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JM | Jan 23, 2023

35% rise in Scotia year-end net profit

/ Our Today

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Big drop in comprehensive income, which end the year at J$1.21 billion

Aerial view of Scotiabank’s Port Royal Street headquarters in downtown Kingston, Jamaica. (Photo: scotiabank.com)

Durrant Pate/Contributor

Scotia Jamaica Banking Group has seen a 35 per cent jump in its October 2022 year-end net profit, which climbed to J$11.68 billion.

This is up from the J$8.64 billion posted for the same period in 2021. Pre-tax profit amounted to J$17.20 billion, which is an increase of 36 per cent from the $12.70 billion recorded for the comparable period in 2021.

Tax charges for the year totaled J$5.52 billion, up from the J$4.03 billion booked 12 months earlier. Total comprehensive income for the year amounted to J$1.21 billion, relative to J$7.90 billion posted for the same period in 2021.

Earnings per share (EPS) for the year totaled J$3.75 (2021: J$2.78). Notably, Scotia Jamaica’s stock price closed the trading period on Friday (January 20, 2023) at J$34.01 per share with a corresponding P/E of 9.06 times.

Modest jump in net interest income

Net interest income for the year increased 26 per cent to J$28.62 billion, relative to J$22.71 billion for the corresponding period in 2021, while interest expenses declined by four per cent to total J$1.78 billion (2021: J$1.86 billion). Interest income for the year increased from J$24.57 billion in 2021 to J$30.40 billion for the year under review.

Scotia ended the year with expected credit loss of J$3.06 billion compared to the loss of J$2.81 billion for the comparable period in 2021. As such, net interest income after expected credit losses for the year rose by 26 per cent to J$25.56 billion relative to the J$19.90 billion recorded for the corresponding period in 2021.

Total other revenue decreased by four per cent to J$17.23 billion (2021: J$17.91 billion). Of this:

  • Net fees and commission income amounted to J$6.18 billion (2021: J$6.09 billion), an increase of one per cent relative to the corresponding period in 2021.
  • Insurance revenue rose by 15 per cent to close the period at J$3.04 billion relative to J$2.63 billion last year.
  • Net foreign currency activities decreased by five per cent and amounted to J$7.21 billion (2021: J$7.56 billion).
  • Net losses on financial assets amounted to J$141.28 million relative to the gain of J$604.43 million recorded in 2021.
  • Other revenue decreased from J$1.02 billion to J$950.67 million, a decrease of seven per cent.

Operating expenses

As such, total operating income for the year increased by 13 per cent to a total J$42.79 billion versus J$37.81 billion for the corresponding period in 2021. Total operating expenses for the year amounted to J$25.59 billion, a two per cent growth from the J$25.14 billion booked for the corresponding period in the prior financial year.

The following details Scotia Jamaica’s operating expenses:  

  • Salaries and staff benefits increased to close the year at J$10.31 billion (2021: J$9.48 billion).
  • Property expenses (including depreciation) amounted to J$2.51 billion (2021: J$2.33 billion).
  • Amortization of intangible assets increased by 23 per cent to close the period at J$119.65 million versus J$97.67 million in 2021.
  • SGJ reported J$1.32 billion for asset tax, eight per cent more than the J$1.22 billion documented for the same period for 2021.
  • Other operating expenses decreased by six per cent and closed the year at J$11.34 billion relative to J$12.02 billion in 2021.

As at October 31,2022, the company’s assets totaled J$595.60 billion, two per cent more than its value of J$585.44 billion last year earlier. The increase in total assets was primarily driven by an increase in ‘Loans, net of allowance for credit losses’ to total J$237.79 billion (2021: J$208.52 billion).

SGJ’s shareholders’ equity at the end of the period amounted to J$110.85 billion relative to the J$113.60 billion recorded in the prior year. Consequently, the book value per share amounted to J$35.62 (2020: J$36.51). 

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