26 Sep 2016 11:22
BMCE BANK OF AFRICA
Financial communication
30 June 2016
STRATEGIC DEVELOPMENT PLAN 2016-2020
UPWARD TREND CONFIRMED IN FIRST HALF 2016
BMCE Bank's Board of Directors, chaired by Mr Othman BENJELLOUN, met on Friday 23 September 2016 at the Bank's head office in Casablanca. It examined the business activity of the Bank and of the Group for the first half ended 30 June 2016 and drew up the financial statements for the period in question.
The Board acknowledged that FinanceCom, a Director of BMCE Bank, is henceforth represented by its Chief Executive Officer, Mr Hicham EL AMRANI. Similarly, RMA Watanya, a director of BMCE Bank, is henceforth represented by its Chief Executive Officer, Mr Zouheir BENSAID. The Board will propose to the Annual General Meeting that Mr Azeddine GUESSOUS, until now RMA Watanya's permanent representative, be appointed as a Director intuitu personae.
The first half 2016 financial statements under IAS/IFRS are published on the Bank's website www.bmcebank.ma.
CONSOLIDATED FINANCIAL STATEMENTS
Net income attributable to shareholders of the parent company
+18%
MAD 1.2 billion
Gross operating income
+18%
MAD 3.1 billion
Net banking income
+13%
MAD 6.7 billion
PARENT FINANCIAL STATEMENTS
Net income
+19%
MAD 1.1 billion
Gross operating income
+18%
MAD 1.9 billion
Net banking income
+17%
MAD 3.6 billion
New strategic plan launched with an emphasis on reinforcing BMCE Bank of Africa Group's organisational structures to support its development until 2020
Initial results encouraging for the new Strategic Plan: net income attributable to shareholders of the parent company rose by 18% to MAD 1,250 million and parent net income by 19%, breaching the MAD 1 billion mark for the first time in an interim period at MAD 1,074 million
Appreciable increase in provisioning at the Group level for the Moroccan and sub-Saharan African operations with loan-loss provisions reaching MAD 8.4 billion, up by almost 14% over the first six months of 2016
Group's strong commitment to sustainable development confirmed in 2016 through a number of initiatives related to environmental preservation
FINANCIAL COMMUNICATION
Tel: +212 522 49 80 03/+212 522 46 28 06 - Fax: +212 520 20 50 54 - E-mail: relationsinvestisseurs@bmcebank.co.ma
RESULTS IN LINE WITH THE STRATEGIC DEVELOPMENT PLAN 2016-2020
DOUBLE-DIGIT GROWTH IN THE MAIN CONSOLIDATED PERFORMANCE INDICATORS
Net income attributable to shareholders of the parent company rose by 18% to MAD 1,250 million.
The contribution to consolidated earnings from BMCE Bank S.A. rose from 48% to 51%. Together with the contribution from the Moroccan subsidiaries, domestic operations accounted for 64% of consolidated earnings. The contribution from overseas operations, in Africa and Europe, was stable at 36%.
Ongoing improvement in the Group's financial profitability with annualised consolidated ROE up year-on-year from 13.9% to 15.5%.
Consolidated net banking income grew by 13% to MAD 6.7 billion, driven primarily by (i) financial market operations (+86%), due to the positive impact from lower interest rates on the fixed income portfolio's value (ii) banking intermediation, the Bank's core business, illustrated by a 6% rise in net interest income.
General operating expenses rose at a slower pace than net banking income (+9% versus +13%), resulting in a 2 percentage points improvement over the period in the cost-to-income ratio to 53.1% vs. 55.1%.
Gross operating income rose by more than 18%, breaching the MAD 3 billion mark for the first time (MAD 3,144 million versus MAD 2,661 million at 30 June 2015).
Significant increase in provisioning with more than MAD 1 billion of net additional provisions recognised in first half 2016, a 31% increase compared to the same period the previous year.
14% increase compared to December 2015 to MAD 8.4 billion in outstanding provisions at 30 June 2016, resulting in an overall increase in risk provisions in a context in which the Group's non-performing loan ratio was unchanged at 7.9% for first half 2016.
Consolidated total assets increased by 8% to MAD 282 billion, underling the strong growth of the Group's operations in sub-Saharan Africa and Europe.
The Group's financial position and capital adequacy were further bolstered with the issue of a MAD 2 billion subordinated note, resulting in an increase of almost 10% in the Group shareholders' equity to MAD 17.7 billion.
PARENT NET INCOME BREACHES THE MAD 1 BILLION MARK FOR THE FIRST TIME IN AN INTERIM PERIOD
19% growth in BMCE Bank SA's parent net income, breaching the MAD 1 billion mark for the first time in an interim period at MAD 1,074 million.
Banking in Morocco's net banking income rose by 17% due to a significant contribution from financial market operations (+69%), supported by the contribution from retail banking with fee income and net interest income up by almost 9% and 3% respectively.
General operating expenses rose by 7.4% to MAD 1,650 million in first half 2016 with 37 new branches opened since June 2015, taking the total number of branches to 708. In addition, the number of employees rose by almost 4% to 5,221 employees (including ANAPEC work placements) in support of Banking in Morocco's commercial development.
Total cost of risk declined by 6% to MAD 520 million due to a 12% increase in provision write-backs, reflecting the strong performance by Banking in Morocco's credit recovery operations.
Non-performing loan ratio of 6.39% remains well below the industry average of 7.88%.
The Bank's loan-loss ratio rose from 67% at 31 December 2015 to 74% at 30 June 2016 versus an industry average of 67,34%.
The Bank continued to attract savings to be to able finance different parts of the Moroccan economy. Customer deposits rose by 5.4% year-on-year to MAD 115.4 billion at 30 June 2016, resulting in an unchanged market share at about 14.1%.
Loans to the economy outperformed the industry average, reaching MAD 111.7 billion, an increase of 5.5%. As a result, market share expanded by 30 basis points to 14.35%.
A NEW STRATEGIC DEVELOPMENT PLAN 2016-2020
The Group's main strategic priorities for 2020 are:
- Organic growth - ongoing expansion of the branch network with a hundred or so branch openings expected in Morocco and sub-Saharan Africa.
- External growth - Group operations to be bolstered in rapidly growing African countries via Bank Of Africa, in Europe via BMCE Euroservices and in China via its future banking branch in Shanghai.
- Retail banking, Banking for Moroccans living abroad and Corporate Banking businesses to be bolstered, particularly in the SME segment and promising new niche markets to be targeted such as Participatory Banking and Green Business.
- Accelerated development of intra-Group synergies benefiting the Group's African subsidiaries by developing the leasing, factoring, credit insurance and trade finance businesses.
- Strongly committed to developing Multi-channel Banking aimed at becoming a leading institution in digital banking in Morocco and Africa.
- Further consolidation of the Group's organisational structures with the Convergence Programme implemented across the entire Group, consisting of pooling resources and standardising procedures in risk management, ad hoc and permanent control, compliance, IT and HR.
Forthcoming Meeting
Monday 26 September 2016 at 15:30
Meeting with Analysts and the Press
BMCE Bank Group's first half 2016 results presentation
BMCE Bank Group's consolidated financial statements (MAD M)
Net income attributable to shareholders of the parent company
CAGR* June 14 - June 15
June 2014 June 2015 June 2016
902 1 064 1 250
Net banking income
CAGR* June 14 - June 15
June 2014 June 2015 June 2016
5 598 5 923 6 705
Total assets
CAGR* June 14 - June 15
June 2014 June 2015 June 2016
237 539 260 497 281 495
*Compound Annual Growth Rate
Net income attributable to shareholders of the parent company
by geographical region at 30 June 2016
Morocco 64%
Africa 27%
Europe 9%
A WELL-DIVERSIFIED AND INNOVATIVE RANGE OF PRODUCTS AND SERVICES
PERSONAL AND PROFESSIONAL BANKING - BUSINESS MODEL UNDERPINNED BY BRANCH NETWORK AND MULTI-CHANNEL BANKING, FOSTERING CLOSE TIES WITH CUSTOMER
37 branches opened in Morocco in first half 2016, taking the total number of branches to 708 at 30 June 2016, underlining a business model which is underpinned by the branch network.
Multi-channel Banking bolstered with the launch of "Agence Directe", an online branch, enabling customers including Moroccans living abroad to subscribe for the Bank's products and services on a remote basis.
Product range for salaried workers enhanced with the launch of "Crédit Joker", a new on-demand consumer loan distributed via a number of different channels such as in branches, the Customer Relationship Centre (CRC) or BMCE Direct.
Bank-insurance penetration ratio rose to 36.6% at 30 June 2016 versus 34.04% the previous year due to 12% growth in the number of contracts.
Electronic money services developed with the launch of "FastPay", a new prepaid card, equipped with contactless technology and the introduction of a text messaging service when paying by card.
Range of card payment terminals enhanced with the introduction of Mobile Point of Sale (MPOS), a mobile device connected via Bluetooth or smartphone to the vendor's account, primarily intended for purchases involving payment against delivery.
Caravane de l'Auto-Entrepreneur (AE), a series of regional conferences aimed at raising awareness about the new status of auto-entrepreneur organised jointly with the Entrepreneurship Observatory (ODE) and the Young Managers Centre Association (CJD).
Deposits from Moroccans living abroad rose by 16.4% to MAD 17.6 billion compared to first half 2015, resulting in a 10.4% market share, up 89 basis points compared to 30 June 2015.
Significant increase (+54.3%) in transfers processed by BMCE Bank in first half 2016 to MAD 2,493 million due to strong sales momentum by BMCE EuroServices and a strong performance in the Canadian market.
CORPORATE BANKING - SUPPORTING CUSTOMERS AND FOSTERING LOYALTY
Corporate Banking loans and deposits rose by 2.2% and 1.6% respectively in first half 2016 compared to 31 December 2015.
Corporate loan growth was primarily driven by a 9% increase in first half 2016 in operating loans and a 4.4% rise in capital goods loans, outpacing industry growth rates for these segments of 3.5% and 2.8% respectively.
Significant increase in the volume of foreign trade flows with import flows up by 20% year-on-year to almost MAD 40 billion and export flows up 16% to MAD 33.4 million at 30 June 2016. These growth rates outpaced growth at the industry level of 3.7% and 1.6% respectively.
Latest version of the IMTIAZ Croissance programme launched, which aims to boost productive investment in manufacturing ecosystems.
Les Rendez vous de l'Entreprise, a series of theme-based conferences and meetings organised for corporate customers. An inaugural conference-debate was held in first half 2016 on the theme of 'New Regulations and Tax Changes in 2016'.
New pioneering concept introduced named the 'Centre of Expertise and Entrepreneurship for Small Businesses'. This is a discussion forum aimed at promoting entrepreneurship by supporting, advising and assisting SMEs which intend to set up a new business or develop an existing one.
INVESTMENT BANKING - BOLSTERING SALES
Outstanding achievements of BMCE Capital Markets for the first half of 2016, supported by relevant positions taken in a suitable environment, which allowed the Trading Room to significantly contribute to the Net Banking Income of the Bank.
BMCE Capital Gestion launched dedicated funds as well as launching the FCP Capital Long/Short mutual fund.
BMCE Capital Gestion Privée diversified its range of products and services, launched a new corporate website and its BKGP Direct Platform.
BMCE Capital Bourse registered a volume of MAD 3.7 billion securing an 11.2% share of the market in a context in which trading volume was unchanged.
BMCE Capital Titres' assets under custody rose by a modest 2% to MAD 202 billion at 30 June 2016 and launch of a new '' Offer Global Custody ', covering 17 countries on the African continent, namely through the BMCE Bank of Africa network.
BMCE Capital Conseil advised on a variety of transactions in first half 2016, ranging from corporate restructuring to M&A deals.
SPECIALISED FINANCIAL SERVICES - SYNERGIES ACROSS BUSINESS LINES
MAGHREBAIL
Net income rose by 7% compared to 30 June 2015 to MAD 43.1 million at 30 June 2016.
SALAFIN
Net income rose by 14% and net banking income by 5.5% in first half 2016, with net interest income up by 12.5% increase and fee income up by 8.9%.
MAROC FACTORING
Pursuing a more selective lending policy with continued diversification of the customer portfolio, as part of a commercial strategy focused primarily on the development and marketing process in the SMEs / SMIs.
RM EXPERTS
RM Experts recovered MAD 172 million of capital in first half 2016, resulting in a write-back of MAD 109 million. This was achieved by proactive management of loans requiring recovery and highly effective loan recovery staff.
AFRICAN OPERATIONS - SOLID GROWTH
BANK OF AFRICA
Core business bolstered with the number of accounts reaching almost 2.9 million due to 47 new branch openings since june 2015, taking the total number of Bank of Africa branches to 528.
Deposits and loans rose by 9% year-on-year to EUR 4.7 billion and EUR 3.5 billion respectively at 30 June 2016.
Net income grew by 20% to EUR 58.8 million due to a 6.2% increase in net banking income to EUR 226.7 million in first half 2016.
LA CONGOLAISE DE BANQUE
La Congolaise de Banque, Congo's leading bank, registered 8% growth in net income to EUR 3.5 million. In addition, the cost-to-income ratio improved by 3 percentage points, contracting from 56% at 30 June 2015 to 53% at 30 June 2016.
LCB CAPITAL was launched, an entity specialising in capital markets activities, brokerage and securities custody.
BANQUE DE DEVELOPPEMENT DU MALI
Banque de Développement du Mali's net banking income rose by 21% to EUR 27.2 million.
Double-digit growth in the main financial indicators with loans rising by 31% and deposits by 46% to EUR 790 million and EUR 884 million respectively in first half 2016.
EUROPEAN PLATEFORM - EARNINGS INCREASINGLY STABLE
BBI LONDON AND PARIS
Net income rose by a substantial 88.4% to GBP 4.8 million with net banking income up 57.3% to GBP 11.2 million in first half 2016 due to a strong performance across all Desks.
Considerable improvement in the cost-to-income ratio which stood at 43.2% at 30 June 2016 versus 81.6% at 30 June 2015 due to significantly lower general operating expenses (-16.8%) as well as strong growth in net banking income (+57.3%).
BBI MADRID
Positive first half with net banking income up 15% due to a strong performance by its main constituents - net interest income +39% and fee income +15%.
Net income rose by 13% compared to first half 2015 to EUR 4.6 million at 30 June 2016.
CORPORATE SOCIAL RESPONSIBILITY - AN EMBEDDED CULTURE AND LEADERSHIP CONFIRMED
Partnership agreement signed between BMCE Bank Foundation and the French Institutes of Morocco (IFM) to conduct a joint appraisal of Network teachers' command of the French language and the contribution made by IFMs to training for French language teachers.
Expansion in the number of Medersat.Com schools which have an 'Eco Ecole' accreditation to 9.
Support for teaching staff and presentation of an award at the end of each school year to schools with the best academic results, the best environmental performance and those making the greatest impact in social-cultural and educational terms.
BMCE Bank became a signatory to the United Nations Global Compact, the first bank in Morocco to join the family of 22,013 businesses worldwide that are committed to incorporating social and environmental impacts into their corporate strategy.
Currently launching a Green Bond, the first of its kind in Morocco, thereby underlining the Group's commitment to environmental preservation by funding eco-responsible projects at home and abroad and supporting private and public sector initiatives aimed at preserving natural resources.
Organised the 2nd African Entrepreneurship Award which has a pan-African dimension with almost 4,000 entrepreneurs participating from 105 countries, including 54 African countries. The 25 finalists will be announced in October and the winners in December 2016.
2016 CERTIFICATIONS
• ISO 9001 certification renewed for the Group's HR operations.
. ISO 9001 certification renewed for the internal audit process.
• BMCE Capital Gestion Privée became the first financial institution in Morocco to obtain ISO 9001: 2015 certification for its private portfolio management business.
• BMCE Capital Gestion obtained 'Service Commitments' and 'ISO 9001:2015' certifications in May 2016