Spring Bank attributes return to profitability to strategic initiatives


Jun 23, 2010 By


Spring Bank Plc has attributed the recent improvement in its first quarter financial performance to the introduction of a number strategic initiatives embarked upon by the company since the intervention by the Central Bank of Nigeria (CBN) in the bank.



The bank announced a profit after tax of N613.41 million in its first quarter audited performance for the period ended, March 31, 2010, compared to a loss after tax of N1.75 billion in the comparable period of 2009.This was in spite of a dip in its gross earnings by 8.48 per cent to N5.97 billion from N6.53 billion in 2009, while its profit before tax stood at N635.82 million from N1.73 billion recorded in 2009.



It would be recalled that the Governor of the Central Bank of Nigeria (CBN), Mallam Sanusi Lamido Sanusi, recently disclosed that Spring Bank Plc was one of the four rescued banks that posted a profit in February 2009.The bank’s deposits grew from N142 billion in December 2009 by 11.6 per cent to 158billion in March 2010 while the balance sheet size grew by 4.1 per cent from N146billion to N152.3billion. The profit_before_tax of N636.0 million is also a significant improvement when compared with the loss position of N28.7billion in the audited accounts of the year ended December 2009.



Following the positive turn of events in the bank, characterized by a sharpened business focus and a more cost efficient operation, Spring Bank is currently considering investment offers from foreign and local investors towards the recapitalization of the bank.In a meeting with representatives of shareholders of the bank recently, the Group Managing Director/Chief Executive Officer (GMD/CEO), Mrs. Sola Ayodele, stated that the monthly profit which began in February this year will be sustained and improved upon. She called for their unflinching support in the recapitalization efforts of her administration so as to build a sound and profitable bank that will deliver a rewarding and lasting shareholder expectation.



She said that the return to the path of profitability has been made possible by a number of strategic initiatives which focused on effective liquidity management, loan recovery, operational efficiency and corporate governance in addition to the intervention funds from the apex bank.



She posited that the bank has been able to reduce its operating expenses from a monthly average of N1.3 billion to N1.1 billion thus saving about N1.2 billion in expenses since the CBN intervention in October 2009 while deposits have also increased from N132 billion in October 2009 to N158 billion in March 2010. Additionally, the GMD/CEO concluded that the bank has been able to achieve a significant improvement in income during the period.







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