| Fri 15 Feb 2008, 8:00 | | IBLP - Imperial Bank - Reviewed condensed results for the year ended 31 December |
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IBLP
IBLP - Imperial Bank - Reviewed condensed results for the year ended 31 December
2007
IMPERIAL BANK
Reg no.: 1995/012641/06, Incorporated in the Republic of South Africa
Preference share code: IBLP ISIN: ZAE000081675
REVIEWED CONDENSED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2007
OVERVIEW
Imperial Bank Limited (Imperial Bank) is a 50.1% subsidiary of Nedbank Limited
with the remaining 49.9% held by Imperial Holdings Limited. These financial
results are published to provide information to the holders of Imperial Bank`s
listed non-redeemable, non-participating, non-cumulative preference
shares.
Imperial Bank has had another successful year in an environment of high
interest rates and rising impairments. Loans and advances increased 27.4%
from R27.7 billion to R35.3 billion and net profit after taxation increased
24.1% from R386.1 million to R479.2 million. Net interest income grew by 38.3%
and operating expenses grew by 21.0%, resulting in the efficiency ratio
improving from 35.4% to 30.2%. The return on ordinary shareholders` equity
decreased from 24.7% to 23.9%.
Property Finance had an excellent year with continued strong demand for both
commercial finance and residential development finance. Supplier Asset Finance
performed ahead of expectations while Motor Finance produced solid results in
an environment of higher interest rates and lower vehicle sales.
Medical Finance achieved budgeted growth in loans and advances and is on track
to achieve critical mass which will enable the division to earn an acceptable
return on equity.
The impairment charge has increased 95.5% compared to the previous period. In
the prior year, both Property Finance and Supplier Asset Finance benefited from
the reversal of provisions raised in previous years. This, combined with the
increases in interest rates over the past year, which have put pressure on
consumers, result in the higher impairment charge. The credit loss ratio of
1.3% continues to be within acceptable parameters.
The effective tax rate has increased from 23.7% to 30.0% as the benefits of the
NRB assessed loss in the previously acquired NRB entity have been fully
utilised.
No material events have occurred subsequent to 31 December 2007 which may have
an impact on the group`s reported financial position at this date.
SECURITISATION
On 18 June 2007, Imperial Bank successfully securitised R1.7 billion of its
motor vehicle instalment sale agreements. The transaction has been structured
as a revolving R1.7 billion tranche for a period of 24 months, and thereafter a
controlled amortisation.
Although the instalment sale agreements have been legally ceded by Imperial
Bank, the instalment sale assets remain on the Imperial Bank balance sheet, as
required by International Accounting Standard (IAS) 39.
CAPITAL MANAGEMENT
In order to support Imperial Bank`s continued growth, the two shareholders
contributed R300 million of equity capital on 26 March 2007.
PROSPECTS
The significant increase in rates has reduced demand for finance and with the
prospect of rates remaining high during 2008, retail demand in particular,
will be hard hit. However, the consensus economic forecast is that the economy
will continue to grow, albeit at a slower rate. Provided this growth
materialises, loans and advances are expected to show real growth especially in
those areas of our business with a small market share.
The higher interest rate environment will result in further increases in the
level of arrears and impairments.
SHAREHOLDERS` AGREEMENT
Nedbank Limited and Imperial Holdings Limited have reconfirmed their commitment
to Imperial Bank and are currently finalising a revised shareholders`
agreement that will formalise the terms of their commitment to Imperial Bank
beyond 2010.
CHANGES TO BOARD OF DIRECTORS
During the reporting period the following changes were made to the Imperial
Bank board:
- Mrs N P Mnxasana was appointed as a non-executive director on 8 May
2007.
- Mr W G Lynch retired as a director and chairman of the board on 16 July 2007.
He sadly passed away on 22 January 2008. Mr Lynch was instrumental in
establishing Imperial Bank in 1996 and had been chairman since that date. He
has played a leading role in building Imperial Bank into the significant
organisation it is today. The board pays tribute to Mr Lynch for his
contribution to Imperial Bank.
- Mr H R Brody was appointed chairman of the board on 17 July 2007.
ACCOUNTING POLICIES
The accounting policies applied for the year are consistent with those of the
prior year. IFRS 7 was successfully implemented during 2007. The group
financial results, from which these condensed financial statements were
derived, are prepared in accordance with International Financial Reporting
Standards and have been prepared on a historical cash basis. These condensed
financial statements have been prepared in terms of IAS 34:Interim Financial
Reporting.
IMPERIAL BANK NON-REDEEMABLE, NON-PARTICIPATING, NON-CUMULATIVE PREFERENCE
SHARES - DECLARATION OF DIVIDEND NO. 3
Notice is hereby given that preference dividend No. 3 of 481.17808 cents per
share has been declared for the period from 1 July 2007 to 31 December 2007,
payable on Monday, 17 March 2008, to shareholders of the non-redeemable,
non-participating, non- cumulative preference shares recorded in the books of
the company at the close of business on Friday, 14 March 2008.
In accordance with the provisions of STRATE, the electronic settlement and
custody system used by the JSE Limited, the relevant dates for the payment of
the dividend are as follows:
Last day to trade cum dividend Friday, 7 March 2008
Shares trade ex dividend Monday, 10 March 2008
Record date Friday, 14 March 2008
Payment date Monday, 17 March 2008
Share certificates may not be dematerialised or rematerialised between Monday,
10 March 2008 and Friday, 14 March 2008, both days inclusive.
Where applicable, dividends in respect of certificated shares will be
transferred electronically to shareholders` bank accounts on payment date. In
the absence of specific mandates, dividend cheques will be posted to
shareholders. Shareholders who have dematerialised their share certificates
will have their accounts, at their CSDP or broker, credited on Monday, 17 March
2008.
For and on behalf of the board
H R Brody R van Wyk
Chairman Chief Executive 8 February 2008
IMPERIAL BANK ORDINARY SHARES - DECLARATION OF DIVIDEND NO. 1
Following a decision by the board to introduce an ongoing dividend programme,
notice is hereby given that the directors of the company have resolved to
declare a cash dividend of 21.88050 cents per share, payable to the
shareholders of the company on Tuesday, 25 March 2008.
KEY RATIOS Reviewed Audited
As at December December
2007 2006
Net interest income to average interest-
earning banking assets % 4.6 4.4
Impairment charge as a percentage of average
gross loans and advances % 1.3 0.9
Non-interest revenue as a percentage
of total income % 10.6 6.9
Efficiency ratio % 30.2 35.4
Return on ordinary shareholders` equity % 23.9 24.7
Return on total average assets % 1.4 1.5
Capital adequacy
- Tier 1 % 6.9 6.1
- Total % 10.6 10.5
Share statistics
Number of shares in issue
- Ordinary shares m 340.0 288.2
- Preference shares m 3.0 3.0
Preference share traded price (closing) R 89.0 99.0
Net asset value per ordinary share R 7.9 6.6
REVIEWED RESULTS - AUDIT OPINION
The auditors, Deloitte & Touche, have reviewed these results and their
unmodified review opinion is available for inspection at the company`s
registered office.
CORPORATE INFORMATION
Registered office: Imperial Bank Limited, 24 Achter Road, Paulshof,
Sunninghill, 2191.
PO Box 6093, Rivonia, 2128.
Transfer secretaries: Computershare Investor Services 2004 (Pty) Ltd, 70
Marshall Street, Johannesburg, 2001. PO Box 61051, Marshalltown, 2107.
Directors: H R Brody: Chairman, R van Wyk: Chief Executive Officer*,
O S Arbee, C J W Ball, L E Bakoro, M J Croucamp, M A Enus-Brey,
P C W Hibbit*, N P Mnxasana, P A Wessels. *Executive
Company Secretary: G Tyusha
Sponsor: Nedbank Capital
Reg no.: 1995/012641/06, Incorporated in the Republic of South Africa
Preference share code: IBLP ISIN: ZAE000081675
CONDENSED GROUP INCOME STATEMENT
For the year ended Reviewed Audited
December December
2007 2006
R`000 R`000
Interest and similar income 4 469 435 2 909 071
Interest expense and similar charges 2 978 076 1 830 442
Net interest income 1 491 359 1 078 629
Impairment losses on loans and advances 412 049 210 807
Income from lending activities 1 079 310 867 822
Non - interest revenue 128 144 64 127
Total income 1 207 454 931 949
Operating expenses 489 321 404 540
Indirect taxation 34 049 21 150
Profit from operations before direct taxation 684 084 506 259
Direct taxation 204 930 120 199
Net profit for the year 479 154 386 060
CONDENSED GROUP BALANCE SHEET
As at Reviewed Audited
December December
2007 2006
R`000 R`000
Assets
Cash and cash equivalents 4 468 12 774
Other short-term securities 1 105 594 1 154 105
Derivative financial instruments 74 630 78 334
Government and other securities 330 985 360 114
Loans and advances to customers 35 319 543 27 736 031
Other assets 397 463 272 304
Investment securities 6 151 5 309
Property and equipment 181 395 125 160
Mandatory deposits with central bank 808 109 656 030
Total assets 38 228 338 30 400 161
Equity and liabilities
Ordinary share capital 3 400 2 882
Ordinary share premium 648 284 348 802
Reserves 1 745 502 1 256 990
Total ordinary shareholders` equity 2 397 186 1 608 674
Preference share capital and premium 298 047 298 062
Total shareholders` equity 2 695 233 1 906 736
Total liabilities 35 533 105 28 493 425
Bank overdraft 32 269 -
Derivative financial instruments 90 207 102 585
Amounts owed to depositors 34 047 864 27 036 305
Other liabilities 250 772 237 974
Current taxation 2 392 54 582
Deferred taxation 109 512 3 797
Long-term debt instruments 1 000 089 1 058 182
Total equity and liabilities 38 228 338 30 400 161
Contingent liabilities 1 540 059 943 913
Operating divisions % of NET PROFIT FOR THE YEAR (DECEMBER 2007)
SEE PRESS RELEASE FOR GRAPH
CONDENSED GROUP CASH FLOW STATEMENT
For the year ended Reviewed Audited
December December
2007 2006
R`000 R`000
Cash generated by operating activities 1 109 229 812 256
Change in funds for operating activities (1 043 912) (486 029)
Net cash generated by operating activities
before taxation 65 317 326 227
Taxation paid (199 895) (132 059)
Net cash (utilised in)/generated
by operating activities (134 578) 194 168
Net cash (utilised in)/generated
by investing activities (27 900) 2 279
Net cash from/(utilised in) financing activities 273 982 (2 128)
Net increase in cash and cash equivalents 111 504 194 319
Cash and cash equivalents at the
beginning of the year 668 804 474 485
Cash and cash equivalents at the end of the year 780 308 668 804
CONDENSED GROUP STATEMENT OF CHANGES IN SHAREHOLDERS` EQUITY
For the year ended
Number of Ordinary Ordinary
ordinary share share
shares capital premium
R`000 R`000
Balance as at 31 December 2005 358 934 487 3 589 648 285
Transfer to/(from) reserves
Net profit for the year
Ordinary shares repurchased (70 711 888) (707) (299 293)
Preference shares issued
Share issue and repurchase expenses (190)
Balance as at 31 December 2006 288 222 599 2 882 348 802
Transfer to/(from) reserves
Net profit for the year
Preference dividends paid
Revaluation of land and buildings
Ordinary shares issued 51 787 025 518 299 482
Preference shares issued
Share issue and repurchase expenses
Balance as at 31 December 2007 340 009 624 3 400 648 284
General
Revaluation credit risk Accumulated
reserve reserve* profit
R`000 R`000 R`000
Balance as at 31 December 2005 2 823 97 611 770 496
Transfer to/(from) reserves (2 823) 83 210 (80 387)
Net profit for the year 386 060
Ordinary shares repurchased
Preference shares issued
Share issue and repurchase expenses
Balance as at 31 December 2006 - 180 821 1 076 169
Transfer to/(from) reserves 48 550 (48 550)
Net profit for the year 479 154
Preference dividends paid (26 003)
Revaluation of land and
buildings 35 361
Ordinary shares issued
Preference shares issued
Share issue and repurchase expenses
Balance as at 31 December 2007 35 361 229 371 1 480 770
Total Preference
ordinary share capital Total
shareholders` and shareholders`
equity premium equity
R`000 R`000 R`000
Balance as at
31 December 2005 1 522 804 - 1 522 804
Transfer to/(from) reserves - -
Net profit for the year 386 060 386 060
Ordinary shares
repurchased (300 000) (300 000)
Preference shares issued - 300 000 300 000
Share issue and
repurchase expenses (190) (1 938) (2 128)
Balance as at
31 December 2006 1 608 674 298 062 1 906 736
Transfer to/(from) reserves - -
Net profit for the year 479 154 479 154
Preference dividends paid (26 003) (26 003)
Revaluation of
land and buildings 35 361 35 361
Ordinary shares issued 300 000 300 000
Preference shares issued - -
Share issue and
repurchase expenses - (15) (15)
Balance as at
31 December 2007 2 397 186 298 047 2 695 233
* Represents non-distributable reserves transferred from other distributable
reserves in order to comply with the Bank`s Act,1990.
OPERATIONAL AND SEGMENTAL REPORTING
For the year ended
Total assets (Rbn) Total income (Rm)
Reviewed Audited Reviewed Audited
December December December December
2007 2006 2007 2006
Motor Finance 22.2 17.3 607.7 481.9
Property Finance 6.5 5.0 325.8 228.1
Medical Finance 4.2 3.0 89.9 64.5
Supplier Asset Finance 4.2 3.5 190.6 165.3
Treasury and Eliminations 1.1 1.6 (6.5) (7.9)
Total 38.2 30.4 1 207.5 931.9
Net profit for the year (Rm)
Reviewed Audited
December December
2007 2006
Motor Finance 206.8 173.4
Property Finance 170.5 113.6
Medical Finance 19.6 15.9
Supplier Asset Finance 85.8 76.4
Treasury and Eliminations (3.5) 6.8
Total 479.2 386.1
These results are available on our website www.imperialbank.co.za
Date: 15/02/2008 08:00:01 Produced by the JSE SENS Department.
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