The Access Bank UK, a wholly owned subsidiary of Access Bank Plc, reported its financial results for the year ended 31 December 2018. During the period, operating income advanced 47%, from £36.2m to £53m, and profit before tax increased 50% to £33m, while Balance Sheet growth grew 36% to 1.9bn.
Herbert Wigwe, Chairman of The Access Bank UK, said, “These results demonstrate our ability to continue growing the business through the depth and quality of customer relationships, whilst still operating within moderate risk appetite. The continuing success of this strategy is reflected in our achievements, being named winner of the Capital Finance International Award 2019 for Best Africa Trade Finance Bank for the fourth straight year, together with the International Finance Award for Best African Trade Finance Bank.”
The Bank saw a strong growth in the Balance Sheet during 2018, increasing from £1,402.5m as at 31 December 2017 to £1.9bn as at 31 December 2018. This growth was in part funded by the continued success of the Bank’s Fixed Term Deposit product range, which is targeted at the UK retail market. Deposits for this product continue to grow at a consistent and satisfactory rate in line with plan, with good retention levels being maintained.
Costs rose 41% in the year, as the Bank continued to invest in employee training and recruitment. The success of this policy was reflected in the Bank receiving the Gold Award from Investors in People in 2017, having been awarded Bronze in 2015. The increase also reflects costs incurred by the Bank in becoming a member of the Sterling Clearing system in 2018, with the Bank becoming a direct participant in the Faster Payments Service, BACS, and the Image Clearing System of the Cheque and Credit Clearing Company.
Jamie Simmonds, Chief Executive Officer and Managing Director of The Access Bank UK stated, “The Access Bank UK is continuing to demonstrate positive growth momentum, with another year of profitability and a strong growth in assets. The investment we have made in becoming a member of the Sterling Clearing system has enhanced our service provision, giving us a sustainable base for growing our business and enabling us to build our service offering for business and personal customers.”
Since commencing operations in 2008, the Bank has achieved its initial objective of providing a credible and sustainable OECD hub to grow the international business of Access Bank Plc. Under the Bank’s second strategic plan, the Bank achieved its goal of creating the most profitable Nigerian bank in the UK and increasing the UK contribution to parent bank Group performance. During the second half of 2017, the Bank developed a new five-year plan, which reflects and is line with Access Bank Plc’s vision of becoming “The worlds most respected African Bank”
Parent company Access Bank Plc has successfully completed its merger with Diamond Bank Plc, designed to significantly accelerate the strategy of being a significant corporate and retail bank in Nigeria and a Pan-African financial services champion. The new Access Bank was publicly launched on April 1, 2019, creating Nigeria and Africa’s largest retail bank by a number of customers.
With regard to The Access Bank UK’s core trade finance markets in Africa, Nigeria remains the key market. Increases in both oil production and oil price in 2018 and expectations of further growth in 2019 have had a positive impact on Nigerian GDP, with the latest forecasts estimating that this will have grown at circa 1.9% for 2018 and forecast to grow at 2.7% in 2019. Given the continued signs of improvement in the situation in Nigeria, the Directors are confident that the outlook for the Bank is a positive one.
The financial statement incorporates the results of The Access Bank UK – DIFC Branch. “As the gateway to trade with Africa and Asia, we will continue to support and encourage corporates in the Middle East and Asia region looking to grow trade relations with these markets and will continue to explore strategic opportunities to grow our business and provide customised offerings to our key customers,” said Rola Seifeddine, Senior Executive Officer and Head of The Access Bank UK - DIFC Branch.
Financial performance summary
2018 2017
Operating income up 47% £53m £36.2m
Pre-tax profit up 50% £33m £22.0m
Balance Sheet growth up 36% £1.9bn £1.4m
Return on average shareholders’ equity up 16.6% 18.3% 16%