FIMBank plc - Full-Year Results

Wednesday, March 11th, 2015

On 11 March, FIMBank plc published its preliminary financial statements for the year ended 31 December 2014. The 2014 figures include the consolidation of CIS Factors (Russia), India Factoring and FIM Holdings (Chile) after the Group acquired a controlling stake in each of these ventures during the year under review.

Performance Overview

During 2014, the FIMBank Group continued to face difficult market conditions for trade finance and a weak international trade environment. Furthermore, the Group’s spectrum of international businesses and ventures continued to pose a formidable challenge as various entities within the Group experienced significant and unprecedented impairment events.

From an operational point of view, net operating income increased by 26.1% to USD52.48 million due to the consolidation of the above mentioned three entities as well as markedly improved net interest margins to USD28.37 million which offset the 9.3% drop in net fee and commission income to USD20.76 million as well as the 42.6% drop in net results from foreign currency operations to USD1.58 million.

However, the higher income was offset by a 31.1% increase in operating expenses to USD39.77 million, a sharp rise in net impairment losses to USD50.7 million (2013: USD6.5 million) largely relating to the Russian and Indian subsidiaries as well as an USD8.9 million downward revision in goodwill.

Furthermore, the Group’s performance was also dragged lower by the increasing share of losses of factoring joint-ventures, especially Egypt and Brasil, with an aggregate net loss of USD3.2 million compared to USD0.66 million in 2013.

Overall, the FIMBank Group reported a pre-tax loss of USD53.43 million compared to the USD6.4 million pre-tax loss in 2013. After accounting for a tax credit of USD14.5 million, minority interests of USD6.7 million and USD6.3 million in losses from discontinued operations (related to the decision by the Board of Directors to exit Russia), the Group’s net loss for the period amounted to USD38.6 million compared to USD4.2 million in 2013. The earnings per share on the losses from continuing operations amount to a negative USD0.1469 compared to a negative USD0.0242 in 2013.

The Statement of Financial Position shows a 14.1% increase in total assets to USD1.4 billion largely reflecting the 29.7% increase in loans and advances to banks and customers which reached just over USD980 million. Similarly, total liabilities grew by 12.7% to USD1.23 billion mainly reflecting the 15.4% increase in bank and customer deposits to USD1.19 billion. Overall, the Group’s equity base (excluding minority interests) grew by 7.9% to USD160.6 million as the loss during the period under review was offset by the equity injections undertaken during the year. The net asset value per share as at 31 December 2014 is of USD0.592.

Dividend & Bonus Issue

Given the loss incurred during 2014, the Directors are not recommending the payment of a dividend.

The Directors are recommending a 1 for 10 bonus issue to all shareholders as at the close of trading on 1 April subject to shareholder approval at the upcoming Annual General Meeting (AGM) scheduled to be held on 7 May 2015. 

Outlook

Looking ahead, the Directors noted that 2015 will be a period of consolidation for the Group comprising an all-round strengthening of governance and risk structures (both at Bank level and especially at the remaining subsidiary and associated entities, as well as a scaling down in the international factoring growth strategy). Furthermore, the Directors highlighted that the main shareholders, namely Burgan Bank and United Gulf Bank, remain committed to help the Group overcome these difficulties and return to better times.

Download 

FIMBank plc – Preliminary Statement of Results for the financial year ended 31 December 2014.

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