Issue link: https://maltatoday.uberflip.com/i/1476201
maltatoday | SUNDAY • 14 AUGUST 2022 12 COMMERCIAL MeDirect Bank continues to deliver business growth whilst investing to become a pan-European WealthTech leader DURING the first six months of 2022, MeDirect continued its transformation towards becom- ing a pan-European WealthTech leader and a specialised mortgage lender. By taking advantage of the flexibility offered by its technolo- gy and ability to innovate, during the past three years MeDirect Group has successfully execut- ed its strategy, which is based on four pillars: building a world-class WealthTech platform, growing its retail franchise focused on afflu- ent customers, de-risking and di- versifying its balance sheet with a focus on mortgages, and improv- ing the efficiency of its operating model. When announcing its interim fi- nancial results for 2022, MeDirect stated that it is on track to com- plete the delivery of its disruptive Wealth SuperApp featuring a single, user-friendly suite of prod- ucts combining innovative wealth solutions with daily banking functionalities, which will make MeDirect a one-stop-shop for its customers. "In the coming months, MeDi- rect will continue to strengthen its platform with the launch of online advisory and discretionary portfo- lio management services, as well as, virtual and physical cards to enhance its everyday banking of- fering. This unique combination of daily banking and wealth ser- vices available via both the mobile app and online banking platform is expected to be highly differenti- ating in the market," said Arnaud Denis, Chief Executive Officer of MeDirect Group. In mid-2022, MeDirect re- vamped its brand in anticipation of the release of its new suite of products. The new branding em- phasises that MeDirect offers its clients the tools necessary to em- power them to navigate the com- plexity of the financial world and makes them feel confident and in control of their finances. MeDi- rect is shifting its customers' per- ception of banking from "we" to "me" – my money, my choices. Another important development has been the building of a scalable specialised mortgage lending plat- form in Malta, Belgium and the Netherlands. In Malta, MeDirect introduced three new products during the first half of 2022 – green home loans, 10-year fixed- rate mortgages and a home equity product. These products were all well-received and have been gain- ing momentum in the Maltese market. MeDirect's home loan offering, which features person- alised service ensures a faster and market-leading turnaround for customers financing their homes. MeDirect's Dutch govern- ment-guaranteed (NHG) mort- gage portfolio now represents approximately 40% of the Group's balance sheet. In December 2021, MeDirect launched its meHome- Loan product in the Belgian mar- ket in partnership with Allianz. In addition, MeDirect continues the steady development of its well-es- tablished Maltese corporate lend- ing business to support the local economy. MeDirect's retail franchise, fo- cused on affluent customers, grew by almost 30% over the past twelve months to more than 106,000 cli- ents. Total client financial assets increased by almost 4% year over year, notwithstanding very chal- lenging market and macroeco- nomic conditions, reaching €4.3 billion. Strong trust in the MeDi- rect brand and its award-winning onboarding process enabled Me- Direct to increase its wealth client base by 19% over the past twelve months. This growth was supported by high customer satisfaction and retention levels. Success in retain- ing clients is demonstrated by the fact that over 90% of clients who opened accounts with MeDirect five years ago remain with the bank. Profit before tax for the period nded 30 June 2022 amounted to €2.7 million, compared to €3.2 million for the period ended 30 June 2021. Operating income grew by 7% year over year whilst improved market conditions led to a €3.5 million net release of loan impairment charges. Net interest income increased by 11% com- pared with the same period last year, from €25.8 million in 2021 to €28.7 million, while net fee and commission income increased by 8% from €2.8 million in 2021 to €3.1 million. The Group's non-performing loan ratio was reduced to 4.6% as at 30 June 2022, from 6.7% in 31 December 2021. The capital and liquidity positions remained strong, supporting the contin- uation of MeDirect's business transformation and growth strat- egy. MeDirect's Tier 1 capital ratio stood at 13.6%, with a total capital ratio of 17.3% - both well above regulatory requirements. The Group's liquidity reserves re- mained strong at €740 million as at 30 June 2022, and the Group's Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR) stood at 247% and 129%, respectively, both well above the minimum requirements. MeDirect's mortgage portfo- lio increased by 9% over the past twelve months. As part of the Group's de-risking plan, the in- ternational corporate lending portfolio was reduced by 12% to €624 million as at 30 June 2022, representing less than 15% of the Group's balance sheet. Environmental, Social and Gov- ernance (ESG) is an important area of focus, and the Group has integrated ESG principles into its daily business. During the first half of 2022, MeDirect implemented a range of ESG initiatives includ- ing, amongst others, incorporat- ing sustainability principles in its credit and investment businesses, launching green home loans, in- cluding a feature in its brokerage platform enabling investors to identify and filter funds and ETFs which focus on sustainability and providing ESG training to MeDi- rect's Board and employees. These efforts were validated by MeDirect's improved rating by EcoVadis, one of the top interna- tional providers of sustainability ratings. MeDirect's overall score was in the top 15% of all compa- nies rated by EcoVadis. Nescafé LifeWalk 2022 challenge completed along Hadrian's Wall in the UK 20 participants have returned to Malta following the four-day Nescafé LifeWalk Challenge 2022, which this year took LifeWalkers once again from coast-to-coast along Hadrian's Wall, from Bowness-on-Solway to Newcastle. The 145-kilo- metre challenge aims to raise further awareness and funds for international kidney dis- ease research, as well as kidney disease research and renal pa- tients in Malta and Gozo. The LifeWalk challenge was originally conceived by R.U.S.H, the Renal Support Hub which is run by the Life- Cycle (Malta) Foundation af- ter the COVID-19 pandemic stalled the Nescafé LifeCycle Challenge. R.U.S.H provides external aid to patients cur- rently in treatment for kidney disease which includes free transport to treatments in the evening, fitness sessions and counselling services that are free of charge. The LifeCycle (Malta) Foun- dation is the only voluntary or- ganisation that raises funds to support renal patients in Malta and Gozo and constantly collab- orates with Mater Dei Hospital's Renal Unit and the University of Malta's kidney disease aware- ness team within the Universi- ty's Research Trust (RIDT). Donations to the LifeCy- cle (Malta) Foundation can be made via Revolut on 9932 9101, by PayPal on this link: https://buff.ly/35g17CC and via SMS: 5061 7370 for €2.33; 5061 8920 for €6.99; 5061 9229 for €11.65; or via a call to 5160 2020 for €10; 5170 2005 for €15; and 5180 2006 for €25. Dona- tions can be made also via bank transfers via Swift code VALL- MTMT, IBAN MT 18 VALL 22013000000014814521017, with the Bank name being Bank of Valletta, and account num- ber 14814521017. For more in- formation, one can visit https:// lifecyclefoundation.com or https://www.facebook.com/Li- feCycleChallenge. The Nescafé LifeWalk 2022 challenge along the Hadrian's Wall trail