REG - Commercial Int Bank - CIB FY2021 Earnings Release
22/02/2022 07:00
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RNS Number : 3508C Commercial Intnl Bank (Egypt) SAE 22 February 2022
News Release
22 February 2022
COMMERCIAL INTERNATIONAL BANK ("CIB") REPORTS
FULL-YEAR 2021 CONSOLIDATED REVENUE OF EGP 26.7 BILLION AND NET INCOME OF EGP
13.3 BILLION, OR EGP 6.10 PER SHARE, UP 30% FROM FULL-YEAR 2020
FOURTH-QUARTER 2021 CONSOLIDATED REVENUE OF EGP 6.93 BILLION AND NET INCOME OF
EGP 3.37 BILLION, OR EGP 1.53 PER SHARE, UP 17% FROM FOURTH-QUARTER 2020
· Fourth-Quarter 2021 Consolidated Financial Results
o Net income of EGP 3.37 billion, up 17% year-on-year (YoY)
o Revenues of EGP 6.93 billion, up 5% YoY
o Return on average equity of 20.0%
o Return on average assets of 2.72%
o Efficiency ratio of 24.5%
o Net interest margin (NIM) 1 of 5.68%
· Full-Year 2021 Consolidated Financial Results
o Net income of EGP 13.3 billion, up 30% YoY
o Revenues of EGP 26.7 billion, up 3% YoY
o Return on average equity 2 of 21.7%
o Return on average assets2 of 2.88%
o Efficiency ratio of 22.8%
o Net interest margin (NIM)(1) of 5.67%
· Resilient Balance Sheet
o Total tier capital recorded EGP 70.0 billion, or 29.9% of risk-weighted
assets
o CBE local currency liquidity ratio of 57.5%, foreign currency liquidity
ratio of 66.2% (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 95% of total
liabilities
o Non-performing loans coverage ratio of 213%
· Supporting our Economy
o Funding to businesses and individuals grew by 20% over 2021 to record EGP
163 billion, with a loan market share of 5.20%(( 3 )).
o Deposits grew by 19% over 2021 to record EGP 406 billion, with a deposit
market share of 6.76%(2).
o Loan-to-Deposit Ratio recorded 40.2% by end of 2021.
o In full-year 2021, CIB's operations generated EGP 6.84 billion in
corporate, payroll, and other taxes.
· Committed to our Community
o CIB Foundation financed "Children Cancer Hospital 57357" to install
Digital Pathology Lab and cover 2021 Annual Operating Costs.
o CIB Foundation subsidized "Egyptian Clothing Bank" with the needed amount
to manufacture and distribute 70,000 training suits and 70,000 shoes.
o CIB Foundation, in collaboration with "Sonaa El Kheir" in "Hayah Karima
Campaign", provided comprehensive medical service through convoys running
across 42 schools.
o CIB Foundation funded "Magdy Yacoub Foundation" with the first and second
installments to cover 400 open-heart surgeries and 690 catheterization
procedures.
o CIB Foundation joined forces with "The National Foundation for Family and
Community Development" to establish clinics and rehabilitation centers.
o CIB Foundation financed "Aswan University Hospital" to outfit the
Pediatric Neurosurgery Department.
· Awards & Rankings
o Global Finance: Best Treasury and Cash Management Providers in Egypt, Best
Trade Finance Provider in Egypt, Best Bank in Egypt, Best Digital Bank,
Financial Leadership in Sustaining Communities in the Middle East, Sustainable
Finance Award
o The Digital Banker: Best Financial Chain Initiative in Egypt, Best
Supplier Financing Initiative, Best Bank for Cash Management, Best Bank for
Payment Services, Best Transaction Banking
o African Banker: Sustainable Bank of the Year
o Euromoney: Best Bank in Egypt
o The Banker: Best Digital Bank in Africa
o Asiamoney: Best Domestic Bank in Egypt
o MEED: Best CSR Initiative in Asia and Middle East
o EMEA Finance's African Banking Awards 2021: Most Innovative Bank
o Forbes: World's Best Employers 2021
CAIRO - Commercial International Bank (EGX: COMI) today reported
fourth-quarter 2021 consolidated net income of EGP 3.37 billion, or EGP 1.53
per share, up 17% from fourth-quarter 2020. Full-year 2021 consolidated net
income recorded EGP 13.3 billion, or EGP 6.10 per share, up by 30% from last
year.
Management commented: "Following a year of continued uncertainty, CIB achieved
yet again its record performance in 2021, reiterating its leading market
position in terms of both profitability and solvency through the year, while
remaining committed to elevate the overall customer banking experience.
Bottom line growth came in exceptionally strong, thanks to the Bank's unique
coverage and flexible balance sheet structure, which helped navigate
efficiently through market dynamics. Such advantages, alongside Management's
focus on rationalizing costs, led to sustained balance sheet growth momentum
without markedly compromising on spreads, especially on the local currency
front, with local currency deposits growing by a notable 23%. CIB lending
activity showed impressive progress as well, in both local and foreign
currency, with an unprecedented 29% growth since 2011 in local currency loans.
This further fueled top line growth, coupled with a strong revival in
contingent business and foreign exchange trading activities, generating a
significant rebound in core fees and commissions. Moreover, the Bank's healthy
coverage and prudent risk management, over the years, contributed to this
singular loan growth, allowing for normalized provision accumulations in light
of relatively stabilizing economic conditions compared to last year. CIB
maintained its foremost coverage position in the market, for both expected and
unexpected losses, with loan loss provision balance covering 11% of gross
loans, combined with the Bank's regulatory capital base covering 30% of its
risk-weighted assets. Despite the adequate capital buffer above minimum
regulatory requirements, the return to CIB shareholders remained amongst the
most competitive in the market, with Return on Average Equity recording 21.9%,
after profit appropriation, up by 255 basis points from last year.
In line with the Bank's leading role in Digital Transformation, CIB pursued
new levels in achieving outstanding records in cost synergies with direct
impact on Bank's financial results. This came as Management placed due focus
on automating and digitizing its business processes, attracting more
digitally-engaged customers and paving the way for its trade business growth,
especially with the increase in online service penetration rates following the
COVID-19 outbreak. With that, CIB is ranked first among all Egyptian Banks in
governmental and commercial domestic E-payment transactions, reflecting the
significant increase in volume and value of transactions, with more than 1
million users in the Online Banking Digital Consumer Channel by end of 2021,
and more than 100% YoY increase in transaction value, reaching EGP 861 billion
across all Bank's digital channels. This came alongside revamping the branch
experience, creating new customer touchpoints to serve new segments and add
new services, while adopting a new culture of agility.
Moving forward, Management remains committed to the Bank's role in supporting
the economy through individual and corporate financing within the scope of its
prudent risk management and operational evolution, while sustaining the
balance between profitability and liquidity amidst probable market
challenges."
FOURTH-QUARTER 2021 FINANCIAL HIGHLIGHTS
REVENUES
Fourth-quarter 2021 standalone revenues were EGP 7.05 billion, up 8% from
fourth-quarter 2020. Full-year 2021 standalone revenues were EGP 26.8 billion,
up 4% from 2020, wholly driven by non-interest income coming 2x higher YoY,
slightly pulled down by 1% decrease in net interest income.
NET INTEREST INCOME
Full-year 2021 standalone net interest income recorded EGP 24.9 billion,
decreasing by 1% YoY, with Total NIM decreasing by 108 basis points (bp), due
mainly to the maturities of exceptionally-high-yielding bonds previously
purchased. Normalizing for the above-market-interest-rate-differential of the
aforementioned bonds in full-year 2020, net interest income grew by 14% YoY,
generated at 5.67% Total NIM(1), down by 22bp YoY, with Local Currency NIM(1)
recording 7.25%, down 54bp, and Foreign Currency NIM(1) recording 1.06%, down
19bp YoY.
NON-INTEREST INCOME
Full-year 2021 non-interest income recorded EGP 1.87 billion, coming 2x higher
YoY. Upon adding back contingent provision charged, which is normally deducted
from Non-Interest Income as part of Other Operating Expenses, recording EGP
411 million for full-year 2021 and EGP 1.29 billion for full-year 2020,
standalone non-interest income grew by 12% YoY. Trade service fees were EGP
798 million, growing by 14% YoY, with outstanding balance of EGP 91.6
billion 4 .
OPERATING EXPENSE
Full-year 2021 standalone operating expense was EGP 6.1 billion, up 10% YoY.
Cost-to-income 5 reported 22.4%, 197bp higher YoY, while remaining
comfortably below the desirable level of 30%. Normalized for the
aforementioned 2020 bond yield-highs, cost-to-income came 76bp lower YoY.
LOANS
Gross loan portfolio recorded EGP 163 billion, growing by 20% or EGP 27.0
billion YoY. Growth was driven mainly by local currency loans, growing by 29%
or EGP 25.4 billion, alongside foreign currency loans, adding 3% or USD 104
million. CIB's loan market share reached 5.20% as of October 2021.
DEPOSITS
Deposits recorded EGP 406 billion, growing by 19% or EGP 66.0 billion YoY.
Growth was driven mainly by local currency deposits, growing by 23% or EGP
59.0 billion, besides foreign currency deposits, adding 8% or USD 452 million.
CIB's deposit market share recorded 6.76% as of October 2021, maintaining the
highest deposit market share among all private-sector banks.
ASSET QUALITY
CIB maintained its resilient asset quality. Standalone non-performing loans
represented 5.13% of the gross loan portfolio, covered 213% by the Bank's EGP
17.9 billion loan loss provision balance. Full-year 2021 loan loss provision
expense recorded EGP 1.68 billion, 66% lower YoY.
CAPITAL AND LIQUIDITY
Total tier capital recorded EGP 70.0 billion, or 29.9% of risk-weighted
assets as of December 2021. Tier I capital reached EGP 63.0 billion, or 90% 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 local
currency liquidity ratio remained well above the regulator's 20% requirement,
recording 57.5% as of December 2021, while CBE foreign currency liquidity
ratio reached 66.2%, above the threshold of 25%. NSFR was 282% for local
currency and 170% for foreign currency, and LCR was 902% for local currency
and 304% for foreign currency, comfortably above the 100% Basel III
requirement.
KEY METRICS AND BUSINESS UPDATES(( 6 ))
· #1 private-sector bank in Egypt in terms of revenues, net income,
deposits, and total assets
INSTITUTIONAL BANKING
· End-of-period gross loans were EGP 119.9 billion, 21% higher YoY, on
34% growth in local currency loans and 5% growth in foreign currency loans.
· End-of-period deposits were EGP 138.6 billion, 24% higher YoY, on 27%
growth in local currency deposits and 16% growth in foreign currency deposits.
· Gross outstanding contingent business reached EGP 95.0 billion, 10%
higher YoY.
BUSINESS BANKING
· End-of-period gross loans were EGP 3.2 billion, 93% higher YoY,
solely in local currency.
· End-of-period deposits were EGP 41.7 billion, 41% higher YoY, mostly
on local currency deposit growth of 44%, besides foreign currency deposit
growth of 29%.
· Gross outstanding contingent business reached EGP 2.7 billion, 46%
higher YoY.
RETAIL INDIVIDUALS BANKING
· End-of-period gross loans were EGP 40.3 billion, 14% higher YoY,
wholly on 17% growth in local currency loans.
· End-of-period deposits were EGP 225.8 billion, 14% higher YoY, driven
by local currency deposit growth of 18%.
· CIB continued to expand its network to reach a total of 188 branches
and 27 units across Egypt, supported by a network of 1,284 ATMs.
CONSOLIDATED FINANCIAL HIGHLIGHTS
Income Statement 4Q21 3Q21 QoQ Change 4Q20 YoY change FY21 FY20 YoY change
EGP million EGP million (4Q21 vs.3Q21) EGP million (4Q21 vs. 4Q20) EGP million EGP million (FY21 vs. FY20)
Net Interest Income 6,811 6,458 5% 6,332 8% 24,966 25,172 -1%
Non-Interest Income 119 682 -83% 246 -52% 1,730 709 144%
Net Operating Income 6,930 7,140 -3% 6,578 5% 26,696 25,881 3%
Non-Interest Expense (1,744) (1,492) 17% (1,425) 22% (6,183) (5,626) 10%
Loan Loss Provision (356) (303) 17% (1,156) -69% (1,680) (5,019) -67%
Net Profit before Tax 4,829 5,344 -10% 3,997 21% 18,833 15,236 24%
Income Tax (1,564) (1,525) 3% (1,129) 39% (5,680) (5,087) 12%
Deferred Tax 102 (7) NM 24 325% 114 87 31%
Net profit 3,367 3,812 -12% 2,892 16% 13,268 10,236 30%
Minority Interest (2.5) (0.2) NM 0 NM (4.5) (1.8) 143%
Net Profit After Minority 3,370 3,812 -12% 2,892 17% 13,272 10,238 30%
Financial Indicators 4Q21 3Q21 QoQ Change 4Q20 YoY change FY21 FY20 YoY change
(4Q21 vs.3Q21) (4Q21 vs. 4Q20) (FY21 vs. FY20)
Profitability
ROAE* 20.0% 23.7% -16% 20.4% -2% 21.7% 19.2% 13%
ROAA* 2.72% 3.17% -14% 2.75% -1% 2.88% 2.53% 14%
Efficiency
Cost-to-Income 24.5% 21.4% 15% 20.8% 17% 22.8% 20.7% 10%
Liquidity
Gross Loans-to-Deposits 40.3% 39.1% 3% 40.2% 0.3% 40.3% 40.2% 0.3%
Asset Quality
NPLs-to-Gross Loans 5.12% 5.42% -5% 4.26% 20% 5.12% 4.26% 20%
Capital Adequacy Ratio 29.9% 32.1% -7% 31.4% -5% 29.9% 31.4% -5%
STANDALONE FINANCIAL HIGHLIGHTS
Income Statement 4Q21 3Q21 QoQ Change 4Q20 YoY change FY21 FY20 YoY change
EGP million EGP million (4Q21 vs.3Q21) EGP million (4Q21 vs. 4Q20) EGP million EGP million (FY21 vs. FY20)
Net Interest Income 6,782 6,433 5% 6,257 8% 24,888 25,090 -1%
Non-Interest Income 266 687 -61% 245 9% 1,867 749 149%
Net Operating Income 7,048 7,119 -1% 6,502 8% 26,755 25,839 4%
Non-Interest Expense (1,714) (1,464) 17% (1,368) 25% (6,096) (5,553) 10%
Loan loss provision (352) (307) 15% (1,127) -69% (1,677) (4,989) -66%
Net Profit before Tax 4,983 5,349 -7% 4,006 24% 18,981 15,297 24%
Income Tax (1,563) (1,525) 3% (1,126) 39% (5,679) (5,085) 12%
Deferred Tax 106 (7) NM 24 342% 118 87 35%
Net Profit 3,526 3,817 -8% 2,904 21% 13,420 10,300 30%
Financial Indicators 4Q21 3Q21 QoQ Change 4Q20 YoY change FY21 FY20 YoY change
(4Q21 vs.3Q21) (4Q21 vs. 4Q20) (FY21 vs. FY20)
Profitability
ROAE* 20.9% 23.7% -12% 20.5% 2% 21.9% 19.3% 13%
ROAA* 2.85% 3.19% -10% 2.77% 3% 2.93% 2.55% 15%
NIM** 5.68% 5.70% 0% 6.40% -11% 5.67% 6.75% -16%
Efficiency
Cost-to-Income 23.6% 21.0% 12% 20.2% 17% 22.4% 20.5% 10%
Liquidity
Gross Loans-to-Deposits 40.2% 39.0% 3% 40.1% 0% 40.2% 40.1% 0%
Asset Quality
NPLs-to-Gross Loans 5.13% 5.43% -6% 4.27% 20% 5.13% 4.27% 20%
Direct Coverage Ratio 213% 206% 4% 281% -24% 213% 281% -24%
*Full-year ROAE and ROAA after profit appropriation
**NIM based on managerial accounts
Consolidated Standalone
BALANCE SHEET Dec-21 Dec-20 YoY Change Dec-21 Dec-20 YoY Change
EGP million EGP million (Dec-21 Vs. Dec-20) EGP million EGP million (Dec-21 Vs. Dec-20)
Cash & Due from Central Bank 43,492 33,769 29% 43,385 33,573 29%
Due from Banks 80,142 87,426 -8% 79,991 86,997 -8%
Net Loans & Overdrafts 145,887 120,347 21% 145,078 119,632 21%
Financial Derivatives 225 249 -9% 225 249 -9%
Financial Investment Securities 213,987 173,764 23% 212,951 173,027 23%
Investments in Associates and Subsidiaries 205 140 47% 1,014 874 16%
Other Assets 14,296 12,148 18% 14,006 11,793 19%
Total Assets 498,236 427,842 16% 496,651 426,145 17%
Due to Banks 866 8,818 -90% 863 8,816 -90%
Customer Deposits 407,242 341,169 19% 406,101 340,087 19%
Other Liabilities 20,826 17,896 16% 20,759 17,838 16%
Total Liabilities 428,933 367,883 17% 427,723 366,740 17%
Shareholders' Equity & Net Profit 68,848 59,476 16% 68,928 59,405 16%
Minority Interest 455 483 -6% 0 0 NM
Total Liabilities & Shareholders' Equity 498,236 427,842 16% 496,651 426,145 17%
1 Based on managerial accounts.
2 After profit appropriation.
3 As of October 2021; latest available CBE data at time of print.
4 Net of Collateral, Gross of Provisions.
5 Cost-to-income is calculated using revenues after adding/deducting back
contingent provision charged/released.
6 Loan, deposit, and outstanding contingent balances are based on managerial
accounts.
Outstanding contingent balances are gross of collateral and provisions.
Growth in foreign currency balances is in real terms, excluding the effect
of EGP appreciation by EGP 0.02 over full-year 2021.
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