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Mainstreet Bank Sustains Profitability

July 21, 2014

Obinna Chima

Mainstreet Bank Limited's financial results for the year ended December 31, 2013 has revealed that the financial institution continued on the path profitability in the year under review.

The results showed that the bank recorded a profit before tax of N13.2 billion in its group financial performance for the year ended December 31, 2013.

Similarly, its gross earnings grew to N49.6 billion in 2013, as against the N47.899 billion it attained in 2012.

The growth was largely driven by increased interest income as the bank significantly grew its loan portfolio by 63 per cent from N34.9billion in 2012 to N57 billion in 2013.

Despite the significant growth in risk assets, Mainstreet Bank's non-performing loan ratio (NPL ratio) remained low at 3.66 per cent, below the five per cent regulatory limit.

The bank's operational efficiency strategy yielded a 26.6 per cent growth in net interest margin.

Mainstreet Bank is wholly owned by the Asset Management Corporation of Nigeria (AMCON). The corporation is currently seeking to divest its 100 per cent ownership of the financial institution.

Following the impressive 2013 performance, the bank has approved payment of a dividend of N1 per every N1 share held in the bank, totaling N6.25billion. This dividend would be paid to AMCON upon receipt of the relevant approval from regulators.

Speaking at the bank's second annual general meeting held in Lagos, the Chairman Board of Directors, Alhaji Gambo Ahmed explained that the financial performance was the outcome of strategies that had been put in place in the last two years to build confidence, optimise cost, improve operational efficiency and customer service delivery.

"We have achieved this result in spite of the socio-economic challenges and increased competition in the Nigerian banking industry. The result clearly reaffirms that the bank is on the right track of becoming a top tier bank.

"We are particularly encouraged by year-on-year growth in our customers' deposit which shows their increasing confidence in the Mainstreet brand," he added.

Commenting on the several initiatives the bank had put in place to enhance efficiency in its operations, the bank's Group Managing/Chief Executive Officer, Faith Tuedor-Matthews, noted that within the period under review, Mainstreet Bank successfully migrated to the latest version of Finacle core banking application, which she stressed significantly improved its ability to deliver service to customers.

She further noted that the bank has continued to focus deeply on its core business as a commercial bank through the introduction of products and services targeted at the real sector of the economy.

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Source: AllAfrica

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