2008-07-28 07:48:00
Financiera Independencia Reports Total Loan Portfolio Growth of 40.4% YoY in 2Q08
MEXICO CITY, July 28 /EMWNews/ -- Financiera Independencia, S.A.B. de C.V., SOFOM, E.N.R. (BMV: FINDEP), (Independencia) a Mexican microfinance lender of personal loans to lower income segment individuals, today announced results for the three-month period ended June 30, 2008. Net income for 2Q08 declined 28.6% year-on-year to Ps.110.2 million, and on a sequential basis fell 32.5%, from Ps.163.1 million in 1Q08. Net income for 6M08 slightly decreased 0.8% from Ps.275.7 million in 6M07.
Financial & Operational Highlights 2Q08 2Q07 % 6M08 6M07 % Income Statement Data Net Interest Income after Provisions* 359.1 361.4 -0.6% 780.1 692.4 12.7% Net Operating Income* 152.9 191.4 -20.1% 373.6 363.9 2.7% Net Income* 110.2 154.4 -28.6% 273.3 275.7 -0.8% Total Shares Outstanding (million)** 664.7 635.0 4.7% 664.7 635.0 4.7% EPS 0.1658 0.2432 -31.8% 0.4112 0.4341 -5.3% Profitability & Efficiency NIM after Provisions Excl. Fees 36.5% 53.4% -16.8 pp 40.5% 52.2% -11.7 pp NIM after Provisions Incl. Fees 56.4% 72.4% -16 pp 59.2% 72.3% -13 pp ROA 10.6% 21.7% -11.1 pp 13.5% 19.7% -6.2 pp ROE 22.8% 58.4% -35.6 pp 28.1% 50.7% -22.6 pp Efficiency Ratio 72.4% 61.0% 11.5 pp 67.3% 62.0% 5.2 pp Operating Efficiency 38.6% 42.0% -3.5 pp 38.0% 42.5% -4.5 pp Capitalization Equity to Total Assets 39.8% 37.4% 2.4 pp 39.8% 37.4% 2.4 pp Credit Quality Ratios NPL Ratio 7.7% 5.7% 2 pp 7.7% 5.7% 2 pp Coverage Ratio 125.0% 125.0% 0.0 pp 125.0% 125.0% 0.0 pp Operational Data Number of Clients 958,902 695,964 37.8% 958,902 695,964 37.8% Number of Offices 172 124 38.7% 172 124 38.7% Total Loan Portfolio* 3,914.6 2,788.8 40.4% 3,914.6 2,788.8 40.4% Average Balance (Ps.) 4,082.4 4,007.1 1.9% 4,082.4 4,007.1 1.9% * Figures in millions of Mexican Pesos. ** Includes a 1,000:1 split effective October, 18 2007 and excludes repurchased shares. (Unless otherwise stated, all financial figures discussed in this announcement are unaudited, prepared in accordance with Mexican Financial Reporting Standards (NIFs) and represent comparisons between the three and six-months periods ended June 30, 2008, and the equivalent three and six- months periods ended June 30, 2007 and March 31, 2008. Results for 2Q07 are expressed in constant Mexican pesos as of December 31, 2007, while 1Q08 and 2Q08 results are in nominal pesos. Tables state figures in millions of pesos, unless otherwise noted.) Commenting on the results, Noel Gonzalez, Chief Executive Officer, said, "The fundamentals of our business remain strong, although this was a challenging quarter with a number of factors contributing to a weaker performance." "Our clients and loan growth continues to be strong and we are very close to reaching our one million customers milestone. However, a change in the mix of our portfolio this quarter resulted in a decline in net interest margin." "Making the most of our flexibility to fine-tune operations, this quarter we introduced several measures to reduce the probability of default of past due loans. Our objective: to focus on the low income segment, while minimizing risk and continuing to build a strong quality client base. This transition, however, had a temporary negative impact on NPL ratios as we initiated these new standards. We also fine-tuned our credit scoring policies increasing the loan application rejection index by four percentage points during the quarter." "We strongly believe in the growth opportunities of our markets and remain committed to providing service to a segment of the population that otherwise would have no access to credit, while moderating risk and volatility. We continue to invest in our business, as reflected in the 12 new offices and the addition of 1,165 new people to our workforce," he closed. 2Q08 CONSOLIDATED RESULTS Financial Margin after Provision for Loan Losses Financial margin after provision for loan losses declined by 0.6% to Ps.359.1 million for 2Q08 compared to Ps.361.4 million for 2Q07. This decrease principally reflected the following changes: Interest Income Interest income increased 27.6% to Ps.635.7 million for 2Q08, principally as a result of the Ps.136.8 million, or 27.5%, increase in interest on loans. The number of clients rose 37.8% during the period, while the average outstanding loan rose 1.9%. Interest income growth, however, was below the 43.3% year-on-year growth reported in 1Q08. This was principally due to declines in both, the growth rate of the loan portfolio and in the average lending rate. The growth rate of the total loan portfolio fell to 40.4%, from 47.3% in 1Q08, driven by a slowdown in the loans to the informal sector, particularly at the CrediMama and CrediPopular products which carry higher interest rates. Given the short maturities of these loans - six months - a slowdown in the growth rate has a significant impact on interest income. The average lending rate(1) of the total loan portfolio declined 8.5 percentage points to 67.8% from 76.3% in 2Q07, driven by:
* Increased participation of premium products geared towards clients that have established a solid credit history with the Company, together with strong growth of the CrediConstruye government subsidized loans, all of which carry lower interest rates; * Higher level of discounts offered to encourage immediate payment of past due installments; and * The change in the interest accrual methodology to a revolving line of credit with interest charge on the outstanding loan amount, from a direct interest accrual methodology, as explained in previous reports. Loans to the informal sector rose 104.7% year-on-year, increasing its share of the total loan portfolio by 9.4 percentage points to 30.1% of total loans up from 20.7% in 2Q07 and 28.4% in 1Q08. However, 8.5 percentage points of the increase resulted from the ongoing success of the CrediConstruye loan product which carries a lower interest rate. In fact, CrediConstruye loans, a product intended to finance home improvements for the informal sector of the economy, reached 85,028 clients in 2Q08, up 21,126, or 33.1% on a sequential basis and 504.5% year on year. The continued sequential growth continues to reflect the positive impact of the agreement reached in September 2007 with the Federal Government through the Sociedad Hipotecaria Federal by which Independencia began offering 40% subsidized construction loans to its clients. The CredInmediato loan product, which is a revolving line of credit that targets the formal sector of the economy, accounted for 69.9% of total loans down from 79.3% in 2Q07 and 71.6% in 1Q08. The number of CredInmediato clients in 2Q08 grew by 24.5% year-on-year, while the total loan portfolio of this product rose by 23.6%, to Ps. 2,735.4 million, reflecting a 0.7% decrease in the average balance in constant pesos.
(1) Average lending rate: interest income / average balance of the total loan portfolio Table 1: Financial Margin* 2Q08 1Q08 2Q07 QoQ % YoY % Interest Income 635.7 610.5 498.3 4.1% 27.6% Interest on Loans 634.8 608.9 498.0 4.2% 27.5% Interest from Investment in Securities 0.9 1.6 0.3 -42.0% 201.3% Interest Expense 46.9 38.0 32.0 23.4% 46.6% Monetary Loss - net 0.0 0.0 3.5 0.0% -100.0% Financial Margin 588.8 572.5 469.8 2.9% 25.3% 6M08 6M07 % Interest Income 1,246.1 924.1 34.8% Interest on Loans 1,243.7 923.2 34.7% Interest from Investment in Securities 2.5 0.9 171.8% Interest Expense 84.9 72.0 17.9% Monetary Loss - net 0.0 -5.3 -100.0% Financial Margin 1,161.3 846.8 37.1% * Figures in millions of Mexican Pesos Table 2: Loan Portfolio, Number of Clients & Average Loan 2Q08 1Q08 2Q07 QoQ % YoY % Loan Portfolio (million Ps.) 3,914.6 3,588.3 2,788.8 9.1% 40.4% Number of Clients 958,902 894,595 695,964 7.2% 37.8% Average Balance (Ps.) 4,082.4 4,011.0 4,007.1 1.8% 1.9% Table 3: Number of Clients by Product Type % of % of 2Q08 Total 1Q08 Total Formal Sector Loans 616,429 64.3% 583,727 65.3% - CredInmediato 616,429 64.3% 583,727 65.3% Informal Sector Loans 342,473 35.7% 310,868 34.7% - CrediPopular 196,211 20.5% 184,987 20.7% - CrediMama 61,234 6.4% 61,979 6.9% - CrediConstruye 85,028 8.9% 63,902 7.1% Total Number of Loans 958,902 100.0% 894,595 100.0% % of QoQ % YoY % 2Q07 Total Change Change Formal Sector Loans 495,268 71.2% 5.6% 24.5% - CredInmediato 495,268 71.2% 5.6% 24.5% Informal Sector Loans 200,696 28.8% 10.2% 70.6% - CrediPopular 135,269 19.4% 6.1% 45.1% - CrediMama 51,361 7.4% -1.2% 19.2% - CrediConstruye 14,066 2.0% 33.1% 504.5% Total Number of Loans 695,964 100.0% 7.2% 37.8% Table 4: Total Loan Portfolio by Product Type* % of % of 2Q08 Total 1Q08 Total Formal Sector Loan Portfolio 2,735.4 69.9% 2,569.6 71.6% - CredInmediato 2,735.4 69.9% 2,569.6 71.6% Informal Sector Loan Portfolio 1,179.3 30.1% 1,018.7 28.4% - CrediPopular 586.7 15.0% 555.2 15.5% - CrediMama 138.5 3.5% 136.4 3.8% - CrediConstruye 454.1 11.6% 327.1 9.1% Total Loan Portfolio 3,914.6 100.0% 3,588.3 100.0% % of QoQ % YoY % 2Q07 Total Change Change Formal Sector Loan Portfolio 2,212.6 79.3% 6.5% 23.6% - CredInmediato 2,212.6 79.3% 6.5% 23.6% Informal Sector Loan Portfolio 576.2 20.7% 15.8% 104.7% - CrediPopular 405.4 14.5% 5.7% 44.7% - CrediMama 84.7 3.0% 1.5% 63.5% - CrediConstruye 86.1 3.1% 38.8% 427.5% Total Loan Portfolio 2,788.8 100.0% 9.1% 40.4% * Figures in millions of Mexican Pesos. Interest Expense Interest expense during 2Q08 increased by Ps.14.9 million, or 46.6%, to Ps.46.9 million from Ps.32.0 million on 2Q07. Interest expense for 2Q07 was reduced by Ps.9.1 million to compensate the corresponding portion of the one- time break-up fee resulting from the replacement of the GE Capital line of credit with a revolving credit line with HSBC Mexico. Excluding this impact, interest expense for 2Q08 would have increased Ps.5.8, or 14.1% in line with the 15.5% growth in the average balance of liabilities for the period and the 0.71 percentage point year-on-year reduction in the average interest rate paid. The average interest rate paid(2) on interest bearing liabilities declined to 10.54% in 2Q08 from 11.25% in 2Q07 and 10.74% in 1Q08. As a SOFOM, Independencia cannot accept deposits and therefore has no interest expense associated therewith.
(2) average interest rate paid = interest expense / daily average balance of interest bearing liabilities for the period. Some of this information may vary when compared with previously-released information were we used periodical average balances. Provision for Loan Losses During 2Q08 Independencia recorded provisions for loan losses of Ps.229.7 million compared with Ps.108.4 million in 2Q07, representing an increase of Ps.121.3 million, or 111.8%. This increase was the result of the following:
* A 40.4% growth in the total loan portfolio to Ps.3,914.6 million; * A 90.4% increase in non-performing loans to Ps.302.2 million in 2Q08 from Ps.158.7 million in 2Q07; and * An increase in the NPL ratio to 7.7% in 2Q08 from 5.7% in 2Q07. During the quarter, the Company made further adjustments to its collections strategy to reduce the number of loans that are more than 30 days past due, and which carry a higher probability of default. As a result, management reduced the number of days that past-due loans are processed in the call center before moving to collection agents on the street and added approximately 500 new agents to the door-to-door collection teams. This transition had a temporary negative impact on NPL ratios. By the end of June, however, the NPL ratio had declined to 7.7% from 7.9% in May. Higher level of discounts offered to encourage immediate payment of loans more than 60 days past-due partially offset the impact on the NPL ratio described above. In addition, management adjusted its credit scoring policies increasing the rejection index for new loan applications by 4.0 percentage points to 38.5% On a sequential comparison, the provision for loan losses increased 51.6% from Ps.151.5 million in 1Q08, while the total loan portfolio grew 9.1%. The NPL ratio, in turn, rose to 7.7% this quarter from 6.5% in 1Q08. Net Operating Revenue Net operating revenue rose year-on-year by Ps.64.1 million, or 13.1%, to Ps.554.2 million in 2Q08 and was a result of the reasons stated above as well as the 51.5% increase in non-interest income (net) to Ps.195.1 million in 2Q08, from Ps.128.8 million in 2Q07 derived from the 40.4% growth in the total loan portfolio. On a sequential comparison, however, net operating revenue declined 5.7% from Ps.587.6 million in 1Q08. Net Operating Income Net operating income for 2Q08 declined year-on-year by Ps.38.5 million, or 20.1%, to Ps.152.9 million. On a sequential comparison, net operating income fell 30.7% from Ps.220.7 million in 1Q08. During the quarter, Independencia increased its labor force by 1,165 to a total of 8,944 people. This reflects the addition of people to the collection team as explained before, as well as to support the Company's growth. Additional people were also added at the second operations center located in the city of Aguascalientes opened last April. This will allow Independencia to more than double capacity to process transactions, including review of loan applications, information verification, collections and call center operations. Over the last twelve months, the Company's labor force increased by 2,389 people, or 36.4%, resulting in a 39.2% increase in salaries and employee benefits to Ps.283.9 million. During that same period, Independencia opened 48 new offices, 12 of which were opened in 2Q08, which brings the total network to 172 units.
Table 5: Net Operating Income* QoQ % YoY % 2Q08 1Q08 2Q07 Change Change Financial Margin 588.8 572.5 469.8 2.9% 25.3% Provision for Loan Losses 229.7 151.5 108.4 51.6% 111.8% Financial Margin After Provision for Loan Losses 359.1 421.0 361.4 -14.7% -0.6% Non-Interest Income, net 195.1 166.7 128.8 17.1% 51.5% - Commissions and Fees Collected 197.9 168.7 129.5 17.3% 52.9% - Commissions and Fees Paid 2.8 2.0 0.7 39.9% 293.3% Net Operating Revenue 554.2 587.6 490.2 -5.7% 13.1% Non-Interest Expense 401.3 366.9 298.8 9.4% 34.3% - Salaries & Employee Benefits 283.9 258.9 204.0 9.7% 39.2% - Other Administrative & Operational Expenses 117.4 108.0 94.8 8.7% 23.9% Net Operating Income 152.9 220.7 191.4 -30.7% -20.1% Operational Data Number of Offices 172 160 124 7.5% 38.7% Total Labor Force 8,944 7,779 6,555 15.0% 36.4% - Full Time Personnel 8,193 7,097 5,870 15.4% 39.6% - Independent Sales Agents 751 682 685 10.1% 9.6% % 6M08 6M07 Change Financial Margin 1,161.3 846.8 37.1% Provision for Loan Losses 381.2 154.5 146.8% Financial Margin After Provision for Loan Losses 780.1 692.4 12.7% Non-Interest Income, net 361.8 266.3 35.9% - Commissions and Fees Collected 366.6 267.3 37.2% - Commissions and Fees Paid 4.8 1.0 392.6% Net Operating Revenue 1,141.9 958.7 19.1% Non-Interest Expense 768.3 594.7 29.2% - Salaries & Employee Benefits 542.8 399.4 35.9% - Other Administrative & Operational Expenses 225.5 195.3 15.5% Net Operating Income 373.6 363.9 2.7% Operational Data Number of Offices 172 124 38.7% Total Labor Force 8,944 6,555 36.4% - Full Time Personnel 8,193 5,870 39.6% - Independent Sales Agents 751 685 9.6% * Financial data in millions of Mexican Pesos. Net Income As a result of the factors discussed above, and after other income and expenses, as well as income tax, net income for 2Q08 declined year-on-year by Ps.44.2 million, or 28.6%, to Ps.110.2 million. Earnings per share (EPS) for the quarter were Ps.0.1658 compared with Ps.0.2432 for the same period last year.
FINANCIAL POSITION Total Loan Portfolio The total loan portfolio rose year-on-year by 40.4% to Ps.3,914.6 million, as a result of the 37.8% increase in the number of clients during the period and a 1.9% increase in the average outstanding balance. As of June 30, 2008 Independencia had 958,902 active clients. The total loan portfolio represented 90.0% of Independencia's total assets as of June 30, 2008, compared to 91.8% of total assets in the same period in the prior year. Non-Performing Loan Portfolio Total non-performing loans reached Ps.302.2 million, up 90.4% from June 30, 2007. The NPL ratio was 7.7% for 2Q08, compared to 6.5% for 1Q08, 7.0% for 4Q07 and 5.7% for 2Q07. NPL ratios remain within the range of 3% to 10% observed during the past five years. The NPL ratio in the CredInmediato product for 2Q08 was 7.8%, compared to 6.0% for 1Q08, 6.7% for 4Q07 and 5.5% for 2Q07. The NPL ratio for the informal segment was 7.4% for 2Q08, compared to 7.6% for 1Q08 and 6.6% for 2Q07. The decline in the NPL ratio of the informal segment reflects the higher participation of the lower-risk CrediConstruye product. The coverage ratio remained unchanged year-on-year and quarter-over- quarter at 125%. Liabilities As of June 30, 2008 total liabilities were Ps.2,620.0 million, a 37.7% increase from Ps.1,902.6 million in June 30, 2007. This increase was the result of higher financing needs to fund the 40.4% growth in the Company's loan portfolio during the period and overall working capital. On June 27, 2008 the Company placed Ps.784 million aggregate principal amount of unsecured Certificados Bursatiles with a 3-year maturity and an interest rate equivalent to TIIE 28 days plus 190 basis points. Of total proceeds, Ps.689.8 million were used to pay down the loan from HSBC, and thus diversify funding sources and reduce the cost of debt. On a sequential comparison, total liabilities rose 42.4% from 1,840.1 million in March 31, 2008. Stockholders' Equity As of June 30, 2008 stockholder's equity was Ps.1,728.8 million, a 52.3% increase from Ps.1,135.2 in June 30, 2007. This increase was attributable to net income generated during the period, minus a total of Ps.510 million dividends for the year and the stock repurchased by the Company, plus a Ps.1,033.0 million capital increase following Independencia's IPO in November 2007. PROFITABILITY AND EFFICIENCY RATIOS ROAE/ROAA ROAE for 2Q08 was 22.8% compared with 30.2% in 1Q08 and 58.4% in 2Q07. ROAE for 1Q08 and 2Q08 reflects the impact from the Ps.1,033.0 million increase in capital following the IPO which took place in November 2007. ROAA for 2Q08 was 10.6% compared with 16.9% in 1Q08 and 21.7% in 2Q07. Efficiency Ratio & Operating Efficiency From 2Q07 to 2Q08, Independencia increased the size of its loan portfolio by 40.4% and the number of clients by 37.8%. It also added 48 offices and 2,389 people. During 2Q08 the Company's efficiency ratio was 72.4%, compared with 61.0% in 2Q07 and 62.4%, in 1Q08 reflecting the lower growth in net interest income, the higher provision for loan losses and the increase in labor force during the quarter. Operating efficiency, in turn improved by 3.5 percentage points to 38.6% for 2Q08 from 42.0% in 2Q07. Total average assets rose by 12.1 percentage points more than non-interest expense, driving the improvement in operating efficiency. On a sequential basis, operating efficiency increased 0.6 percentage points from 38.0% in 1Q08. KEY EVENTS Shareholders Approve Dividend Payment At the shareholder's meeting held on April 29, 2008, it was resolved that Financiera Independencia will pay a cash dividend in the amount of MX$0.75 pesos, Mexican currency, per each outstanding share, in four equal and quarterly installments of MX$0.1875 pesos, Mexican currency per share, on May 14, 2008, August 6, 2008, November 5, 2008 and February 4, 2009 from the balance of the net tax profit account of the Company. Successful Closing of Ps.784 million Medium Term Certificados Bursatiles On June 27, 2008 the Company successfully placed Ps.784 million aggregate principal amount of Certificados Bursatiles ("the Notes"). The Notes are unsecured, have a 3-year maturity and pay an interest rate equivalent to TIIE 28 days plus 190 basis points. The notes were rated mxA and A+(mex) by Standard & Poor's and Fitch Ratings, respectively. Net proceeds were used to increase the Company's loan portfolio, make capital expenditures related to expanding its distribution network and pay down debt. The Notes were the first tranche of a Ps.1,500 million Certificados Bursatiles program with a 5-year maturity filed with the Comision Nacional Bancaria y de Valores in Mexico.
2Q08 EARNINGS CONFERENCE CALL Day: Tuesday, July 29 2008 Time: 11:00 PM US ET; 10:00 AM Mexico City time Dial-in number: 888-713-4214 (US & Canada) 617-213-4866 (International & Mexico) Access Code: 82579107 Web cast: A live web cast of the conference call and replay will be available at http://www.independencia.com.mx. Pre-registration: If you would like to pre-register for the conference call use the following link: https://www.theconferencingservice.com/prereg/key.process?key=PRQGYYKEK Pre-registering is not mandatory but is recommended as it will provide you immediate entry into the call and will facilitate the timely start of the conference. You will receive a code that allows you to enter the call directly. Pre-registration only takes a few moments, and you may do so at any time, including up to and after call start time. To pre-register, please click the link above. Alternatively, if you would rather be placed into the call by an operator, please call at least 15 minutes prior to call start time. Replay: Starting Tuesday, July 29, 2008 at 1:00 PM US ET, ending at midnight US ET on Tuesday, August 5, 2008. Dial-in number: 888-286-8010 (US & Canada); 617-801-6888 (International & Mexico). Access Code: 94758633.
About Financiera Independencia:
Financiera Independencia, S.A.B. de C.V., SOFOM, E.N.R.
(Independencia), is a Mexican microfinance lender of personal loans to
individuals. Independencia provides microcredit loans on an unsecured basis
to individuals in the low-income segments in Mexico in urban areas of both
the formal and informal economy. As of June 30, 2008, Independencia had a
total outstanding loan balance of Ps.3,914.6 million, operated 172 offices
in 124 cities throughout 31 of Mexico's 32 federal entities and had a total
labor force of 8,944 people. The Company listed on the Mexican Stock
Exchange on November 1, 2007, where it trades under the symbol "FINDEP".
More information can be found at http://www.independencia.com.mx
Some of the statements contained in this press release discuss future
expectations or state other forward-looking information. Those statements
are subject to risks identified in this press release and in Financiera
Independencia's filings with the Mexican Stock Exchange. Actual
developments could differ significantly from those contemplated in these
forward-looking statements. The forward-looking information is based on
various factors and was derived using numerous assumptions. Our
forward-looking statements speak only as of the date they are made and,
except as may be required by applicable law, we do not have an obligation
to update or revise them, whether as a result of new information, future or
otherwise.
FINANCIERA INDEPENDENCIA S.A.B. DE C.V., SOFOM, E.N.R.
Consolidated Balance Sheet
As of June 30, 2008 and 2007
(Millions of Mexican Pesos)
Absolute
2Q08 2Q07 Change % Change
ASSETS
Cash 81.9 126.2 (44.3) (35.1%)
Investments in Securities 121.3 1.5 119.8 8067.7%
Cash and Cash Equivalents 203.2 127.7 75.5 59.2%
Performing Loans 3,612.5 2,630.1 982.4 37.4%
Non-Performing Loans 302.2 158.7 143.4 90.4%
Total Loan Portfolio 3,914.6 2,788.8 1,125.8 40.4%
Allowances for Loan Losses (377.7) (198.4) (179.3) 90.4%
Total Loan Portfolio - Net 3,536.9 2,590.4 946.5 36.5%
Other Accounts Receivables - Net 86.1 38.2 47.8 125.2%
Property, Plant & Equipment - Net 206.4 118.6 87.8 74.0%
Deferred Income Tax 253.1 124.0 129.1 104.1%
Other Assets 63.1 38.9 24.3 62.4%
Total Assets 4,348.8 3,037.8 1,311.0 43.2%
LIABILITIES
Commercial Paper 784.0 - 784.0 n/a
Bank and Other Entities Loans 1,237.8 1,671.5 (433.8) (26.0%)
Other Accounts Payable 598.3 231.1 367.2 158.9%
Total Liabilities 2,620.0 1,902.6 717.4 37.7%
STOCKHOLDERS' EQUITY
Capital Stock 153.6 149.8 3.8 2.5%
Additional Paid-In Capital 1,457.7 643.9 813.8 126.4%
Capital Reserves 13.6 71.9 (58.3) (81.1%)
Retained Earnings 103.9 269.5 (165.7) (61.5%)
Minority Interest - - - 0.0%
Total Stockholders' Equity 1,728.8 1,135.2 593.6 52.3%
Total Liabilities and Stockholders'
Equity 4,348.8 3,037.8 1,311.0 43.2%
FINANCIERA INDEPENDENCIA S.A.B. DE C.V., SOFOM, E.N.R.
Consolidated Income Statement
For the Three and Six-Months Periods Ended June 30, 2008 and 2007
(Millions of Mexican Pesos)
Absolute %
2Q08 2Q07 Change Change
Interest Income 635.7 498.3 137.4 27.6%
Interest Expense 46.9 32.0 14.9 46.6%
Monetary Loss - Net - 3.5 (3.5) (100.0%)
Financial Margin 588.8 469.8 119.0 25.3%
Provision for Loan Losses 229.7 108.4 121.3 111.8%
Financial Margin After Provision
for Loan Losses 359.1 361.4 (2.3) (0.6%)
Commissions and Fees Collected 197.9 129.5 68.4 52.9%
Commissions and Fees Paid 2.8 0.7 2.1 293.3%
Market Related Income - - - n/a
Net Operating Revenue 554.2 490.2 64.1 13.1%
Non-Interest Expense 401.3 298.8 102.5 34.3%
Net Operating Income 152.9 191.4 (38.5) (20.1%)
Other Income - Net 3.6 6.3 (2.7) (43.2%)
Total Income Before Income Tax
and Employees' Statutory Profit
Sharing 156.5 197.7 (41.2) (20.8%)
Income Tax and Employees'
Statutory Profit Sharing
Current 92.7 66.2 26.4 39.9%
Deferred (46.3) (22.9) (23.4) 102.3%
Total Income Before Minority
Interest 110.2 154.4 (44.2) (28.6%)
Minority Interest (0.0) 0.0 (0.0) n/a
Net Income 110.2 154.4 (44.2) (28.6%)
Weighted Average Number of Shares 665 635 29.7 4.7%
EPS 0.1658 0.2432 (0.08) (31.8%)
Absolute %
6M08 6M07 Change Change
Interest Income 1,246.1 924.1 322.0 34.8%
Interest Expense 84.9 72.0 12.9 17.9%
Monetary Loss - Net - (5.3) 5.3 (100.0%)
Financial Margin 1,161.3 846.8 314.4 37.1%
Provision for Loan Losses 381.2 154.5 226.7 146.8%
Financial Margin After Provision
for Loan Losses 780.1 692.4 87.7 12.7%
Commissions and Fees Collected 366.6 267.3 99.3 37.2%
Commissions and Fees Paid 4.8 1.0 3.8 392.6%
Market Related Income - - - n/a
Net Operating Revenue 1,141.9 958.7 183.2 19.1%
Non-Interest Expense 768.3 594.7 173.5 29.2%
Net Operating Income 373.6 363.9 9.7 2.7%
Other Income - Net 8.6 23.1 (14.5) (62.6%)
Total Income Before Income Tax
and Employees' Statutory Profit
Sharing 382.3 387.0 (4.7) (1.2%)
Income Tax and Employees'
Statutory Profit Sharing
Current 184.8 114.2 70.6 61.8%
Deferred (75.9) (2.9) (73.0) 2524.6%
Total Income Before Minority
Interest 273.3 275.7 (2.3) (0.8%)
Minority Interest - 0.0 (0.0) n/a
Net Income 273.3 275.7 (2.3) (0.8%)
Weighted Average Number of Shares 665 635 29.7 4.7%
EPS 0.4112 0.4341 (0.02) (5.3%)
FINANCIERA INDEPENDENCIA S.A.B. DE C.V., SOFOM, E.N.R.
Key Ratios & Operating Data
For the Three and Six-Months Periods Ended June 30, 2008 and 2007
(Millions of Mexican Pesos)
2Q08 1Q08 2Q07 QoQ % YoY %
Key Ratios
Profitability & Efficiency
NIM after Provisions Excl.
Fees (1) 36.5% 45.9% 53.4% -9.3 pp -16.8 pp
NIM after Provisions Incl.
Fees (2) 56.4% 64.0% 72.4% -7.7 pp -16 pp
ROAA (3) 10.6% 16.9% 21.7% -6.3 pp -11.1 pp
ROAE (4) 22.8% 30.2% 58.4% -7.3 pp -35.6 pp
Efficiency Ratio (5) 72.4% 62.4% 61.0% 10 pp 11.5 pp
Operating Efficiency (6) 38.6% 38.0% 42.0% 0.6 pp -3.5 pp
Capitalization
Equity to Total Assets 39.8% 53.7% 37.4% -14 pp 2.4 pp
Credit Quality Ratios
NPL Ratio (7) 7.7% 6.5% 5.7% 1.2 pp 2 pp
Coverage Ratio (8) 125.0% 125.0% 125.0% 0.0 pp 0.0 pp
Operating Data
Number of Clients 958,902 894,595 695,964 7.2% 37.8%
- Formal Sector 616,429 583,727 495,268 5.6% 24.5%
- Informal Sector 342,473 310,868 200,696 10.2% 70.6%
Number of Offices 172 160 124 7.5% 38.7%
Total Labor Force 8,944 7,779 6,555 15.0% 36.4%
- Full Time Personnel 8,193 7,097 5,870 15.4% 39.6%
- Independent Sales Agents 751 682 685 10.1% 9.6%
6M08 6M07 %
Key Ratios
Profitability & Efficiency
NIM after Provisions Excl. Fees (1) 40.5% 52.2% -11.7 pp
NIM after Provisions Incl. Fees (2) 59.2% 72.3% -13 pp
ROAA (3) 13.5% 19.7% -6.2 pp
ROAE (4) 28.1% 50.7% -22.6 pp
Efficiency Ratio (5) 67.3% 62.0% 5.2 pp
Operating Efficiency (6) 38.0% 42.5% -4.5 pp
Capitalization
Equity to Total Assets 39.8% 37.4% 2.4 pp
Credit Quality Ratios
NPL Ratio (7) 7.7% 5.7% 2 pp
Coverage Ratio (8) 125.0% 125.0% 0.0 pp
Operating Data
Number of Clients 958,902 695,964 37.8%
- Formal Sector 616,429 495,268 24.5%
- Informal Sector 342,473 200,696 70.6%
Number of Offices 172 124 38.7%
Total Labor Force 8,944 6,555 36.4%
- Full Time Personnel 8,193 5,870 39.6%
- Independent Sales Agents 751 685 9.6%
(1) Net Interest Margin after Provisions (excluding Fees): Net Interest
Margin after Provision for Loan Losses / Average Interest-Earning
Assets
(2) Net Interest Margin after Provisions (including Fees): Net Interest
Margin after Provision for Loan Losses + Fees Collected - Fees
Paid / Average Interest-Earning Assets
(3) ROAA: Net Income / Average Assets
(4) ROAE: Net Income / Average Equity
(5) Efficiency Ratio: Non-Interest Expense / Net Operating Revenues
(6) Operating Efficiency: Non-interest Expense / Average Assets
(7) NPL Ratio: Non-Performing Loans / Total Loan Portfolio
(8) Coverage Ratio: Allowances for Loan Losses / Non-Performing Loans
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