2022 Annual financial statements
Belief comes first
CONTENTS
3 Directors' report
- Directors' responsibilities
-
Certificate from the Secretary
7 Independent auditor's report
- Statements of financial position
-
Statements of profit or
loss and other comprehensive income - Statements of changes in equity
- Statements of cash flows
- Notes to the financial statements
1 | Reporting entity | 16 |
2 | Basis of preparation | 16 |
3 | Adoption of new and | |
revised International | ||
Financial Reporting | ||
Standards | 18 | |
4 | Segment reporting | 22 |
- Significant accounting judgements, estimates
and assumptions | 26 |
- Significant accounting
policies | 29 | |
7 | Risk management | 44 |
8 | Fair value | 68 |
- Cash and balances with
central banks | 71 | |
10 | Money market investments | 71 |
11 | Loans and advances to | |
customers | 72 | |
12 | Repurchase agreements | 73 |
13 | Current tax | 73 |
14 | Assets held for sale | 74 |
15 | Investments at fair value | |
through profit or loss | 74 |
16 Investments at fair value through other comprehensive
income75
17 Investments in subsidiary
companies75
18 | Investment in joint | |
venture | 76 | |
19 | Other assets | 77 |
20 | Investment property | 78 |
21 | Intangible assets | 78 |
22 | Leases | 79 |
23 | Property and equipment | 80 |
24 | Deferred tax | 83 |
25 | Balances due to other | |
banks | 84 | |
26 | Customer deposits | 85 |
27 | Other payables | 86 |
28 | Provisions | 86 |
29 | Loans payable | 86 |
30 | Subordinated debt | 87 |
31 | Convertible preferences | |
shares | 87 | |
32 | Share capital | 88 |
33 | Restructuring reserve | 88 |
34 | Property revaluation | |
reserve | 88 | |
35 | Loan loss reserve | 89 |
36 | Other reserves | 89 |
37 | Foreign currency translation | |
reserve | 89 | |
38 | Group subsidiaries | 89 |
39 | Interest | 94 |
40 | Net fee and commission | |
income | 94 | |
41 | Income from investments | 95 |
42 | Gain on foreign exchange | |
transactions | 95 | |
43 | Other operating income | 95 |
44 | Staff and training costs | 95 |
45 | Premises and equipment | |
costs | 95 | |
46 | Depreciation and | |
amortisation | 96 | |
47 | Administration and | |
general expenses | 96 | |
48 | Impairment loss on | |
financial assets | 96 | |
49 | Basic and diluted | |
earnings per share | 97 | |
50 | Contingent liabilities | 98 |
51 | Capital commitments | 98 |
52 | Related party transactions | 99 |
53 | Directors' fees and | |
expenses | 102 | |
54 | Events after the | |
reporting date | 102 |
55 Exchange rates used for translating the Group's
foreign operations | 102 |
Abbreviations and acronyms 103
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Directors' report
for the year ended 31 December 2022
The Directors are pleased to submit their report together with the audited consolidated and separate financial statements of FMBcapital Holdings Plc (the Company) and its subsidiaries (the Group) for the year ended 31 December 2022.
Nature of Business
The Company is a public limited liability Company incorporated in Mauritius, registered as a Global Business Licence Company with the Financial Services Commission (FSC) in Mauritius, and listed on the Malawi Stock Exchange (MSE).
The Company owns and manages a portfolio of direct and indirect subsidiary investments, which are principally involved in the provision of commercial banking services. Details of Group subsidiaries, including their countries of domicile, are set out in Note 38 of the financial statements.
Directors' interests in the Company
As at 31 December 2022, the total direct and indirect interests of the Directors and parties related thereto in the issued
ordinary share capital of the Company were as follows: | 2022 | 2021 | |||
Name | Shares | % | Shares | % | |
Premier Capital (Mauritius) Limited | (i) | 766 266 044 | 31.17 | 766 266 044 | 31.17 |
Prime Bank Limited | 262 500 000 | 10.68 | 262 500 000 | 10.68 | |
Prime Capital Holdings Limited | 262 500 000 | 10.68 | 262 500 000 | 10.68 | |
Magni Holdings Limited | (i) | 232 000 000 | 9.44 | 232 000 000 | 9.44 |
Hitesh N. Anadkat | (i) | 62 797 891 | 2.55 | 61 710 170 | 2.51 |
NG Anadkat Limited | (i) | 27 067 289 | 1.10 | 27 067 289 | 1.10 |
Livingstone Exports Limited | (i) | 16 446 961 | 0.66 | 16 446 961 | 0.66 |
Livingstone Holdings Limited | (i) | 13 116 970 | 0.53 | 13 116 970 | 0.53 |
Thomas Kadantot | (ii) | 1 587 600 | 0.06 | 1 587 600 | 0.06 |
Omega O'Neill | (iii) | 1 309 391 | 0.05 | 1 309 391 | 0.05 |
Shaun Anadkat | (iv) | 700 000 | 0.03 | 700 000 | 0.03 |
Sheena Anadkat | (iv) | 500 000 | 0.02 | 500 000 | 0.02 |
Dillon Anadkat | (iv) | 400 000 | 0.02 | 400 000 | 0.02 |
- Mr. H. N Anadkat and members of his immediate family have beneficial interest in Premier Capital (Mauritius) Limited, NG Anadkat Limited, Livingstone Exports Limited, Magni Holdings Limited and Livingstone Holdings Limited.
- Mr. T. Kadantot is a director of FCB Malawi, a wholly owned subsidiary of the Company.
- Ms.Omega O'Neill is an immediate family member of Mr. J. M. O'Neill. Mr. J.M. O'Neill resigned from the Board of the Company effective May 2022.
- Mr. Shaun Anadkat, Ms. Sheena Anadkat and Mr. Dillon Anadkat are immediate family members of Mr. H. N. Anadkat.
The Board of Directors and Directors' remuneration
As at 31 December 2022, the Board comprised: | |
Terence Michael Davidson - Chairman | Hitesh Natwarlal Anadkat |
Busisa Moyo (Appointed July 2022) | Gavin John Chapman |
Johannes Christoffel Els | Mahendra Gursahani |
Priscilla Balgobin-Bhoyrul | Rajkamal Taposeea |
Susanne Alfs | John Michael O'Neill (Resigned May 2022) |
The Board is responsible for directing the affairs of the Company in the best interests of its Shareholders, in conformity with legal and regulatory frameworks, and consistent with its constitution and best governance practices.
Remuneration paid by the Company and its subsidiaries to Directors of the Company has been disclosed in Note 53 of the annual financial statements.
The individual remuneration of the Directors is disclosed below:
USD | 2022 | 2021 |
Name of Non-executive Director | ||
Terence M. Davidson | 60 000 | 57 500 |
Hitesh N. Anadkat | 18 000 | 15 500 |
Busisa Moyo | 9 000 | - |
Johannes C. Els | 18 000 | 15 000 |
Mahendra Gursahani | 18 000 | - |
Priscilla Balgobin-Bhoyrul | 18 000 | 16 000 |
Rajkamal Taposeea | 18 000 | 16 000 |
Susanne Alfs | 18 000 | 16 500 |
John M. O'Neill | 9 000 | 16 500 |
186 000 | 153 000 |
Gavin J. Chapman is not remunerated as agreed with Barclays and Mahendra Gursahani was not remunerated as a Non-executive Director in 2021 as he was acting as interim Group Managing Director.
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2022 ANNUAL FINANCIAL STATEMENTS (continued)
Directors' report (continued)
for the year ended 31 December 2022
Dividend
During 2022 a final dividend in respect of the financial year ended 31 December 2021 of USD 2 458 250 (0.1 US cents per ordinary share) was approved by the Shareholders at the Annual General Meeting in June 2022 and paid in July 2022. An interim dividend in respect of the financial year ended 31 December 2022 of USD 3 687 375 (0.15 US cents per ordinary share) was approved by the Directors in August 2022 and paid in September 2022.
The directors have approved a second interim dividend in respect of the financial year ended 31 December 2022 of USD 8 312 625 (0.34 US cents per ordinary share). The financial statements for the current financial year do not reflect this dividend. The dividend will be accounted for in equity as an appropriation of accumulated profits in the financial year ending 31 December 2023.
Therefore, the dividend in relation to the 2022 financial year will amount to USD 12 000 000 (2021: USD 4 424 850), comprising a settled first interim dividend of USD 3 687 375, or 0.15 US cents per share (2021: USD 1 966 600, or 0.08 US cents) and a second interim dividend of USD 8 312 625, or 0.34 US cents per share (2021: USD 2 458 250, or 0.1 US cents per share). This will equate to a 30% dividend pay out against profit attributable to owners of the Company (2021: 16%).
Going concern
The Directors have no reason to believe that the Group will not be a going concern in the period ahead. The going concern assessment was performed through a review of the economic conditions in which the Group is expected to perform over the next 12 months, its ability to adapt its strategy, business and operating models to the projected macro environment, financial forecasts and business underwriting capacity. The Group has sufficient capital, human and physical resources, as well as sources of sustainable deposits which are well diversified and is, therefore, able to address short-term stress factors within reasonable parameters.
The effects of the Covid-19 pandemic on the Group's ability to continue as a going concern were also considered, given the uncertainty around further mutations and variations to the virus, as well as the impact on the Group's future results. As 2022 progressed, the infection and mortality statistics were assessed as not being material to the Group's financial results, position and cash flows.
Financial risk factors
The consideration of major financial risks impacting on the Group's operations has been set out in Note 7 of the financial statements.
Donations
During the year, no donation for political purposes was made by the Company or any of its subsidiaries.
Ethical standards
The Board is fully committed to ensuring the Group's affairs are conducted with integrity and that the highest ethical standards are maintained. All employees of the Group are required to abide by a code of conduct containing detailed guidelines governing ethics and integrity in the workplace.
Auditor's report and financial statements
The independent auditor's report is set out on pages 7 to 9 and the financial statements are set out on pages 10 to 102.
On behalf of the Board
Terence Davidson | Busisa Moyo |
Director | Director |
4
Directors' responsibilities
for the year ended 31 December 2022
The Directors are responsible for the preparation and fair presentation of the consolidated and separate annual financial statements of FMBcapital Holdings Plc, comprising the consolidated and separate statements of financial position as at 31 December 2022 and the statements of profit or loss and other comprehensive income, statements of changes in equity and statements of cash flows for the year ended 31 December 2022, and the notes to the financial statements which include a summary of significant accounting policies and other explanatory notes, in accordance with International Financial Reporting Standards. The consolidated and separate financial statements comply with the Mauritius Companies Act,
2001 as far as it is applicable to companies holding a Global Business Licence. In addition, the Directors are responsible for preparing the Directors' Report.
The Mauritius Companies Act, 2001 requires the Directors to ensure that the Group and Company maintain proper accounting records which disclose with reasonable accuracy at any time the financial position of the Group and Company and ensure the financial statements comply with the Mauritius Companies Act, 2001.
In preparing the consolidated and separate financial statements, the Directors accept responsibility for the following:
- Maintenance of proper accounting records
- Selection of suitable accounting policies and applying them consistently
- Making judgements and estimates that are reasonable and prudent
- Compliance with applicable accounting standards, when preparing financial statements, subject to any material departures being disclosed and explained in the consolidated and separate financial statements; and
- Preparation of financial statements on a going concern basis unless it is inappropriate to presume the Company will continue to operate for the foreseeable future.
The Directors are also responsible for such internal control as the Directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and for maintaining adequate accounting records and an effective system of risk management.
The directors confirm that they have complied with the above requirements in preparing the consolidated and separate financial statements.
Approval of financial statements
The consolidated and separate financial statements of FMBcapital Holdings Plc as identified in the first paragraph, were approved by the Board of Directors on 17 May 2023 and are signed on its behalf by:
Terence Davidson | Busisa Moyo |
Director | Director |
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FMBcapital Holdings plc published this content on 25 May 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 May 2023 09:19:00 UTC.