APS Bank posts €18.4m pre-tax profit and all-round growth in 2017
APS Bank announced a record €18.4m pre-tax profit in the financial year ended 31 December 2017, an increase of 16% on 2016 as the bank registered strong growth and all-round record levels of activity. These results were announced at a corporate presentation held at the Corinthia Palace Hotel & Spa on 25 April.
In a favourable business environment characterised by exceptionally low interest rates, increasingly onerous regulatory obligations, shifting international geopolitical situations and generally improving economic conditions across Europe, with Malta being one of the best performers, APS Bank’s results underscore the soundness of its business model and the transformation that the bank is experiencing.
Group Operating Income expanded by 22%, from €34.9m to €42.8m, reflecting the significant business momentum which outpaced the programme of heavy investment in technology, channel transformation, strengthening of risk, compliance and governance structures and investment in human capital, which continue relentlessly. Cost-efficiency remained around the 50% level despite the significantly increased activity.
Overall credit quality at bank level continued to improve, with NPLs to Gross Loans reducing from 6.4% in 2016 to 4.2% in 2017 despite higher net impairment provisions. ROE increased to a strong 11.5% (2016: 10.1%). Balance Sheet growth was also robust, with total assets increas- ing by 16% to €1.5bn and with deposit raising and lending activity growing by 11% and 27% respectively over 2016. The Group Total Capital ratio of 14.8%, consisting primarily of Tier 1 equity, is down from last year yet still comfortably above the regulatory minimum.
Presenting the results and commenting on the bank’s outlook for 2018, CEO Marcel Cassar said: “We are continuing with the transformation at various levels, organisational, network and processes, strengthening the governance, risk and compliance infrastructure and improving the quality and diversification of the income statement, which places us in a strong position to grow and gain further market share.”
Chairman Frederick Mifsud Bonnici said: “Our differentiated, customer focused, simple and low risk business model will help us, I believe, to continue delivering to customers and shareholders and to support the communities in which we operate. With our solid foundations, a strong capital base and highly engaged and committed staff, we look forward to the future with optimism.”