Coronation Merchant Bank Limited has announced its Audited Financial Results for the year ended 31 December 2020 and declared a PBT of N5.784 bn.
Commenting on the financial results, Banjo Adegbohungbe, the Managing Director of Coronation Merchant Bank said that “despite the challenges in our operating environment, we navigated the headwinds that characterised the year to deliver strong results. In a year when the entire world grappled with the debilitating effects of the COVID-19 pandemic, we strengthened our partnerships with our customers and created sustainable value for our shareholders”.
Financial Highlights
- Total Assets up 63% from N253.35 billion in 2019 to N412.36 billion.
- Loans and advances to customers up 69% to N122.21 billion as at Dec 2020 (Dec 2019: N72.2 billion)
- Customer Deposits up 41% to N195.16 billion as at Dec 2020 (Dec 2019: 138.08 billion)
- Profit After Tax down 1% to N5.040 billion (Dec 2019: N5.097 billion)
- Shareholders’ Funds up by 16% to N40.11 billion (Dec 2019: N34.57 billion)
Key Ratios
- Capital Adequacy Ratio: 20.01% as at Dec 2020 (Dec 2019: 19.17%)
- Regulatory Loan to Funding Ratio: 67.9% as at Dec 2020 (Dec 2019: 71.1%)
- NPL Ratio: 0% as at Dec 2020 (Dec 2019: 0%)
- Cost to Income Ratio of 50.3% as at Dec 2020 (Dec 2019: 51.1%)
- Net Interest Margin: 1.63% as at Dec 2020 (Dec 2019: 2.39%)
- EPS: 100 kobo (Dec 2019: 101 kobo)
- Return on Equity 15.49% as at Dec 2020 (Dec 2019: 15.29%)
Despite the volatile environment in 2020, Profit before Tax increased by 15% from N5.024 billion in 2019 to N5.784 billion while Total Assets grew by 63% from N253.35 billion in 2019 to N412.36 billion in 2020. Non-interest income grew by 23%, mainly driven by trading income that compensated for the declining yield environment in the market.
Risk assets increased by 69% as the Bank continued to support its customers through difficult times. Cost of risk remained at a healthy level of 0.14% while Non-Performing Loans was nil; which reflects the efficacy of our risk management framework and sound corporate governance. Operating expense grew moderately at 14% YoY in spite of the impact of FX devaluation and rising inflation which closed at 15.75% as at December 2020.
During the year, we concluded our maiden international credit rating by Fitch with B- (stable outlook) as at 31 December 2020. The Bank’s bold decision to proceed with an internationally accepted rating despite the challenging and uncertain operating environment is a reflection of the strength of its franchise, the efficacy of its business strategy and its commitment to delivering long term value for its clients.
In addition to this, the Bank raised several tranches of Commercial papers and issued its maiden subordinated bond which was fully subscribed, raising over N25 billion. The continued positive results recorded by the Bank in its issues of commercial papers and bonds is a testament to its strong credit rating in the capital markets and growing levels of investor confidence.
About Coronation Merchant Bank
Coronation Merchant Bank was established in 2015 to provide wholesale banking to a long-underserved market. The Bank offers: Corporate & Investment Banking, Private Banking/Wealth Management and Global Markets/Treasury Services to its niche clientele. It presently has two branches located in Abuja and Port Harcourt with its Head Office in Lagos, Nigeria.
The Bank has been the recipient of numerous international and national awards for product innovation and sound corporate governance practices. Some of the international awards it received in 2021, 2020 and 2019 include Best Investment Bank in Nigeria by Global Finance, Best Investment Bank in Nigeria by World Finance, Best Investment Bank in Nigeria by Global Banking & Finance Review, Best Investment Bank by Global Business Outlook and Best Investment Bank in Nigeria by International Finance.
The Bank’s nimble business strategy has enabled it to record considerable success in the few years of its operations. The bank attained a strong investment grade rating of “A+” with a stable outlook in 2020 (the highest among Merchant Banks in Nigeria) from Nigeria’s foremost rating Agency – Agusto & Co. The bank has also been rated ‘B-‘ with a Stable Outlook by Fitch, one of the ‘Top 3’ global rating agencies, making it the first and only Nigerian Merchant Bank to receive an international risk rating.
Thank you for this piece. It is quite informative especially the financial highlights and key ratios. I will like to ask if it’s possible to get the calculations used in arriving at the key ratios because my calculations seems to be different and will like to know what I am doing wrong. Thank you