Feb 2008 Financial News

RBL Releases First Quarter Results (Q108)

Feb 11, 2008

Republic Bank Limited
Results for the First Quarter Ended December 31, 2007

Earnings Per Share
For the First Quarter Ended December 31, 2007 Republic Bank Limited reported Earnings Per Share (EPS) of $1.66, up 17.73 per cent on the comparable quarter in fiscal 2007. This is indeed a strong start for fiscal 2008 and the Chairman has indicated that the Bank is on track to meet its performance targets for the year.

Financial Highlights
•Net Interest Income stood at $466.2 million, up 20 per cent on Q107.
•Other Income was up 16.38 per cent to $256.9 million.
•Operating Expenses amounted to $341.9 million compared to $291.9 million in the comparable quarter.
•Profit Before Taxation ended at $381.1 million, up 9.84 per cent.
•Loss on discontinued operations was $2.6 million for Q108 compared to $19.2 million for Q107.
•Profit After Taxation was up 17.18 per cent from $248.4 million (Q107) to $291.1 million (Q108)

Recommendation
RBL last closed at a price of $80.56 on the local exchange. We are forecasting an EPS of $7.25 for fiscal 2008, which is 20 per cent up on the core EPS for FY07. At the current price and this forecast, RBL is trading at a multiple of 11.11 times which is low for this Bank. Additionally, using a multiple of 14 times and the forecasted EPS of $7.25, this share has an estimated return of approximately 26 per cent or a Target Price of $101.50. Thus, we continue recommend a BUY on this share.

Gia Singh
WISE Equity Research Team