Bank PHB Records N2.74bn First Quarter Profit

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The management of Bank PHB, on Tuesday, told investors through the Nigerian Stock Exchange (NSE) of its return to profit ability in the first quarter ended March 31, 2010, despite a decline in gross earnings income for the period.

There was also improvement in the net asset position in deposit base from N477.981 billion to N481.696 billion.

According to the result, earnings income stood at N19.834 billion, from the previous N42.807 billion, out of which profit before tax and extraordinary items stood at N4.349 billion. Extraordinary items recorded a negative N1.409 billion for the period, which reduced profit before tax to N2.94 billion from the previous N3.072 billion loss. Profit after tax for the first quarter was N2.747 billion from a loss of N1.289 billion.

The bank also submitted its audited full year performance score-card indicating that despite the N70.798 billion or 79.33 per cent rise in gross earnings income, the group slipped into a net loss position.

Earnings income for the year stood at N160.035 billion from N89.237 billion, while PBT stood at N488.049 billion, compared with a profit of N27.193 billion, while after tax position worsened from a profit of N20.649 billion to N400.189 billion loss.

The bank’s full year balance sheet showed that investment in treasury bills shrinked from N140.363 billion to N11.853 billion, just as the value of its loans and advances portfolio dropped to N186.844 billion as against the previous N314.125 billion. Net assets for the period worsened to a negative N194.587 billion from the preceding full periods’ N169.208 billion negative position.

The bank’s external auditors- PriceWaterhouseCoopers however qualified the account, going by the net loss and negative shareholders’ funds, besides its liquidity and capital adequacy ratios that fell below the regulatory threshold.

“The external auditors draw attention to the possibility of law suit regarding the control of Spring Bank Plc. Therefore, the financial statements of Spring Bank Plc were not included in the group financial statements,” the NSE told investors.

The note to the account explained that the CBN granted a seven-year medium term financing facility of N170 billion to the bank to meet its maturing obligations and has confirmed its intention to continue to support the bank financially so that the bank can continue as a going concern for at least 12 months from June 30, 2010, when the bank’s board approved the results.

The bank also told investors of ongoing intensive loan recovery efforts to shore up its liquidity, where expectations remain high that management would continue to carry out transactions that would enhance its liquidity situation with the Assets Management Corporation of Nigeria (AMCON), which was signed into law on Monday.