REG - Commercial Int Bank - CIB - 4Q 2022 Earnings Release
13/02/2023 07:00
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RNS Number : 6494P Commercial Intnl Bank (Egypt) SAE 13 February 2023
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News Release
12 February 2023
COMMERCIAL INTERNATIONAL BANK ("CIB") REPORTS
FULL-YEAR 2022 CONSOLIDATED REVENUE OF EGP 32.9 BILLION AND NET INCOME OF EGP
16.1 BILLION, OR EGP 4.83 PER SHARE, UP 21% FROM FULL-YEAR 2021
FOURTH-QUARTER 2022 CONSOLIDATED REVENUE OF EGP 9.78 BILLION AND NET INCOME OF
EGP 3.95 BILLION, UP 17% FROM FOURTH-QUARTER 2021
· Fourth-Quarter 2022 Consolidated Financial Results
o Net income of EGP 3.95 billion, up 17% year-on-year (YoY)
o Revenues of EGP 9.78 billion, up 41% YoY
o Return on average equity (ROAE) of 23.9%
o Return on average assets (ROAA) of 2.57%
o Efficiency ratio of 22.1%
o Net interest margin (NIM) 1 (#_ftn1) of 6.49%
· Full-Year 2022 Consolidated Financial Results
o Net income of EGP 16.1 billion, up 21% YoY
o Revenues of EGP 32.9 billion, up 23% YoY
o ROAE 2 (#_ftn2) of 25.1%
o ROAA(2) of 2.86%
o Efficiency ratio of 21.2%
o NIM1 of 6.10%
· Strong Balance Sheet
o Total tier capital recorded EGP 75.0 billion, or 22.7% of risk-weighted
assets.
o CBE local currency liquidity ratio of 48.0%, foreign currency liquidity
ratio of 68.1% (comfortably above CBE requirements of 20% and 25%,
respectively)
o CIB remains well above the 100% requirement in the Basel III NSFR and LCR
ratios.
o High quality of funding, with customer deposits comprising 94% of total
liabilities
o Non-performing loans coverage ratio of 227%
· Supporting our Economy
o Funding to businesses and individuals recorded EGP 222 billion, growing by
36% over full-year 2022, or 16% net of the EGP devaluation impact, with a loan
market share of 5.41%(( 3 (#_ftn3) )).
o Deposits recorded EGP 530 billion, growing by 31% over full-year 2022, or
15% net of the EGP devaluation impact, with a deposit market share of
6.10%(3).
o Loan-to-Deposit Ratio recorded 41.8% by end of 2022.
o In full-year 2022, CIB's operations generated EGP 8.03 billion in
corporate, payroll, and other taxes.
· Committed to our Community
o CIB Foundation joined forces with "Raie Masr Foundation" to purchase and
outfit 3 mobile clinics and operate 900 medical convoys.
o CIB Foundation paid a 50%-down-payment to "Life Care" and "EGMED"
companies against LGs to purchase pediatric medical equipment for "Ahl Masr
Hospital".
o CIB Foundation supported "Ain Shams University Children's Hospital" with
the first installment to send doctors and nurses to "Great Ormond Street
Hospital" in England for a 5-year training program.
o CIB Foundation subsidized "Egyptian Clothing Bank" with the second
installment to manufacture 50,000 training suits and shoe pairs.
o CIB Foundation financed "Banha University Hospital" with the third
installment to cover the operating costs pertaining to Pediatric ICU and
Neonatal ICU.
· Awards & Rankings
o Global Finance:
§ World's Best Trade Finance Providers in Egypt for 2022
§ World's Best Foreign Exchange Providers 2022
o The Digital Banker:
§ Best Wholesale/Transaction Bank for Digital Customer Experience
o Euromoney:
§ Best Bank for Digital Solutions in Egypt
§ Best Bank in Egypt
§ Best Bank for SME Banking in Egypt
§ Middle East's Best Bank for SMEs
o EMEA Finance:
§ Best Green Bond in Africa
§ Best Structured Finance Deal in Africa
§ Best Local Currency Loan
§ Best Cash Management Services in North Africa
§ Best Payment Services in North Africa
§ Best Trade Finance Services in North Africa
§ Best Local Bank
o MENA:
§ Sustainable Bank of the Year
CAIRO - Commercial International Bank (EGX: COMI) today reported
fourth-quarter 2022 consolidated net income of EGP 3.95 billion, up 17% from
fourth-quarter 2021. Full-Year 2022 consolidated net income recorded EGP 16.1
billion, or EGP 4.83 per share, up by 21% from last year.
Management commented: "Ending a year packed with extraordinary global and
local challenges, CIB achieved another milestone in 2022, delivering record
financial performance, while maintaining pioneer solvency. This came as
Management wittingly capitalized on the Bank's solid grounding and agile
Balance Sheet structure, which came in largely accommodating for the
unforeseen dynamics on most fronts.
On the funding side, and notwithstanding the fierce competition especially in
the local currency deposit market, CIB managed to sustain its balance sheet
growth momentum, growing its local currency deposit base by an impressive 18%,
and its foreign currency deposit base by a genuine 8%, over the year, to
maintain its highest market share among Private-Sector Banks. This came at
highly-rationalized costs, which, coupled with the Bank's flexible Balance
Sheet structure and proactive Treasury Management, reflected into expanded
margins, despite the highly-competitive and highly-uncertain environment.
On the lending side, CIB continued its role in extending funding to Businesses
and Individuals, delivering remarkable growth this year in local currency
loans, which grew by a notable 35% or EGP 40 billion, and by an even
further-impressive 43% or EGP 53 billion, upon accounting for Securitization
Deals. This, coupled with a strong restoration in Trade Finance Business,
generated a significant rebound in Core Fees and Commissions, hence further
fueling-up top line growth through the sustainable stream of non-interest
income. The latter came in particularly realizable as CIB has been
sufficiently-armed to cater for customer needs and to accommodate the
outstanding backlog of Trade Finance requests, thanks to the Bank's adept
Foreign Currency Liquidity Management in light of the prevailing market
volatility.
Furthermore, this robust loan growth came to pass while preserving the Bank's
top-notch solvency, maintaining the Highest-in-Market Coverage for both
Expected and Unexpected Losses. This was reflected in a Loan Loss Provision
Balance of EGP 24.4 billion, covering 11% of the Bank's Gross Loan Portfolio,
and with the Bank's Capital Adequacy Ratio (CAR) resting at 22.7%, with a
comfortable capital buffer above minimum regulatory requirements, which
shielded against unfavorable macroeconomic dynamics, as well as accommodated
for genuine core business growth. In addition, and despite having the highest
capital buffer in Market, the return to CIB shareholders remained, as well,
amongst the highest in the Banking Sector, with Return on Average Equity
(ROAE) recording 25.1%, after accounting for 2022 Proposed Profit
Appropriation, up by 321 basis points from last year.
On another note, and further attesting its sound fundamentals in face of
uncertainties, CIB anchored its regional presence, kicking-off 2023 with the
acquisition of the remaining 49% stake in the Kenya-based Mayfair-CIB Bank, to
become a fully-owned subsidiary of CIB. Back in April 2020, CIB marked the
first Egyptian Bank to establish a presence in Kenya, viewing a well-regulated
market with potential opportunities for economic prosperity, through owning a
51% stake in Mayfair Bank, which turned in its first-time profit in 2021 since
being licensed in 2017. Now, the acquisition of the remaining stake further
reaffirms the mutual confidence, with the aspiration of Mayfair-CIB playing
the role of the African Digital Hub for CIB, extending the Bank's leading role
in Digital Transformation to new regions and verticals.
Overall, Management is content about CIB's solid performance for the year.
And, although the road ahead remains uncertain, Management yet holds a
cautiously-optimistic view about future economic prospects, with great
confidence in the Bank's ability to efficiently navigate through unforeseen
market dynamics, drawing on its resolute balance sheet fundamentals and firm
coverage."
FOURTH-QUARTER 2022 FINANCIAL HIGHLIGHTS
REVENUES
Fourth-quarter 2022 standalone revenues were EGP 9.68 billion, up 37% from
fourth-quarter 2021. Full-Year 2022 standalone revenues were EGP 32.8 billion,
up 22% from full-year 2021, backed by 24% increase in net interest income,
alongside increase in non-interest income by 3%.
NET INTEREST INCOME
Full-Year 2022 standalone net interest income recorded EGP 30.8 billion,
increasing by 24% YoY, generated at 6.10% Total NIM1, which increased by 43
basis points (bp) YoY, with Local Currency NIM1 recording 7.56%, coming 31bp
higher YoY, and Foreign Currency NIM1 recording 2.34%, coming 128bp higher
YoY.
NON-INTEREST INCOME
Full-Year 2022 standalone non-interest income recorded EGP 1.92 billion,
coming 3% higher YoY. Upon adding back other provision charged, which is
normally deducted from Non-Interest Income as part of Other Operating
Expenses, recording EGP 1.86 billion for full-year 2022 and EGP 411 million
for full-year 2021, standalone non-interest income grew by 66% YoY. Trade
service fees were EGP 1.16 billion, growing by 46% YoY, with outstanding
balance of EGP 135 billion 4 (#_ftn4) .
OPERATING EXPENSE
Full-Year 2022 standalone operating expense was EGP 7.18 billion, up 18% YoY.
Cost-to-income recorded 20.7%, coming 170bp lower YoY 5 (#_ftn5) and
comfortably below the desirable level of 30%.
LOANS
Gross loan portfolio recorded EGP 222 billion, growing by 36% YoY, with real
growth of 16% net of the EGP devaluation impact, which added EGP 28.1 billion
to the EGP equivalent balance. Growth was driven wholly by local currency
loans, increasing by 35% or EGP 40.1 billion, sufficiently counterbalancing
net foreign currency loan repayments of 13% or USD 401 million. CIB's loan
market share reached 5.41% as of September 2022.
DEPOSITS
Deposits recorded EGP 530 billion, growing by 31% YoY, with real growth of 15%
net of the EGP devaluation impact, which added EGP 54.2 billion to the EGP
equivalent balance. Growth was driven by local currency deposits, growing by
18% or EGP 57.3 billion, coupled with foreign currency deposits adding 8% or
USD 507 million. CIB's deposit market share recorded 6.10%3 as of September
2022, maintaining the highest deposit market share among all private-sector
banks.
ASSET QUALITY
CIB maintained its sturdy asset quality. Standalone non-performing loans
represented 4.81% of the gross loan portfolio, covered 229% by the Bank's EGP
24.4 billion loan loss provision balance. Full-Year 2022 loan loss provision
expense recorded EGP 1.51 billion compared to EGP 1.68 billion in full-year
2021.
CAPITAL AND LIQUIDITY
Total tier capital recorded EGP 75.0 billion, or 22.7% of risk-weighted assets
as of December 2022. Tier I capital reached EGP 63.4 billion, or 85% of total
tier capital. CIB maintained its comfortable liquidity position above CBE
requirements and Basel III guidelines in both local currency and foreign
currency. CBE liquidity ratios remained well above the regulator's
requirements, with local currency liquidity ratio recording 48.0% as of
December 2022, compared to the regulator's threshold of 20%, and foreign
currency liquidity ratio reaching 68.1%, above the threshold of 25%. NSFR was
239% for local currency and 208% for foreign currency, and LCR was 1291% for
local currency and 297% for foreign currency, comfortably above the 100% Basel
III requirement.
KEY METRICS AND BUSINESS UPDATES(( 6 (#_ftn6) ))
o #1 private-sector bank in Egypt in terms of revenues, net income,
deposits, and total assets.
INSTITUTIONAL BANKING
o End-of-period gross loans were EGP 162 billion, 35% higher YoY, wholly
backed by 33% growth in local currency loans.
o End-of-period deposits were EGP 195 billion, 41% higher YoY, mostly driven
by 32% growth in local currency deposits, besides 6% growth in foreign
currency deposits.
o Gross outstanding contingent business reached EGP 140 billion, 47% higher
YoY.
BUSINESS BANKING
o End-of-period gross loans were EGP 7 billion, 2x higher YoY, solely on
more than doubled local currency loans.
o End-of-period deposits were EGP 68 billion, 63% higher YoY, driven by 49%
growth in local currency deposits along with 47% growth in foreign currency
deposits.
o Gross outstanding contingent business reached EGP 3.7 billion, 37% higher
YoY.
RETAIL INDIVIDUALS BANKING
o End-of-period gross loans were EGP 53 billion, 30% higher YoY, wholly on
31% growth in local currency loans.
o End-of-period deposits were EGP 267 billion, 18% higher YoY, mainly driven
by 5% growth in foreign currency deposits and 4% growth in local currency
deposits.
o CIB continued to expand its network to reach a total of 190 branches and
21 units across Egypt, supported by a network of 1,307 ATMs.
CONSOLIDATED FINANCIAL HIGHLIGHTS
Income Statement 4Q22 3Q22 QoQ 4Q21 YoY Change FY22 FY21 YoY Change
Change
EGP million EGP million (4Q22 vs. 3Q22) EGP million (4Q22 vs. 4Q21) EGP million EGP million (FY22 vs. FY21)
Net Interest Income 9,187 8,089 14% 6,811 35% 31,005 24,966 24%
Non-Interest Income 588 363 62% 119 397% 1,893 1,730 9%
Net Operating Income 9,776 8,452 16% 6,930 41% 32,898 26,696 23%
Non-Interest Expense (2,230) (1,872) 19% (1,744) 28% (7,372) (6,183) 19%
Loan Loss Provision (1,287) (224) 474% (356) 261% (1,585) (1,680) -6%
Net Profit before Tax 6,259 6,357 -2% 4,829 30% 23,941 18,833 27%
Income Tax (1,459) (1,872) -22% (1,564) -7% (6,345) (5,680) 12%
Deferred Tax (827) (67) NM 102 NM (1,424) 114 NM
Net profit 3,973 4,419 -10% 3,367 18% 16,172 13,268 22%
Minority Interest 23 10 125% (3) NM 58 (4) NM
Net Profit After Minority 3,951 4,408 -10% 3,370 17% 16,114 13,272 21%
Financial Indicators 4Q22 3Q22 QoQ 4Q21 YoY Change FY22 FY21 YoY Change
Change
(4Q22 vs. 3Q22) (4Q22 vs. 4Q21) (FY22 vs. FY21)
Profitability
ROAE* 23.9% 27.1% -12% 20.0% 20% 25.1% 21.7% 16%
ROAA* 2.57% 3.16% -19% 2.72% -5% 2.86% 2.88% -1%
Efficiency
Cost-to-Income 22.1% 21.4% 3% 24.5% -10% 21.2% 22.8% -7%
Liquidity
Gross Loans-to-Deposits 41.9% 40.3% 4% 40.3% 4% 41.9% 40.3% 4%
Asset Quality
NPLs-to-Gross Loans 4.86% 4.61% 5% 5.12% -5% 4.86% 5.12% -5%
Capital Adequacy Ratio 22.7% 26.7% -15% 29.9% -24% 22.7% 29.9% -24%
*Full-year ROAE and ROAA after profit appropriation
STANDALONE FINANCIAL HIGHLIGHTS
Income Statement 4Q22 3Q22 QoQ Change 4Q21 YoY Change FY22 FY21 YoY Change
EGP million EGP million (4Q22 vs. 3Q22) EGP million (4Q22 vs. 4Q21) EGP million EGP million (FY22 vs. FY21)
Net Interest Income 9,125 8,015 14% 6,782 35% 30,836 24,888 24%
Non-Interest Income 551 397 39% 266 107% 1,916 1,867 3%
Net Operating Income 9,677 8,412 15% 7,048 37% 32,752 26,755 22%
Non-Interest Expense (2,152) (1,791) 20% (1,714) 26% (7,177) (6,096) 18%
Loan loss provision (1,249) (248) 403% (352) 255% (1,512) (1,677) -10%
Net Profit before Tax 6,275 6,372 -2% 4,983 26% 24,062 18,981 27%
Income Tax (1,358) (1,874) -28% (1,563) -13% (6,342) (5,679) 12%
Deferred Tax (992) (67) NM 106 NM (1,590) 118 NM
Net Profit 3,924 4,432 -11% 3,526 11% 16,130 13,420 20%
Financial Indicators 4Q22 3Q22 QoQ Change 4Q21 YoY FY22 FY21 YoY Change
Change
(4Q22 vs. 3Q22) (4Q22 vs. 4Q21) (FY22 vs. FY21)
Profitability
ROAE* 23.7% 27.3% -13% 20.9% 14% 25.1% 21.9% 15%
ROAA* 2.56% 3.19% -20% 2.85% -10% 2.87% 2.93% -2%
NIM** 6.49% 6.24% 4% 5.68% 14% 6.10% 5.67% 8%
Efficiency
Cost-to-Income 21.5% 20.6% 4% 23.6% -9% 20.7% 22.4% -8%
Liquidity
Gross Loans-to-Deposits 41.8% 40.2% 4% 40.2% 4% 41.8% 40.2% 4%
Asset Quality
NPLs-to-Gross Loans 4.81% 4.59% 5% 5.13% -6% 4.81% 5.13% -6%
Direct Coverage Ratio 229% 216% 6% 213% 7% 229% 213% 7%
*Full-year ROAE and ROAA after profit appropriation
**NIM based on managerial accounts
BALANCE SHEET
Consolidated Standalone
Balance Sheet Dec-22 Dec-21 YoY Change Dec-22 Dec-21 YoY Change
EGP EGP (Dec-22 Vs. Dec-21) EGP EGP (Dec-22 Vs. Dec-21)
million million million million
Cash & Due from Central Bank 47,493 43,492 9% 47,385 43,385 9%
Due from Banks 133,857 80,142 67% 133,766 79,991 67%
Net Loans & Overdrafts 196,578 145,887 35% 195,599 145,078 35%
Financial Derivatives 1,940 225 761% 1,940 225 761%
Financial Investment Securities 238,545 213,987 11% 237,095 212,951 11%
Investments in Associates and Subsidiaries 186 205 -9% 1,074 1,014 6%
Other Assets 17,233 14,296 21% 16,784 14,006 20%
Total Assets 635,832 498,236 28% 633,643 496,651 28%
Due to Banks 3,497 866 304% 3,476 863 303%
Customer Deposits 531,617 407,242 31% 530,125 406,101 31%
Other Liabilities 32,381 20,826 55% 32,322 20,759 56%
Total Liabilities 567,494 428,933 32% 565,922 427,723 32%
Shareholders' Equity & Net Profit 67,758 68,848 -2% 67,721 68,928 -2%
Minority Interest 580 455 28% 0 0 NM
Total Liabilities & Shareholders' Equity 635,832 498,236 28% 633,643 496,651 28%
1 (#_ftnref1) Based on managerial accounts.
2 (#_ftnref2) After 2022 profit appropriation.
3 (#_ftnref3) As of September 2022; latest available CBE data at time of
publishing. Sep-22 Deposit Market Share excludes EGP 20 billion pertaining to
an inward transfer, which took place on September 29th, 2022 and was withdrawn
on October 2nd, 2022.
4 (#_ftnref4) Net of Collateral, Gross of Provisions.
5 (#_ftnref5) Cost-to-income is calculated using revenues after
adding/deducting back other provision charged/released.
6 (#_ftnref6) 1) Loan, deposit, and outstanding contingent balances are
based on managerial accounts. 2) Growth in foreign currency balances is in
real terms, excluding the effect of EGP devaluation by EGP 9.03 over full-year
2022. 3) Outstanding contingent balances are gross of collateral and
provisions.
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