FIMBank plc - Full-Year Results
On 22 March 2023, FIMBank plc published the Annual Report and Financial Statements for the year ended 31 December 2022.
Net interest income surged by 22% to USD30.3 million (2021: USD24.9 million) as the increase in absolute terms in interest income to USD48 million (+USD10.5 million) outweighed the increase in interest expense to USD17.7 million (+USD5.1 million), reflecting the initial impact from the higher interest rate environment.
In contrast, FIMBank reported a substantial drop of 47.5% in non-interest income to USD8.49 million compared to USD16.2 million in 2021 as the higher levels of net fee and commission income (+USD0.59 million) to USD 11.4 million and dividend income (+USD2.73 million) to USD3.82 million were offset by the net trading loss of USD6.92 million compared to the gain of USD2.50 million in 2021 as well as the loss of USD0.34 million from financial instruments carried at fair value compared to the gain of USD1.13 million recorded in 2021.
The financial performance was also dented by the increase in net impairment losses to USD25.8 million compared to USD1.91 million in the previous corresponding period.
On the expenditure side, total operating costs dropped by 6.6% to USD37.8 million reflecting lower salary costs.
Overall, FIMBank reported a pre-tax loss of USD24.7 million which is significantly higher than the loss of USD1.29 million reported in 2021. After accounting for taxation minority interests, the net loss for the year attributable to shareholders of FIMBank amounted to USD26.6 million.
The Statement of Financial Position as at 31 December 2022 shows that total assets contracted by 5.7% to USD1.69 billion whilst total liabilities eased by 4.7% to USD1.49 billion. Moreover, given the 5.7% drop in customer loans to USD592.8 million and the increase of 5.1% in customer deposits to USD981.9 million, the loan-to-deposit ratio eased to 60.4% compared to 67.3% in 2021. Shareholders’ funds contracted by 12.5% to USD195.5 million which translates into a net asset value per share of USD0.374 (31 December 2021: USD0.428).
FIMBank’s CET1 ratio and total capital ratio dropped to 17.8% compared to 18.7% as at the end of 2021, however the total capital remained well above the minimum requirement for the Bank which was reduced to 16% from 17.5% following the Supervisory Review and Evaluation Process (SREP) from the MFSA.
In their commentary, the Directors of FIMBank explained that the balance sheet is now more resilient due to lower legacy exposures and is positioned favourably for an increasing interest rate scenario. Furthermore, reduction in capital requirements enables further growth in asset portfolios and creates opportunities to increase revenue streams.