Interest income led annual boost to profitability: Commercial International Bank – Egypt’s (COMI) Q1 2019 earnings climbed to EGP2.64bn (+31% y/y, +3% q/q), in line with the management guidance for bottom-line growth for the full year. Sequential earnings growth, however, was somewhat flattened, for the most part, by a mere 2% rise in net interest income with gross interest income being unchanged, while the cost of funding retreated in light of the 100bps rate cut by mid-quarter. Income from Treasuries accounted for 55% of total interest income, after the 44% recorded a quarter earlier, remaining the principal contributor in Q1 2019. Unsurprisingly so, as Treasury buying was a recurring theme for the bank since Q3 2018. Meanwhile, income from net fees and commissions stood at EGP578mn (-11% y/y, +1% q/q). We note that the effective tax rate retreated in Q1 2019 to 29.7% (-51bps q/q).
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