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Equity Bank FY 2016 results
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maka
#21 Posted : Wednesday, March 15, 2017 2:22:26 PM
Rank: Elder

Joined: 4/22/2010
Posts: 11,522
Location: Nairobi
Angelica _ann wrote:
mlennyma wrote:
Ericsson wrote:
Equity Bank Earnings Fall for First Time in a Decade, Bad Loans Up 100%
The Group’s Non Performing Loans (NPLs) doubled from the previous year’s Ksh 9.0 Billion to Ksh 18 Billion while NPLs from its Kenyan Business more than doubled to Ksh 15 Billion from 2015’s Ksh 6.8 Billion.

Kenyans are in shit and unable to repay loans...uhuruto tena


When you say, you are told the sky is not falling. d'oh! d'oh! d'oh!



Badosmile Pessimist wewe...
possunt quia posse videntur
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Ericsson
#22 Posted : Wednesday, March 15, 2017 2:27:26 PM
Rank: Elder

Joined: 12/4/2009
Posts: 10,808
Location: NAIROBI
(1)In just 3 months,Equity Bank's income statement was shredded by two things: Banking Amendment Act (the law) and asset non-perfomance..

(2)Q4 EPS was down 70%q/q.Took a Kshs.2.6bn haircut on income from loans due to the law.NPL ratio surged to 7%;and so was Q4 impairments

(3) Due to its risk-on lending and funding approach,Equity will be the worst hit by the law due to its and will struggle to adjust.

(4)I expect the bank's 2017 asset strategy to be dominated by piling up of Government securities..
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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mlennyma
#23 Posted : Wednesday, March 15, 2017 2:37:50 PM
Rank: Elder

Joined: 7/21/2010
Posts: 6,194
Location: nairobi
Ericsson wrote:
(1)In just 3 months,Equity Bank's income statement was shredded by two things: Banking Amendment Act (the law) and asset non-perfomance..

(2)Q4 EPS was down 70%q/q.Took a Kshs.2.6bn haircut on income from loans due to the law.NPL ratio surged to 7%;and so was Q4 impairments

(3) Due to its risk-on lending and funding approach,Equity will be the worst hit by the law due to its and will struggle to adjust.

(4)I expect the bank's 2017 asset strategy to be dominated by piling up of Government securities..

I will make sure by release of Q1 I will have rough work money to buy between 15-20
"Don't let the fear of losing be greater than the excitement of winning."
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Ebenyo
#24 Posted : Wednesday, March 15, 2017 3:59:22 PM
Rank: Veteran

Joined: 4/4/2016
Posts: 2,016
Location: Kitale
kshs 7.5 billion in dividends.How does that translates into dividend per share?
Towards the goal of financial freedom
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Ericsson
#25 Posted : Wednesday, March 15, 2017 4:27:38 PM
Rank: Elder

Joined: 12/4/2009
Posts: 10,808
Location: NAIROBI
Ebenyo wrote:
kshs 7.5 billion in dividends.How does that translates into dividend per share?

sh.2 per share
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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watesh
#26 Posted : Wednesday, March 15, 2017 5:04:48 PM
Rank: Veteran

Joined: 8/10/2014
Posts: 992
Location: Kenya
That crazy NPL provision Equity made protects in FY2017 earnings. If there is a drop in earnings thanks to interest rate capping, it wont seem huge since they suppressed their 2016 profits with the mega NPL provisions.
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obiero
#27 Posted : Wednesday, March 15, 2017 5:56:38 PM
Rank: Elder

Joined: 6/23/2009
Posts: 14,222
Location: nairobi
watesh wrote:
That crazy NPL provision Equity made protects in FY2017 earnings. If there is a drop in earnings thanks to interest rate capping, it wont seem huge since they suppressed their 2016 profits with the mega NPL provisions.

Insane logic if that was the case

KQ ABP 4.26
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Realtreaty
#28 Posted : Wednesday, March 15, 2017 6:18:13 PM
Rank: Elder

Joined: 8/16/2011
Posts: 2,387
I am just chipping in, what did Aka Mr Equity say about Equitel? Has Equitel brought forth any tangible fruits or just buds? How will Equitel compete with Safaricom. My interest in Equity was equitel to see if I could increase shareholding.
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watesh
#29 Posted : Wednesday, March 15, 2017 6:29:33 PM
Rank: Veteran

Joined: 8/10/2014
Posts: 992
Location: Kenya
Breakdown of quarterly interest income from Equity Bank Kenyan subsidiary
2016
Q1 - 10.73
Q2 - 11.34
Q3 - 11.51
Q4 - 9.49

As compared to 2015
Q1 - 8.26
Q2 - 8.65
Q3 - 9.27
Q4 - 11.09

Observations:
Just like KCB the Q4 interest income much lower than Q1 in the year 2016. I predict a flat growth or slight drop in Q1 2017 interest income.
If the interest rate cap sticks, Q2 and Q3 will relatively have flat growth since the drop in interest income should be equal to its usual average growth so it cancels out the effect. Q4 2017 will experience higher growth than the other quarters since Q4 2016 has already been affected by interest rate cap.
All this is with the assumption that economic conditions remain ceteris paribus.
Profit growth will be determined by NPLs in 2017 plus a little bit by lower taxes thanks to infrastructure bond interest income which is tax exempt. Equity wrote off a bunch of NPLs in 2016 which they state were one off costs, they are focusing more on quality rather than volumes, i expect lower NPLs in 2017.
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lochaz-index
#30 Posted : Wednesday, March 15, 2017 7:47:15 PM
Rank: Veteran

Joined: 9/18/2014
Posts: 1,127
watesh wrote:
Breakdown of quarterly interest income from Equity Bank Kenyan subsidiary
2016
Q1 - 10.73
Q2 - 11.34
Q3 - 11.51
Q4 - 9.49

As compared to 2015
Q1 - 8.26
Q2 - 8.65
Q3 - 9.27
Q4 - 11.09

Observations:
Just like KCB the Q4 interest income much lower than Q1 in the year 2016. I predict a flat growth or slight drop in Q1 2017 interest income.
If the interest rate cap sticks, Q2 and Q3 will relatively have flat growth since the drop in interest income should be equal to its usual average growth so it cancels out the effect. Q4 2017 will experience higher growth than the other quarters since Q4 2016 has already been affected by interest rate cap.
All this is with the assumption that economic conditions remain ceteris paribus.
Profit growth will be determined by NPLs in 2017 plus a little bit by lower taxes thanks to infrastructure bond interest income which is tax exempt. Equity wrote off a bunch of NPLs in 2016 which they state were one off costs, they are focusing more on quality rather than volumes, i expect lower NPLs in 2017.

What do you suppose will happen to Equity's or the whole sector's NPLs once the cap law is done away with assuming similar macro conditions?
The main purpose of the stock market is to make fools of as many people as possible.
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