May 2017 Financial News

Income from Guardian Holdings sends NCB profit to historic high

May 03, 2017

NCB Financial Group Ltd (NCBFG) and its subsidiaries booked net profit of $9.5 billion at mid-year March 31, 2017 - an increase of 58 per cent over the prior year. The group achieved its highest quarterly result of $5.9 billion, up 63 per cent over the comparative quarter, which management said was due to its strategic focus on expansion in the Caribbean region.

Results were buttressed by share of profit of associates which grew by $1.4 billion mainly as a result of the Group accounting for its share of six months' profit for the 29.99 per cent shareholding in Guardian Holdings Ltd.

Domiciled in Trinidad, Guardian is a regional insurance and commodities giant in which NCBFG acquired a stake in early 2016.

Income from Guardian was $822.27 million. Other associate companies are JMMB Group Ltd and Elite Diagnostic Ltd.

Operating income for the group was $29.2 billion, an improvement of $3.8 billion or 15 per cent over the prior year's comparative period results.

In notes attached to the financials, it was noted that gains were realised on investment activities growing by $1.8 billion or 96 per cent “mainly due to improved investor confidence as a result of the improved macroeconomic fundamentals of Jamaica”.

It was also noted that the jump in net fee and commission income by $1.7 billion or 33 per cent came mainly from credit-related fees on loan product sales, point of sale and e-commerce commissions, coupled with corporate finance and unit trust fees.

Directors said that the group continued the execution of strategic initiatives, including infrastructure improvements and operational streamlining, while implementing cost containment and reduction plans, which resulted in operating expenses of $19.1 billion, an increase of $985 million or five per cent over the prior year.

The main movements were staff costs increasing by $1.1 billion or 17 per cent due to negotiated increases in salaries, wages, allowances and benefits.

Other operating expenses grew by $1.0 billion or 15 per cent.

Loans and advances, net of provision for credit losses, increased by $34.6 billion to $207.3 billion at March 31, 2017.

Directors said the increase was driven by a 22 per cent and 17 per cent increase in the retail banking and corporate banking portfolios, respectively.

Non-performing loans totalled $5.9 billion as at March 31, 2017 (March 31, 2016: $8.5 billion).

Customer deposits increased to $274.0 billion, up $23.1 billion or nine per cent over the prior year, driven in the main by growing savings and current account portfolios, which increased by 10.9 per cent and 21 per cent, respectively.

Stockholders' equity for NCBFG increased to $106.4 billion from $92.2 billion at March 31, 2016.

The company is slated to pay an interim dividend of $0.60 per ordinary stock unit on May 29 for stockholders on record as at May 12.

Source:
BY AVIA COLLINDER
collindera@jamaicaobserver.com
Business reporter
Jamaica Observer
Wednesday May 3, 2017

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