“Stocks surge to record highs as Trump returns to presidency…”

U.S. stocks rallied sharply to close at record highs on Wednesday after Republican Donald Trump won.

Donald Trump’s U.S. presidential election victory boosted the stock market on Wednesday as investors bet on lower corporate taxes and deregulation, lifting shares of Tesla banks, small-cap companies and Trump’s own media company.

His promise to make Tesla CEO Elon Mask head of a government efficiency commission after the billionaire backed Trump throughout his electoral campaign sparked a 15% surge in shares of the electric automaker.

Wall Street’s main indexes jumped to record highs, with the Dow Jones industrial average rallying almost 4% and the S&P 500 more than 2% higher. The small-cap Russell 2000 index jumped almost 6% to its highest in nearly three years.

Trump Media & Technology Group, majority-owned by Trump, jumped 6%. The company late on Tuesday reported quarterly results that showed the Truth Social parent’s revenue was just $1 million.

The stock has more than tripled in value from its lows in late September, valuing Trump’s stake at over $4 billion.

POLICY DETAILS AWAITED

Markets “have priced in a pretty strong mandate for the Republicans and are biasing toward most of the Trump trades,” said Scott Chronert, U.S. equity strategist at Citi.

“The market focus seems to be putting more emphasis on deregulation, tax cuts and a more business-friendly backdrop.”

Wall Street lenders JPMorgan Chase, Bank of America and Goldman Sachs jumped between 8% and 13% on prospects of looser regulations and more deals.

Semiconductor stocks advanced, with the PHLX chip index rallying 3.1% and artificial intelligence darling Nvidia  gaining 4% to a record high close.

Trump has proposed tariffs on imported chips, particularly from Taiwan’s TSMC, whose U.S.-listed shares dropped 1.3%.

The S&P 500 energy index climbed 3.5%, while U.S. renewable energy companies NextEra Energy and First Solar fell 5% and 10%, respectively.

BOV announces profit before tax of €223.7 million

The Bank of Valletta Group has announced a strong and sustained financial performance for the nine months ending September 2024, with a profit before tax of €223.7 million, up by 36.9% over the same period last year. This positive performance is the result of the continuous expansion of loan portfolios, a drive to improve and diversify net fee and commission income, as well as the Bank’s continued focus on its balance sheet optimisation strategy.

The Group’s operating income increased from €315.9 million to €359.2 million compared to the same period in 2023. This is reflected in a 14.5% rise in Net Interest Income and a 5.4% increase in Net Fee and Commission income over the same period in 2023. The credit portfolio has also shown consistent growth, resulting in a 9.1% increase primarily due to sustained growth across all segments including business loans, home loans and personal loans. The positive performance was also prevalent on the asset quality side, where the overall non-performing exposures ratio decreased to 2.8% of total balances, as compared to 3.1% in December 2023.

The investments book maintained an upward trend and increased to €5.9 billion as a result of the purchase of high-quality paper instruments, generating interest income of €92 million over the nine-month period under review. Most of these investments are measured at amortised costs, aligning with the Bank business model to hold securities until maturity to collect interest revenues. On the liabilities side, customer deposits increased by 1% since the beginning of the year, with the increase coming from both personal and non-personal customers.

When excluding strategy related costs, operating costs registered an increase of 4.0% compared to the same period in 2023, aligned with the Group’s efforts to prioritise talent, compensation and benefits, technological advancements and regulatory compliance. In this vein, operational efficiency continues to attract a high level of focus, with the cost-to-income ratio standing at 42.1%, which is 4% lower than the 46.1% achieved in the same period in 2023, driven by cost management and procurement excellence initiatives.

The Group’s liquidity remains well above the minimum regulatory requirements, as do the Group’s capital ratios. Pre-tax Return on Average Equity stands at 22.5%, representing approximately an improvement of 3.8% over the equivalent number recorded in the same period last year. The net asset value per share at the end of the third quarter of 2024 stood at €2.4 per share as compared to €2.2 per share as at December 2023.

APS Bank reports all-round 3Q growth, increased market share

APS Bank plc announces the publication of its financial results, extracted from the Group and Bank unaudited management accounts for the nine months ended 30 September 2024 (also referred to as the “period”, “3Q”, or “9M”), as presented to the Board of Directors on 31 October 2024.

Income Statement

During the period under review, APS Bank plc registered a pre-tax profit of €16.5 million at Group level (3Q 2023: €23.3 million) and €14.8 million at Bank level (3Q2023: €23.6 million). As anticipated earlier in the year, and despite a progressive improvement in performance over the past months, the results continue to lag those of 2023 mainly due to a contraction in net interest income, primarily driven by margin compression on loans and deposits.

–           In fact, net interest income for the 9M was €49.1 million, down on the €55.5 million for the same period in 2023. Interest receivable increased from €77.2 million in 2023 to €84.7 million, with growth being spread across both retail and commercial product lines.

–           This was more than neutralised by interest expense which increased to €35.6 million from €21.6 million in 2023, due to higher cost of MREL funding and the Bank’s policy of passing through the interest rate benefits to its depositors.

–           Net fee and commission income is up by 2.8% over 2023 to €6.4 million, reflecting overall business growth and revenue from insurance intermediation, pensions, investment services and cards.

–           Other income for the period amounted to €2.6 million, markedly up on the €1.1 million recorded for 3Q 2023 and resulting mainly from gains on movements in the portfolio of financial assets at both Group and Bank levels.

–           Net impairment charges for 3Q 2024 were €1.1 million, spread over the three Expected Credit Losses (ECL) stages and across a growing local commercial book and the international syndicated loan portfolio; the NPL (Non-performing loans) ratio of 1.7% – lowest in years – indicative of the quality of the book and strength of the Group’s credit underwriting standards.

–           Operating expenses of €41.1 million are up by 4.1% on the €39.5 million for the corresponding 9M of 2023. Continued investment in top-end technology, including fraud prevention, digitalisation, regulatory, compliance and human resources, and associated cost inflation, are the key contributors.

–           The cost-to-income ratio for the 9M period was 70.8%, up from the 3Q 2023 ratio of 62.8% and in large part a result of the contraction in net interest income.

Financial Position

•  Total Group assets/liabilities at 30 September 2024 exceeded €3.9 billion, expanding by 7.2% (or €264.6 million) during the period under review. Key contributors were:
• A growth in customer deposits which increased by €305.3 million to reach €3.4 billion, largely attributable to strategic product campaigning such as targeted offers of classic term deposits, new Kapital+ releases as well as initiatives promoting the Bank for everyday banking.
• Countering the above increase, the Group reported a reduction in amounts owed to banks of €47.3 million, shifting dependencies to optimise on treasury lines and liquidity management.

• Most of the fund raising went to the Bank’s loan books which grew by €226.6 million to reach €3.1 billion – home finance remaining the top contributor to growth now reaching €2.0 billion by 3Q 2024, with limited, cautious growth in the commercial and syndicated loan portfolios.

• Taking advantage of opportunities created by the interest rate environment, cash balances with the Central Bank of Malta increased by €75.3 million to €206.3 million over the 9M under review, as the portfolio of debt and fixed income instruments contracted by €36.6 million to €405.4 million.

• The pick-up in fund-raising and higher cash levels in 3Q 2024 resulted in Liquidity Coverage Ratios (LCR) hovering comfortably between 150% and 170%.

–           Total equity at the end of 3Q 2024 was €296.1 million, up by €8.7 million on December 2023, in part also thanks to the downward direction of interest rates and some uplift from market performance which further helped claw back unrealised losses in the Bank’s investments portfolio.

–           The Bank’s CET1 ratio stood at 14.4% (31 December 2023: 14.6%) and the Capital Adequacy Ratio at 20.0% (31 December 2023: 20.6%).

–           Assets under management remained stable thanks to generally positive market sentiment, with steady growth in both occupational and personal pension clients.

Malta Company Announcements:

PG p.l.c

The Board of Directors of PG p.l.c. announces that it shall be convening on 26 November 2024 in order to consider and, if deemed fit, approve the distribution of an interim dividend for the financial year ending 30 April 2025.

Gap Group p.l.c

The Company announces that it purchased €120,000 of its 3.90% Secured Bonds 2024 – 2026 (MT0001231233) from its bondholders during the month of October 2024. In accordance to section 6.10 of the Securities Note forming part of the Company’s Prospectus dated 6 December 2021, the purchased Bonds will be cancelled and may not be re-issued or re-sold. 

Malita Investments p.l.c

The Company announced that it shall convene an Extraordinary General Meeting of the shareholders of the Company, to be held at The Palace, High Street, Sliema, on Thursday 28 November 2024 at 4:00pm (the “EGM”).

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