SBM Holdings Ltd.
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SBM Holdings: Lower forecasts on asset clean-up, Covid-19 provisioning
We see SBMH delivering MUR447mn net profit this year; the key delta is higher risk costs due to Mauritius’ vulnerabilities to the global slowdown. Significant changes in the Board’s composition earlier this year (which saw more than half the members replaced, including the Chairman) have prompted a re-evaluation of provisioning needs; a MUR2.5bn charge was taken in Q4 19 and a further MUR0.8bn in Q1 20 (lifting the cost of risk to close to 2.5% of loans in both FY 19 and Q1 20). But the recovery phase is heavily dependent on the external environment; Bank of Mauritius projects a 12.5% GDP contraction this year.
16 Jul 2020
Tellimer Research
16 Jul 2020
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SBM Holdings: Lower forecasts on asset clean-up, Covid-19 provisioning
We see SBMH delivering MUR447mn net profit this year; the key delta is higher risk costs due to Mauritius’ vulnerabilities to the global slowdown. Significant changes in the Board’s composition earlier this year (which saw more than half the members replaced, including the Chairman) have prompted a re-evaluation of provisioning needs; a MUR2.5bn charge was taken in Q4 19 and a further MUR0.8bn in Q1 20 (lifting the cost of risk to close to 2.5% of loans in both FY 19 and Q1 20). But the recovery phase is heavily dependent on the external environment; Bank of Mauritius projects a 12.5% GDP contraction this year.
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SBM Holdings: Management update: momentum is building
Management comments support our positive outlook. Loan growth likely to accelerate. Kenya is seeing loan market share gains this year and this is likely to continue into 2020, via both capex and working capital facilities. Significant changes to personnel and systems have been made to try to ensure that the negative risk cost experience of the past is not repeated. Net interest income is seeing strong growth, +16% yoy in 9M 19. The growth reflects the Kenya acquisition, branch expansion in India and a shift from Contract of Determinate Duration to Contract of Indeterminate Duration for certain Mauritian staff.
27 Nov 2019
Tellimer Research
27 Nov 2019
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SBM Holdings: Management update: momentum is building
Management comments support our positive outlook. Loan growth likely to accelerate. Kenya is seeing loan market share gains this year and this is likely to continue into 2020, via both capex and working capital facilities. Significant changes to personnel and systems have been made to try to ensure that the negative risk cost experience of the past is not repeated. Net interest income is seeing strong growth, +16% yoy in 9M 19. The growth reflects the Kenya acquisition, branch expansion in India and a shift from Contract of Determinate Duration to Contract of Indeterminate Duration for certain Mauritian staff.
Tellimer Research
SBM Holdings: Q3 19: higher operating costs offset strong core revenues
Effective tax rate (23%) was lower than expected (27%). Operating costs (+32% yoy) were higher than expected, largely due to a special levy which is not included in the tax line, and a MUR204mn India cyber-attack provision, over 80% of which will be reversed in Q4 based on recoveries to date. The cost of risk was 126bps, above our 107bps expectation. Lending appetite remains cautious in Mauritius (particularly in Segment B). Opinions contained in this report represent those of the research department of Tellimer at the time of publication.
13 Nov 2019
Tellimer Research
13 Nov 2019
SBM Holdings: Q3 19: higher operating costs offset strong core revenues
Effective tax rate (23%) was lower than expected (27%). Operating costs (+32% yoy) were higher than expected, largely due to a special levy which is not included in the tax line, and a MUR204mn India cyber-attack provision, over 80% of which will be reversed in Q4 based on recoveries to date. The cost of risk was 126bps, above our 107bps expectation. Lending appetite remains cautious in Mauritius (particularly in Segment B). Opinions contained in this report represent those of the research department of Tellimer at the time of publication.
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SBM Holdings: Asset clean-up drives positive ROTE outlook
Domestic leader with a growing international franchise. Discounted valuation, rapid EPS growth to attract investor interest. SBMH trades at 0.6x 2019f tangible PB, 7.4x 2019f PE and 6.2x 2020f PE. We expect delivery of sustained improvements in both these areas. One of SBMH’s key competitive advantages is its ability to raise low-cost deposit funding in Mauritius (both in MUR and foreign currencies such as EUR and US$), a reflection of its extensive local distribution network (43 branches), well-respected brand and strong mass-market positioning. Cheap funding costs should facilitate low-risk lending, both domestically and abroad; we think Segment B lending will resume its growth in H2 19.
16 Aug 2019
Tellimer Research
16 Aug 2019
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SBM Holdings: Asset clean-up drives positive ROTE outlook
Domestic leader with a growing international franchise. Discounted valuation, rapid EPS growth to attract investor interest. SBMH trades at 0.6x 2019f tangible PB, 7.4x 2019f PE and 6.2x 2020f PE. We expect delivery of sustained improvements in both these areas. One of SBMH’s key competitive advantages is its ability to raise low-cost deposit funding in Mauritius (both in MUR and foreign currencies such as EUR and US$), a reflection of its extensive local distribution network (43 branches), well-respected brand and strong mass-market positioning. Cheap funding costs should facilitate low-risk lending, both domestically and abroad; we think Segment B lending will resume its growth in H2 19.
Tellimer Research
The sale is on: Buy NGA and PAK banks
25 Sep 2018
Tellimer Research
25 Sep 2018
The sale is on: Buy NGA and PAK banks
Tellimer Research
SBM Holdings: STATE BANK OF MAURITIUS Q1 18 results: Scaling up
15 May 2018
Tellimer Research
15 May 2018
SBM Holdings: STATE BANK OF MAURITIUS Q1 18 results: Scaling up
Tellimer Research
SBM Holdings: SBM HOLDINGS: FY 17 – Strong volume growth comes at a cost
4 Apr 2018
Tellimer Research
4 Apr 2018
SBM Holdings: SBM HOLDINGS: FY 17 – Strong volume growth comes at a cost
Tellimer Research
SBM Holdings: STATE BANK OF MAURITIUS: International strategy - pieces now on the board
12 Jan 2018
Tellimer Research
12 Jan 2018
SBM Holdings: STATE BANK OF MAURITIUS: International strategy - pieces now on the board
Tellimer Research
SBM Holdings: SBM HOLDINGS: 9M 17 – Margin, cost pressures offset good volumes
14 Nov 2017
Tellimer Research
14 Nov 2017
SBM Holdings: SBM HOLDINGS: 9M 17 – Margin, cost pressures offset good volumes
Tellimer Research
MAURITIUS BANKS: Growth turnaround on the horizon
15 May 2017
Tellimer Research
15 May 2017
MAURITIUS BANKS: Growth turnaround on the horizon
Tellimer Research
MAURITIUS BANKS: Slow but steady wins the race
15 Dec 2016
Tellimer Research
15 Dec 2016
MAURITIUS BANKS: Slow but steady wins the race
Tellimer Research
SBM Holdings: SBM Holdings Limited : Expansion uncertainties outweigh turnaround
15 Jul 2015
Tellimer Research
15 Jul 2015
SBM Holdings: SBM Holdings Limited : Expansion uncertainties outweigh turnaround
Tellimer Research
Top 30 Company Report - Sub-Saharan Africa Ex South Africa
10 Feb 2011
Tellimer Research
10 Feb 2011
Top 30 Company Report - Sub-Saharan Africa Ex South Africa
Tellimer Research
Sub-Saharan Africa - Top 30 Companies
25 Feb 2009
Tellimer Research
25 Feb 2009
Sub-Saharan Africa - Top 30 Companies
Overview
Location
Mauritius
Region
Global
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Financials
S.B.M. Holdings Limited is a financial holding company incorporated under the laws of Jersey.
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