Jaiz Bank reports 66% profit decline in 2016

Jaiz Bank has reported a profit after tax of N311.3 million for the 2016 financial year ended 31st December 2016.
The company’s PAT represents a 66 percent depreciation from N910 million recorded as PAT for the corresponding period of the prior year.

Jaiz Bank through its audited financial statements submitted to the Nigerian Stock Exchange on Monday, also reported a total income of N4.9 billion against N4.3 billion in 2015. The Bank’s expenses increased to N4.6 billion from N3.5 billion while operating profit for the 2016 financial year was reported at N343 million.

Total Assets for the bank as at December 2016 stood at N67.6 billion representing a 28 percent increase over the N52.6 billion recorded in the corresponding period of 2015 as shareholders funds appreciated to N14.7 billion from N11.4 billion recorded in 2015.

In a letter to the Bank’s shareholders, The Chairman Dr. Umaru A. Mutallab,(CON) Said “The outgoing year has been both a very challenging but yet exciting one for us in our corporate existence. It was challenging not only because of the recessed node of the economy throughout the year, but also it was part of our formative period where we had to make the difficult decision of either keeping our revenues or reinvesting them in infrastructure and expansion of our business.

Of course, had consideration not been given to growing the branch channels of the Bank and other allied infrastructures, profitability could have been much higher than prior year looking at the Total Income of N4.91billion that was generated (2015: N4.30billion).
I want to assure you though that we do not see this pursuit of operational expansion to be at the expense of shareholders.

On the contrary, we think our shareholders will benefit because their bank has a longer-term and more sustainable view of the benefits to future bottom-line.

According to Hassan Usman, FCA, the Bank’s CEO’s report, the bank’s growth in financing assets (38%), and strong deposit inflows (30%) is a sign of success.

“Our robust risk management system made it possible for us to do so – in an era where banks are shying away from lending to real sector and come out with one of the least nonperforming risk assets ratio in the industry.

Our capital ratio (33%) has further improved and is comfortably three times ahead of current regulatory requirements (10%) and broadly in line with our best understanding of the kind of capital we would require over the medium term to support our rapid growth.

Our strong prudential health enables us to be secure and to invest in the future for the benefit of shareholders today and tomorrow.

Notwithstanding the fact that there is no compliant Interbank Money Market for us to participate in, your Bank for yet another year, maintained one of the highest liquidity ratio (23%) in the industry. Our goal has consistently been to deliberately build solid foundations for a bank that shall sustainably be profitable and whose prudential health is based on sound realism.

We are conscious of the fact that such action may in the short-run come at the expense of high profitability but in the long – run, be rest assured of having a bank with growing profitability without compromising sound financial health,” he said.