Scotia Group profit grows modestly to new high
S cotia Group Jamaica Limited, SGJ, made $13.2 billion in annual profit, reflecting modest improvement of three per cent over the previous year, as two of its five segments recorded a dip in earnings.
The result was still a new high in earnings for the No. 2 banking group, whose profit per share rose to $4.24 at year ending October, versus $4.10 a year earlier.
The underperforming segments were retail banking, and corporate and commercial.
The treasury segment was top contributor to group profit, at $5.9 billion; followed by the insurance segment that the bank had planned to sell, which made $4 billion. Those plans to sell the insurance operation to Sagicor Financial were shelved, reportedly because the parties could not agree on the terms of the sale.
“Our insurance business, Scotia Jamaica Life Insurance Company, SJLIC, has delivered solid results marked by a 20 per cent increase in policies sold year-over-year. As previously announced, we decided not to pursue the sale of our insurance business. We remain committed to providing the highest levels of customer service and high-quality insurance solutions, and we are focused on growing the business,” said SGJ in a statement.
Total revenue for the group hit $42.6 billion, up from $40.3 billion a year earlier. The single-digit growth in revenue and profit, however, hid the significant rise in cash holdings. Scotia Group closed the year with more than $93 billion in cash and equivalents, up from $71 billion a year earlier.
“Our core businesses have performed well this year as we remained focused on executing our strategic objectives – accelerating growth and investing for the future,” said SGJ President and CEO David Noel in the preface to the financials. “During the year, we continued to focus on simplifying and optimising our processes to better serve our customers,” he said.
Total loan growth remained strong throughout the period with a year-over-year increase of 13 per cent. Its mortgage portfolio also increased by a similar level.
On a normalised basis, the group profit would have increased 9.75 per cent, excluding the proceeds of the sale of its microcredit arm in 2018 to Lasco Financial Services.
SGJ shareholder equity grew by 2.1 per cent to $118 billion as a result of internally generated profits. Total assets rose from $522 billion to $549 billion.