May 2011 Financial News

PCFS net profit jumps 27%

May 11, 2011

PanCaribbean Financial Services (PCFS) on Monday posted a 27 per cent rise in its first quarter net profit, which for the three months to March 31, 2011 totaled $503 million.

Earnings per share for the period rose from $0.72 to $0.92 while the financial institution's share price closed at $21 yesterday, up by 17 per cent from $18.02 a share a year ago.

The jump in profit reflected improvement in all its revenue streams, excepting for feesand commission.

Although PCFS' interest income for the three-month period actually declined by 14 per cent from year-earlier levels, interest expenses were cut by 28 per cent, resulting in net interest income improving by nine per cent to $756 million from $692 Million.

Income from fees and commissions declined by 16 per cent to $90 million, but net trading income jumped 139 per cent to $176 million for the March end quarter.

However, other operating income, which include earnings from structured products and service fees, showed the largest year-on-year increase -- from $6 million to $37 million, or 479 per cent growth.

The banking group's "credit quality has shown some deterioration as non-performing loans and leases were $407 Million or 4.7 per cent of the portfolio (industry average: 6.5 per cent) versus $369 Million or 3.9 per cent of the portfolio at December 2010", according to directors' statement accompanying the financial statements.

"Credit provisions were 88 per cent of non-performing loans and leases (industry average : 70 per cent)," it added. "Non-performing loans and leases as a percentage of total assets was 0.53 per cent, up from 0.51 per ce at December 2010."

PCFS' capital base grew by $572 million, or five per cent to $11.2 billion over the three months largely due to a rally in GOJ US$ and JA$ denominated bond prices, which is refelcted in fair value reserves.


Source:
Jamaica Observer
Wednesday May 11, 2011

http://www.jamaicaobserver.com/business/PCFS-net-profit-jumps-27_8782299#ixzz1M3ijgQlV