CIB1H2022 Earnings Release

RNS Number : 5287T
Commercial Intnl Bank (Egypt) SAE
25 July 2022
 

News Release

24 July 2022

COMMERCIAL INTERNATIONAL BANK ("CIB") REPORTS

SECOND-QUARTER 2022 CONSOLIDATED REVENUE OF EGP 6.90 BILLION AND NET INCOME OF EGP 3.51 BILLION, OR EGP 1.58 PER SHARE, UP 9% FROM SECOND-QUARTER 2021

 

· Second-Quarter 2022 Consolidated Financial Results

Net income of EGP 3.51 billion, up 9% year-on-year (YoY)

Revenues of EGP 6.90 billion, up 8% YoY

Return on average equity of 21.5%

Return on average assets of 2.68%

Efficiency ratio of 21.7%

Net interest margin (NIM)[1] of 5.91%

· First-Half 2022 Consolidated Financial Results

Net income of EGP 7.76 billion, up 28% YoY

Revenues of EGP 14.7 billion, up 16% YoY

Return on average equity of 23.1%

Return on average assets of 3.04%

Efficiency ratio of 20.6%

NIM1 of 5.79%

· Resilient Balance Sheet

Total tier capital recorded EGP 73.6 billion, or 28.8% of risk-weighted assets

CBE local currency liquidity ratio of 62.8 % , foreign currency liquidity ratio of 66.2 % (comfortably above CBE requirements of 20% and 25%, respectively)

CIB remains well above the 100% requirement in the Basel III NSFR and LCR ratios

High quality of funding, with customer deposits comprising 94% of total liabilities

Non-performing loans coverage ratio of 209%

· Supporting our Economy

Funding to businesses and individuals recorded EGP 191 billion, growing by 17% over first-half 2022, or 11% net of the EGP devaluation impact, with a loan market share of 5.19%[2].

Deposits recorded EGP 428 billion, growing by 5% over first-half 2022, or 1% net of the EGP devaluation impact, with a deposit market share of 6.13%2.

Loan-to-Deposit Ratio recorded 44.8% by end of first-half 2022.

In second-quarter 2022, CIB's operations generated EGP 2.05 billion in corporate, payroll, and other taxes.

· Committed to our Community

CIB Foundation financed "The Egyptian Naval Forces New Children's Hospital" in Alexandria with the needed amount to purchase new equipment and furnish the Hospital.

CIB Foundation subsidized "Egyptian Clothing Bank" with the first installment to manufacture 50,000 training suits and 50,000 shoe pairs.

CIB Foundation funded "Magdi Yacoub Heart Foundation" with the fourth installment to cover 200 open-heart surgeries and 345 catheterization procedures.

CIB Foundation financed "Ibrahim A.Badran Foundation" with the third installment to support "Our Kids Our Future" Campaign with medical convoys.

CIB Foundation, in collaboration with, "Rotary Giza Metropolitan" funded "El Kasr El Eini Hospital" to cover 38 open-heart surgeries.

· Awards & Rankings

Global Finance:

§ Best Trade Finance Providers in Egypt for 2022

§ World's Best Foreign Exchange Providers 2022

§ Best Bank in Egypt

§ Best Trade Finance Provider in Egypt

§ Best Treasury and Cash Management Providers in Egypt.

The Digital Banker:

§ Best Bank for Payment Services

§ Best Transaction Banking

§ Best Bank for Cash Management

Euromoney:

§ Best Bank for Digital Solutions in Egypt

§ Best Bank in Egypt

§ Country Awards Best Bank for SME Banking in Egypt

§ Regional Awards Middle East's Best Bank for SMEs

EMEA Finance:

§ Best Green Bond in Africa

§ Best Structured Finance Deal in Africa

§ Best Local Currency Loan

MENA

§ Sustainable Bank of the Year

CAIRO - Commercial International Bank (EGX: COMI) today reported second-quarter 2022 consolidated net income of EGP 3.51 billion, or EGP 1.58 per share, up 9% from second-quarter 2021.

Management commented: "CIB concluded the first half of 2022 with remarkable performance drawing on a resilient Egyptian Economy that was able to control the inflationary pressures and pave the way for an encouraging local consumption and a recovery in investment, despite a much fluid global macroeconomic environment.

Throughout the first half, CIB recorded top and bottom line growth of 16% and 28%, respectively, year-on-year (YoY). On the lending side, CIB managed to grow its local currency loan book by 20% or EGP 23 billion over the first half, with around 60% of this amount booked in the second quarter, signaling a gradual pickup in short-term working capital loan demand following a period of justified slow borrowing appetite. Catering to Trade Finance activities, the Bank was well-positioned to avail sufficient foreign currency, assisted in this by its flexible balance sheet structure Management has been building over the years, and proactive Treasury Management, which consequently allowed for efficient allocation of funds in light of interest rate and foreign exchange dynamics. Moreover, CIB managed to preserve its margins at 5.79%, despite the competitive environment, a further testament to Management's focus on safeguarding the returns of both current and future shareholders.

CIB continued its deposit gathering momentum, which came in stronger in the second quarter, recording a healthy 11% growth YoY, with a healthy share of Current and Saving Accounts (CASA) amounting to 56% of Total Deposits, in line with the Bank's funding strategy.

The Bank's coverage levels, for both expected and unexpected losses, remain reassuring, with loan loss provisions covering 10% of the Bank's gross loan portfolio and with Capital Adequacy Ratio (CAR) resting comfortably at 29%. This further affirms the Bank's healthy coverage and prudent risk management maintained over the years."

 

 

 

SECOND-QUARTER 2022 FINANCIAL HIGHLIGHTS

REVENUES

Second -quarter 2022 standalone revenues were EGP 7.03 billion, up 11% from second-quarter 2021. First-half 2022 standalone revenues were EGP 14.7 billion, up 16% from first-half 2021, mostly driven by 17% increase in net interest income, coupled with 6% increase in non-interest income.

NET INTEREST INCOME

First-half 2022 standalone net interest income recorded EGP 13.7 billion, increasing by 17% YoY, generated at 5.79% Total NIM 1 , increasing by 14 basis points (bp) YoY, with Foreign Currency NIM 1 recording 1.43%, coming 54bp higher YoY, and Local Currency NIM 1 recording 7.41%, coming in flat YoY.

NON-INTEREST INCOME

First-half 2022 standalone non-interest income recorded EGP 968 million, coming 6% higher YoY. Upon adding back other provision charged, which is normally deducted from Non-Interest Income as part of Other Operating Expenses, recording EGP 1.24 billion for first-half 2022 and EGP 367 million for first-half 2021, standalone non-interest income grew by 72% YoY. Trade service fees were EGP 470 million, growing by 20% YoY, with outstanding balance of EGP 112 billion[3].

OPERATING EXPENSE

First-half 2022 standalone operating expense was EGP 3.23 billion, up 11% YoY. Cost-to-income reported 20.3%, 220bp lower YoY[4], remaining comfortably below the desirable level of 30%.

LOANS

Gross loan portfolio recorded EGP 191 billion, growing by 17% Year-to-Date (YtD), with real growth of 11% net of the EGP devaluation impact , which added EGP 9.60 billion to the EGP equivalent balance. Growth was driven wholly by local currency loans, growing by 20% or EGP 23.5 billion, sufficiently counterbalancing net foreign currency loan repayments by 9% or USD 265 million. CIB's loan market share reached 5.19% as of March 2022.

DEPOSITS

Deposits recorded EGP 428 billion, growing by 5% YtD, with real growth of 1% net of the EGP devaluation impact, which added EGP 18.5 billion to the EGP equivalent balance. Growth was driven wholly by foreign currency deposits adding 4% or USD 249 million, covering net local currency deposit outflows by 1% or EGP 1.74 billion. CIB's deposit market share recorded 6.13% as of March 2022, maintaining the highest deposit market share among all private-sector banks.

ASSET QUALITY

CIB maintained its resilient asset quality. Standalone non-performing loans represented 4.84% of the gross loan portfolio, covered 209% by the Bank's EGP 19.3 billion loan loss provision balance. First-half 2022 loan loss provision expense recorded EGP 14.4 million compared to loan loss provision expense of EGP 1.02 billion in first-half 2021 .

CAPITAL AND LIQUIDITY

Total tier capital recorded EGP 73.6 billion, or 28.8% of risk-weighted assets as of June 2022. Tier I capital reached EGP 64.7 billion, or 88% 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 62.8% as of June 2022, while CBE foreign currency liquidity ratio reached 66.2%, above the threshold of 25%. NSFR was 223% for local currency and 200% for foreign currency, and LCR was 857% for local currency and 292% for foreign currency, comfortably above the 100% Basel III requirement.

KEY METRICS AND BUSINESS UPDATES[5]

#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 140 billion, 17% higher YtD, wholly backed by 22% growth in local currency loans.

End-of-period deposits were EGP 147 billion, 6% higher YtD, wholly driven by 5% growth in foreign currency deposits. 

Gross outstanding contingent business reached EGP 116 billion, 22% higher YtD.

BUSINESS BANKING

End-of-period gross loans were EGP 5 billion, 50% higher YtD, solely on 51% growth in local currency loans.

End-of-period deposits were EGP 51 billion, 23% higher YtD, driven by 24% growth in foreign currency deposits and 18% growth in local currency deposits. 

Gross outstanding contingent business reached EGP 3.51 billion, 31% higher YtD.

RETAIL INDIVIDUALS BANKING

End-of-period gross loans were EGP 46 billion, 15% higher YtD, wholly on 16% growth in local currency loans.

End-of-period deposits were EGP 230 billion, 2% higher YtD, wholly on 1% growth in foreign currency deposits.

CIB continued to expand its network to reach a total of 190 branches and 23 units across Egypt, supported by a network of 1,292 ATMs.

CONSOLIDATED FINANCIAL HIGHLIGHTS





Income Statement

 2Q22

 1Q22

QoQ Change

 2Q21

 YoY Change

 1H22

1H21

 YoY Change 

 

 EGP million

 EGP million

(2Q22 vs. 1Q22)

 EGP million

(2Q22 vs. 2Q21)

 EGP million

 EGP million

(1H22 vs. 1H21)

 

Net Interest Income

7,011

6,717

4%

6,019

16%

13,729

11,697

17%

 

Non-Interest Income

(116)

1,057

NM

341

NM

941

929

1%

 

Net Operating Income

6,896

7,774

-11%

6,360

8%

14,670

12,626

16%

 

Non-Interest Expense

(1,599)

(1,671)

-4%

(1,471)

9%

(3,270)

(2,946)

11%

 

Loan Loss Provision

(113)

39

NM

(318)

-65%

(74)

(1,020)

-93%

 

Net Profit before Tax

5,183

6,142

-16%

4,571

13%

11,325

8,660

31%

 

Income Tax

(1,642)

(1,373)

20%

(1,382)

19%

(3,014)

(2,591)

16%

 

Deferred Tax

(21)

(510)

-96%

25

NM

(531)

19

NM

 

Net profit

3,521

4,260

-17%

3,215

10%

7,780

6,088

28%

 

Minority Interest

9.6

15.4

-38%

(2.1)

NM

15.5

(1.7)

NM

 

Net Profit After Minority

3,511

4,244

-17%

3,217

9%

7,765

6,090

28%

 

 








 

 

Financial Indicators

 2Q22

 1Q22

 QoQ Change

 2Q21

 YoY Change

 1H22

1H21

 YoY Change 

 

 

 

(2Q22 vs. 1Q22)


(2Q22 vs. 2Q21)

 

 

(1H22 vs. 1H21)

 

Profitability









 

ROAE

21.5%

25.3%

-15%

21.0%

2%

23.1%

19.9%

16%

 

ROAA

2.68%

3.32%

-19%

2.81%

-5%

3.04%

2.72%

12%

 

Efficiency



 


 



 

 

Cost-to-Income

21.7%

19.6%

11%

22.3%

-3%

20.6%

22.7%

-9%

 

Liquidity









 

Gross Loans-to-Deposits

44.9%

41.6%

8%

38.8%

16%

44.9%

38.8%

16%

 

Asset Quality



 


 



 

 

NPLs-to-Gross Loans

4.84%

4.89%

-1%

5.69%

-15%

4.84%

5.69%

-15%

 

Capital Adequacy Ratio

28.8%

30.6%

-6%

32.0%

-10%

28.8%

32.0%

-10%

 

 

STANDALONE FINANCIAL HIGHLIGHTS 

 






Income Statement

 2Q22

 1Q22

 QoQ Change

 2Q21

 YoY Change

 1H22

1H21

 YoY

 Change 

 

 EGP million

 EGP million

(2Q22 vs. 1Q22)

 EGP million

(2Q22 vs. 2Q21)

 EGP million

 EGP million

(1H22 vs. 1H21)

 

Net Interest Income

7,093

6,603

7%

5,997

18%

13,695

11,673

17%

 

Non-Interest Income

(59)

1,027

NM

323

NM

968

914

6%

 

Net Operating Income

7,629

-8%

6,320

11%

14,663

12,587

16%

 

Non-Interest Expense

(1,688)

(1,545)

9%

(1,446)

17%

(3,233)

(2,919)

11%

 

Loan loss provision

41

NM

(317)

-83%

(14)

(1,019)

-99%

 

Net Profit before Tax

5,291

6,124

-14%

4,557

16%

11,415

8,649

32%

 

Income Tax

(1,735)

(1,375)

26%

(1,381)

26%

(3,111)

(2,590)

20%

 

Deferred Tax

(510)

-96%

25

NM

(531)

19

NM

 

Net Profit

4,240

-17%

3,201

10%

7,774

6,077

28%

 

 

Financial Indicators

 2Q22

 1Q22

 QoQ Change

 2Q21

 YoY Change

 1H22

1H21

 YoY

Change 



(2Q22 vs. 1Q22)


(2Q22 vs. 2Q21)



(1H22 vs. 1H21)

Profitability









ROAE

21.6%

25.3%

-14%

21.0%

3%

23.1%

19.9%

16%

ROAA

2.71%

3.33%

-19%

2.80%

-3%

3.05%

2.72%

12%

NIM*

5.91%

5.66%

4%

5.62%

5%

5.79%

5.65%

2%

Efficiency









Cost-to-Income

22.5%

18.4%

22%

22.0%

2%

20.3%

22.5%

-10%

Liquidity









Gross Loans-to-Deposits

44.8%

41.5%

8%

38.7%

16%

44.8%

38.7%

16%

Asset Quality









NPLs-to-Gross Loans

4.84%

4.90%

-1%

5.71%

-15%

4.84%

5.71%

-15%

Direct Coverage Ratio

209%

218%

-4%

204%

2%

209%

204%

2%

*NIM based on managerial accounts 

 

Consolidated

Standalone

BALANCE SHEET

Jun-22

Dec-21

YtD Change

Jun-22

Dec-21

YtD Change

 

 EGP million

 EGP million

(Jun-22 Vs. Dec-21)

 EGP million

 EGP million

(Jun-22 Vs. Dec-21)

Cash & Due from Central Bank

41,970

43,492

-3%

41,845

43,385

-4%

Due from Banks

56,928

80,142

-29%

56,971

79,991

-29%

Net Loans & Overdrafts

171,927

145,887

18%

170,919

145,078

18%

Financial Derivatives

877

225

289%

877

225

289%

Financial Investment Securities

236,815

213,987

11%

235,567

212,951

11%

Investments in Associates and Subsidiaries

211

205

3%

1,064

1,014

5%

Other Assets

14,735

14,296

3%

14,373

14,006

3%

Total Assets

523,463

498,236

5%

521,616

496,651

5%

Due to Banks

2,959

866

242%

2,970

863

244%

Customer Deposits

428,866

407,242

5%

427,556

406,101

5%

Other Liabilities

25,591

20,826

23%

25,546

20,759

23%

Total Liabilities

457,416

428,933

7%

456,072

427,723

7%

Shareholders' Equity & Net Profit

65,522

68,848

-5%

65,545

68,928

-5%

Minority Interest

525

455

15%

0

0

NM

Total Liabilities & Shareholders' Equity

523,463

498,236

5%

521,616

496,651

5%


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[1] Based on managerial accounts.

[2] As of March 2022; latest available CBE data at time of publishing.

[3] Net of Collateral, Gross of Provisions.

[4] Cost-to-income is calculated using revenues after adding/deducting back other provision charged/released.

 

[5] 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 depreciation by EGP 3.1 over first-half 2022.

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