ABBEY MORTGAGE BOOSTS PROFITS WITH REDUCED NON-PERFORMING LOANS AFFIRMING SUCCESSFUL RISK MANAGEMENT TACTICS (Reporter: Tobi Adetunji)

Abbey Mortgage Plc continues to enhance its earnings, overcoming the impact of inflationary pressures, attributed to the Bank’s successful risk management strategies, particularly the reduction in Non-Performing Loans (NPLs).

In December 2023, the mortgage firm observed an 11.79 percent surge in net profit, reaching N856.26 million compared to N766.19 million in December 2022. Notably, interest income experienced a substantial increase of 49.27 percent, amounting to N49.27 billion in December 2023, compared to N4.83 billion in the preceding year. Conversely, fees and commission income witnessed a decline of 83.15 percent, totaling N395.08 million.

Abbey Mortgage prioritized cost reduction to enhance efficiency, successfully trimming total operating expenses by 1.70 percent to N2.31 billion, despite a challenging economic environment.

Over the past three years, Abbey Mortgage strategically reduced NPLs, affirming its commitment to maintaining good asset quality, a noteworthy accomplishment in an industry grappling with deteriorating asset quality.

Anticipating an industry-wide increase in minimum capital requirements, Abbey Mortgage has proactively positioned itself for recapitalization. Mobolaji Adewumi, the managing director and CEO of Abbey Mortgage Bank, emphasized the bank’s readiness for recapitalization, stating that Abbey is already working towards ensuring continuous compliance with any minimum capital requirement adjustments. The last capital raise occurred in 2020, generating approximately N3 billion.

According to Adewumi, the Central Bank of Nigeria (CBN) has indicated a need for banks, including microfinance and mortgage banks, to recapitalize. Abbey Mortgage is committed to staying ahead of these requirements, aligning with its strategic vision and proactive approach.

News Source: Techeconomy