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Fimbank posts pre-tax profits of $1.39m in first six months
First International Merchant Bank plc has just published its
interim financial statements, showing that the bank has generated
a profit on ordinary activities, before tax, of US$1,392,144,
in the six months up to the end of June.
General manager Ray Busuttil said: “This figure is higher
than that generated in the same period last year. Though we
were extremely busy, during the six months under review, with
our combined share offering and subsequent listing on the Malta
Stock Exchange, in our operations area it was business as usual,
and we continued to register gradual growth. We have not been
affected by the slowdown on the Malta market, as our business
is more internationally
oriented. Our business contacts and relationships with banks
have continued to grow.”
There has been a marked increase in business related to letters
of credit, in which the bank specialises. The end-of-June balances,
at US$84.6m, are substantially higher than the US$60.4m reported
at the end of the previous December. This increase of US$24.2m
is mainly due to confirmations and contingent liabilities on
issued letters of credit.
The main changes to Fimbank’s balance sheet are those brought
about by the increase in capital, a result of the combined share
offering. This caused shareholders’ funds to increase to
US$36,782,611, which are primarily reflected in the higher level
of short-term money market deposits with banks. The increase
in capital has also made possible US$4.6m in loans and advances
to customers.
Mr Busuttil says this increase in capital has had a “negligible”
effect on income, where the interim results are concerned, because
the proceeds of the share offering were only received on 26
June, just four days prior to the reporting date.
No interim dividend is being proposed. The published figures,
which are in compliance with Malta Stock Exchange regulations
on interim financial reporting for listed companies, and with
Central Bank of Malta directives, have been extracted from unaudited
management accounts, and have been drawn up according to the
accounting policies used in the preparation of the bank’s
audited financial statements for the year 2000.
The figures show that net interest income was practically at
the same level; although the gross figure
was seven per cent higher, the actual interest paid increased
by a similar amount. Mr Busuttil said: “We
estimate that the deteriorating return on US dollar funds has
reduced the interest return on shareholders funds by approximately
USD225,000 over the same six-month period last year. But, on
the other hand, net fee income from ordinary activities has
increased by 19.5 per cent, and the ratio of net fee income
to net interest return is 58.5 to 41.5 of operating income.
The increase in net fee income is a clear indicator of growth.”
The bank’s overheads, during these six months, rose by
18 per cent, mainly due to payroll inc-
reases and professional consultancy fees. Fimbank is now gearing
up towards implementation of its rec-ently approved five-year
business plan, and has already engaged new staff to join its
team at all levels. “We are set for the next steps. We
shall be seeking strategic alliances, and shall continue to
develop business in new markets,” Mr Busuttil said.
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