BoV half-year profits up marginally

The Bank of Valletta Group recently announced a pre-tax profit of Lm6.9 million for the six month period ended 31 March up - Lm100,000 from the same time frame last year.

For the first half of this financial year, the Group managed to obtain a 13 per cent Return on Equity (2001: 13.8 per cent), which it considers a satisfactory result.

On 31 March, Group total assets amounted to Lm1.75 billion, an increase of 0.9 per cent p.a. over the September 2001 figure. Especially significant was the steep rise in customer deposits, which increased at an annualised rate of 12.5 per cent over September 2001 and now stand at Lm1.32 billion. Concurrently, advances to customers, net of provisions, increased at the rate of 3.0 per cent p.a. to reach Lm733.4 million. Shareholders’ funds amount to Lm109.3 million, representing an annualised increase of 11.2 per cent over September 2001.

Commenting on the results achieved, Joseph F.X. Zahra, Chairman of the BOV Group commented that the period under review has witnessed a strengthening of the core activities of the BOV Group. Indeed, the Group has registered an increase in both net-interest income and its operating income. The Chairman said that despite the current stock market conditions, the Group still managed to strengthen the ratio of its non-interest income to operating income from 31.1 per cent in March 2001 to 32.8 per cent as at the end of March 2002. Such an increase was mainly driven by core activities.

The strengthening of core activities is also evidenced by the growth in interest margins which the Group has registered during the first six months of the current financial year. Mr Zahra went on to say that although expenses have also increased, these have climbed at a lower rate than the increase in operating income. He said that increases in expenses were mainly of a restructuring nature and due to depreciation, maintenance of IT systems, insurance and security measures, as well as performance-related remuneration.

The Chairman commented positively on the significant increase in customer deposits. He said that the Lm78 million increase in deposits during the six-month period under review showed that BOV was a customer oriented organisation that enjoyed the full trust of the Maltese depositor. Indeed, these results show that BOV has remained close to the market that it services and is managing to continue to increase its market share at a sustained pace.

Mr Zahra said that during the six months under review, the Bank had continued with its internationalisation programme and has opened a representative office in Tripoli. He also referred to the launch of a number of new products which are characteristic of the dynamic and innovative spirit of BOV. Amongst these he mentioned the new BOVI private banking service, the Index Linked Deposit Accounts as well as the TeenSavers Account.