Jaiz Bank Plc recorded well-rounded performance in the first quarter of this year as Nigeria’s pioneer non-interest commercial bank continued to improve its cost efficiency and risk management.
Key extracts of the three-month report for the period ended March 31, 2019 released yesterday at the Nigerian Stock Exchange (NSE) showed that gross earnings rose by 38.7 per cent while pre and post-tax profits jumped by 225.08 per cent and 244.19 per cent respectively. Earnings per share rose by 190 per cent.
The three-month report indicated that gross earnings rose to N2.59 billion in first quarter 2019 as against N1.87 billion in first quarter 2018. Gross profit grew by 51.9 per cent increased from N1.39 billion to N2.11 billion.
Profit before tax jumped from N146.57 million to N476.46 million. After taxes, net profit rose to N428.68 million in first quarter 2019 compared with N124.58 million in first quarter 2018. Consequently, earnings per share increased to 1.45 kobo in first quarter 2019 as against 0.50 kobo in corresponding period of 2018.
The first quarter performance further consolidated the growth trajectory of the alternative banking pioneer and raised strong prospect of Jaiz Bank substantially surpassing its full-year performance in 2018 in the current business year. The net profit in first quarter 2019 is more than half of the full-year net profit recorded in 2018.
Jaiz Bank recently released its audited report and accounts for the year ended December 31, 2018, showing 55 per cent growth in net profit to N834.37 million.Gross earnings rose by 11 per cent from N7.86 billion in 2017 to N8.74 billion in 2018. Profit before tax increased from N894.01 million to N897.70 million. After taxes, net profit rose from N537.12 million to N834.37 million.
The balance sheet showed stronger underlying strength during the period. Total assets rose by 24 per cent from N87.31 billion to N108.46 billion. Deposits also grew by 25 per cent from N68.12 billion in 2017 to N85.03 billion in 2018. The non-interest bank expanded its financing and investment activities by 37 per cent to N69.36 billion in 2018 as against N50.79 billion in 2017. Jaiz Bank, as a non-interest bank, makes profit basically from profit-sharing on investments and gains on trading activities.
Key underlying ratios showed improvements in returns and operational strength of the bank. Return on assets rose by a quarter from 0.6 per cent in 2017 to 0.8 per cent in 2018. While cost-to-income inched up from 85.84 per cent to 87.28 per cent, return on equity improved from 6.54 per cent to 6.85 per cent. Capital adequacy remains considerably above regulatory threshold at 21.13 per cent while liquidity ratio increased by 50 per cent from 18.64 per cent to 27.94 per cent. Staff strength and number of branches also increased by 6.0 per cent and 16 per cent respectively.
Managing Director, Jaiz Bank Plc, Mr. Hassan Usman, said the 2018 results further demonstrated that the bank has the capacity to grow sustainably in line with its strategic vision of becoming the leading non-interest bank in Sub-Saharan Africa by 2022.
He assured that while maintaining steady focus on elements that contributed to improved performance in 2018, the bank shall work harder to optimise its potential in order to deliver better returns in 2019.
He noted that the bank had in 2017 crafted a strategic plan to build on its pioneer status in Nigeria into becoming the leading non-interest bank in Sub-Saharan Africa over the next five years.
According to him, the bank has since been working hard across its business towards the strategic milestones set out for the years while maintaining steady focusing on its business growth.
“The commitment and dedication of our people make me confident that the attainment of this goal is assured. 2018 is the year we demonstrated we have the capacity to grow safely and sustainably. We used a number of measures to spark progress in this regard, some of which include our commitment to the development of micro, small and medium enterprises, focus on unserved markets and the financially excluded, institutional alliances, nimble workforce as well as effective performance tracking amongst others,” Usman said.
He added that Jaiz Bank, as the leader in alternative financing, is committed to ensuring that its engagement with the financially excluded remains boldly innovative as well as transformative.
Jaiz Bank was created out of the former Jaiz International Plc which was set up in 2003 as a Special Purpose Vehicle (SPV) to establish Nigeria’s first full-fledged non-interest bank. The bank is owned by some 27,000 shareholders including the Islamic Development Bank (IDB). It obtained a regional operating license to operate as a non-interest bank from the Central Bank of Nigeria (CBN) on November 11, 2011 and began full operations as the first non-interest bank in Nigeria on January 6, 2012. In 2016, it obtained the national banking license from the CBN and started to rapidly spread its network across the country.
Jaiz Bank recorded another milestone on February 9, 2017 as the first non-interest financial institution to be listed on the Nigerian Stock Exchange (NSE) with the admission of the entire issued share capital of the bank to the main board of the Exchange.
Under its five-year growth plan, Jaiz Bank projects to grow its income and profitability consecutively. According to the five-year financial forecast, total income is expected to be about N81.17 billion while profit after tax is projected at N11.09 billion for the five-year period.