Bank Windhoek shows stellar financial results

Bank Windhoek Holdings Limited released its reviewed consolidated interim group results this week. The group continued to achieve sound performance for the half year ended 31 December 2014, reporting profit for the period of N$360.6 million, an increase of 12.8% year-on-year. “This consistent growth and positive performance is a tribute to our loyal and expanding customer base as well continued commitment of our staff to our quest for superior customer service. The financial performance was further achieved through good revenue growth, disciplined expense management and effective credit management,” said Christo de Vries, Managing Director. 

Key performance highlights witnessed headline earnings increased by 17.5% to N$360.7 million, normalised group total comprehensive income increased by 18.5% to N$383.5million and an annualised return on equity of 21.5%. Net asset value per share increased 11.4%. Jaco Esterhuyse, Chief Financial Officer, added that net interest income increased by 15.1% to N$601.5 million for the half year ended 31 December 2014. The group maintained a net interest margin of 5% whilst making good progress with its strategy to diversify its sources of funding, to lengthen the funding maturity profile and to improve the asset/liability maturity match. The bank has maintained low bad debt levels with the non-performing loans as a percentage of gross advances decreasing from 0.76% to 0.66% over the comparative period. For the six months ended 31 December 2014 non-interest income increased by 16.4% to N$395.7 million. The growth in non-interest income is fuelled by the increase in business volumes, with the leading contributors being transactional accounts and electronic banking channels. The non-interest income contribution to total income remained stable at 40.2% whilst non-interest income coverage of operating expenses improved from 74.2% to 77.8%. Disciplined cost management resulted in operating expenses increasing by 11% to N$508.5 million, well below the increase in operating income of 15.3%. As a direct result of the positive operating performance, the cost to income ratio improved from 53.7% to 51.7%. Income from associates decreased by 20.4% to N$41.2 million, as a result of a non-recurring profit on the sale of Capricorn Unit Trust Management Company by associate company Sanlam Namibia Holdings included in the prior year. Excluding this profit, the income from associates would have increased by 7.0%. Loans and advances to customers grew by 18.2% to N$22.1 billion, which is marginally higher than the growth in funding of 17.5%. “The group has made good progress with the delivery of the key strategic initiatives identified during the 2014 financial year, with emphasis on further improving the customer experience and the seamless delivery of superior service. The implementation of further initiatives will continue during 2015. Liquidity management will continue to be a key focus by further diversifying and improving the maturity profile of the group’s funding portfolio. The group will also continue to actively investigate investment opportunities to further diversify its revenue streams. The group continues to do business in a responsible manner with the creation of sustainable stakeholder value as the central focus,” concluded de Vries.