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Pre-tax profits of US$2.7m for Fimbank
by David Kelleher
First International Merchant Bank, Malta’s only merchant
bank, has registered a pre-tax profit of US$2.7m for the year
2000, a 38 per cent increase over the previous year.
The bank, which has been operating in Malta for the past five
years, presented its accounts
for the first time to stockbrokers and financial representatives
on
Tuesday.
Presenting the results, Fimbank’s managing director Raymond
Busuttil, said the encouraging results were the fruit of the
staff’s hard work over the past five years. Despite a heavy
capital expenditure on a state-of-the-art banking software and
the expansion and refurbishing of the offices, the bank still
managed to increase its pre-tax profits by 38 per cent.
Profit after tax to equity has more than tripled in the last
five years, from 2.52 per cent to 8.48 per cent. Profit to shareholders
has also increased by 38 per cent over the previous year. Operating
incomes was US$5.91m compared to US$4.47m in 1999. Net interest
income increased to US$2,811m from US$1,999m in 1999. The major
contributors to the bank’s income came from Net fees and
commissions (73 per cent), net interest income on operating
activities (23 per cent), and exchange gains (four per cent).
Overheads increased by 27 per cent in 2000, two per cent of
which were attributed to the new system.
The balance sheet shows customer deposits averaged US$27m, loans
and advances to customers US$25m, bank deposits totalling US$22m
and commitments, US$54m. The bank will not be paying any dividends,
despite earnings per share going up by 3c to 10c8. All profits
after tax – US$2,168m – are being retained and brought
forward with retained earnings brought forward for a total of
US$5.555m.
The majority of Fimbank’s income is derived from trade
finance-related transactions. The bank adopts a cautious but
proactive approach to business, and has had only one bad debt
in its entire history. Speaking to The Malta Business Weekly,
finance manager Reuben Xuereb said the bank had now established
itself in the market and it was the right time for people to
get to know more about Fimbank’s operations.
“We have had five very successful years and the results
for 2000 are very encouraging. Fimbank’s main focus is
on trade financing and we have the largest trade services department
in Malta, made up of 15 highly prof-
essional people,” Mr Xuereb said.
He added that the bank had managed to do away with cyclical
trends in the bank’s performance by diversifying into different
markets, using business consultants to break into various operational
niches.
“We are now entering a number of niche markets where some
banks may not have the infrastructure or the expertise to provide
trade financing. The bank has taken its business to the Ivory
Coast, Ghana, Morocco, Algeria, and West Africa. All companies
need financing but in these countries they may not necessarily
find the means to do so,” Mr Xuereb said.
“Our client base is now expanding rapidly, and most of
our new clients are introduced by satisfied customers,”
Claude L. Roy, President, said.
Trade finance and related
services will remain its core activity, but the bank plans to
extend
its reach into new markets
worldwide.
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