The Housing and Development Bank (HDB) achieved profit before tax (PBT) of EGP 1.45bn during the first half (H1) of this year, compared to EGP 1.309bn in H1 2020, an increase of EGP 141m (10.8%), according to HDB Chairperson and Managing Director Hassan Ghanem.
He added that the bank’s net profit amounted to EGP 1.001bn in H1 2021, compared to EGP 1bn in the comparison period.
According to Ghanem, this reflects the bank’s efforts to achieve good business results despite the novel coronavirus (COVID-19) pandemic and its negative repercussions on all areas and economic activities, whether at the local or global level.
Ghanem said the bank’s continuing to achieve positive growth was the result of the continuous support towards its development and expansion plans, which had a direct positive impact on the bank’s performance.
He stressed that the bank has developed a clear and ambitious strategy, through which it seeks to be among the top commercial banks. Moreover, it implements a plan to develop banking services and products. Furthermore, there has been remarkable development in providing all competitive banking services and products, in addition to digital products.
He pointed out that the Central Bank of Egypt’s (CBE) policies to enhance financial inclusion, achieve digital transformation, and expand the number of bank branches and ATMs, had a positive impact on HDB’s results.
Ghanem also stressed that the efficiency and professionalism of the bank’s executive management, employees, and board of directors, had a great role in achieving these good indicators, in light of the current economic conditions and their effects on all items of the budget and the income statement.
He pointed out that the bank’s financial indicators revealed maintaining a strong capital base, as the bank achieved a remarkable growth in total assets, which supported the growth of operating revenues, as total assets rose to EGP 64.7bn, compared to EGP 58.3bn, an increase of EGP 6.4bn (11%).
According to the bank’s financial statements, net loans and facilities increased to EGP 21.185bn, compared to EGP 19.350bn, an increase of EGP 1.835bn (9.5%). Meanwhile, HDB’s customer deposits rose to EGP 52.146bn, compared to EGP 47.122bn, an increase of EGP 5.024bn (10.7%). The bank’s loan-to-deposit ratio amounted to 40.6%.
Ghanem stressed that the bank succeeded in maintaining the reinforcement of its capital allocations to face credit risks related to the negative effects of the pandemic on economic activity. The bank’s capital allocations for portfolio credit risk increased by 5.2%.
According to the bank’s financial statements, the net income from return amounted to EGP 1.617bn in H1 2021, compared to EGP 1.280bn in the same period last year, an increase of EGP 337m (26.3%). It included an increase in the return on loans and similar revenues by 15.2%, and the increase in the cost of deposits and similar costs by 6.3%.
Dividends increased by 74.5% to EGP 192m in H1 2021, which reflects the development of the profits of subsidiaries and sister companies. The bank’s earnings per share also amounted to EGP 6.74.
HDB’s housing projects also achieved strong profits, reaching EGP 207m, an increase of 31%.
According to the bank’s performance indicators, the capital adequacy ratio in accordance with Basel II requirements reached 21.62% at the end of the second quarter (Q2) of 2021. The return on assets reached 1.55%, and the return on equity, including net profit, was 12.4% in Q2 of 2021.
Ghanem stressed that HDB believes in the importance of expanding electronic payments, in line with CBE policies, and always seeks to provide the latest banking services and products that fit the needs of all segments of customers.
He indicated that the bank has implemented a comprehensive plan for digital transformation to keep pace with the successive changes in financial technology, expand the provision of digital banking services and work to develop them permanently to facilitate banking transactions and spread the culture of cashless payment due to its extreme importance in the near future.
He explained that the bank had developed the services provided through the electronic wallet “Floussy Phone”, activating the internet banking and mobile banking services, providing electronic reservation of housing units and land, and paying the installments of housing units electronically.
“We seem to expand the issuance of cards and a long-term partnership agreement was signed with the International MasterCard to stimulate the use of electronic payments, in addition to prepaid cards, especially “Meeza” cards. This will contribute to spreading digital financial culture, expanding the base of electronic payment, and increasing financial inclusion rates,” Ghanem said.
He indicated that the rate of issuance and usage of credit cards increased during 2020 to nearly 90%, with further targeted expansion in the issuance of cards in 2021.
Ghanem revealed that there is a plan to spread ATMs throughout the country, in light of CBE’s initiative and the bank’s plan, as the number of ATMs for the bank has so far reached nearly 320, with an increase of up to 30% during 2020. ATMs will increase to 400 during 2021.
He pointed out that the bank has installed 25 vocalized ATMs for the people with special needs.
Ghanem stressed that the bank seeks, in accordance with the policy of geographical spread and in line with financial inclusion, to be close to the public, especially in geographical places where banking services are not widely available. He noted that the number of bank branches is currently 100. 10 new branches were opened in 2020.