Issue link: https://maltatoday.uberflip.com/i/1482987
maltatoday | SUNDAY • 130 OCTOBER 2022 17 BOV announces improved benefits on Motor Loans BANK of Valletta has just im- proved its existent suite of Mo- tor Loans with several additional benefits such as reduced interest rates, extended loan terms, and higher applicable loan amounts. These benefits complement the Bank's Free Life Cover availa- ble on all personal loans up to €25,000 – a feature which so far places BOV as the only Bank in Malta offering life cover on loans for free! Alan Micallef, Lead Consum- er & Micro-Business Finance at Bank of Valletta spoke about these improved benefits and mentioned how the Bank is making motor finance more accessible and attractive to cus- tomers. He highlighted how those interested in buying a new car or motorcycle and require financial assistance can benefit from several financing options from BOV, tailor-made to client requirements and the type of vehicle being purchased, being it electric, hybrid or the conven- tional fuel-powered vehicle. Mr. Micallef also highlight- ed another scheme which also gives the opportunity to cus- tomers to finance their motor insurance premium. "BOV of- fers a tailor-made Motor Loan product that not only finances the purchase of the car, but also finances the related comprehen- sive motor insurance premia up to 7 years. This is another first on the market, in line with the Bank's efforts to give customers improved products and services across its product suite." To make these offers even more attractive, the Bank is al- so covering the financing of any applicable Government Incen- tive on Motor Vehicles. Cus- tomers need not fork out the full amount until the actual grant is refunded. On most BOV Motor Loans, the term may be extended up to 15 years, making repayments much more feasible. There is no capping in the loan amount, however the maximum loan amount depends on customer's income and repayment capabili- ty. No customer contribution or security is required on all Motor Loans. Furthermore, when tak- ing up a BOV Personal Energy Loan to finance the purchase of Electric Vehicles, customers will not pay any interest during the first ten years of the loan as they will benefit from a fully subsidised interest rate during this period. This is subject to current variable rates remain unchanged. Interested customers who might require further information, or need to set up an appointment with a loan specialist can reg- ister their interest on bov.com/ motorloans. Outstanding Bank performance contrasted by shifting market conditions APS Bank plc announces the publication of the financial re- sults extracted from the Group and Bank unaudited manage- ment accounts for the nine months ended 30 September 2022, (also referred to as the "period" or "9M") as presented to the Board of Directors on Thursday 27 October 2022. Financial Performance For the nine months end- ed September 2022, APS Bank plc posted €8.4 million pre-tax profit at Group level (9M2021: €16.7 million) and €21.7 mil- lion pre-tax profit at Bank level (9M2021: €16.0 million). These contrasting outcomes continue the trend of the first and second quarters, as global markets re- main confronted by persistent economic instability and rising inflationary pressures. Notwith- standing these challenges, the Bank registered strong results, increasing the quarterly prof- it before tax over 2Q by 66.1% which was partly offset by the unrealised negative market trends at Group level. Net interest income remains a key driver of the revenue mix, growing by €16.9 million during 3Q to a total of €46.7 million for the nine months, increasing by 15.0% or €6.1 million when compared to the same period last year. New business oppor- tunities from both personal and commercial clients supported the expansion of the Group's credit portfolio, reflected in an increase of €6.4m (12.5%) of interest income over the same period last year. Cost of funding remained stable at €10.6 million, increasing only slightly over the comparative period, demon- strating the Group's efficient management of its asset-liability mix and cost of funding. Net fee and commission in- come for the period was €5.0 million, marginally higher (2.0%) when compared to 2021. The increase in this revenue source was steered by the gen- eral growth in local and foreign banking activities, card related commissions and enlarged cus- tomer base. This was offset by reductions in investment servic- es income, which was negatively impacted by the ongoing market volatility. Continuing the trend of the first half of the year, the Group's results from financial instru- ments remained in red territory of €8.4 million. This is mainly due to the high economic uncer- tainty and instability of financial markets which negatively im- pacted the investment in APS Funds SICAV. Other operating income from business activi- ties amounted to €1.0 million (9M2021: €0.5 million) at Group level. At Bank level, gains on sale of local investments drove oth- er operating income up by €2.8 million to a cumulative amount of €4.3 million for the period under review. Third quarter operating ex- penses totalled €10.5 million bringing the aggregate for the period to €33.5 million (9M2021: €30.4 million). Mainly attributing to this is the Group's continuous investment in hu- man capital to motivate and retain skilled workers resulting in increased salaries in all lev- els and incentive schemes as well as costs for staff training and well-being. In addition, in- creases were recorded across the board in other areas, such as regulatory and compliance costs, insurance, security and the ongoing investment in tech- nology infrastructure, channels and digitisation, seeking the right balance between more ef- ficiency and customer-centric methods and more Environ- mental, Social and Governance (ESG) sustainability initiatives. The Group's cost-to-income ratio from business operations as at 3Q2022 was 63.4% drop- ping by 1.9% when compared to the 65.3% of 2Q2022, affirm- ing the management's oversight on effectively delivering quality service whilst maintaining pru- dent cost levels. Impairments against expected credit losses resulted in a writeback of €0.1 million, reflecting the perfor- mance of customer loans and advances and the Group's high credit underwriting standards and attitude to risk while active- ly pursuing new business oppor- tunities. Financial Position As at the end of the reporting quarter, total assets stood at €3.1 billion, further expanding by €46.2 million during 3Q and a year-to-date growth of €305.5 million. Loans and advances to customers mainly led this ex- pansion with total growth of €217.2 million during the peri- od. Home loans and personal financing remained the highest contributor, further expand- ing by €59.5 million in 3Q for a total growth of €174.3 million since December 2021. Syndi- cated loans and trade financing increased by 22.0%, or €29.5 million, during the period to reach €163.8 million. Concur- rently, during the nine months under review, holdings of debt securities grew by €127.6 mil- lion whilst cash and reserves with the Central Bank of Mal- ta decreased by €73.0 million, reflecting active liquidity man- agement and the Group's sup- port of Government borrowing programmes. Corresponding to the increase in the Group's asset base, liabilities grew by 10.5% or €269.3 million, reaching €2.8 billion. Overnight deposits in- creased by €269.2 million over the nine-month period recon- firming the strength of the APS brand in attracting customer funding. This was counterbal- anced by a targeted reduction in term deposits of €14.8 million, further improving the deposit portfolio mix and funding cost. Total equity amounted to €257.0 million, rising by 16.4% from December 2021's €220.8 million. As cautiously antici- pated earlier in the year, mar- ket movements resulting from rising interest rates have had a direct, negative impact on re- serves (through 'other compre- hensive income'). These cor- rections, albeit unrealised and expected to reverse fully over time, were amply compensated by the €66 million equity cap- ital raised from the successful Initial Public Offering (IPO) of June which was hugely oversub- scribed within hours of opening. The same IPO has had the effect of boosting the Bank's capital adequacy ratio to 18.8%, with the CET1 ratio at 15.2%.