Profits of Rs 18,1 billion for Financial Year ending 30 June 2025

“The successful execution of our strategy has contributed to a resilient financial performance. Profit attributable to ordinary shareholders increased by 12.6% to Rs 18.1 billion, translating into a return on equity of 16.4%. Our risk profile remains sound, underpinned by improving asset quality as well as robust capital and strong liquidity metrics. Our solid results and capital buffers have enabled us to increase the dividend payout for the financial year 2024/25 to Rs 25.50 compared to Rs 23.00 last year, thereby reinforcing our commitment to delivering consistent returns to shareholders.

Looking ahead, we will focus on the execution of our strategic pillars, aligning our efforts and uniting our teams around the shared objectives defined in Vision 2030. Despite multiple challenges and headwinds that will affect our bottom line in FY 2025/26, I remain confident that our refreshed strategy, dedicated and talented workforce and values embodied in our ‘Shared Ways of Working’ will enable the Group to continue creating sustainable long-term value for all our stakeholders.”

Financial Performance

· Operating income rose by 13.9% to Rs 42,160 million, supported by the growth in both net interest income and non-interest income.

· Net interest income increased by 11.6% compared to the prior year, on account of an increase in interest-earning assets in the banking cluster, whilst overall net interest margins remained relatively flat. In Mauritius, the effective deployment of the excess liquidity at higher yields and the expansion of the loans and advances portfolio contributed to the growth in the rupee-denominated net interest income. Conversely, margins on rupee customer loans and advances declined slightly in line with heightened competition. Foreign currency net interest income also increased as the decline in margins, linked to the fall in the USD benchmark rate, was more than offset by the increase in average interest-earning assets.

· Non-interest income grew by 18.3% to Rs 15,108 million for the year under review. Having reported a non-recurring loss in FY 2023/24 arising from the disposal of the stake in Société Générale Moçambique, the growth is explained by:

• a 11.8% increase in net fee income driven by payment, trade finance and wealth management activities in the banking cluster as well as higher fee income from MCB Capital Markets;
• a 19.9% increase in net trading income reflecting higher volume of foreign currency transactions;
• an increase of Rs 135 million in fair value gains on equity financial instruments. Of note, the fair value gains on the Visa and Mastercard shares are now recognised in Other Comprehensive Income, following the acquisition of these shares by MCB Group Ltd from MCB Ltd in November 2024.

· Non-interest expenses increased by 15.9% to Rs 15,747, reflecting continued investment to support business expansion across operating clusters. Year-on -year increase in non-interest expense is explained by:

•  a rise in staff costs by 17.4% resulting from the increase headcount linked to business growth and adjustments in salaries;
•  an increase of 33.0% in IT costs associated with the continued investment in technology and higher system costs in line with our cloudification strategy, cyber-security initiatives and inflation-linked adjustments;
•  a contribution of Rs 256 million to the Deposit Insurance Scheme in Mauritius.
• As a result, the cost-to-income ratio increased by 64 basis points to 37.4%.

· The impairment charge decreased by 4.9% reflecting higher recoveries made during the year and lower charge for specific provisions at MCB Ltd. The cost of risk decreased to 0.74% from 0.78% in FY 2023/24. The Group’s specific coverage ratio stood at 87.6% as at 30 June 2025.

· The share of profit of associates dropped by Rs 548 million to Rs 34 million mainly due to the loss incurred by Promotion and Development Limited, as a result of the write-down of the property value at Caudan in view of repairs required to the quay following the damages caused by a cyclone in 2024.

· The tax charge for the year increased by 19.5% in line with the growth in profits before tax and the non-recurrence of a tax credit which was booked last year in line with changes in tax laws in Mauritius.

· Profit attributable to shareholders increased by 12.6% to Rs 18,065 million in FY 2024/25, with the share of MCB Ltd’s foreign-sourced income standing at approximately 64% thereof.

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