A decent first half demonstrates resilience

MCB Group (MCBG) reported H126 operating income growth of 7.7% boosted by strong trading growth (+48%), with net interest income increasing modestly (+4%) to MUR14.1bn. PBT grew 15.4% y-o-y to MUR14.5bn. The company’s core business grew faster than the headline figures suggest, as H125 results included one-off gains from Visa and Mastercard shares. Operating expense growth was high (+17%), mainly driven by higher staff costs, which caused the cost to income ratio to rise 3pp to 37.8% for H126. The company believes staff costs growth is set to moderate in H226. The effective income tax rate rose 6pp to 26%, driven by changes in Mauritian tax laws. We have kept our forecasts unchanged, as the decent growth was largely counterbalanced by th...