NCB's $14.7b nine-month profit highest ever ... Surpasses full-year 2016 results
NCB Financial Group made net profit of $14.7 billion for the nine months ended June, an increase of 48 per cent over the corresponding period last year and 17 per cent more than its intake of $14.4 billion for the full year to September 2016.
"Our nine-month results signify the highest net profit performance for the group, exceeding the full-year results for the 2016 financial year," Group Deputy Chief Executive Officer Dennis Cohen said. Profit at year end September 2016 was $14.4 billion, itself 17 per cent higher than the year before. For the nine months to June 2016, the bank made a profit of $9.9 billion.
He said the company is considering deploying some of its $47 billion in available cash resources into higher-yielding assets.
The company's last acquisition, a 29.99 per cent shareholding in Guardian Holdings Limited, has boosted its earnings for two consecutive quarters. That acquisition was completed in May 2016 at an approximate cost of $28 billion.
The bank is also pursuing organic growth and operational efficiencies.
Speaking at the quarterly investors briefing in St Andrew on Friday, NCB Financial Group President and Chief Executive Patrick Hylton announced that the bank is about to open its first Agile Lab, which would result in faster and better service under its increasingly digital infrastructure. Agile Lab is a rapid application development platform for developing business-application software.
The group is also piloting three new branch types - a full-service model, another cashless, and the third offering retail services and insurance only.
In spite of a 10 per cent fall-off in earnings from $5.25 billion in the third-quarter ending June, compared to the March quarter when net profit was $5.8 billion, nine-month earnings were boosted by factors such as share of profit in associates, which grew to $1.8 billion.
The decline was attributed to a one-off deferred tax credit for March. During the quarter, net fee and commission income grew by 31 per cent, or $2.4 billion.
Cohen also praised the performance of NCB Capital Markets, which, he said, had raised funding of more than US$600 million for regional companies since the start of 2017.
Gains on foreign currency and investment activities grew by $2.5 billion, or 80 per cent, and net interest income increased by five per cent, or $1.2 billion, as a result of growth in the loan portfolio.
Operating expenses of $28 billion grew by nine per cent, or $2.3 billion, over the prior year, driven by staff costs.
The group's chief source of funding, customer deposits of $293.5 billion, increased by $37.5 billion, or 15 per cent, over the prior year.
Stockholders' equity increased to $111.7 billion from $96.5 billion. Cohen noted that key regulatory ratios of the group's regulated entities meet or exceed the minimum regulatory requirements.
NCB has declared an interim dividend of $0.60 per ordinary stock unit, payable on August 29.