ABBEY MORTGAGE BANK : QUARTER 3 - FINANCIAL STATEMENT FOR 2023

ABBEY MORTGAGE BANK PLC Head Office: 23, Karimu Kotun Street, Victoria Island, Lagos.

Tel: [phone]

eMail: [e-mail] Website: www.abbeymortgagebank.com TIN: 01334740-0001

ABBEY MORTGAGE BANK PLC

LAGOS, NIGERIA

UNAUDITED IFRS FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER, 2023

CONDENSED REPORTS

ABBEY MORTGAGE BANK PLC
REPORT FOR THE PERIOD ENDED 30 SEPTEMBER, 2023
CONTENTS	Page
Introduction	1
Result at a Glance	2
Statement of Profit or Loss and Other Comprehensive Income	3
Statement of Financial Position	4
Statement of Changes in Equity	5
Statement of Cash Flows	6
Notes to the Financial Statements	7
Statement of Value Added	36
Five-Year Financial Summary	37

ABBEY MORTGAGE BANK PLC

Introduction

Abbey Mortgage Bank's Financial Statements complies with the applicable legal requirements of the Nigerian Securities and Exchange Commission regarding interim financial statements for the period ended 30 September 2023. These financial statements contain extract of the unaudited financial statements prepared in accordance with 'Internarional Financial Reporting Standards' and its interpretation issued by the International Accounting Standards and adopted by the Financial Reporting Council of Nigeria. For better understanding, certain disclosures and some prior period figures have been presented in line with the reporting periods' figures. Due to rounding, numbers presented throughout this document may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.

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ABBEY MORTGAGE BANK PLC

RESULT AT A GLANCE

GROSS EARNINGS	PROFIT BEFORE TAX	PROFIT AFTER TAX
N5,471.77 million	N776.12 million	N648.06 million

MAJOR INCOME STATEMENT ITEMS	2023	2022	INCREASED/
	September	September	(DECREASED)
	N'000	N'000	%
Gross Earnings	5,471,767	3,996,730	36.91
Net Operating Income	2,229,906	1,998,239	11.59
Profit Before Tax	776,117	771,492	2.60
Profit After Tax	648,058	646,252	2.28
EarningsPer Share:
-Basic(Kobo)	8.51	8.45	1.71
MAJOR STATEMENT OF FINANCIAL POSITION ITEMS	2023	2022	INCREASED/
	September	December	(DECREASED)
	N'000	N'000	%
Loans and advances to customers	10,966,673	5,159,962	112.53
Deposits from customers	38,318,439	27,627,752	38.70
Total Assets	54,391,892	39,858,233	36.46
Total Equity	8,346,472	7,698,414	8.42

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ABBEY MORTGAGE BANK PLC

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE PERIOD ENDED 30 SEPTEMBER, 2023

	UNAUDITED	UNAUDITED	UNAUDITED	UNAUDITED
	9 Months	3 Months	9 Months	3 Months
	Sep-23	Sep-23	Sep-22	Sep-22
Notes	₦'000	₦'000	₦'000	₦'000

Interest income	3
Interest expense	4
Net interest income
Fees and commision income	5
(Loss)/profit on disposal of non-current assets held for sale
Other operating income	6
Total operating income
Credit loss expense	7
Net operating income
Personnel expenses	8
Depreciation	9
Amortisation	21
Other operating expenses	10
Total operating expenses
Profit or (Loss) before income tax expense
Income tax expense	11

Profit or (Loss) for the period

Other comprehensive Income

Total comprehensive Income for the year net of tax

5,154,450	2,111,754	3,513,475	1,319,473
(3,241,861)	(1,349,967)	(2,000,491)	(772,089)
1,912,589	761,787	1,512,984	547,384
204,115	135,071	355,173	148,592
-	-	2,000	-
113,202	62,005	128,082	65,666
2,229,906	958,863	1,998,239	761,642
-	-	-	-
2,229,906	958,863	1,998,239	761,642
(523,220)	(188,265)	(415,055)	(148,213)
(114,018)	(39,924)	(74,167)	(7,705)
(6,960)	(2,249)	(3,489)	(1,173)
(809,591)	(332,322)	(734,036)	(275,703)
(1,453,789)	(562,760)	(1,226,747)	(432,794)
776,117	396,103	771,492	328,848
(128,059)	(79,221)	(125,240)	(47,669)
648,058	316,882	646,252	281,179
-	-	-	-
648,058	316,882	646,252	281,179

Earnings per share attributable to ordinary equity holders	12	8.51	12.48	8.45	11.08
(Kobo) - Basic and Diluted

The accompanying notes form part of these financial statements.

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ABBEY MORTGAGE BANK PLC
STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER, 2023
		UNAUDITED	AUDITED
		Sep-23	Dec-22
	Notes	₦'000	₦'000
Assets
Cash on hand	13	35,263	26,501
Cash balances with central bank	14	704,644	629,891
Due from banks and other financial institutions	15	33,395,890	27,813,952
Loans and advances	16	10,966,673	5,159,962
Financial investments - equity instrument at FVTPL	17	497,111	497,111
Financial Investments- securities at amortised cost	18	6,202,184	3,731,668
Other assets	19	1,134,007	554,320
Property and equipment	20	1,332,626	1,324,111
Intangible assets	21	68,243	65,466
		54,336,641	39,802,982
Non-current assets held for sale	22	55,251	55,251
Total Assets		54,391,892	39,858,233
Liabilities and equity
Deposits from customers	23	38,318,439	27,627,752
Due to other banks	24	3,766,693	3,738,255
Current income tax payable	11.2	131,827	63,988
Other liabilities	25	332,338	414,670
Borrowings	26	3,200,000	-
Due to National Housing Fund	28	296,123	315,153
		46,045,420	32,159,818
Equity
Share capital	29	5,076,923	5,076,923
Share premium	30	5,117,138	5,117,138
Accumulated losses	31	(2,892,575)	(3,540,633)
Statutory reserve	32	298,440	298,440
Regulatory risk reserve		746,546	746,546
Total Equity		8,346,472	7,698,414
Total liabilities and equity		54,391,892	39,858,233

The financial statements were approved by the Board of Directors on October 27,2023 and signed on its behalf by:

Mazi Emmanuel Kanu O.Ivi

Chairman

FRC/2014/ICAN/00000008160----------------------------------------------------

Mobolaji Adewumi

Managing Director/CEO

FRC/2021/006/00000022431----------------------------------------------------

Oluwatomi Olurinola

Financial Controller

FRC/2021/001/00000025175----------------------------------------------------

The accompanying notes form part of these financial statements.

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ABBEY MORTGAGE BANK PLC

STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 30 SEPTEMBER, 2023

	Share	Share	Statutory	Regulatory	Accumulated	Total
	capital	Premium	Reserve	risk reserve	Losses	Equity
	₦'000	₦'000	₦'000	₦'000	₦'000	₦'000
Balance as at 1 January 2022	5,076,923	5,117,138	298,440	1,356,485	(4,916,732)	6,932,254
Additional capital issued and fully paid	-	-				-
Profit for the year	-	-	-	-	766,159	766,159
Other comprehensive income for the year	-	-	-	-	-	-
Transfer to statutory reserve	-	-	-	-	-	-
Transfer to regulatory risk reserve	-	-	-	(609,939)	609,939	-
Balance as at 31 December 2022	5,076,923	5,117,138	298,440	746,546	(3,540,633)	7,698,414
Additional capital issued and fully paid	-	-				-
Profit for the Period	-	-	-	-	648,058	648,058
Other comprehensive income for the year	-	-	-	-	-	-
Transfer to statutory reserve	-	-	-	-	-	-
Transfer to regulatory risk reserve	-	-	-	-	-	-
Balance as at 30 September 2023	5,076,923	5,117,138	298,440	746,546	(2,892,575)	8,346,472

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ABBEY MORTGAGE BANK PLC

STATEMENT OF CASH FLOWS

FOR THE PERIOD ENDED 30 SEPTEMBER, 2023

Cash flows from operating activities:

Profit/(loss) before income tax

Adjustment for non-cash items

Cash flows from operating activities before changes in working capital

Change in operating assets

Change in operating liabilities

Income tax paid

Net cash flows used in operating activities

	UNAUDITED	AUDITED
	9 Months	12 Months
	Sep-23	Dec-22
Notes	₦'000	₦'000
	776,117	827,268
33.4	96,029	(117,928)
	872,146	709,340
33.2	(8,931,663)	(1,675,384)
33.3	10,589,327	6,456,565
11.2	(60,220)	(46,448)
	2,469,591	5,444,074

Cash flows from investing activities:
Purchase of intangible assets	21	(9,737)	(58,523)
Proceeds on disposal of non-current asset held for sale		-	106,158
Refund to customer for returning non-current asset formerly sold		-	-
Repossession non-current asset formerly sold		-	-
Proceeds on disposal of property and equipment		7,160	143,294
Purchase of property and equipment	20	(128,253)	(407,763)
Dividend received		23,500	23,000
Net cash flows generated from investing activities		(107,330)	(193,834)
Cash flows from financing activities:
Deposit for share		-	-
Proceeds from increase in share capital		-	-
Proceeds of Long-term borrowings		3,400,000	-
Repayments of Long-term borrowings		(200,000)	-
Net cash flows used in financing activities		3,200,000	-
Net increase/( decrease) in cash and cash equivalents		5,562,261	5,250,240
Net foreign exchange difference		-	-
Cash and cash equivalents at beginning of year		24,163,505	18,913,265
Cash and cash equivalents at end of the period	33	29,725,767	24,163,505

The accompanying notes form part of these financial statements.

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ABBEY MORTGAGE BANK PLC

NOTES TO THE FINANCIAL STATEMENTS - Continued

For the Period Ended 30 September, 2023

1 General information

These financial statements are the financial statements of Abbey Mortgage Bank Plc. (the "Bank"), a public limited liability Bank incorporated and domiciled in Nigeria on 26 August 1991. The Bank obtained its licence to operate as a mortgage bank on 20 January 1992 and commenced business on 11 March 1992. It was later converted to a public limited liability Bank in September 2007. On 21 October 2008, the Bank became officially listed on the Nigerian Exchange Group.

The principal activities of the Bank are the provision of mortgage services, financial advisory, and real estate construction finance.

For the earlier years of its operations, the Bank specialized in funding small and medium size businesses. In the last few years, the Bank has started to implement a mortgage financing strategy in line with its strategic vision to become "the number one mortgage service provider in Africa". The Bank currently has 130 (2022: 126) staff in eight (8) branches and the Head Office.

2.1 Basis of preparation

1. Statement of Compliance
   These financial statements of the Bank are general purpose financial statements which have been prepared in accordance with International Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards Board (IASB). Additional information required by the provisions of the Companies and Allied Matters Act 2020, the Banks and Other Financial Institutions Act 2020, the Financial Reporting Council of Nigeria ("FRCN") Act No. 6, 2011 and relevant Central Bank of Nigeria circulars, is included where appropriate.
2. Basis of Measurement
   The financial statements have been prepared on the historical cost basis except for equity instruments which are carried at fair value.
3. Use of Estimates and Judgments
   The preparation of the financial statements in conformity with IFRSs requires management to make judgments, estimates and assumptions that affect the
   application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.
   Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised and in any future periods affected.

2.2 Changes in accounting policies and disclosures

The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the preparation of the Bank's annual financial statements for the year ended 31 December 2022. The Bank has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective.

2.3 Standards recently issued and effective

The standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Bank's financial statements are disclosed below. The Bank intends to adopt these standards and interpretations, if applicable, when they become effective.

1. IFRS 17 Insurance Contracts
   In May 2017, the IASB issued IFRS 17 Insurance Contracts (IFRS 17), a comprehensive new accounting standard for insurance contracts covering recognition and measurement, presentation and disclosure. Once effective, IFRS 17 will replace IFRS 4 Insurance Contracts (IFRS 4) that was issued in 2005. IFRS 17 applies to all types of insurance contracts (i.e., life, non-life, direct insurance and re-insurance), regardless of the type of entities that issue them, as well as to certain guarantees and financial instruments with discretionary participation features.
   A few scope exceptions will apply. The overall objective of IFRS 17 is to provide an accounting model for insurance contracts that is more useful and consistent for insurers. In contrast to the requirements in IFRS 4, which are largely based on grandfathering previous local accounting policies, IFRS 17 provides a comprehensive model for insurance contracts, covering all relevant accounting aspects. The core of IFRS 17 is the general model, supplemented by:

• A specific adaptation for contracts with direct participation features (the variable fee approach) *A simplified approach (the premium allocation approach) mainly for short-duration contracts

IFRS 17 is effective for reporting periods beginning on or after 1 January 2023, with comparative figures required. Early application is permitted, provided the entity also applies IFRS 9 and IFRS 15 on or before the date it first applies IFRS 17.

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ABBEY MORTGAGE BANK PLC

NOTES TO THE FINANCIAL STATEMENTS - Continued

For the Period Ended 30 September, 2023

Amendments to IFRS 17

In June 2020, the IASB issued amendments to IFRS 17. These amendments follow from the Exposure Draft (ED) on proposed Amendments to IFRS 17 Insurance Contracts.

As a result of its re-deliberations, the IASB has made changes to the following main areas of IFRS 17

Deferral of the effective date of IFRS 17 and IFRS 9 for qualifying insurance entities by two years to annual reporting periods beginning on or after 1 January 2023)

• Scope of the standard
• Expected recovery of insurance acquisition cash flows from insurance contract renewals
• CSM relating to investment activities
• Applicability of the risk mitigation option for contracts with direct participation features
• Reinsurance contracts held - expected recovery of losses on underlying onerous contracts
• Simplified presentation of insurance contracts in the statement of financial position
• Additional transition reliefs

IFRS 17 will not be applicable to the Bank, as it does not issue insurance contract.

1. Interest rate Benchmark Reform-Phase 2- Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16
   On 27 August 2020, the IASB published Interest Rate Benchmark Reform - Phase 2, Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16. With publication of the phase two amendments, the IASB has completed its work in response to IBOR reform.
   The amendments provide temporary reliefs which address the financial reporting effects when an interbank offered rate (IBOR) is replaced with an alternative nearly risk-free interest rate (RFR)
   The amendments include a practical expedient to require contractual changes, or changes to cash flows that are directly required by the reform, to be treated as changes to a floating interest rate, equivalent to a movement in a market rate of interest. It also permit changes required by IBOR reform to be made to hedge designations and hedge documentation without the hedging relationship being discontinued. The ammendments also provide temporary relief to entities from having to meet the separately identifiable requirement when an RFR instrument is designated as a hedge of a risk component.
   The amendment is effective for annual periods beginning on or after 1 January 2021. While application is retrospective, the entity is not required to restate prior periods.
   The amendment will have no significant impact on the Bank.
2. Reference to the Conceptual Framework- Amendment to IFRS 3
   In May 2020, the IASB issued Amendments to IFRS 3 Business Combinations - Reference to the Conceptual Framework. The amendments are intended to replace a reference to a previous version of the IASB's Conceptual Framework (the 1989 Framework) with a reference to the current version issued in March 2018 (the Conceptual Framework) without significantly changing its requirements.
   The amendments add an exception to the recognition principle of IFRS 3 to avoid the issue of potential 'day 2' gains or losses arising for liabilities and contingent liabilities that would be within the scope of IAS 37 Provisions, Contingent Liabilities and Contingent Assets or IFRIC 21 Levies, if incurred separately. The exception requires entities to apply the criteria in IAS 37 or IFRIC 21, respectively, instead of the Conceptual Framework, to determine whether a present obligation exists at the acquisition date. At the same time, the amendments add a new paragraph to IFRS 3 to clarify that contingent assets do not qualify for recognition at the acquisition date.
   The amendment is effective for annual periods beginning on or after 1 January 2022 and must be applied prospectively. The amendment is not expected to have significant impact on the Bank.

2.3 Standards recently issued and effective

1. Property, plants and machinery - Proceeds before intended use-Amendment to IAS 16
   The amendment prohibits entities from deducting from the cost of an item of property, plant and equipment (PP&E), any proceeds of the sale of items produced while bringing that asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Instead, an entity recognises the proceeds from selling such items, and the costs of producing those items, in profit or loss.
   The amendment is effective for annual periods beginning on or after 1 January 2022 and must be applied reprospectively only to items of PP&E made available for use on or after the beginning of the earliest period presented when the entity first applies the amendment.
   The amendment is not expected to have significant impact on the Bank.
2. Onerous Contracts- Cost of fulfilling a contract- Amendments to IAS 37
   In May 2020, the IASB issued amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets to specify which costs an entity needs to include when assessing whether a contract is onerous or loss-making.

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