JMMB Group watching interest rates hikes, adds that Guyana market difficult to enter

Large financial provider JMMB Group Ltd said it is closely monitoring US interest rates and Middle East tensions, while flagging the Guyanese market as difficult to enter.

“It’s a little volatile right now,” Chief Financial Officer Patrick Ellis said after the company’s annual general meeting on Wednesday at The Jamaica Pegasus hotel in New Kingston.

He cited US and Israeli attacks on Iran and their effect on global markets. “With the Fed moving rates, that normally has an impact,” he said. “I’m hoping we can hold rates stable in the short term and see how things pan out.”

Higher benchmark rates generally push up lending rates and put pressure on riskier capital markets, as investors move to the safety of higher-yielding government securities. JMMB’s investment banking arm and its peers have taken trading losses during periods of higher rates.

The US Federal Reserve raised its benchmark rate a quarter point to a range of 3.75 per cent to 4.0 per cent on September 16, its first increase since 2023, citing inflation. This week the Bank of Jamaica raised its policy rate by half a point to 6.0 per cent, the highest since March 2025, pointing to higher commodity prices tied to conflicts in the Middle East and Ukraine, and to drought-driven food inflation.

Ellis said Jamaica’s financial system has shown resilience. He added that US mid-term elections in November could bring more unpredictability, but that the company remains focused on balancing its regional operations.

JMMB operates in Jamaica, the Dominican Republic, Trinidad and Tobago, and Barbados.

Guyana has been on its list before

“Guyana is a developing space, an emerging market space with oil and everything, but you have to go through the process in terms of their governance and regulatory framework,” Ellis said. “It’s not easy to navigate, but we have always been in dialogue with parties there, and it’s something we plan to do, but we don’t have a short-term timeline right now.”

At last year’s annual meeting, the company said Guyana and Barbados were on its radar, and Chairman Archibald Campbell said entry into Guyana had proved difficult. JMMB’s private equity arm has also invested in Guyana-based restaurant operator Corum Restaurant Group.

For the quarter ended June 30, JMMB reported net operating revenue of $7.68 billion, up 3 per cent from a year earlier. Net interest income rose 20 per cent to $4.21 billion, and foreign-exchange trading margins rose 47 per cent to $801 million. Lower securities trading gains held back overall growth. Net profit attributable to shareholders totalled $2.08 billion. The company’s share of profit from its stake in Sagicor Financial Co, net of finance costs, was $3 billion, exceeding that figure. Sagicor, an insurance group operating mainly across the Caribbean and the US, is listed on the Toronto Stock Exchange.

Revenue diversification

Jamaica accounted for 55 per cent of gross operating revenue, followed by the Dominican Republic at 21 per cent, Trinidad and Tobago at 15 per cent, and Barbados at 9.0 per cent.

Chief Executive Keith Duncan, a senator, updated the meeting on the company’s real estate projects. They include a 10-storey building on Haughton Avenue in New Kingston, with five floors of parking and five of offices that will house JMMB Real Estate; a four-storey building on Harbour Street in downtown Kingston; and a development in Tobago.

Asked about JMMB’s 24.49 per cent stake in Sagicor, which some investors say shows JMMB shares are undervalued, Ellis said Sagicor’s performance has added stability and value to the balance sheet.

“With [SFC] we are extremely well diversified,” Ellis said. “We are generating about US$28 million to US$30 million per quarter, that’s US$120 million annually in positive cash flow.”

luke.douglas@gleanerjm.com