Kingston, Jamaica – August 9, 2023: For the quarter ended June 30, 2023, NCB Financial Group reported net profit of $7.4 billion, a $2.4 billion or 48% improvement over the prior quarter ended March 2023. Net profit attributable to stockholders of the parent for the June 2023 quarter was $5.5 billion, an increase of $2.1 billion or 62% over the March 2023 quarter. This rebound was primarily attributable to improved gains from investment activities in its Wealth, Asset Management, and Investment Banking segment.
This contributed to operating income of $35.6 billion for the quarter ended June 30, 2023, reflecting an increase of 13% or $4.0 billion over the March 2023 quarter. The Group’s diversified business model and strong financial position continues to facilitate strong performance in a challenging economic environment.
Other positive indicators of a rebound include a reduction in non-performing loans year over year, as well as a decline in cost to income ratio quarter over quarter. The cost to income ratio for the June 2023 quarter declined to 74.09% down from 76.12% in the prior March 2023 quarter.
Non-performing loans totalled $24.9 billion as of June 30, 2023, declining by $5.5 billion or 18% from the prior year. The reduction in non-performing loans led to an improvement in the non-performing loan ratio, decreasing to 4.0%, from 5.3% in the prior year.
The Board of Directors, at its meeting on August 9, 2023, decided not to pay an interim dividend as it continued its prudent focus on capital conservation. In its stock exchange release, NCBFG stated, “Conserving capital is prudent to ensure the organisation is most resilient in a world of change. However, the continued absence of dividends to our shareholders is not aligned with our commitment to fulfilling the needs of all our stakeholders. Through an intense focus on operating efficiency and capital efficiency, as well as other strategies, we intend to return to the pattern of regular dividend declarations whilst we simultaneously meet the increasing regulatory capital requirements that are being implemented globally.”
NCBFG Interim Group CEO, Robert Almeida also took the opportunity to reinforce the leadership team’s commitment to creating a pathway to distributable profits and the resumption of consistent dividends:
“NCBFG remains strong, as demonstrated by our profitability, liquidity, and continuously meeting or exceeding regulatory capital adequacy ratios. At present, NCBFG proudly possesses the largest capital base in the Jamaican market. Among companies listed on the Jamaican and Trinidadian stock exchanges, NCBFG and Guardian continue to be among the most profitable and well capitalised. NCBFG, including its operating subsidiaries, operate in a highly regulated industry, and each entity consistently meets or exceeds regulatory requirements. We remain steadfast in adopting a prudent approach to address the more stringent capital requirements under BASEL III and the enhanced reporting standards outlined in IFRS.”
Almeida added: “We are intensely focused on growing and optimising the available capital pool to 1. ensure the continued growth, safety and soundness of NCBFG and its operating subsidiaries; and 2. create a clear pathway to distributable profits and consistent dividend payments. To this end, we have intensified our efforts in identifying and implementing operating and capital efficiency initiatives as a key enabler to drive this significant outcome, and billions of annually recurring cost savings are already being actioned.”
Chairman the Hon. Michael Lee-Chin, OJ further endorsed the comments of interim Group CEO Almeida:
“We are confident that our focus on Efficiency, Governance, Customer Experience (EGCe), will result in desirable outcomes for all stakeholders. Our shareholders will be rewarded for their loyalty with a return to consistent dividends as a result of our focus on efficiency and our customers will benefit from an enhanced experience. These are not promises, but commitments that we share publicly so you can hold us to account.”
The Group will host its virtual FY 2023 Q3 Investor Briefing on August 10, 2023, to provide a detailed financial report and to outline more details on the path forward.