Aug 2013 Financial News

JMMB's profit in DR jumps tenfold

Aug 29, 2013

JAMAICA Money Market Group's (JMMB's) operations in the Dominican Republic saw its operating profit increase more than tenfold.

The near-bank said that gains on securities trading was the main reason behind an increase in earnings from $33.6 million during the three months to June 30, 2012, to $390 million in the corresponding quarter this year.

On the other hand, in Trinidad and Tobago, JMMB's associated company's contribution from the IBL Group, reflected a loss of $25.5 million during the period under review — due mainly to additional provisioning on its loan portfolio.

"We were conservative in making that provision based on the delinquency levels we saw there," said Kerry-Ann Stimpson, marketing manager, JMMB Group.

The company expects that it will be able to implement a more robust governance structure framework to further support efforts to drive profitability in Trinidad, in light of its pending acquisition of IBL.

The performance overseas helped push up JMMB's operating profit from $562 million for the three months to June 30, 2012, to $939 million for the review quarter.

JMMB also saw a 19 per cent increase in net interest income during the three months ended June 30, up from $984 million in the corresponding period to $1.2 billion

The financial institution saw an increase in its fees and commissions, which was $103 million for the three months ended June 2013, up from $66 million in the prior year.

And foreign exchange margins from cambio trading saw a 151 per cent increase up from $43.5 million during the corresponding period.

Operating expenses for the three months ended June 30, significantly increased by $290.8 million to $1.1 billion, up from $836 million in the prior year.

"This was mainly attributable to operating costs for CCFG which comprise $238.1 million and the remaining $52.7 million due mainly to inflationary increase granted to staff at the start of the financial year coupled with growth in subsidiaries in the regional markets," the company said.

Consequently, management continues to effectively manage its efficiency ratio which improved to 55.6 per cent, during the quarter under review from 60 per cent at the end of the quarter last year.

The company did see its bottom line fall by 59 per cent year over year during the review period, but that was due to the one-off gain from the acquisition of Capital and Credit Financial Group (CCFG), which was recorded in the corresponding period last year.

"While there was a reduction in net profit over the prior period, excluding the one-off gain from acquisition of CCFG of $1.57 billion, the group's operating earnings reflected a positive increase of $362.1 million or 77 per cent," said JMMB.


Source:
BY SHAMILLE SCOTT Business reporter scotts@jamaicaobserver.com
Jamaica Observer
Wednesday August 28, 2013

http://www.jamaicaobserver.com/business/JMMB-s-profit-in-DR-jumps-tenfold_14958272#ixzz2dOGFLBOi