Wednesday, May 4, 2011

Diamond Bank’s Chairman Assures Shareholders of Steady Growth

... as shareholders approve Dividends

The esteemed shareholders of Diamond Bank Plc, one of the leading commercial banks in the country, have been assured of the Bank’s steady growth in both profitability and business expansion, as it also pays dividends.

Speaking at the Bank’s 20th Annual General Meeting (AGM) held in Lagos weekend, the Chairman of the Bank, HRM Igwe Nnaemeka Achebe (the Obi of Onitsha), stated during the last year’s AGM, he said there is every reason to look forward to a better future, as the Bank continues on the path of profitability and commitment to adequate return on investment for all the shareholders.

I am happy to confirm that the key actions we took in 2010 financial year were fruitful. Your Bank returned to profitability and you should expect steady growth in the years ahead”, he stated.

Igwe Achebe further stated that Diamond Bank has a dividend policy that balances the dual objectives of appropriately rewarding shareholders through dividends and reinvesting profit to support future growth. “Consistent with this policy and in recognition of the Bank's overall performance, your directors are pleased to recommend a dividend of 15 kobo per share for the financial year ended December 31, 2010. This decision was taken in order to appreciate our shareholders for their patience, commitment and support especially in 2009 when the Bank could not pay any dividend,” he stated.

According to him, the Bank recorded a Profit Before Tax (PBT) of N9.5 billion for the year compared to the loss before tax of 9.0 billion for the 8-month financial year ended December 31, 2009. This improved performance was as a result of the significant increase in our interest margin and the gains from the initiatives that were implemented to improve operating efficiency and organizational productivity. The Bank’s focus on its retail banking strategy over the years is paying off with significant improvement of the balance sheet through low-cost deposits, thus improving the net interest margin. The risk-adjusted returns on retail assets have also been very encouraging. The Bank’s ratio of operating expenses to operating income improved from 68.1 percent recorded in 2009 to 62.6 percent in 2010. The Bank had focused on implementing cost effective business structures and processes which has culminated in more efficient staffing and operating model. The impact of these measures has resulted in improved efficiency.

“Taking into account the vigorous implementation of our risk management and other business transformation initiatives, I have no doubt that our Bank is set on steady and sustainable profit path. The current implementation of 2010 shareholders’ resolution for the Bank to divest from non-bank subsidiaries or combine the relevant activities with its operations will enable the Bank focus on the areas of its core competence. Considering the steps taken in the last two years to optimize the business, I sincerely believe that your Bank is now well positioned to conclude the clean-up of the legacy loan losses in the 2011 Financial Year and move progressively to becoming one of the top Nigerian banks in terms of ROE, and the champion in customer experience and operational efficiency,” he stated.