Jaiz Bank grows profit by 54% to N979.2m in Q1

Nigeria’s premier non-interest bank, Jaiz Bank Plc recorded strong growths in the top-line and bottom-line in the first quarter of this year, with pre-tax profit rising by 54 per cent to N979.2 million within the three-month period.

Interim report and accounts of Jaiz Bank for the period ended March 31, 2021 released at the Nigerian Exchange (NGX) Limited showed that gross earnings rose by 45 per cent from N4.18 billion in first quarter 2020 to N5.99 billion in first quarter 2021. Profit before tax leapt from N636.69 million to N979.17 million.

The results further improve the earnings outlook of the bank, with consistent earnings reassuring all stakeholders and the investing public that the bank may surpass expectations by the end of the current business year.

Jaiz Bank had distributed more than N833 million as cash dividend to its shareholders for the 2020 business year. With the bank’s earnings per share increasing from 1.88 kobo in the first quarter of last year to 2.82 kobo in the first quarter of the year, market analysts expected to see improved shareholders’ value this year.

Managing Director, Jaiz Bank Plc, Hassan Usman said the first quarter results reflected a continuation of the bank’s positive performance in 2020, where it recorded a profit before tax of N3.07 billion.

He assured that with a strong start to the year, the bank is positioned to maintain this positive outlook for the whole year.

According to him, Jaiz Bank, as the premier non-interest bank in Nigeria, will maintain its remarkable earnings streak and its leading position in non-Interest banking in Nigeria.

He assured that with its investments in technology and the expansion of its retail market drives, the bank is set to meet its profit forecasts and dividend promise to its shareholders.

The first quarter performance places the bank in good stead to achieve its second quarter forecasts. The board of the bank had affirmed that it would remain profitable with above average double-digit profit margin of 14.3 per cent in the second quarter with gross earnings of N6.43 billion within the three-month period.

Second quarter forecasts for the period ending June 30, 2021 released at the NGX indicated that the non-interest bank continues to expect profitable performance across all indices.

The forecasts signed by Executive Director of Operations and Chief Finance Officer, Jaiz Bank Plc, Mr. Abdulfattah Amoo, projected gross earnings at N6.43 billion, including financing incomes of N6.07 billion and other incomes of N358.88 million within the three-month period between April and June, this year.

Financing expenses are projected at N1.23 billion, leaving net revenue from funds at N4.84 billion. Credit impairment is estimated at N750 million while net operating income is expected at N4.45 billion. With operating expenses estimated at N3.53 billion, profit before tax is projected at N918.06 million. After taxes, net profit is expected at N826.26 million.

Jaiz Bank had in a five-year projection made available earlier to the investing public forecast that it would grow its income and profitability consecutively over the five-year period, with pre-tax profit for the period expected to be about N15.86 billion.

The management of the bank had outlined the five-year growth plan of the pioneer non-interest bank, with an assurance that it would sustain year-on-year growth over five-year period.

Usman had explained that the overall vision of the bank was to become the leading non-interest financial institution in Sub-Saharan Africa.

He said the bank has been positioned to sustain its growth trajectory, pointing out that the bank has the necessary resources to achieve its growth targets.

According to the five-year financial forecast, total income was expected to be about N81.17 billion while profit after tax was projected at N11.09 billion for the five-year period. Gross income was expected to rise to N10.07 billion in 2018 and subsequently to N12.59 billion, N15.73 billion, N19.27 billion and N23.51 billion in 2019, 2020, 2021 and 2022 respectively.

Profit before tax was projected to rise to N1.33 billion in 2018 and grow consecutively to N2.03 billion, N3.01 billion, N4.03 billion and N5.47 billion in 2019, 2020, 2021 and 2022 respectively. After taxes, net profit would rise to N927 million in 2018 and grow further to N1.42 billion in 2019. Profit after tax was projected to jump to N2.11 billion in 2020 and rise consecutively to N2.82 billion and N3.83 billion in 2021 and 2022 respectively.

Balance sheet of the bank was also expected to increase over the years. Total assets was projected at N123.61 billion in 2018 and subsequently to N150.5 billion, N182.6 billion, N220.02 billion and N262.80 billion in 2019, 2020, 2021 and 2022 respectively. Deposit was projected to rise consecutively to N88.55 billion, N113.34 billion, N142.81 billion, N177.09 billion and N216.05 billion in 2018, 2019, 2020, 2021 and 2022 respectively. Shareholders’ fund was projected to rise to N28.6 billion in 2018 and grow consecutively to peak at N35.23 billion by 2022.

Shareholders’ return was also expected to grow over the years. Return on equity was expected to firm up to 4.39 per cent in 2018 and improve consecutively to 4.87 per cent, 6.92 per cent, 8.79 per cent and 11.22 per cent in 2019, 2020, 2021 and 2022 respectively.

Usman said the bank’s growth strategy of focussing on the real sector, though painstaking, will ensure sustainable growth and better returns over the years.

According to him, Jaiz Bank wants to develop small and medium enterprises (SMEs), grow with them and support them not only for profit making but to ensure the country achieves real growth.

“We shall continue to internally develop new customers, new markets and new product for both our physical and virtual channels. We remain committed to continuous up-scaling of our governance mechanism to meet the highest operating standards. Cost efficiency is at the heart of our value creation model. We shall strive to be a low cost operator,” Usman said.

He noted that while the bank would continue to expand its operations across the country by opening more branches, it will significantly leverage on technology to reach the nooks and crannies of the country and bring the semi-banked and unbanked population into the formal economy.

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