ABIL full-year profits rise

JOHANNESBURG – South Africa’s biggest mass-market lender, African Bank Investments Limited (ABIL) yesterday posted a 15 per cent rise in headline earnings, boosted by a robust economy and increased lending.

Abil said in a statement to the JSE Securities Exchange that headline earnings per share, which strips out capital, non-trading and one-off items, jumped to 161,6 cents in the year to September 30 from 140,4 cents in the year-ago period. ABIL, South Africa’s dominant lender of small amounts to low income groups, said that full-year new loans granted were up by 25 per cent to 4,4 billion rand over the prior period, growing its lending books by 13 per cent.It said the growth in lending books was largely offset profits by a 34 per cent fall in the pay down books, but it still made a net growth in gross interest-bearing advances of four per cent to 5,1 billion rand, reversing the declining trends of recent years.ABIL distinguishes between “lending books”, being advances books in which lending is continuing and “pay down books”, being books that are being unwound and in which no new lending is taking place.This is done in order to facilitate enhanced disclosure regarding asset quality and growth, given the significant changes that have taken place in the ABIL advances portfolios over the last few years.The lender said the ongoing change in the mix of the lending portfolio towards retail debit order loans as well as the decline in low-yielding pay down books led to a huge rise in the total yield on advances from 52,9 per cent to 60,3 per cent.”The positive economic environment over the past twelve months has been conducive to a consistent and steady performance of ABIL’s businesses,” the bank said, adding that it had also tightened its operating focus on its main business drivers.”Looking forward to 2005, the group expects to grow sales between 10 percent and 20 per cent, depending on market conditions and legislative developments,” it said.Abil also said its margins were further enhanced by increased contributions from the higher yielding businesses of Credit Indemnity and Miners Credit.Total revenue grew by seven per cent to 3,074 million rand against 2,866 million rand previously.Abil’s share traded 1,0 per cent lower at 14,90 rand by 0826 GMT, while the mid-cap index was up 0,07 per cent.-Nampa-ReutersABIL, South Africa’s dominant lender of small amounts to low income groups, said that full-year new loans granted were up by 25 per cent to 4,4 billion rand over the prior period, growing its lending books by 13 per cent.It said the growth in lending books was largely offset profits by a 34 per cent fall in the pay down books, but it still made a net growth in gross interest-bearing advances of four per cent to 5,1 billion rand, reversing the declining trends of recent years.ABIL distinguishes between “lending books”, being advances books in which lending is continuing and “pay down books”, being books that are being unwound and in which no new lending is taking place.This is done in order to facilitate enhanced disclosure regarding asset quality and growth, given the significant changes that have taken place in the ABIL advances portfolios over the last few years.The lender said the ongoing change in the mix of the lending portfolio towards retail debit order loans as well as the decline in low-yielding pay down books led to a huge rise in the total yield on advances from 52,9 per cent to 60,3 per cent.”The positive economic environment over the past twelve months has been conducive to a consistent and steady performance of ABIL’s businesses,” the bank said, adding that it had also tightened its operating focus on its main business drivers.”Looking forward to 2005, the group expects to grow sales between 10 percent and 20 per cent, depending on market conditions and legislative developments,” it said.Abil also said its margins were further enhanced by increased contributions from the higher yielding businesses of Credit Indemnity and Miners Credit.Total revenue grew by seven per cent to 3,074 million rand against 2,866 million rand previously.Abil’s share traded 1,0 per cent lower at 14,90 rand by 0826 GMT, while the mid-cap index was up 0,07 per cent.-Nampa-Reuters