APS Group registers pre-tax profit of €15.7 million

APS Group registers lower pre-tax profit of €15.7 million but bank betters its performance with a pre-tax profit of €28.9 million


APS Group registered a pre-tax profit of €15.7 million last year, a decline of €8.4 million on the previous year, despite the bank’s improved performance.

The financial results show that the bank saw its pre-tax profit increase to a record of €28.9 million in 2022, up from €23.7 million, a year earlier.

The results were approved by the APS Bank plc board of directors on Thursday. The directors are recommending a final gross dividend to ordinary shareholders of 2.68 cents per ordinary share for a total of €9.8 million.

In a statement, the directors said the contrasting outcomes of the Group and the bank follow the trend that started emerging in the first half of the year, as global markets were confronted by persistent economic instability and rising inflationary pressures.

“Notwithstanding these challenges, and despite the unrealised negative market trends at Group level, the Bank once again delivered excellent operating results,” the directors said.

Financial performance

Net interest income remained a key driver of the revenue mix, growing by 17.6% from €55.4 million in 2021 to €65.1 million in 2022. An overall expansion of the Group’s home finance and commercial loan books, and in the fixed-income portfolio, were the main contributors to the growth in interest revenue, as spreads on the syndicated loan book also improved.

Interest income grew by 15.5% from €69.1 million in 2021 to €79.9 million in 2022. Interest expense of €14.8 million increased by 7.2%. “This demonstrates the Group’s efficient management of its asset-liability mix and cost of funding in a period which saw interest rates move to their highest in years,” APS said.

Net fee and commission income for the year of €6.9 million was marginally down on the €7 million of 2021. As the general growth in transactional business, card related commissions and enlarged customer base brought new sources of fee-based banking income, this was counterweighed by reductions in investment services fees, negatively impacted by the ongoing market volatility.

Operating expenses for the year grew by 15.9% to €47 million from €40.6 million in 2021. The main contributor was ‘employee compensation and benefits’, up by 19.4% to €26.1 million.

Increases were recorded across the board in other operating overheads, resulting not least from general inflation; these included regulatory and compliance costs, insurance, security and the ongoing investment in technology infrastructure, channels and digitisation, seeking the right balance between more efficiency and more sustainability (ESG/CSR) initiatives.

As a result, the Group’s cost-to-income ratio deteriorated from 64.3% in 2021 to 72.7% in 2022, largely also due to the unrealised deterioration in fair value instruments. Conversely, the Bank’s cost-to-income ratio improved from 2021’s 64.1% to 61.5% in 2022. 

Impairments against expected credit losses resulted in a writeback of €0.3 million.

Financial position

As at the end of the reporting period, Group total assets stood at €3.11 billion, a year-on-year growth of 11.3% on the €2.8 billion at the end of 2021. Loans and advances to customers grew by 15.1% to €2.22 billion while the fixed income portfolio, held mainly for liquidity and income diversification purposes, grew by 40.1% to €459.6 million. Corresponding to the increase in the Group’s asset base, amounts owed to customers grew by 11.5% or €278.9 million, to reach €2.71 billion, despite pressures arising from competing debt issuances in the local market. Total equity amounted to €261.5 million, compared to December 2021’s €220.8 million.

“As cautiously anticipated earlier in the year, market movements resulting from rising interest rates have had a direct, negative impact on reserves… These corrections, albeit unrealised and expected to reverse fully over time, were amply compensated by the €66 million equity capital raised from the successful Initial Public Offering of June which was hugely oversubscribed within hours of opening,” APS said.


The directors are recommending a final gross dividend of 2.68 cents per ordinary share with each shareholder having the option to receive either cash or new ordinary shares, at an attribution price of 57c per new ordinary share. This final dividend is in addition to the interim dividend paid by the Bank in the fourth quarter of 2022.

CEO Marcel Cassar said: “What seemed like a promising start to 2022 on the back of a post-pandemic economic rebound soon came to face new shocks. Prominently, the Russian invasion of Ukraine and amplified supply chain challenges in energy and food prices fuelled inflationary pressures and ensuing interventions from monetary authorities. Such international developments are felt also in our widely open economy, partly cushioned by government subsidies which however contribute to a build-up in public debt. In this complex environment, Malta is experiencing higher economic growth, milder inflation, and lower unemployment than its EU counterparts, aided in no small way by a stronger than expected tourism recovery and buoyant retail and property markets.”

He said the bank navigated through these choppy waters and delivered “excellent results”.

Cassar said APS will manage the higher interest scenario prompted by the international turmoil by keeping in mind the "concerns of all its customers".

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