BANK Windhoek Holdings is expected to make an acquisition of a financial industry company as part of its expansion plans, The Namibian understands. Bank Windhoek controls about 30% of the market.
Company sources have denied that the cautionary announcement the company put out on 5 June has something to do with renewed interest from Barclays Bank to buy Bank Windhoek following a failed bid several years ago.
“Further to the cautionary notice dated 5 June 2015, shareholders are advised that negotiations are in progress, which if successfully concluded, may have a material effect on the price of the company’s shares,” the company said in the notice.
On Friday, Bank Windhoek Holdings released financial results for the year ended 30 June.
Managing director, Christo de Vries said the bank expects interests rates to increase by between 75 basis points to 1,5 points. Year-on-year profit before tax increased by 21,5% to N$1,06 billion compared to N$878,3 million in 2014.
“Our success can largely be attributed to our loyal and growing customer base and leveraging off our local insight and decision-making to remain locally relevant whilst offering internationally competitive products and services”, said De Vries.
Profit after tax grew by 20,5% to N$753 million compared to N$624,9 million in 2014 and a three year compound annual growth rate of 23,2%.
Net interest income after loan impairment charges increased by 17,6% to N$1,2 billion compared to N$1,02 billion on the back of strong loans and advances growth of 16,7%, together with an improvement in the net interest margin.
Non-interest income increased by 19,4% to N$811,9 million compared to N$679,7 million in 2014 despite the implementation of zero cash handling fees on certain accounts during the year under review.
The increase was mainly due to strong growth in transaction volumes and income from trading activities, cards and electronic channels.
Operating expenses increased by 13,9% to N$1,04 billion compared to N$914, 6 million in 2014.
The increase above inflation was mainly due to an increased headcount to provide for growth; operational banking expenses, mainly due to increased transaction volumes; and ongoing investment in technology.
The group’s total asset growth of 17,6% is driven by the growth in loans and advances of 16,7%, which was mainly due to growth in overdrafts and commercial mortgage loans.
The group remains well capitalised with a total risk-based capital adequacy ratio of 15,8% above the minimum regulatory requirement of 10%.
De Vries said investment in digital channels will ensure that Bank Windhoek keep up with market demands but also to lead with new technology.
“The outlook for Bank Windhoek Holdings remains positive and we look forward to build on the successful track record and solid foundation of our group. The group is well-positioned for the new financial year, with a clear plan to deliver future growth and value for all its stakeholders through a well-defined strategy,” De Vries said.
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