- Net interest income improved by 27.0% YoY, mainly driven by growth in interest income (+19.1% YoY). The growth in interest income was primarily supported by an increase in lending-based interest income (+46.4% YoY). With gross loan growth largely flat (+0.6%) in the quarter, the YoY increase in interest income from loans may have reflected low base effect (income statement line items did not reflect the combined business as at Q1â19)
- Non-interest revenue (NIR) surged by 56.0% YoY to N73.0 billion in Q1â20. The key drivers of NIR were the 76.0% YoY increase in net fee and commission income, 4.2x surge in net gains on investment securities, and loan recoveries of N15.7 billion (vs Q1â19: N134 million). On the flip side, FX losses amounted to N54.7 billion (vs Q1â19 gain of N6.2 billion)
- Operating expenses rose by 63.7% YoY, leading to an increase in cost-to-income ratio to 62.2% in Q1â20 from 53.2% in Q1â19. Personnel expenses (48.4% YoY), AMCON charges (54.9% YoY), IT expenses (+76.2% YoY) were notable cost drivers in the review period. Similarly, loan loss provisions rose 2.5x to N8.6 billion, pushing the cost of risk to 1.1% from 0.7% in December 2019
- Annualised ROE was 26.3% (FYâ19: 17.7%). On regulatory compliance, capital adequacy remained above regulatory thresholds at 19.0%
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