DAR ES SALAAM: I&M Bank’s net profit has surged more than 16 times in this year’s second quarter, attributed to increased net interest income.
The bank’s statement released showed the profit after tax increased to 3.33bn/- up from 198m/- registered in a similar period last year.
The robust performance attributed to the increase in net interest by 17.9 per cent to 12.2bn/- until last June up from 10.4bn/- posted in a similar period last year.
The bank’s Chief Executive Officer (CEO) Mr Zahid Mustafa said “The overall improvement in the economic environment, including lower inflation rates and stable interest rates provided a conducive environment for business growth and profitability,” Despite the increase, the lender’s loan portfolio in Q2 slightly decreased compared to the record set in the previous quarter, which ended in March.
Until the end of June this year, I&M bank managed to issue loans worth 447bn/- from 464bn/- registered in Q1 ended March.
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Equally, the lender’s total assets grew by 15.2 per cent year-on-year to 759bn/- from 659bn/- reported last year.
Additionally, non-interest income also decreased by 5.4 per cent to 3.12bn/- until the end of June from 3.30bn/- posted in the same period last year.
The decrease was attributed to foreign currency dealings and translation gains. The lender’s foreign currency dealings and translation gains increased to 1.84bn/- until the end of June up from 1.62bn/- posted in the same quarter last year, equivalent to 13.4 per cent increase despite the decrease in fees and commissions.
Bank’s fees and commissions declined by 9.84 per cent to 1.24bn/- until last June from 1.38bn/- posted in the same quarter of the previous year.
Additionally, Non-performing loans (NPLs) significantly declined by 21 per cent to 52.4bn/- from 66.4bn/- posted in Q1 ended in March.
The NPLs ratio until the end of June stands at 11.0 per cent, down compared to 13.2 per cent until the end of March, though it is still high compared to BoT’s threshold of 5.0 per cent.
The bank plans for proactive loan monitoring to decrease the ratio.
“By offering restructuring options and financial advisory services to distressed borrowers to help them manage their repayment schedules effectively,” CEO Mustafa added.
