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Absa hikes dividend as FY'18 profit rises YOY

Absa Group Ltd. reported full-year 2018 profit attributable to ordinary equity holders of 13.92 billion South African rand, up from a restated 13.89 billion rand in 2017.

EPS for the year was 16.73 rand, compared with the year-ago 16.66 rand.

The group's headline earnings for the year, meanwhile, dipped to 14.14 billion rand from 14.38 billion rand in 2017. Headline EPS also declined to 17.00 rand from 17.24 rand a year ago.

Return on equity was 13.4% in 2018, compared with the year-ago 14.2%. The bank said in December 2018 that it aims to increase its normalized group ROE to between 18% and 20% by 2021.

Net interest income rose year over year to 43.76 billion rand from 42.64 billion rand, so did net fee and commission income, to 22.52 billion rand from 21.71 billion rand. Net insurance premium income came in at 7.19 billion rand, up on a yearly basis from 6.60 billion rand.

The group booked impairment losses totaling 6.32 billion rand, down from 7.02 billion rand a year before. Operating expenditure amounted to 46.80 billion rand, compared with the year-ago 43.30 billion rand.

Absa declared a final dividend for 2018 of 620 cents, up from 595 cents a year before, and payable to registered shareholders as of the April 12 close of business.

As of Dec. 31, 2018, the group's common equity Tier 1 ratio stood at 12.8%, down from 13.5% as of Dec. 31, 2017. The group's capital adequacy ratio was flat at 16.1% over the period.

As of March 8, US$1 was equivalent to 14.39 South African rand.