Wema Bank Profit Drops 18% to N523m in First Quarter

Wema Bank Plc on Wednesday reported its unaudited results for the first quarter (Q1) ended March 31, 2016. The bank recorded gross earnings of N11.3 billion in 2016, up by 6.1 per cent above the N10.6 billion in the corresponding period of 2015.

However, profit before tax fell by 18 per cent from N615 million to N505 million, while profit after tax fell by same margin from N523 million to N429 million. Speaking on the results, Managing Director/Chief Executive Officer of Wema Bank, Mr. Segun Oloketuyi said: Connsidering the challenging operating environment led by weaker oil prices, a tight monetary policy and rising inflation, Wema Bank has been able to deliver top line growth with gross earnings increasing by 6.1 per cent to N11.3 billion compared to N10.6 billion in the same period last year. We have continued to grow our retail volumes in 2016; while the number of new accounts and card activations have increased by over 50 per cent and the deployment of alternative platforms have also grown by 15 per cent. We remain focused on keeping our cost profile under check while gradually growing the asset portfolio where we see optimal opportunities.”

According to him, while concerns remain, as we progress in the financial year around, rising inflation due to the impact of higher energy, transportation prices and a slower GDP growth due to a lack of stimulus, the bank remain focused on executing its strategies to drive economic production.

“Despite these headwinds, we believe that we will improve our 8.2% growth in interest income over Q1 2015 which will translate into improved net interest margins and consequently, improving profitability over the course of the year,” he said.

Speaking in the same vein, the Chief Financial Officer of Wema Bank, ‘Tunde Mabawonku said: “In spite of the challenging market conditions, the bank grew its interest income by 8.2 per cent to N9.7bn from N8.9 billion in Q1 2015. While trading income has not been immune from the larger macro headwinds, our diversification strategies are yielding results as fee and commission income grew by 17.1 per cent to N1.35 billion from N1.15 billion in the same period last year.”