Lombard Bank has announced record profits for the year ended 31 December. Profits before tax reached Lm3.67 million, an increase of no less than 44 per cent on 2004.

The bank also announced that it will recommend the payment of a Final Dividend of 20c per share at its forthcoming annual general meeting to be held in April.

It seems that despite the two largest banks in Malta providing stiff competition and having a vast array of modern and sophisticated financial products, there is still a lucrative market for smaller players that seems to satisfy the growing need for tailored and personalised services.

The performance of Lombard Bank on the Malta Stock Exchange has also been remarkable in that the share price has more than doubled in less than 12 months with shares on Tuesday exchanging hands at Lm10.50 each.

Its net income increased by 30.2 per cent to Lm4.78 million, indicating, the bank said, a market-driven interest rate policy and effective asset/liability management. The bank’s core operations continued to enhance the Net Interest Margin which reached

51.2 per cent.

Administrative expenses were limited to Lm2.06 million, reflecting the bank’s awareness to contain overheads. A Cost/Income ratio of 38.2 per cent was realised despite the fact the bank does not benefit from economies of scale.

Customer loans and advances increased by 14 per cent. The bank said continued high regard to credit quality resulted in a net release of Lm0.29 million from impairment allowances.

Based on a post-tax profit of Lm2.37 million for the year, Earnings per Share reached 56.6 cents. Shareholders’ Funds are up by 25 per cent to Lm16.6 million and include an increase to the Property Revaluation Reserve of Lm0.81 million following a revaluation of the bank’s property as required by International Accounting Standards. Total assets stood at Lm188 million. Return on Equity (pre-tax) increased to 24.4 per cent.