Earnings Update- ACCESS- 9M: 2019.

Impressive Growth Trajectory Maintained Access Bank (ACCESS) recently published its unaudited third-quarter result for 2019 which revealed solid growth in gross earnings (+36.89%) and net income (+44.23%) during the period. The bank continues to ride on the revenue and cost synergies from its merger with Diamond Bank, which have positively impacted its results. The impressive performance in gross earnings was underpinned by robust Interest income growth (+ 47.55%), with non-interest income also inching upwards by 7.84%. The bank witnessed an expansion in its net interest margin by 150 bps to 6.8%, supported by lower funding costs and a higher yield on earning assets. Loan to Deposit Ratio stood at 67.4%, which places it clear of the new regulatory minimum of 65%. Also, the bank’s Non-Performing Loan (NPL) ratio fell to 6.3%, from the initial post-merger ratio of 10.0% which highlights the group’s impressive credit risk management efforts. We have revised our 2019 target EPS downwards to NGN3.65 (previously 4.27), due to the company’s weaker than expected second-quarter performance, while we raise our Target P/E slightly upwards to 2.56x (previously 2.35x). This brings our 2019FY target price slightly lower to NGN9.34. Kindly find attached the full report.

Impressive Growth Trajectory Maintained

Access Bank (ACCESS) recently published its unaudited third-quarter result for 2019 which revealed solid growth in gross earnings (+36.89%) and net income (+44.23%) during the period. The bank continues to ride on the revenue and cost synergies from its merger with Diamond Bank, which have positively impacted its results. The impressive performance in gross earnings was underpinned by robust Interest income growth (+ 47.55%), with non-interest income also inching upwards by 7.84%. The bank witnessed an expansion in its net interest margin by 150 bps to 6.8%, supported by lower funding costs and a higher yield on earning assets. Loan to Deposit Ratio stood at 67.4%, which places it clear of the new regulatory minimum of 65%. Also, the bank’s Non-Performing Loan (NPL) ratio fell to 6.3%, from the initial post-merger ratio of 10.0% which highlights the group’s impressive credit risk management efforts. We have revised our 2019 target EPS downwards to NGN3.65 (previously 4.27), due to the company’s weaker than expected second-quarter performance, while we raise our Target P/E slightly upwards to 2.56x (previously 2.35x). This brings our 2019FY target price slightly lower to NGN9.34. Kindly find attached the full report.