3 Apr 2018 07:00
BMCE BANK OF AFRICA
2017 Results
Financial communication
2017 PERFORMANCE UNDERPINNED BY THE CORE BUSINESS
BMCE Bank's Board of Directors, chaired by Mr Othman BENJELLOUN, met on Friday 30 March 2018 at the Bank's head office in Casablanca. It examined the business activity of the Bank and of the Group for the financial year ended 31 December 2017 and drew up the financial statements for the financial year in question.
The Board of Directors shall also propose to the Annual General Meeting of Shareholders the appointment of Messrs. Michel LUCAS and Abdou BENSOUDA as intuitu personae directors. Similarly, it acknowledged the appointment of Mr Lucien MIARA, Chairman of Fédération du Crédit Mutuel Méditerranée, as a Director of BMCE Bank, representing Banque Fédérative du Crédit Mutuel, Crédit Mutuel-CIC Group.
The Board of Directors shall propose to the Annual General Meeting of Shareholders a dividend payment of 5 dirhams per share, to be paid in July 2018.
The 2017 financial statements prepared under IAS/IFRS are published on the bank's website www.bmcebank.ma.
PARENT BUSINESS ACTIVITY at 31 December 2017
Net income +12.3% MAD 1.5 billion
Net banking income +1.2% MAD 6.2 billion
Customer deposits - Morocco +5.4% MAD 128.9 billion
CONSOLIDATED BUSINESS ACTIVITY at 31 December 2017
Net income attributable to shareholders of the parent company unchanged MAD 2 billion
Net banking income +3% MAD 13.4 billion
Customer deposits +5% MAD 195.2 billion
Strong growth (+12.3%) in BMCE Bank's net income with net income attributable to shareholders of the parent company unchanged after what was an exceptional performance in 2016 in terms of income from market operations
Net banking income driven by commercial banking operations (+6.4%) due to growth in net interest income (+5%) and fee income (+14%)
Bank Of Africa, the second-largest contributor to consolidated earnings, saw its net income attributable to shareholders of the parent company grow by 13%
Ongoing overseas expansion with the forthcoming opening of a branch office in Shanghai, the first of its kind by a Moroccan bank, with Morocco one of the destinations on the Silk Road initiative, an extensive programme to develop infrastructure, services and trade between China and nearly seventy countries
BMCE Bank of Africa, one of the 20 global signatories to Positive Impact Finance, promoted by the United Nations Environment Programme's Finance Initiative
CORE BUSINESS SOLID
CONSOLIDATED RESULTS: GROUP EARNINGS UNCHANGED
Net income attributable to shareholders of the parent company unchanged at MAD 2 billion, weighed down by the exceptional non-recurring performance from market operations in 2016.
Increasingly diversified revenues and earnings with overseas operations accounting for almost 40% of the Group's net income attributable to shareholders of the parent company and 48% of its net banking income. BMCE Bank of Africa, underlining its reputation as one of the leading banking institutions in Africa, is now the second largest pan-African banking group by geographical coverage.
Net banking income rose by just under 3% year-on-year to MAD 13.4 billion.
Solid performance by the core business as illustrated by:
- Net banking income from commercial banking operations, which grew by 6.4% on a consolidated basis;
- The significant contribution from net interest income and fee income, accounting for 90.5% of consolidated net banking income.
Strong determination to reduce operating costs with the rate of growth in general operating expenses continuing to slow from +9% in 2014 to +5% in 2017.
Enhanced operational efficiency by BMCE Bank of Africa Group with the launch of a programme aimed at sustainably improving the cost-to-income ratio over a 3-year period, consisting of identifying and implementing specific cost-reduction initiatives and boosting net banking income.
The cost of risk increased by 11% to MAD 1.8 billion in 2017, with non-performing loans unchanged.
Ongoing increase in provisioning for non-performing loans with the Group's loan-loss provision coverage ratio reaching 63.5% in 2017 versus 60% in 2016 and 54% in 2015.
Consolidated total assets rose by 2% year-on-year from MAD 306.0 billion at 31 December 2016 to MAD 313 billion at 31 December 2017.
The Group's financial position was bolstered with shareholders' equity growing by 4% to MAD 24.5 billion in 2017.
Forthcoming Meeting
Monday 2 April 2018
at 15:30
Meeting with Analysts and the Press:
BMCE Bank of Africa Group's 2017 Annual Results Presentation
PARENT RESULTS: BUSINESS UNDERPINNED BY CORE BUSINESS REVENUES
Double-digit growth (+12.3%) in net income to MAD 1.5 billion in 2017.
Net banking income rose by 1.2% in 2017 impacted in 2017 by a non-recurring income from market operations, after what was an exceptional performance in 2016.
Healthy performance from the core business with net interest income up 11% and fee income 5% ahead in 2017.
General operating expenses well contained, rising by only 3.7%, growing at their slowest rate over the past 10 years, underlining the Bank's commitment to improving operational efficiency.
Cost-to-income of 58.3% due to a number of factors specific to BMCE Bank SA such as: (i) significant investment in Group structuring (ii) ongoing expansion of the branch network (36 branch openings in Morocco in 2 years) and (iii) a number of cornerstone projects implemented in respect of initiatives aimed at enhancing productivity.
Gross operating income broadly unchanged (+0.5%) at MAD 2.7 billion in 2017.
Parent cost of risk fell by 25% to MAD 612 million in 2017 versus MAD 821 million in 2016;
Increased efforts at loan recovery resulting in a significant increase in provisions (+42%) to MAD 544 million in 2017;
The Bank's overall deposits grew by 6.4% to MAD 143 billion in 2017 versus +5% at the industry level, resulting in a market share of 15.09%, a gain of 16 basis points in 2017.
Group earnings indicators
at 31 December 2017by geographical region
Net income attributable to shareholders of the parent company
Morocco 61%
Africa 32%
Europe 7%
Net banking income
Morocco 52%
Africa 44%
Europe 4%
AN INNOVATIVE APPROACH TO CUSTOMER SERVICE
PERSONAL AND PROFESSIONAL BANKING - AN INCREASINGLY ATTRACTIVE PRODUCT RANGE WITH NEW PRODUCTS AND SERVICES LAUNCHED
Attractive range of banking services marketed to Young Professionals with a 30% price reduction on a premium package over the first three years, Crédit Joker, an on-demand loan for Young Professionals as well as a mortgage loan.
Bank-insurance revenue up 11.8% to MAD 2.37 billion in 2017.
The number of payment and cash withdrawal cards in circulation grew by 2% to 1,156 million at 31 December 2017, with the volume of payments by bank card on the domestic market registering double-digit growth (+19.5%), while the volume of foreign currency-denominated cross-border transactions rose by 29.5% in 2017.
New range of products and services for Young Professionals and Entrepreneurs, which are free of charge on a one-year basis to the under-35 age group.
The private client portfolio grew by 44% with an enhanced range of services for this customer segment, including Mastercard World, BMCE Exclusive, BMCE Visa Infinite cards and exclusive sales in partnership with a number of leading property companies.
Deposits from Moroccans living abroad rose by 5.2%, driven primarily by an increase in deposits into cheque accounts (+7.2%) and passbook savings accounts (+9.8%), as well as double-digit growth in account openings, packages and bank-insurance products between the 2016 and 2017 marketing campaigns organised for Moroccans living abroad.
MRE First launched, a package specifically designed for Young Moroccan Expatriate Professionals and the BMCE Fidelios loyalty programme launched, aimed at enhancing customer satisfaction and offering Moroccans living abroad incentives for every type of transaction involving money transfers, foreign currency exchange and transfers by bank card.
BMCE Euroservices' branch network in Europe expanded with three new branch openings in Spain and one branch in the process of being opened in Nice.
Digital banking services bolstered with Moroccans living abroad able to open online accounts in 2017 and the number of available languages extended to five in respect of BMCE Bank's distribution channels.
CORPORATE BANKING: MARKET RANKING CONFIRMED
The Bank's market ranking was unchanged as the second leading banking in deposit-taking and third in loan distribution.
Corporate deposits grew by 7.5% to almost MAD 35 billion at 31 December 2017, outperforming the banking industry which registered a 2.1% increase while loans fell by 8.3%.
Export flows rose by 9.7% year-on-year versus +9.3% at the industry level while import flows increased by 7.5% versus +6.3% at the industry level.
BMCE Bank's SME product offering enhanced by the launch of: (i) Pack Businesss Entreprise Maîtrisé and (ii) two new corporate banking packages - Pack Casablanca Finance City for corporate customers with CFC status and Pack CM-CIC for SME customers which are also CM-CIC customers.
Responsible financing solutions marketed with the pre-launch of a new credit line for waste recycling as part of BMCE Bank's strategy of being a bank that is committed to social responsibility.
The Centre of Expertise and Entrepreneurship for Small Businesses expected to be officially launched in 2018 so as to provide support, advice and assistance to customers who intend to start up or develop a business.
BMCE Bank's SME Club organised a special event for women entrepreneurs to mark International Women's Day, attended by thirty or so female executives, finance directors, administrators and company directors.
INVESTMENT BANKING: A DEVELOPMENTAL YEAR
Respectable performance by BMCE Capital Markets despite challenging market conditions with management revenues of about MAD 600 million at 31 December 2017.
BMCE Capital Bourse's performance in 2017 was more than respectable with trading volume up 17.8% to MAD 18.3 billion. As a result, its market share rose to 14.4% at 31 December 2017.
BMCE Capital Titres registered positive growth thanks to a welcome recovery in post-trade activity with assets under custody up 2%, resulting in a 25% share of the mutual fund market.
BMCE Capital Gestion's status as a major player in Morocco's asset manager industry was further enhanced, despite growing competition, by attracting more than MAD 61 billion of assets under management, resulting in a market share of 15%.
BMCE Capital Gestion Privée completed a number of cornerstone business development projects including developing wealth management diagnostic systems as well as renewing its ISO 9001:2015 certification.
BMCE Capital Titrisation carried out its inaugural securitisation transaction on behalf of a major company.
A convincing performance by BMCE Capital Solutions, an outsourcing pioneer in the post-trade processing of securities market transactions in Morocco, with the volume of transactions handled growing by 20%, the number of customers up 28% and business handled with the dealing room up 13%.
SPECIALISED FINANCIAL SERVICES: NEW GROWTH DRIVERS
SALAFIN
Salafin in the process of acquiring Taslif which will see it offering new shares to Taslif's shareholders. This strategic merger will be value-accretive for the new company.
Salafin saw its net banking income grow by 2.9% to MAD 140 million with net income up 1.2% to MAD 140 million.
MAGHREBAIL
Maghrebail is establishing a branch office in Tangier Free Zone so as to market tax-free foreign currency-denominated finance leases to businesses located within the Zone.
Maghrebail's net income rose by 7% to MAD 93.3 million while net outstandings increased by 9% to MAD 11.8 billion. Maghrebail is now the second highest-ranking player in its industry with a market share of 25.88% at 31 December 2017.
MAROC FACTORING
Maroc Factoring bolstered its credit and operational risk management systems, resulting in an improvement in the quality of the loan portfolio.
Maroc Factoring's net income declined by 35% to MAD 9.8 million in 2017 following a change in the way in which factoring is managed between BMCE Bank and its subsidiary. Maroc Factoring's new role is to be a Centre of Expertise in the Factoring Business for BMCE Bank of Africa Group entities.
RM EXPERTS
RM Experts improved its internal processes thanks to a combination of amicable reminder measures, enforced debt recovery procedures, the realism of its staff and adopting a more disciplined and responsible management approach.
As much as MAD 402 million of capital was recovered in 2017 while write-backs amounted to more than MAD 306 million, up on the previous year.
INTERNATIONAL OPERATIONS: ONGOING DIVERSIFICATION
BANK OF AFRICA GROUP
Bank Of Africa Group's consolidated net income attributable to shareholders of the parent company grew by 13% to EUR 70 million in 2017.
BOA Group bolstered its core banking business with new accounts growing by 13%, taking the total number of accounts to 3.5 million and an 11% improvement in bank productivity as measured by the average number of accounts per branch.
Healthy commercial performance as illustrated by a 3% increase in outstanding loans to € 3.9 billion and 3% growth in deposits to € 5.2 billion.
Branch network expanded with a dozen or so new branch openings, taking the total number of branches to 560.
LCB BANK
LCB Bank, the Group's Congolese subsidiary, launched a digital banking project in partnership with GNS Technologies, based on the successful Moroccan format with Damane Cash. An initial range of LCB-branded products and services is in the process of being marketed.
Sharp increase (+52 basis points) in LCB Bank's share of the deposit market from 12.64% at 31 December 2016 to 13.06% at 30 November 2017 while its share of the loan market was unchanged year-on-year at 14.56% at 30 November 2017.
BANQUE DE DEVELOPPEMENT DU MALI
Banque de Développement du Mali, market leader of Mali's banking industry, saw customer loans grow by 7% to FCFA 355 billion and customer deposits by 5% to FCFA 462,374 million in 2017.
BDM Diaspo Transfert launched in partnership with BMCE Euroservices, a money transfer service for Malians living abroad.
BMCE BANK INTERNATIONAL LONDON & PARIS
BBI UK continued to grow its core businesses as well as focusing on upgrading its information systems.
Net Income of 5.7 million £ as of end year 2017 hampered, however, by a combination of exceptional items including foreign currency effects, the cost of IT investment and tax-related regulatory constraints that weighed down on the London subsidiary's earnings.
BMCE BANK INTERNATIONAL MADRID
Results were positive in 2017 with net income growing by 30.7% to EUR 5.4 million due to a sharp improvement in the cost of risk (-40%). 2016 also saw the Spanish authorities introduce tighter regulations relating to loan provisions for risk countries.
Successful strategy implemented focusing on four aspects: (i) bolstering correspondent banking relations (ii) consolidating its competitive advantage in trade finance (iii) diversifying loan commitments by geographical region and (iv) expanding the scope of commercial transactions to include other currencies.
CORPORATE SOCIAL RESPONSIBILITY: STRONGLY COMMITTED TO POSITIVE IMPACT FINANCE
Efforts ongoing to develop the skills of BMCE Bank Foundation's teaching staff by implementing an extensive training programme for educators, supervisors and teachers.
Highly successful international conference on pre-school education in Morocco organised by BMCE Bank Foundation in conjunction with the Ministry of Education in terms of the quality of the participants and the meetings organised.
Medersat.com's overseas network expanded with the forthcoming opening of a school in Rwanda in Kigali province in addition to schools in Senegal, Congo-Brazzaville and Mali.
Mandarin Chinese teaching developed in a Medersat.com school in Bouskoura on a one-to-one basis and in three Nador-based schools by videoconference within the framework of the partnership with the Confucius Institute and Casablanca's Hassan II University.
Three new schools, Moulay Yakoub, Ouazzane and Nador, obtained the 'Eco-school' label, awarded each year by the Mohammed VI Foundation for the Environment to state schools that meet the specific criteria drawn up for this purpose. Sixteen Medersat.com schools have now obtained this label.
BMCE Bank of Africa signed up to the Principles for Positive Impact Finance, a new finance framework based on a methodology for identifying, assessing, reporting and ensuring transparency in Positive Impact Finance activities.
Applied a Positive Impact Finance approach for managing environmental and social (E&S) risks in financing as well as for monitoring the performance of the Bank's green products and green bond.
BMCE Bank participated in the inaugural launch in Africa of the Principles for Positive Impact Finance, jointly organised by CFC and UNEP FI.
A Resource Efficiency facility - energy, water, waste and transport - for the African market, currently being developed in partnership with the EIB.
EUR 20 million contract signed to help Morocco preserve its water resources and adapt to climate change, by targeting private sector industrial companies and public service drinking water and waste management companies.
MoU signed to provide a 'Women in Business' credit facility for women entrepreneurs which includes finance, assistance and training.
Social Responsibility Charter formalised.
First Moroccan bank to sign up to the United Nations Global Compact and become the leading partner for the Moroccan network of the Global Compact.
The African Entrepreneurship Award (AEA), since being launched in 2015, has seen a total of USD 3 million awarded to 33 entrepreneurs from 13 African countries - South Africa, Cameroon, Ethiopia, Ghana, Uganda, Kenya, Liberia, Morocco, Mozambique, Nigeria, Senegal, Tanzania and Rwanda. In 2018, the 4th AEA will see two new categories introduced: sport and innovation.
Positive impact has been positive for the winners of the first two programmes in 2015 and 2016, with 2,281 new jobs created, reaching 264,000 customers and increasing by four times the revenues as a result of the money awarded and the support received in terms of coaching and mentoring.
CERTIFICATIONS & AWARDS: ONGOING RECOGNITION
BMCE Bank of Africa, for the 8th time since 2000, named 'Best Bank in Morocco - Moroccan Bank of the Year' by the prestigious magazine, The Banker, a Financial Times publication.
Certified 'Top Employer in Morocco' by the Top Employers Institute, a global certification company recognising excellence in the conditions that employers create for their employees.
First Moroccan bank to be OHSAS 18001-certified by Bureau Veritas for its occupational health and safety management system.
Awarded the 'Best Customer Service Award 2018', with customer satisfaction registering a sharp improvement from 81% in 2016 to 94% in 2017.
'2017 Sustainable Energy Gold Award' awarded at the 26th EBRD Annual Meeting and Business Forum in May 2017 in Cyprus on the theme of 'Targeting Green and Inclusive Growth'.
Named 'Most active partner in Morocco' by the EBRD in the context of its trade assistance program.
Gold Sabre Award winner and Certificate of Excellence in the North Africa region for the Bank's social media campaign to promote the African Entrepreneurship Award programme.
Won the bronze medal in the 'Best Integral Phygital Compain' category for its 'Connected bank' communications campaign to promote and broadcast the Bank's entire range of innovative solutions and services.
Recognition for LCB from the International Socrates Committee of the Europe Business Assembly (EBA), a prestigious UK-based organisation, with two international awards, 'Best Regional Enterprise' and 'Best Manager of the Year'.
FINANCIAL COMMUNICATION
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