APS Group registered a pre-tax profit of €24.1 million for 2021, an increase of 52.5% over the previous year, while the bank posted a record pre-tax profit of €23.7 million, up from €15.5 million the previous year.
As the macroeconomic situation continues to create challenges for businesses and families, the group’s resilience and strength of its business model was again manifest in such unprecedented times, APS said in a statement.
"These results were achieved while the APS Group continued to support the community in its many facets, ensuring business continuity and absorbing the financial impact of the current economic climate."
Net interest income grew by 13.3% to €55.4 million, driven mainly by the continued growth in the bank’s lending book.
Interest receivable on loans and advances increased by €6.8 million to €63.2 million. Interest expense remained at 2020 levels despite the significant growth in customer deposits, demonstrating the group’s efficient asset-liability and funding management in the face of compressed interest margins.
Net fees and commission income totalled €7 million, an increase of 34.3% or €1.8 million higher than last year. This growth results from an expanded customer base and increased services, in particular the provision of credit, general banking and investment services, including from the pension products offering launched in late 2020.
Operating expenses increased by 21% to €40.6 million, raising the cost to income ratio to 64.3%. The key drivers for the increase are the continuous investment in human capital to sustain operational growth and strengthen risk and compliance management, and various projects which are in motion, not least in the technology, aimed at improving the customer experience and the group's position within the industry.
Impairment against expected credit losses for the year amounted to a writeback of €1.5 million compared with a net charge of €5.5 million in 2020.
Group total assets at December 31, 2021, expanded by a further €374 million, or 15.4% reaching €2.8 billion.
Lending activity grew by 14.7% to reach €2.1 billion. The demand for home loans steered this expansion by largely contributing to this increase, followed by commercial lending.
The syndicated loans portfolio also grew by 18.7% to €134.3 million. In terms of liquidity management, a further €99.4 million in liquidity balances were placed with the Central Bank of Malta.
Marcel Cassar, Chief Executive Officer, said: “We are pleased to be announcing these excellent results for a year when the Maltese economy was still trying to adapt to the new contours of a post-pandemic era with all the challenges that it still presents. These results confirm the strength of our business model which sees us gaining market share through improving our services and product lines, enriching the customer experience and continuing the strategic transformation of the Bank while supporting the community into the ‘new normal’."