Societe Generale posts NPL of 7.5% in 2021; half the industry’s average
Gross Non-Performing Loans (NPLs) of Societe Generale Ghana Limited for the review period of 2021 was 7.5 percentage points.
This is half the banking industry’s average NPL of 15.2% according to the January 2022 Monetary Policy Report by the Bank of Ghana (BoG).
Per the bank’s 2021 Financial Statement, its NPL increased slightly from the previous 6.72% NPL recorded in 2020 to the 7.5% NPL posted in 2021.
The increment in the bank’s NPL indicates a slight deterioration of its loan asset quality.
That not withstanding, the bank has one of the lowest NPL as compared to its peers in the country.
Societe-Generale also in the review period, strengthened it’s Capital Adequacy Ratio (CAR) increasing it by 1.59 percentage points to end the year at 22.38%.
Capital Adequacy Ratio (CAR) is a measurement of a bank’s available capital expressed as a percentage of a bank’s risk-weighted assets and liabilities.
Capital Adequacy Ratios mandate that a certain amount of the deposits be kept aside whenever a loan is being made. These deposits are kept aside as provisions to cover up the losses in case the loan goes bad.
With regards to recorded profit after tax, the bank increased its net profit from GHS 154m in 2020 to GHS 184m in 2021.
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Elements that accounted for the GHS 30m year-on-year increment in the bank’s net profit for 2021 was mainly the bank’s operating income which grew from GHS 548m in 2020 to GHS 636m in 2021.
Total assets value recorded for 2021 amounted to GHS 5.4bn. A year-on-year increase of some GHS 322m when compared to the GHS 5.1bn total assets value posted for the year 2020.
Accounting for the increase in total assets value was the increase in the bank’s non-pledged trading assets from GHS 67m to GHS 143m in 2020 and 2021 respectively.
Loans and advances to customers, cash and cash equivalents, equity investments of the bank among other elements that make up the bank’s total assets value recorded marginal declines in their value, thereby inhibiting significant growth in the bank’s total assets value for 2021.
Total liabilities of Societe Generale also increased from GHS 4.1bn in 2020 to GHS 4.4bn in 2021, mainly on the account of increments in borrowings by the bank.
Examine Societe Generale’s 2021 financial statement below:
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