BNF Bank plc reported €12.2 million in profit before tax in 2022, representing a 34.9 per cent rise from the previous year’s €9.1 million.
This comes following the publication of the bank’s Annual Report and Audited Financial Statements for 2022 on Monday, in which it showcased a “strong” performance over the year.
The increase in profitability was primarily a result of a €3.1 million increase in net interest income from 2021’s figures, taking it up from €22.7 million to €25.8 million. This was mainly driven by growth in BNF Bank’s loans and advances to customers, along with careful liability management.
Net fees and commission income also proved to be positive for the bank, as income increased by nine per cent to €4.4 million, while expenses dropped by 20.6 per cent to €1.1 million.
BNF Bank’s employee compensation and benefits, along with other administrative expenses went up by 11.4 per cent and 6.5 per cent, respectively. On the other hand, in 2022, the bank wrote back expected credit losses of €0.7 million due to an improvement in asset quality experienced over the course of the year.
Net loans to customers at year end grew by 14 per cent to €903.7 million, while the percentage of credit impaired lending decreased from 4.1 per cent to 2.6 per cent.
The bank’s total equity and liabilities expanded from 2021’s €1 billion to €1.2 billion in 2022.
Following the end of the reporting period, a net dividend of €0.041 per nominal share of €0.7552 for a total amount of €4,036,726.50 is being proposed by the Board of Directors to be distributed to the shareholders for 2022. A resolution to this will be proposed during the coming Annual General Meeting, and is subject to regulatory approval.
Non-Executive Chairman Michael Frendo dubbed 2022 a “successful” year for BNF Bank, both when it comes to financial results, and also because “some key milestones were achieved”. He said that the global environment “continued to present challenges” for governments and central banks, leading them to navigate through economic uncertainty, particularly those emerging from the war in Ukraine, supply chain disruptions, and also inflationary pressures.
Non-Executive Chairman Michael Frendo / BNF Bank
2022 saw BNF Bank’s very first listing on the Malta Stock Exchange, and also issued a subordinated bond, milestones that Dr Frendo described as “core” parts of the bank’s capital plan. He added that the bank has also implemented an “important phase” of its digital transformation, enabling it to monitor financial crime compliance in a “more structured and efficient manner”.
“The financial statements show that BNF Bank continued to grow in a prudent and sustainable manner,” he explained, before adding that he is “proud” of how it has met the “continuing challenges of these extraordinary times”.
Commenting on the results, CEO David Power said that as of the end of 2022, the bank was “largely in line” with its financial key performance indicators, despite having to navigate through another year of “complex international challenges”.
Aside from the aforementioned achievements, Mr Power also made reference to the growth of the bank’s UK branch, which is currently involved in secured syndications with conservative loan-to-value ratios, the underlying security being central and prime immovable property.
He remarked that the “strong” financial performance for the year was “once again underpinned by focused and rigorous” risk management, as well as adherence to regulatory requirements.
Looking ahead, he explained that the previous year’s global challenges have persisted into 2023, with high levels of inflation being maintained in the global economy. Locally, inflation has remained below the European average mainly due to subsidised energy costs, he highlighted.
Mr Power also highlighted how this month, the international financial sector was hit by “stress events” resulting in the collapse of various United States regional banks, along with banking giant UBS’s acquisition of Credit Suisse.
“As the bank has commenced the final year of its Vision 2023 strategy, we continue to work towards our core objective of keeping our customers as our focal point and striving to improve our product and service offering. Beyond 2023 we are progressing with our strategic plans which will take us on our journey for the medium-term, and ensure the continued success of BNF Bank,” he said.
He added that BNF Bank “prides itself” on its community initiatives, undertaken through its branch network and framed by its ESG strategy. “Our objective is to be fully connected with the communities we work in, not just through the banking services we offer, but also by supporting worthy causes both financially and by our staff giving their time to help,” Mr Power concluded.
With 12 branches spread across Malta and Gozo, BNF Bank has grown to become a key player in Malta’s financial services industry, offering a wide portfolio of products for both personal and business clients.