I&M Bank (Rwanda) Plc has released its audited financial results for the fiscal year 2023, revealing a surge in profit after tax by 15 per cent to Rwf 10.7 billion, driven by growth across all business segments.

The Bank’s net operating income also saw a 17 per cent increase to Rwf 45.8 billion.

As per the Bank’s financial report for the year which ended on December 31, 2023, total assets reached Rwf 678.8 billion, marking a 38 per cent growth, indicating the Bank's strong performance and expanding footprint.

Moreover, earnings per share stood at Rwf 7.06, reflecting a 15 per cent rise, which emphasizes the Bank's dedication to providing value to its shareholders. In light of the achievement, the Board of Directors has recommended a dividend payout of Rwf 1.41 per share, pending approval by shareholders at the forthcoming Annual General Meeting.

Commenting on the Bank's performance, Benjamin Mutimura, the Chief Executive Officer, said, "Despite a changing environment, we achieved strong financial results, credited to strong customer relationships and our dedicated staff. We're committed to being a trusted financial partner, leading digital transformation in Rwanda with innovative propositions like the 'Agiserera' and 'Iyubake' campaigns to drive growth for Micro, Small, and Medium Enterprises (MSMEs).”

Mutimura noted that in 2023, I&M Bank Rwanda entered a strategic partnership with the Swedish International Development Cooperation Agency (SIDA) to enhance the growth and resilience of MSMEs in Rwanda.

"Through this innovative Portfolio Guarantee Agreement,” he explained, "our Bank will provide a financial safety net for MSMEs, covering up to 70 per cent of their financing needs, enabling our customers to borrow up to Rwf 350 million without requiring any collateral. Our online onboarding and Irembo Government service payments have supported economic recovery.”

With a resilient balance sheet and cutting-edge technologies, I&M Bank (Rwanda) Plc reports delivering superior customer delight, leading to a 23 per cent year on year growth in customer base.

Mutimura said that embracing eKash interoperability and partnering with Old Mutual showcases the Bank’s dedication to MSMEs.

"We were honoured to have received the Best Taxpayer and Best Bank in Rwanda awards for the third consecutive year, recognising our pursuit of excellence,” he added.

"On the outlook for 2024, despite global economic uncertainty, we're optimistic, focusing on strategic initiatives and enhancing internal capabilities. The bank will move beyond traditional segmentation, serving customers and their ecosystems through both traditional and digital channels to deliver a seamless and valuable experience in the financial year 2024."

2023 profit and loss statements show improvements compared to 2022

The strength of I&M Bank Rwanda’s performance was reflected in all profitability metrics, with return on equity (ROE) and return on asset (ROA) remaining stable at 14.39 percent and 1.96 percent respectively, according to a financial report from the bank.

Net interest income grew by 10 per cent, primarily driven by improved margins on the bank’s interest-earning assets, particularly in the loan portfolio and investment securities which are up 35 per cent and 7 per cent, respectively.

Furthermore, the report shows that fees and commission income rose by 23 per cent year-on-year, driven by the rise in digital transactions, thanks to the Bank’s investment in enhancing the customers’ digital experience.

Foreign currency trading profits also surged by 74 per cent year-on-year, driven by a higher volume of foreign exchange transactions and diversification of transactions in different currencies.

According to its financial report, total operating expenses grew by 18 per cent year on year, reflecting the investment in staff, with staff costs increasing by 17 per cent year on year from human capital development and cost of living adjustments. Other operating expenses went up by 24 per cent driven mainly by enhancement of technological customer facing platforms to improve operational resilience and customer satisfaction,” the report reads.

"Impairment charges decreased by 17 per cent despite loan book expansion, attributed to successful recoveries. This reduced the cost of risk on gross loans and advances to 94 basis point from 1.61 per cent, indicating improved asset quality.”

More highlights: 2023 balance sheet and capital position

I&M Bank Rwanda’s loan portfolio growth of 35 per cent year on year extended to asset quality, with the gross non-performing loans (NPL) ratio falling to a healthy 2.4 per cent from 4.2 per cent in 2022.

The Bank's deposits base also increased by 51 per cent to Rwf 539 billion as of December 31, 2023, while shareholders' funds grew 10 per cent, driven by a strong 17 per cent increase in retained earnings to Rwf 55.6 billion.

The Bank says the solid performance also translated to healthy capital adequacy ratios, with an overall Capital Adequacy Ratio (CAR) of 18.01 per cent and a Tier 1 ratio of 16.65 per cent.

CAR measures a bank's capital in relation to its risk-weighted assets, assessing its ability to absorb losses, while Tier 1 capital refers to a Bank's core capital, including equity capital and disclosed reserves, providing a measure of its financial strength and resilience.