds blow tougher and rougher.
“Moreover, there are reassuring signs that the new strategy and initiatives to reduce costs are proving successful and are reflected in certain financial indicators. Quarter on quarter, costs came in lower and as incremental measures are put in place, the benefits will be magnified. By taking the first steps to reconfigure the operating structure of the Bank we have deployed more resources to provide improved services to customers and having done this, we are optimistic about performance in the quarters ahead,” stated the CEO.
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