Unpacking Key Numbers From Absa Bank’s Q3 Financial Results

By Soko Directory Team / Published November 30, 2022 | 9:32 am




KEY POINTS

Net interest income grew by 25.3 percent y-o-y to 23.3 billion shillings, on the back of a 24.7 percent y-o-y increase in interest income to 29.3 billion shillings.

Interest expense increased by 22.4 percent y-o-y to 6.0 billion shillings, slowing net interest income growth. The annualized net interest margin in turn edged up by 22 bps y-o-y to stand at 8.2 percent.


Absa

KEY TAKEAWAYS


Operating expenses (less loan loss provisions) edged up by 10.2 percent y-o-y to 13.3 billion shillings. Staff costs increased by 8.7 percent y-o-y to 7.4 billion shillings whereas other operating expenses increased by 14.3 percent y-o-y to 4.9 billion shillings. The cost-to-income ratio stood at 39.7 percent, down 442 bps y-o-y.


ABSA Group released its 3Q22 results recording a 30.1 percent y-o-y increase in profit after tax (PAT) to 10.7 billion shillings.

Performance was supported by a 22.5 percent y-o-y increase in total operating income to 33.4 billion shillings but trimmed by a 47.9 percent y-o-y increase in the loan loss provision expense to 5.0 billion shillings. EPS for the period stood at 1.97 shillings (+30.1 percent y-o-y).

Net interest income grew by 25.3 percent y-o-y to 23.3 billion shillings, on the back of a 24.7 percent y-o-y increase in interest income to 29.3 billion shillings.

Interest expense increased by 22.4 percent y-o-y to 6.0 billion shillings, slowing net interest income growth. The annualized net interest margin in turn edged up by 22 bps y-o-y to stand at 8.2 percent.

Non-funded income increased by 16.4 percent y-o-y to 10.2 billion shillings, largely attributable to a 60.0 percent y-o-y increase in net income from forex dealings to 5.0 billion shillings.

Other operating income recorded a 36.8 percent y-o-y decline to 638.4 million shillings while fees and commission income declined by 1.2 percent y-o-y to 4.6 billion shillings. The funded income reliance in turn increased 157 bps y-o-y to 69.6 percent.

Operating expenses (less loan loss provisions) edged up by 10.2 percent y-o-y to 13.3 billion shillings. Staff costs increased by 8.7 percent y-o-y to 7.4 billion shillings whereas other operating expenses increased by 14.3 percent y-o-y to 4.9 billion shillings. The cost-to-income ratio stood at 39.7 percent, down 442 bps y-o-y.

Pre-provision operating profit increased by 32.1 percent y-o-y to 20.2 billion shillings. Loan loss provision expense saw a 47.9 percent y-o-y increase to 5.0 billion shillings, placing the annualized cost of risk at 2.3 percent, 34 bps higher y-o-y. In turn, pre-tax profit was up 27.6 percent y-o-y to 15.1 percent.

Customer loans and advances grew by 26.4 percent y-o-y to 289.4 billion shillings. Government securities saw a 12.9 percent y-o-y increase to 92.2 billion shillings whereas held-for-dealing securities increased by 6.1 percent y-o-y to 47.6 billion shillings.

On the funding side, customer deposits saw a 4.6 percent y-o-y increase to 281.1 billion shillings. The loans-to-deposits ratio stood at 103.0 percent, up 1,777 bps y-o-y.

Gross NPL edged up by 2.0 percent y-o-y to stand at 20.0 billion shillings, with the NPL ratio declining by 142 bps y-o-y to stand at 6.5 percent. The NPL coverage ratio increased by 617 bps y-o-y to 77.0 percent.

On a trailing basis, ABSA is trading at a P/E ratio of 4.6x relative to an industry median of 3.7x, and a P/B ratio of 1.0x relative to an industry median of 0.7x. Its annualized ROE stands at 22.1 percent whereas its annualized ROA stands at 2.8 percent.

Related Content: Absa Bank’s Profits After Tax Up 30% For Q3 To Ksh 10.7 Billion




About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

View other posts by Soko Directory Team


More Articles From This Author








Trending Stories










Other Related Articles










SOKO DIRECTORY & FINANCIAL GUIDE



ARCHIVES

2023
  • January 2023 (161)
  • 2022
  • January 2022 (293)
  • February 2022 (329)
  • March 2022 (359)
  • April 2022 (294)
  • May 2022 (271)
  • June 2022 (232)
  • July 2022 (278)
  • August 2022 (253)
  • September 2022 (246)
  • October 2022 (196)
  • November 2022 (231)
  • December 2022 (166)
  • 2021
  • January 2021 (182)
  • February 2021 (227)
  • March 2021 (325)
  • April 2021 (259)
  • May 2021 (285)
  • June 2021 (273)
  • July 2021 (277)
  • August 2021 (232)
  • September 2021 (271)
  • October 2021 (305)
  • November 2021 (364)
  • December 2021 (249)
  • 2020
  • January 2020 (272)
  • February 2020 (310)
  • March 2020 (390)
  • April 2020 (321)
  • May 2020 (335)
  • June 2020 (327)
  • July 2020 (333)
  • August 2020 (276)
  • September 2020 (214)
  • October 2020 (233)
  • November 2020 (242)
  • December 2020 (187)
  • 2019
  • January 2019 (251)
  • February 2019 (215)
  • March 2019 (283)
  • April 2019 (254)
  • May 2019 (269)
  • June 2019 (249)
  • July 2019 (335)
  • August 2019 (293)
  • September 2019 (306)
  • October 2019 (313)
  • November 2019 (362)
  • December 2019 (318)
  • 2018
  • January 2018 (291)
  • February 2018 (213)
  • March 2018 (275)
  • April 2018 (223)
  • May 2018 (235)
  • June 2018 (176)
  • July 2018 (256)
  • August 2018 (247)
  • September 2018 (255)
  • October 2018 (282)
  • November 2018 (282)
  • December 2018 (184)
  • 2017
  • January 2017 (183)
  • February 2017 (194)
  • March 2017 (207)
  • April 2017 (104)
  • May 2017 (169)
  • June 2017 (205)
  • July 2017 (189)
  • August 2017 (195)
  • September 2017 (186)
  • October 2017 (235)
  • November 2017 (253)
  • December 2017 (266)
  • 2016
  • January 2016 (164)
  • February 2016 (165)
  • March 2016 (189)
  • April 2016 (143)
  • May 2016 (245)
  • June 2016 (182)
  • July 2016 (271)
  • August 2016 (247)
  • September 2016 (233)
  • October 2016 (191)
  • November 2016 (243)
  • December 2016 (153)
  • 2015
  • January 2015 (1)
  • February 2015 (4)
  • March 2015 (164)
  • April 2015 (107)
  • May 2015 (116)
  • June 2015 (119)
  • July 2015 (145)
  • August 2015 (157)
  • September 2015 (186)
  • October 2015 (169)
  • November 2015 (173)
  • December 2015 (205)
  • 2014
  • March 2014 (2)
  • 2013
  • March 2013 (10)
  • June 2013 (1)
  • 2012
  • March 2012 (7)
  • April 2012 (15)
  • May 2012 (1)
  • July 2012 (1)
  • August 2012 (4)
  • October 2012 (2)
  • November 2012 (2)
  • December 2012 (1)
  • 2011
    2010
    2009
    2008
    2007
    2006
    2005
    2004
    2003
    2002
    2001
    2000
    1999
    1998
    1997
    1996
    1995
    1994
    1993
    1992
    1991
    1990
    1989
    1988
    1987
    1986
    1985
    1984
    1983
    1982
    1981
    1980
    1979
    1978
    1977
    1976
    1975
    1974
    1973
    1972
    1971
    1970
    1969
    1968
    1967
    1966
    1965
    1964
    1963
    1962
    1961
    1960
    1959
    1958
    1957
    1956
    1955
    1954
    1953
    1952
    1951
    1950