Diversification, a core theme of IDLC Finance
Wednesday, 26 May 2010
FE Report
IDLC Finance Ltd will expand its businesses in line with diversification, a core theme of the company.
"We have already diversified our business areas and no other competitors are so diversified like us," Selim RF Hussain, CEO and managing director of IDLC Finance told the FE in an interview.
"We have always believed that diversification of products and services and revenue streams is the best way of ensuring sustained financial performance,".
Accordingly, the company has continued to focus on multiple business areas in 2009 and took measures to encounter the uncertainty that may arise in business activities from the aftermath of the global economic crisis.
During 2009, IDLC Finance earned a consolidated net profit of Tk 822 million compared to previous year's Tk 406 million showing a robust growth of 102.3 per cent.
" The whopping growth of 102.3 per cent in net profit earning is the ever first in our company's history since its inception in mid-80's", Mr Selim said.
He said the year 2009 was remarkable for IDLC because of two reasons-reduction of cost of fund and surge of stock market operation.
"The weighted average of our cost of fund declined to 10.44 in 2009 against 12.63 in 2008," he added.
Consolidated earnings per share during the year under review were Taka 273.96 compared to previous year's Taka 135.46.
IDLC's total investment portfolio as on December 31,2009 stood at Tk. 20,099 million which is 26.33 per cent higher than the previous year.
Out of the total portfolio, lease, term loan, real estate finance and margin loans, respectively, represent 22.06 per cent, 17.30 per cent, 24.10 per cent, and 29.50 per cent of the total portfolio.
IDLC also maintains a well-diversified investment
portfolio in the major sectors with highest allocation to services and apparel & accessories at 9.97 per cent and 9.96 per cent, respectively, followed by food and beverages sector at 8.82 per cent, transport at 7.72 per cent, textiles at 7.02 per cent,housing & real Estate at 6.81 per cent, pharmaceuticals at 5.72 per cent, financial services at 4.76 per cent, iron & steel at 4.45 per cent,agro based industry at 4.38 per cent and so on.
"This diversification of investment portfolio helps us mitigate economic and sectoral risks," Mr Selim said.
Commenting on the future growth of the company, he said a total of 20 new branches will be added in Dhaka,Rajshahi, Comilla and Noakhali.
At present, the company has 13 branches in Dhaka, Chittagong, Sylhet, Bogra and Narayangonj.
He said IDLC believes that Information & Communication technology (ICT) has become indispensable for financial institutions in ensuring smooth operation and providing efficient service.
"We have adopted a comprehensive ICT Policy. IDLC is one of the very few companies that have embraced ICT as the key to achieving excellence in its various aspects of operations," Mr Selim added.
He said the up-gradation of its IT platform will be completed by next one year.
During 2009, IDLC's Merchant Banking Operation earned Tk 814.5 million in revenues, which is a hefty 87.2 per cent higher than the previous year.
The merchant banking operation has earned an operating profit of Tk. 189.54 million,compared to previous year's Tk. 91.67 million, marking a robust growth of 106.8%.
At the end of December 2009, total portfolio value at cost was Tk. 11,455 million (Tk. 12,637 million at the market price) and balance of margin loan was Tk. 5,862 million.
Mr Selim has over 23 years of all-round banking experience in Bangladesh, India and Australia.
He was appointed the CEO & Managing Director of IDLC Finance Ltd in January, 2010.
Prior to joining IDLC, he was CFO - Consumer Banking, Standard Chartered Bank, Mumbai, India in 2008 & 2009.
Mr Selim was also the CFO of Standard Chartered Bank, Dhaka, Bangladesh during 2002-2007.
An MBA from IBA of Dhaka University, he started his career in ANZ Grindlays Bank in 1986.
IDLC Finance Ltd will expand its businesses in line with diversification, a core theme of the company.
"We have already diversified our business areas and no other competitors are so diversified like us," Selim RF Hussain, CEO and managing director of IDLC Finance told the FE in an interview.
"We have always believed that diversification of products and services and revenue streams is the best way of ensuring sustained financial performance,".
Accordingly, the company has continued to focus on multiple business areas in 2009 and took measures to encounter the uncertainty that may arise in business activities from the aftermath of the global economic crisis.
During 2009, IDLC Finance earned a consolidated net profit of Tk 822 million compared to previous year's Tk 406 million showing a robust growth of 102.3 per cent.
" The whopping growth of 102.3 per cent in net profit earning is the ever first in our company's history since its inception in mid-80's", Mr Selim said.
He said the year 2009 was remarkable for IDLC because of two reasons-reduction of cost of fund and surge of stock market operation.
"The weighted average of our cost of fund declined to 10.44 in 2009 against 12.63 in 2008," he added.
Consolidated earnings per share during the year under review were Taka 273.96 compared to previous year's Taka 135.46.
IDLC's total investment portfolio as on December 31,2009 stood at Tk. 20,099 million which is 26.33 per cent higher than the previous year.
Out of the total portfolio, lease, term loan, real estate finance and margin loans, respectively, represent 22.06 per cent, 17.30 per cent, 24.10 per cent, and 29.50 per cent of the total portfolio.
IDLC also maintains a well-diversified investment
portfolio in the major sectors with highest allocation to services and apparel & accessories at 9.97 per cent and 9.96 per cent, respectively, followed by food and beverages sector at 8.82 per cent, transport at 7.72 per cent, textiles at 7.02 per cent,housing & real Estate at 6.81 per cent, pharmaceuticals at 5.72 per cent, financial services at 4.76 per cent, iron & steel at 4.45 per cent,agro based industry at 4.38 per cent and so on.
"This diversification of investment portfolio helps us mitigate economic and sectoral risks," Mr Selim said.
Commenting on the future growth of the company, he said a total of 20 new branches will be added in Dhaka,Rajshahi, Comilla and Noakhali.
At present, the company has 13 branches in Dhaka, Chittagong, Sylhet, Bogra and Narayangonj.
He said IDLC believes that Information & Communication technology (ICT) has become indispensable for financial institutions in ensuring smooth operation and providing efficient service.
"We have adopted a comprehensive ICT Policy. IDLC is one of the very few companies that have embraced ICT as the key to achieving excellence in its various aspects of operations," Mr Selim added.
He said the up-gradation of its IT platform will be completed by next one year.
During 2009, IDLC's Merchant Banking Operation earned Tk 814.5 million in revenues, which is a hefty 87.2 per cent higher than the previous year.
The merchant banking operation has earned an operating profit of Tk. 189.54 million,compared to previous year's Tk. 91.67 million, marking a robust growth of 106.8%.
At the end of December 2009, total portfolio value at cost was Tk. 11,455 million (Tk. 12,637 million at the market price) and balance of margin loan was Tk. 5,862 million.
Mr Selim has over 23 years of all-round banking experience in Bangladesh, India and Australia.
He was appointed the CEO & Managing Director of IDLC Finance Ltd in January, 2010.
Prior to joining IDLC, he was CFO - Consumer Banking, Standard Chartered Bank, Mumbai, India in 2008 & 2009.
Mr Selim was also the CFO of Standard Chartered Bank, Dhaka, Bangladesh during 2002-2007.
An MBA from IBA of Dhaka University, he started his career in ANZ Grindlays Bank in 1986.