Wed | Aug 16, 2017

NCB makes $14b profit, a new record

Published:Sunday | November 13, 2016 | 11:00 AMSteven Jackson
NCB Group Managing Director Patrick Hylton.

National Commer-cial Bank Jamaica Limited (NCBJ) made net profit of $14.4 billion over its financial year ending September, up 17 per cent from last year.

"We recorded record profits for the year," said Deputy Managing Director Dennis Cohen at an investors briefing on Friday.

It resulted in earning per share of $6.35 compared to $5 a year earlier. The group benefited from a better than expected fourth-quarter, and it remains bullish on prospects for the next financial year.

"This year can be summarised as dynamic and eventual as we sought to capitalise on the opportunities in our business environment to further drive our successes as an organisation," said Group Managing Director Patrick Hylton in a statement accompanying the financial results released to the stock market.

The banking group will pay a dividend of 90 cents per share, amounting to a distribution of $2.22 billion set for December 9.

At the investor briefing, Hylton announced a new four-year strategic plan to make NCBJ faster, simpler and stronger by 2020. It will focus on digitalisation, regional expansion, core business and improving customer experience.

The new strategy follows on the completion of a five year plan which wrapped up the end of FY 2015/16. It aimed to make the group one of the top five financial institutions in the English- and Spanish-speaking Caribbean.

The strategy received mixed marks, but some of the successes included keeping the top position in Jamaica as measured by asset and profit; ranking among the top 10 financial institutions in the region, defined by net profit; and regional expansion, with its largest acquisition being the 29.99 per cent stake acquired in Guardian Holdings Limited, one of the region's largest insurers.

NCBJ's annual gross revenues hit $65.75 billion, up from $61.2 billion.

PARTIAL RECOVERY

Its loan portfolio expanded to $189 billion from $165 billion a year earlier due in part to the growth in retail, SME and corporate banking business loans. The bank also carved $2.4 billion from its non-performing loan portfolio, which fell from $8.5 billion to $6.1 billion.

"The reduction in NPL portfolio was as a result of the partial recovery of a significant debt during the fourth quarter," said NCBJ - in what appears to be a reference to the incomplete Palmyra condo resort, which was recently sold to entities related to Sagicor Group.

Hylton and Cohen would only say the partial recovery related to a construction loan.

NCB wrapped up the year with total assets of $607.7 billion and a net book value of $103 billion.

steven.jackson@gleanerjm.com