Dec 2016 Financial News

Net income of $143.4m for FirstCaribbean

Dec 12, 2016

The 46 per cent increase in net income recorded by FirstCaribbean International Bank for the year ended October 31, is a significant improvement, CEO Gary Brown said in a report to shareholders. The net income of $143.3 million, up $45.4 million from the $97.9 million earned in the previous year.

“Lower loan loss impairment expense contributed significantly to this result, as the bank benefited from increased loan recoveries and an improved loss experience. Growth in our core revenue was also a highlight for the year,” Brown said.

He added that although there was a slow pace of economic recovery and uneven investment activity across the Caribbean, the bank’s productive loans grew five per cent over 2015, while non-performing loans declined by 28 per cent, “reflecting the bank’s priority to grow its business with a sound risk management focus.”

FirstCaribbean’s retail and wholesale banking segments produced loan growth of four per cent and six per cent respectively.

Brown said: “Revenue of $533.8 million was up $11.4 million or two per cent against prior year’s revenue.

“Interest margin pressure still persists in a low LIBOR rate environment with the pace of uplift slower than expected.

“Demand for credit is better than last year, but is generally expected to follow the lagging economic conditions in most jurisdictions.”

The bank’s operating expenses of $357.4 million were down by $12.7 million or three per cent from the $370.1 million recorded in 2015. Brown said this was affected by restructuring related costs, incuding the sale of FirstCaribbean’s Belize operation.

“The bank is committed to discretionary expense control and strives to maintain a balance between the investment in its network, products and people. However, the impact of higher business taxes imposed by various jurisdictions coupled with higher operating costs continues to hurt operating results,” Brown said.

“Loan loss impairment expense was significantly lower by $24.2 million compared with the prior period’s expense of $41.5 million. Additionally, non-productive loan balances reduced by $161.6 million to $418.4 million compared with the same period last year.

“Significant effort has been placed on strengthening creditquality within our total loan portfolio.”

He said while the economic outlook for the Caribbean remains modest, FirstCaribbean is well positioned for sustainable growth and improved shareholder returns

Source:
Trinidad Guardian
Monday December 12, 2016

http://www.guardian.co.tt/business/2016-12-12/net-income-1434m-firstcaribbean