The FIMBank Group is on the right track thanks to the implementation of a consolidation strategy adopted in 2015 and which has started to yield the desired results. This emerges from the publication of the group's 2015 results, which were announced this week.

The Group's Consolidated Audited Financial Statements show that for the year ended 31 December 2015, the group registered a loss of $7.1 million compared to a loss of $45.2 million in 2014. At 31 December 2015, Total Consolidated Assets stood at $1.44 billion, a marginal increase of 2% over the $1.41 billion reported at end 2014, while Total Consolidated Liabilities stood at $1.27 billion, up by 3.5% from $1.23 billion in 2014.

Net income for 2015 stood at $34.9 million, compared to a loss of $4.7 million in the previous year. During 2015, net interest income rose by 4% from $28.4 million to $29.6 million. Similar improvements with respect to 2015 were noted in foreign currency operations and other operating income.

These were offset by a significantly lower level of fee income from trading assets and documentary credits, mainly due to a change in the geographic focus and up-scaled client target base. Significantly, net impairments decreased by 80%, standing at $10.3 million, compared to $50.7 million in 2014. As a result of controlled impairments and marked-to market-losses, the group has improved its net income by $39.7 million, to $34.9 million. Operating expenses increased by $7.2 million to $47.0 million, primarily as a result of various one-off costs related to business reorganisation and the strategic redeployment of resources.

Commenting on the financial results, FIMBank Group CEO Murali Subramanian stated that "Following the most difficult year in the group's history, the year under review necessitated stability to the business, reinforcement of the governance and risk structures, and the gradual re-building of the portfolios to a sustainable level. Through the implementation of a number of measures and initiatives, the group succeeded in overcoming the substantial impairments which marred the 2014 performance, whilst at the same time creating a revenue platform to generate value going forward."

The Group CEO explained that the ongoing streamlining of the international factoring strategy means that the different factoring businesses in Malta and abroad are now aligned towards a common objective. "Aided by a strengthened leadership team and governance structures, the Group intensified its effort to maximise its resource potential, including a review of key staff positions, enhanced cost management processes, and better utilisation of assets across the different group entities", he said.

Commenting on the immediate outlook for the FIMBank Group, Chairman Dr John C, Grech stated that the group is "encouraged by the profit registered in the last quarter of 2015 and the positive performance for the first two months of this year, a trend which we expect will be sustained throughout 2016". He referred to the macro-economic outlook as "challenging", driven as it is by weaknesses in commodity prices and emerging markets. "Apart from posing external risks to the business, these will exert more pressure on the group to diversify the target sectors to rebalance and rebuild its different portfolios", he explained. "The key pillars of the turnaround will remain at the heart of the Group's operations - an improved origination strategy across its various product offerings, a more harmonised global factoring strategy, continued focus to asset quality and loan recovery management, as well as cost efficiencies and resource optimisation. This will allow FIMBank to respond with agility to the changes in economic cycles across its different geographical

presences, and to reposition itself as a growing profitable institution, through adequate returns and value creation to all its stakeholders".

Meanwhile, FIMBank's Board of Directors will not be recommending a cash dividend. However, subject to regulatory approval, the board will be recommending a 1 for 25 Bonus Issue of Ordinary Shares by way of capitalisation of the Share Premium Account.