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4FINANCE HOLDING S.A. REPORTS RESULTS FOR THE THREE MONTHS ENDING 31 MARCH 2021 - Seite 2
- Despite bringing operating costs down 21% YoY, the cost to income ratio for the Period was 58.9%, vs 52.9% in Q1 2020, due to the lower interest income. Costs were reduced reflecting cost discipline and focus on operational efficiency.
- Good fundamental asset quality indicators, disciplined lending and an active NPL debt sales market resulted in a significant reduction in quarterly net impairment charges (down 61% YoY and 36% QoQ) and cost of risk (7.6% for the Period vs 17.4% in Q1 2020). Both metrics are at their lowest levels since the introduction of IFRS9 at the start of 2018.
- Adjusted EBITDA was €25.1 million for the Period, up 8% year-on-year, a strong result delivered despite the reduction in the top line. The full interest coverage ratio as of the date of this report is 1.9x.
- Post-provision operating profit for the Period was €13.6 million, benefiting from the 61% year-on-year reduction in net impairment charges, with a profit before tax of €9.7 million.
- Net receivables totaled €533.1 million as of 31 March 2021, up 1.3% year-to-date. During the quarter, TBI Bank grew net receivables further and the small reduction in online business portfolio was due to run-off products.
- Improved overall gross NPL ratio at 14.9% as of 31 March 2021 (16.7% for online), compared with 17.0% as of 31 December 2020 (19.2% for online).
Liquidity and funding
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- Strong funding position, with €96.0 million of online cash at the end of the Period.
- $116 million of USD bonds held in treasury following further buybacks in March and April.
- Strong capital position at TBI Bank (19.0% capital adequacy ratio), with good deposit growth in Q1.
- The Group has two bond maturities in the first half of 2022 and plans to address these during 2021. As such, the Group is reviewing a range of liability management options for both its EUR and USD bonds.
Kieran Donnelly, CEO of 4finance, commented:
"Our core online products have continued to see quarter-on-quarter income growth since Q2 2020, with strong repayment behaviour rooted in sound underwriting and services that our customers value. Sales of these products have returned to pre-Covid levels - despite the continuation of Covid restrictions. TBI has driven substantial growth in loan issuance in its local markets and we are now accessing the bank's funding for our Lithuania near-prime business.