NCB Profits from Diversity in 1st Quarter
29 Jan 2011
Innovation-Expertise-Strength continue to be evidenced in the performance of National Commercial Bank Jamaica Limited (NCB), as the results for the first quarter were announced at an Investors' Briefing held at the NCB Wellness & Recreation Centre recently. NCB reported a net profit of $3.01billion for the quarter ended December 31, 2010 which represents a 0.4.% increase ($13 million) when compared with Quarter ended September 2010 and an increase of $235 million or 8.5% when compared with Quarter ended December 2009. NCB continues to deliver a creditable performance and accredits this to strategically paying attention to: customer, efficiency, employee and nation building. The key driver of NCB's commendable performance is the strength in the diversity of the organization which is reflected in the actual performance of the segments within the Group. Group Chief Financial Officer, Yvonne Clarke presented on the bank's overall performance and reflected on last year's versus the current year's performance, showing switched roles between Treasury & Correspondent Banking as the highest contributor with 27% to the overall operating income of the Group vis a vis the performance of 2nd place contributor NCB Capital Markets with 26%. The Deputy Group Managing Director, Dennis Cohen in delivering the Business Performance Review took the opportunity to make two major announcements: (1) the reduction in the interest rate for car loans to 15.5% as well as a 50% discount on commission fees and 100% financing on new and used cars and (2) the discontinuation of dormant fees to meet the customers' needs. The operating revenue increased by 13% quarter over quarter, an increase which is as a result of increased insurance premium income, resulting from annuities written in the period, increased net interest income resulting from growth in our investment portfolio, coupled with a lower cost of funding and increased fee and commission income in the areas of pension management, credit related and card related activities. The Risk-Based Capital Adequacy Ratio for NCBJ was 15.5% which exceeds the minimum requirement of 10% stipulated by the Bank of Jamaica. (31 December 2009- 15.3%) The Capital to Risk Weighted Assets Ratio for NCBCM was 76.8% which exceeds the minimum requirement of 10% stipulated by the Financial Services Commission (31 December 2009 - 62.8%). The Solvency Ratio for NCBIC was 28.3% which exceeds the minimum requirement of 10% stipulated by the Financial Services Commission (31 December 2009 - 25.5%). NCB's Wealth Management segment, NCB Capital Markets, contributed operating profits of $1. 07 billion for the quarter ended 31 December 2010 and the result for this segment reflects a 19% increase over the prior December 2009 period. The significant growth over the prior year's results is due to an increase in net interest income. NCB Insurance Company reported operating profits of $592 million for the three months ended 31 December 2010, representing growth of $52 million over the prior year's results. The Board of Directors has declared an interim dividend of $0.45 cents per share payable on the 24 February 2011 for shareholders on record as at 11 February 2011. Patrick Hylton, Group Managing Director in his summation reiterated that NCB's performance is a reflection of the strength in the diversity of the business. "There are strong pockets of performance in different segments of our business and this is dependent on what is happening in our economic environment at any point in time, and we have been able to identify, respond to and execute on opportunities which exist in the market place". Hylton stated that the focus in the future is going to be on two groups which are the primary drivers of the performance for the institution: Customers, to ensure that their needs continued to be understood and anticipated while keeping them engaged for the appropriate experience. Employees as a key stakeholder group to drive performance. Alongside thanking these groups he further recognized them as essential to the long term sustainability of the organization.
