MyBucks (DE:MBCG) (MBC) continues to expand its lending business organically, leveraging the acquisitions of banks from Opportunity International (in particular those operating in Mozambique and Uganda) completed in H117. At the same time, it introduced several measures to optimise its funding structure and reduce the cost of debt. MBC aims to move towards break-even at net income level through expanding its product offering, entering new regional markets, further technological innovations, as well as continued focus on operating and funding cost reductions.
Solid growth and improving quality of loan book
MBC’s loan book increased by 25.1% y-o-y to €85.7m in FY18 assisted by all segments, in particular individual and SME lending (as banking income is still a minor contributor and insurance revenues grew by c 6.5% y-o-y). At the same time, loan impairment charges declined by 3.0% y-o-y (despite the spike in South Africa), and compared to revenues stood at 19% (vs 22% in FY17). The company was able to improve the quality of its portfolio with provisions to gross book ratio standing at 10.9% in FY18 vs 20.2% last year. Amid the lack of recognized restructuring expenses (FY17: €0.7m), operating profit rose 26.6% y-o-y to €14.4m in FY18.
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