| Thu 31 Jul 2008, 8:00 | | IBLP - Imperial Bank - Financial results for the six months ended 30 June 2008 |
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IBLP
IBLP - Imperial Bank - Financial results for the six months ended 30 June 2008
IMPERIAL BANK
Reg no.: 1995/012641/06
Incorporated in the Republic of South Africa
Preference share code: IBLP ISIN: ZAE000081675
FINANCIAL RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2008
OVERVIEW
Imperial Bank Limited (Imperial Bank or the 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.
Increased interest rates, food, fuel and energy costs have resulted in lower
disposable income for the South African consumer, which impacted negatively on
the banking industry`s trading conditions. In these circumstances, Imperial Bank
produced satisfactory trading results with net operating income of R306.3
million compared to R311.0 million for the same period last year. Despite the
tougher trading environment and tightening of credit criteria, new business
volumes have been maintained at the same levels as the previous year. Motor
Finance volumes benefited from increased financing in the used car market. Loans
and advances of the Bank grew 27.1% from R31.4 billion to R39.9 billion
following a successful implementation of the National Credit Act requirements.
Net profit for the period dropped 15.9% from R224.3 million to R188.7 million,
mainly due to higher tax charges. Net interest income increased 18.8% from
R681.8 million to R809.8 million, reflecting a margin squeeze mainly due to the
increased cost of funding. Expenses remained well controlled, increasing by only
3.2%, and resulting in the efficiency ratio improving from 32.0% to 26.8%. The
return on ordinary shareholders` equity declined from 24.3% to 15.5%.
Property Finance had a satisfactory six months although demand for residential
development finance has declined as anticipated. Supplier Asset Finance
performed in line with expectations, whereas the growth in Medical Finance has
been adversely affected by the higher interest rates. The results of the Motor
Finance division were affected by the higher interest rates and lower used car
prices, which led to an increased level of impairments resulting in the credit
loss ratio increasing from 1.9% to 2.7%. Motor Finance was the main contributor
to the impairment charge in the Bank increasing significantly from R177.2
million to R340.8 million.
The impairment charge in the Property, Medical and Supplier Asset Finance
divisions remain at acceptable levels.
The increase in the taxation charge is mainly due to the group having fully
utilised the benefits of an assessed loss in a subsidiary company.
PROSPECTS
Imperial Bank anticipates that conditions will remain challenging in the second
half of the year, as performance will continue to be negatively affected by the
high interest rate environment.
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.
CHANGE TO BOARD OF DIRECTORS
During the reporting period the following change was made to the Imperial
Bank board:
Mr M A Enus-Brey resigned from the board on 31 January 2008.
ACCOUNTING POLICIES
The accounting policies applied for the first half of the year are consistent
with those of the prior year. 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 the
historical cost basis, except for financial assets and financial liabilities
which are recorded at fair value through profit or loss. 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 . 4
Notice is hereby given that preference dividend No. 4 of 515.31507 cents per
share has been declared for the period from 1 January 2008 to 30 June 2008,
payable on Monday, 15 September 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, 12 September 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, 5 September 2008
Shares trade ex dividend Monday, 8 September 2008
Record date Friday, 12 September 2008
Payment date Monday, 15 September 2008
Share certificates may not be dematerialised or rematerialised between Monday,
8 September 2008, and Friday, 12 September 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, 15
September 2008.
For and on behalf of the board
H R Brody R van Wyk
Chairman Chief Executive 1 August 2008
IMPERIAL BANK ORDINARY SHARES - DECLARATION OF DIVIDEND NO . 2
Notice is hereby given that the directors of the company have resolved to
declare a cash dividend of 15.76929 cents payable to the shareholders of the
company payable on Monday, 22 September 2008.
KEY RATIOS
At June June December
2008* 2007* 2007**
Net interest income to average
interest-earning banking assets % 4.2 4.6 4.6
Impairment charge as a percentage
of average gross loans and advances % 1.8 1.2 1.3
Non-interest revenue as a percentage
of operating income % 13.7 6.6 10.6
Efficiency ratio % 26.8 32.0 30.2
Return on ordinary shareholders` equity % 15.5 24.3 23.9
Return on total average assets % 0.9 1.4 1.4
Capital adequacy
- Tier 1 % 7.5 6.7 6.9
- Total % 10.9 10.7 10.6
SHARE STATISTICS
Number of shares in issue
- Ordinary shares m 340.0 340.0 340.0
- Preference shares m 3.0 3.0 3.0
Preference share traded price (closing) R 81.0 93.5 89.0
Net asset value per ordinary share R 8.2 7.1 7.9
CORPORATE INFORMATION
Registered office: Imperial Bank Limited, 24 Achter Road, Paulshof,
Sunninghill, 2191.
PO Box 6093, Rivonia, 2128.
Transfer secretaries: Computershare Investor Services (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, 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 period ended Six months Six months Twelve months
June June December
2008* 2007* 2007**
R`000 R`000 R`000
Interest and similar income 2 930 092 1 985 696 4 469 435
Interest expense and similar charges 2 120 295 1 303 905 2 978 076
Net interest income 809 797 681 791 1 491 359
Impairment losses on loans
and advances 340 830 177 189 412 049
Income from lending activities 468 967 504 602 1 079 310
Non-interest revenue 74 166 35 857 128 144
Operating income 543 133 540 459 1 207 454
Operating expenses 236 843 229 429 489 321
Net operating income 306 290 311 030 718 133
Indirect taxation 22 570 12 097 34 049
Profit from operations
before direct taxation 283 720 298 933 684 084
Direct taxation 95 029 74 639 204 930
Net profit for the period 188 691 224 294 479 154
CONDENSED GROUP BALANCE SHEET
At June June December
2008* 2007* 2007**
R`000 R`000 R`000
Assets
Cash and cash equivalents 280 67 896 4 468
Other short-term securities 1 496 794 1 002 411 1 105 594
Derivative financial instruments 244 444 70 974 74 630
Government and other securities 303 643 336 916 330 985
Loans and advances to customers 39 929 663 31 359 737 35 319 543
Other assets 411 821 291 831 397 463
Investment securities 5 422 6 746 6 151
Property and equipment 230 558 120 983 181 395
Mandatory deposits with central
bank 938 688 746 800 808 109
Total assets 43 561 313 34 004 294 38 228 338
Equity and liabilities
Ordinary share capital 3 400 3 400 3 400
Ordinary share premium 648 284 648 284 648 284
Reserves 1 845 362 1 468 356 1 745 502
Total ordinary shareholders` equity 2 497 046 2 120 040 2 397 186
Preference share capital and
premium 298 047 298 047 298 047
Total shareholders` equity 2 795 093 2 418 087 2 695 233
Total liabilities 40 766 220 31 586 207 35 533 105
Bank overdraft - - 32 269
Derivative financial instruments 134 911 99 409 90 207
Amounts owed to depositors 39 270 932 30 183 622 34 047 864
Other liabilities 254 280 212 741 250 772
Current taxation (3 853) 45 607 2 392
Deferred taxation 150 312 15 108 109 512
Long-term debt instruments 959 638 1 029 720 1 000 089
Total equity and liabilities 43 561 313 34 004 294 38 228 338
Contingent liabilities 3 271 564 1 040 949 1 540 059
OPERATING DIVISIONS % OF NET PROFIT FOR THE SIX MONTHS ENDED 30 JUNE 2008
(Pie Chart- please see press)
CONDENSED GROUP CASH FLOW STATEMENT
For the period ended Six Months Six Months Twelve Months
June June December
2008* 2007* 2007**
R`000 R`000 R`000
Cash generated by operating
activities 550 924 486 682 1 109 229
Change in funds for operating
activities (247 877) (549 853) (1 043 912)
Net cash generated by/(utilised in)
operating activities
before taxation paid 303 047 (63 171) 65 317
Taxation paid (83 044) (84 399) (199 895)
Net cash generated by/(utilised in)
operating
activities 220 003 (147 570) (134 578)
Net cash utilised in investing
activities (61 343) (6 523) (27 900)
Net cash from financing activities - 299 985 273 982
Net increase in cash and cash
equivalents 158 660 145 892 111 504
Cash and cash equivalents at the
beginning
of the period 780 308 668 804 668 804
Cash and cash equivalents at the
end of period 938 968 814 696 780 308
CONDENSED GROUP STATEMENT OF CHANGES IN SHAREHOLDERS` EQUITY
For the period ended
Number of Number of Ordinary Ordinary
ordinary preference share share
shares shares capital premium
R`000* R`000*
Balance at 31
December 2006 288 222 599 3 000 000 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
Share issue and
repurchase expenses
Balance at 31
December 2007 340 009 624 3 000 000 3 400 648 284
Transfer to/(from)
reserves
Net profit for the
period
Ordinary dividends paid
Preference dividends
paid
Balance at
30 June 2008 340 009 624 3 000 000 3 400 648 284
For the
period ended Total
General ordinary
Revaluation credit risk Accumulated shareholders`
reserve reserve profit equity
R`000* R`000* R`000* R`000*
Balance at
31 December
2006 - 180 821 1 076 169 1 608 674
Transfer
to/(from)
reserves 48 550 (48 550) -
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
Share issue
and
repurchase
expenses -
Balance at
31 December
2007 35 361 229 371 1 480 770 2 397 186
Transfer
to/(from)
reserves (229 371) 229 371 -
Net profit
for the
period 188 691 188 691
Ordinary
dividends
paid (74 396) (74 396)
Preference
dividends
paid (14 435) (14 435)
Balance at
30 June 2008 35 361 - 1 810 001 2 497 046
For the period ended Preference
share capital Total
and shareholders`
premium equity
R`000* R`000*
Balance at 31 December 2006 298 062 1 906 736
Transfer to/(from) reserves -
Net profit for the year 479 154
Preference dividends paid (26 003)
Revaluation of land and buildings 35 361
Ordinary shares issued 300 000
Share issue and repurchase expenses (15) (15)
Balance at 31 December 2007 298 047 2 695 233
Transfer to/(from) reserves -
Net profit for the period 188 691
Ordinary dividends paid (74 396)
Preference dividends paid (14 435)
Balance at 30 June 2008 298 047 2 795 093
SEGMENTAL ANALYSIS BY OPERATION
For the period ended Total assets (Rbn)
June June December
2008* 2007* 2007**
Motor Finance 24.8 19.7 22.2
Property Finance 7.7 5.7 6.5
Medical Finance 4.6 3.6 4.2
Supplier Asset Finance 3.4 3.9 4.2
Treasury and Eliminations 3.1 1.1 1.1
Total 43.6 34.0 38.2
For the period ended Operating income (Rm)
Six Months Six Months Twelve Months
June June December
2008* 2007* 2007**
Motor Finance 264.8 281.7 607.7
Property Finance 156.2 138.0 325.8
Medical Finance 48.1 38.6 89.9
Supplier Asset Finance 53.4 85.5 190.6
Treasury and Eliminations 20.6 (3.3) (6.5)
Total 543.1 540.5 1 207.5
For the period ended Net profit for the period (Rm)
Six Months Six Months Twelve Months
June June December
2008* 2007* 2007**
Motor Finance 70.4 100.9 206.8
Property Finance 84.3 69.1 170.5
Medical Finance 12.5 5.7 19.6
Supplier Asset Finance 9.6 37.9 85.8
Treasury and Eliminations 11.9 10.7 (3.5)
Total 188.7 224.3 479.2
* Unaudited ** Audited
Date: 31/07/2008 08:00:02 Produced by the JSE SENS Department.
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