MCB’s profits up by 12.5% to reach Rs 1.6 bn for the quarter ended September 2015 upon enhanced performance linked to foreign activities and better yields.
MCB Group Ltd profit level boosted by 12.5% to reach Rs 1.6 billion for the quarter ended September 2015, upon higher net interest income driven by enhanced performance linked to foreign activities of MCB Ltd and better yields within overseas subsidiaries coupled by the decline in excess liquidity following measures taken by the Bank of Mauritius.
Banking major MCB Group Ltd posted encouraging results for the quarter ended 30 September 2015, with profits reaching Rs 1.6 billion and representing a growth of 12.5 % against the corresponding period of 2014.
The positive performance of MCB was linked to foreign activities of MCB Ltd and better yields within the company overseas subsidiaries leading to higher net interest income.
MCB, the biggest bank by market value in East Africa and the Indian Ocean region, net interest income increased by 14.7% to Rs 2.2 billion rupees.
The earning per share rose from Rs 5.77to Rs 6.49.
Operating income went up by 11.1% to reach Rs 3,490 million. The rise was mainly driven by a growth of 14.7% in net interest income, reflecting enhanced performance linked to foreign activities of MCB Ltd and better yields within overseas subsidiaries.
Net interest income was also helped by the decline in excess liquidity following measures taken by the Bank of Mauritius. On the other hand, net fee and commission income increased marginally, with higher contribution from non-banking operations compensating for a drop in the Bank’s revenues from regional trade financing amidst lower international oil prices.
‘Other income’ grew by 12.8%, supported by a 14.6% growth in profit on exchange and enhanced receipts from non-banking activities.
Expenses grew by 10.4% to support business expansion. Despite increasing slightly in nominal terms, allowance for credit impairment effectively dropped on an annualised basis as compared to FY 2014/15.
The share of income from associates rose by 8.6% to reach Rs 93.9 million in line with an improved performance of BFCOI over the period under review. Given strong performances achieved by the international segment of MCB Ltd and most of the overseas banking subsidiaries, foreign-sourced earnings within the banking cluster accounted for some 55% of Group results.
The partnership agreement with Société Générale for the latter to inject additional equity in MCB Moçambique SA was concluded on 2nd October 2015. This entity will thus be treated as an associate as from the next reporting period.
Looking ahead, on current trends, results for the semester to December 2015 are projected to improve on last year despite the generally subdued operating environment. In this respect, the recent drop in the key Repo Rate amidst low inflation in Mauritius should help boost private investment.