| Fri 31 Jul 2009, 9:21 | | IBLP - Imperial Bank Limited - Unaudited Interim Results for the Six Months |
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IBLP - Imperial Bank Limited - Unaudited Interim Results for the Six Months
Ended 30 June 2009
Imperial Bank Limited
(Incorporated in the Republic of South Africa)
Registration number: 1995/012641/06
JSE preference share code: IBLP
ISIN code: ZAE000081675
("Imperial Bank")
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2009
OVERVIEW
Imperial Bank Limited (Imperial Bank or the Bank) is primarily engaged in
asset-based financing. Nedbank Limited (Nedbank) and Imperial Holdings Limited
(Imperial Holdings) currently hold 50.1% and 49.9% respectively of the ordinary
share capital.
As previously announced, Nedbank and Imperial Holdings are in discussions
regarding Nedbank acquiring Imperial Holdings` 49.9% shareholding in Imperial
Bank.
The Bank has four operating divisions. Motor Finance is the largest division
comprising 63.6% of total net loans and advances, followed by Property Finance
with 17.9%, Professional Finance with 11.0% and Supplier Asset Finance with
7.5%.
These financial results are published to provide information to, amongst
others, the holders of Imperial Bank`s listed non-redeemable,
non-participating, non-cumulative preference shares.
REVIEW OF THE PERIOD
The six-month period has been characterised by a continuation of the extremely
difficult trading conditions experienced in the second half of 2008 and while
interest rates have been reduced by 400 basis points since the beginning of the
year, the recession in the world and South African economies has more than off-
set any benefits of a lower interest and inflationary environment. This has
also impacted the availability of capital and liquidity in the local market,
which has the effect of a reduced balance sheet growth.
Whilst the balance sheet grew 17.5% compared to June 2008, growth for the six
months under review reduced to 10.0% (annualised) with the balance sheet
growing from R48.8 billion at 31 December 2008 to R51.2 billion at 30 June
2009. In reviewing the trading results, it is encouraging that margins widened
with net interest income increasing 18.4% compared to the six months to 30 June
2008. Core non-interest revenue consisting of fees and commissions increased
64.3% from R49.3 million to R81.0 million, as a result of strong administration
fees. Overall revenue was negatively impacted by mark to market losses of R11.5
million (June 2008 profits of R24.6 million). Operating expenses remained well
controlled with the efficiency ratio improving from 26.8% to 26.3%.
Impairments, however, reflect the severe strain in the economy, increasing
70.0% from R340.8 million to R579.3 million. Consequently, profit for the
period declined 42.0% from R188.7 million to R109.4 million.
The effective tax rate was 28.5% compared to 33.5% last year.
There are no material events which have occurred subsequent to 30 June 2009
which may have an impact on the Bank`s reported financial position at this
date.
PROSPECTS
There continues to be uncertainty in both the world and the South African
economy with the recession likely to continue for longer than originally
expected. Although trading conditions remain tough and unpredictable, there are
indications that the lower interest rates are beginning to assist consumers,
which would enable the Bank to achieve better results in the second six-month
period.
All business units are focused on improving risk-based pricing, increasing
non-interest revenue and tightly controlling operating expenditure. In
addition, all business units have a key focus on managing arrear accounts and
collections. Demand for commercial property finance and motor finance,
particularly for pre-owned passenger vehicles, remains steady whilst demand
for professional finance is muted. There is very little demand for residential
development finance. In view of current difficult trading conditions Supplier
Asset Finance will selectively consider new business while focusing on
returning the business to profitability.
CAPITAL MANAGEMENT
As previously reported, the Bank intends to increase the capital adequacy ratio
over time from the current 10.7% to 12.0%. However, under current market
conditions, it is not attractive to raise Tier II capital and therefore the
Bank will manage asset growth with a view to steadily improving the capital
ratio until such time as market conditions are conducive to the raising of
additional capital, whilst at all times maintaining the minimum regulatory
capital requirements.
BOARD OF DIRECTORS
There have been no changes to the board of directors since December 2008.
ACCOUNTING POLICIES
The accounting policies applied for the period are consistent with those of
the prior year. The Imperial Bank 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 cost basis except for the fair value of certain financial
instruments. These condensed financial statements have been prepared in terms
of IAS 34: Interim Financial Reporting and IAS 1: Presentation of Financial
Statements.
IMPERIAL BANK NON-REDEEMABLE, NON-PARTICIPATING, NON-CUMULATIVE PREFERENCE
SHARES
Declaration of dividend No. 6
Notice is hereby given that preference dividend No. 6 of 457.20548 cents per
share has been declared for the period from 1 January 2009 to 30 June 2009,
payable on Monday, 14 September 2009, 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, 11 September 2009.
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, 4 September 2009
Shares trade ex dividend Monday, 7 September 2009
Record date Friday, 11 September 2009
Payment date Monday, 14 September 2009
Share certificates may not be dematerialised or rematerialised between Monday,
7 September 2009 and Friday, 11 September 2009, 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, 14
September 2009.
For and on behalf of the board
H R Brody R van Wyk
Chairman Chief Executive Officer
21 July 2009
KEY RATIOS
At June June December
2009* 2008* 2008**
Net interest income to average
interest-earning banking
assets % 4.1 4.2 4.2
Impairment charge as a percentage of
average gross loans
and advances % 2.5 1.8 1.7
Non-interest revenue as a percentage of
operating income*** % 15.5 13.6 7.8
Efficiency ratio % 26.3 26.8 28.8
Return on ordinary shareholders` equity % 7.1 15.5 13.2
Return on total average assets % 0.4 0.9 0.8
Capital adequacy
- Tier 1 % 8.2 7.5 8.5
- Total % 10.7 10.9 11.1
SHARE STATISTICS
Number of shares in issue
- Ordinary shares m 393.7 340.0 393.7
- Preference shares m 3.0 3.0 3.0
Preference share traded price (closing) R 89.0 81.0 72.4
Net asset value per ordinary share R 8.8 8.2 8.5
CORPORATE INFORMATION
Registered office: Imperial Bank Limited, 24 Achter Road, Paulshof, 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,
P K Ward. * 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 STATEMENT OF COMPREHENSIVE
INCOME
For the period ended June June December
2009 2008 2008
R`000* R`000* R`000**
Interest and similar income 3 223 371 2 930 092 6 431 739
Interest expense and similar
charges 2 264 924 2 120 295 4 699 196
Net interest income 958 447 809 797 1 732 543
Impairment charge on loans and
advances 579 335 340 830 700 538
Income from lending activities 379 112 468 967 1 032 005
Non-interest revenue*** 69 529 73 964 87 324
Operating income*** 448 641 542 931 1 119 329
Operating expenses 270 200 236 843 524 846
Indirect taxation 25 632 22 570 51 310
Profit from operations before
non-trading and
capital items 152 809 283 518 543 173
Non-trading and capital
items*** 304 202 285
- Net profit on sale of
property and equipment 304 202 285
Profit before direct taxation 153 113 283 720 543 458
Total direct taxation 43 694 95 029 182 245
- Direct taxation 43 609 94 972 182 165
- Taxation on non-trading and
capital items 85 57 80
Profit for the period 109 419 188 691 361 213
Other comprehensive income net
of taxation: - - 11 823
- Gains on property revaluation - - 15 727
- Taxation on other
comprehensive income - - (3 904)
Total comprehensive income for
the period 109 419 188 691 373 036
Profit attributable to:
- Equity holders of the parent 109 419 188 691 373 036
- Non-controlling interest -
preference shareholders 16 360 14 435 29 895
CONDENSED GROUP STATEMENT OF FINANCIAL POSITION
At June June December
2009 2008 2008
R`000* R`000* R`000**
ASSETS
Cash and cash equivalents 12 531 280 46 693
Other short-term securities 2 131 806 1 496 794 1 563 385
Derivative financial
instruments 63 969 244 444 37 619
Government and other securities 304 562 303 643 529 163
Loans and advances to
customers 46 771 744 39 929 663 44 734 236
Current taxation 11 949 - -
Other assets 448 548 411 821 504 787
Investment securities 4 531 5 422 5 183
Property and equipment 313 566 230 558 279 484
Mandatory deposits with
central bank 1 119 403 938 688 1 067 545
Total assets 51 182 609 43 561 313 48 768 095
EQUITY AND LIABILITIES
Ordinary share capital 3 937 3 400 3 937
Ordinary share premium 1 097 747 648 284 1 097 747
Reserves 2 053 689 1 845 362 1 960 630
Total ordinary shareholders`
equity 3 155 373 2 497 046 3 062 314
Preference share capital and
premium 298 047 298 047 298 047
Total shareholders` equity 3 453 420 2 795 093 3 360 361
Total liabilities 47 729 189 40 766 220 45 407 734
Derivative financial
instruments 262 765 134 911 357 171
Amounts owed to depositors 46 275 936 39 270 932 43 934 979
Other liabilities 206 015 218 927 110 712
Provisions 19 703 35 353 45 403
Current taxation - (3 853) 5 706
Deferred taxation 174 509 150 312 162 013
Long-term debt instruments 790 261 959 638 791 750
Total equity and liabilities 51 182 609 43 561 313 48 768 095
Contingent liabilities and
unutilised facilities 2 682 445 3 271 564 2 515 567
OPERATING DIVISIONS % OF PROFIT FOR THE PERIOD ENDED 30 JUNE 2009
Please see Press for Graph
CONDENSED GROUP STATEMENT OF CASH FLOWS
For the period ended June June December
2009 2008 2008
R`000* R`000* R`000**
Cash generated by operating activities 786 454 639 755 1 364 900
Change in funds for operating
activities (628 245) (247 877) (826 524)
Net cash generated by operating
activities before taxation paid 158 209 391 878 538 376
Taxation paid (74 486) (83 044) (174 985)
Cash flows from operating activities 83 723 308 834 363 391
Cash flows utilised by investing
activities (49 667) (61 343) (106 553)
Cash flows (utilised by)/generated
from financing
activities (16 360) (88 831) 77 092
Net increase in cash and cash
equivalents 17 696 158 660 333 930
Cash and cash equivalents at the
beginning
of the period 1 114 238 780 308 780 308
Cash and cash equivalents at the end
of the period 1 131 934 938 968 1 114 238
CONDENSED GROUP STATEMENT OF CHANGES IN EQUITY
For the period ended
Number of Number of Ordinary
ordinary preference share
shares shares capital
R`000*
Balance at 31 December 2007 340 009 624 3 000 000 3 400
Transfer(from)/to reserves
Total comprehensive income for
the period
Ordinary dividends paid
Preference dividends paid
Ordinary shares issued 53 673 165 537
Balance at 31 December 2008 393 682 789 3 000 000 3 937
Total comprehensive income
for the period
Preference dividends paid
Balance at 30 June 2009 393 682 789 3 000 000 3 937
For the period ended
Ordinary General
share Revaluation credit risk
premium reserve reserve
R`000* R`000* R`000*
Balance at 31 December 2007 648 284 35 361 229 371
Transfer(from)/to reserves (229 371)
Total comprehensive income for
the period 11 823
Ordinary dividends paid
Preference dividends paid
Ordinary shares issued 449 463
Balance at 31 December 2008 1 097 747 47 184 -
Total comprehensive income
for the period
Preference dividends paid
Balance at 30 June 2009 1 097 747 47 184 -
For the period ended Total Preference
ordinary share capital
Accumulated shareholders` and
profit equity premium
R`000* R`000* R`000*
Balance at 31 December 2007 1 480 770 2 397 186 298 047
Transfer(from)/to reserves 229 371 -
Total comprehensive income
for
the period 361 213 373 036
Ordinary dividends paid (128 013) (128 013)
Preference dividends paid (29 895) (29 895)
Ordinary shares issued 450 000
Balance at 31 December 2008 1 913 446 3 062 314 298 047
Total comprehensive income
for the period 109 419 109 419
Preference dividends paid (16 360) (16 360)
Balance at 30 June 2009 2 006 505 3 155 373 298 047
For the period ended
Total
shareholders`
equity
R`000*
Balance at 31 December 2007 2 695 233
Transfer(from)/to reserves -
Total comprehensive income for
the period 373 036
Ordinary dividends paid (128 013)
Preference dividends paid (29 895)
Ordinary shares issued 450 000
Balance at 31 December 2008 3 360 361
Total comprehensive income
for the period 109 419
Preference dividends paid (16 360)
Balance at 30 June 2009 3 453 420
SEGMENTAL ANALYSIS BY OPERATION
For the period ended Total assets (Rbn)
Twelve
Six months Six months months
June June December
2009* 2008* 2008**
Motor Finance 30.3 24.8 28.5
Property Finance 8.4 7.7 8.0
Professional Finance 5.1 4.6 4.9
Supplier Asset Finance 3.5 3.4 3.7
Treasury and Eliminations 3.9 3.1 3.7
Total 51.2 43.6 48.8
For the period ended Operating income (Rm)***
Twelve
Six months Six months months
June June December
2009* 2008* 2008**
Motor Finance 227.4 264.8 549.6
Property Finance 98.0 156.1 286.1
Professional Finance 45.0 48.1 78.5
Supplier Asset Finance 28.0 53.3 120.5
Treasury and Eliminations 0.2 20.6 84.6
Total 448.6 542.9 1 119.3
For the period ended Profit for the period (Rm)
Twelve
Six months Six months months
June June December
2009* 2008* 2008**
Motor Finance 68.6 70.4 134.5
Property Finance 41.1 84.3 151.4
Professional Finance 10.5 12.5 13.1
Supplier Asset Finance (9.6) 9.6 32.1
Treasury and Eliminations (1.2) 11.9 30.1
Total 109.4 188.7 361.2
* Unaudited ** Audited
*** Non-interest revenue and operating income have been restated to exclude
non-trading and capital items in order to align with Nedbank`s disclosure.
These results are available on our website
www.imperialbank.co.za
31 July 2009
Date: 31/07/2009 09:21:34 Produced by the JSE SENS Department.
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