Diamond Bank sustains Q4 weak performance in Q1 2017

Following the release of Diamond Bank’s first quarter result for the period ended 31 March 2017 which showed sustained surprises ostensibly below expectations, investors reacted by pitching the bank’s stocks supply against demand.

As news of the bank’s Q1 2017 performance reached the investing public and dealing members of the Nigeria Stock Exchange (NSE), reactions impacted negatively on the bank’s stocks leading to N0.11 or 12.22 per cent decline suffered by its equities.

The bank opened trading at N0.90 per share, prior to release of its Q1 result, but closed lower at N0.79 per share, following reactions from the Q1 result.

Experts predict that the reactions would be sustained in the new week, as only speculation may reverse price trajectory.

Meanwhile, Diamond bank’s first quarter result released by the NSE last Friday showed that though funding income rose by 25 per cent y/y, opex grew by 9 per cent y/y. Also PBT and PAT were down year on year.

PBT fell by 17 per cent year on year ; while PAT declined -3% y/y, drive by other comprehensive income of N827m.

Non-interest income declined by23 per cent y/y, loan loss provisions soared by 20 per cent y/y and 9 per cent y/y increase in opex, spurred the decline in PBT.

The changes on these lines more than offset a 25% y/y increase in funding income to N31.5bn. Meanwhile, sequentially, PBT improved remarkably from a depressed Q4 2016.

Both PBT and PAT grew Q/Q by 19 per cent and 44 per cent respectively. The bank’s positive surprise in earnings was driven by a better-than-expected performance by funding income line.

Daily Times recalls that Diamond Bank’s Q4 2016 result for the period ended 31 December 2016 showed that the bank made a loss after tax of N1bn largely driven by a negative result on the other comprehensive income line.