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Here are ten reasons why

The NCB Financial Group is Jamaica’s largest financial entity. Its bank boasts the largest deposits, assets  and customers.

The fortunes of Jamaica are inextricably linked to NCB’s.

NCB’s tag line is ‘Building a Better Jamaica’, a sentiment shared by all well-meaning Jamaicans who want to see a better country, to see their children, friends and fellow citizens prosper.

The chairman and majority owner of NCB Michael Lee Chin has repeatedly said that the way to greater wealth is by owning assets. By buying NCB, one is buying a piece of the Rock.

With NCB’s current APO, Michael Lee Chin has appealed directly to Jamaicans imploring them to seize an opportunity to own and create wealth. As NCB prospers, so do you.

NCB was acquired by Lee Chin back in 2002 when the share price was just J$2. In 2019 it went as high as J$210. People who had faith made money and prospered.

The Group, after twenty years since it was acquired is transitioning. It now has new personnel and a new mantra-Efficiency, Governance and Customer Care (EGC).

Last year was a tough one and decisions had to be made that would see NCB recalibrate and return to pre-eminence.

NCB’s is avowedly committed to being the ‘People’s Bank’, the custodians of Jamaicans’ fortunes.

The share price for this IPO is J$65 and you need to buy a minimum of 100 shares thus making an investment of at least $6,500. You now have the opportunity to make multiples of that sum, buy, holding and prospering for you and your family. You are not buying a ticket to winnings – you are  participating in accretion, you are acquiring an asset that will continue to growi. Will NCB return to the heady days of its stock price going beyond J$200? Yes it will.

Here’s why you should participate in this NCB APO.

1. It is a great investment for capital preservation and you are are investing in a financial entity that is growing. It is a means by which you can own a piece of Jamaica. 

“NCB is the people’s bank, therefore the people should own the bank. There’s a saying,’If you buy the milk , you should own the cow. I call on all Jamaicans to participate in our APO”, declared Michael Lee Chin. This is a call to action, a call to invest, prosper, make money while doing good. Bet on Jamaica and Jamaicans and by doing so watch your fortunes grow while you lie under the blanket of financial security. You want a quality lifestyle? Then earn it. Leave a legacy that is good, hand down wealth to the next generation, thereby ensuring they get a good start in life.

2. Participate in wealth creation. Lee Chin is rich. Butch Stewart was rich. Elon Musk is rich, Warren Buffett is rich. Jeff Bezos is rich. How did they become rich?  They became rich by the ownership of quality businesses. So what makes for a quality business?  A business that can stand the test of time. Coca Cola has stood the test of time, so to has Apple. NCB has stood the test of time. These businesses have been around for a long time and are likely to be around for a long time yet. These businesses are necessary for how we live our lives. They endure. These businesses are integral to functionality and have competitive advantages. They tend to be market leaders built on capital preservation. You have to ask yourself the question, will NCB be worth more twenty years from now?  Will it earn you income during that time? 

3. NCB is owned by a Jamaican, one of the most successful business leaders to come out of Jamaica who is committed to the country’s development. He  invested in NCB over twenty years ago and became richer as a result of doing so. Why can’t you? Some of the major banks in Jamaica are owned by foreign corporate giants who see opportunities in Jamaica and have prospered for many decades from their investment. Jamaica now has the country’s leading bank, owned and headed by a Jamaican. National sentiment does have a part to play. What Lee Chin embodies is  the owner/operator investor.

More often than not Jamaica’s leading personalities come from the world of sport and entertainment. Seldom are there world class business leaders to speak of. NCB is headed by one who took the bank from the ashes of being FINSAC’d  to making it one of the most profitable banks in the Caribbean. A phenomenal achievement. We all cheered and supported Bolt when he participated  in the Olympics. We took pride that he was a son of the soil. Let’s now get behind a great Jamaican business leader who invested and built NCB into a banking giant.

4. NCB has unrivalled assets of J$2.2 trillion, larger than the next eight companies in Jamaica combined. It is the 800 pound gorilla in the room. It has 38 per cent of the banking market in Jamaica, 26 per cent of the general insurance market in Trinidad & Tobago and 39 per cent of the life, health and pension markets in Trinidad & Tobago. Put another way – NCB is the biggest financial sector player in Jamaica and the leading insurer in Trinidad & Tobago, thus giving it reach and scale. Investing in such an entity, literally and figuratively pays dividends.

5. NCB is diversified and diversification reduces risk.It is well positioned in life insurance and pensions which go on for decades. The assets and liabilities are long term. It is the biggest capital market player in Jamaica. It is also a significant general insurance player as well as the leading bank. Here your risk is mitigated and your investment in NCB has built in shock absorbers. The overall business of NCB is likely to be less volatile thus providing you with comfort. NCB has a presence in 21 countries and more often at investment grade. In these territories it operates in US dollars or currencies that are convertible into US dollars.

6. NCB has gone through turbulent global shocks, withstood them and prospered. The foundations are strong. Some of us can remember Century Bank, Jamaica Citizens Bank, and Eagle Bank, local financial entities that initially showed promise but unfortunately were vanquished due in the main to circumstances of their own making. That is not the case with NCB and is unlikely to be so. NCB survived the global financial crisis of 2008, more than six years after Lee Chin acquired it . It persevered through two debt exchanges. Into the beginning of a new decade, it endured the ravishes of the COVID pandemic and still reported super profits. Don’t take my word for it, check it out for yourself. 

7. NCB is run by a mixture of great international and local talent. NCB prides itself on hiring high performing Jamaicans with a track record.  Sheree Martin is recognised as a very good retail banker. Malcolm Sadler , who has been with NCB for over 20 years, is a dependable pair of hands as a CFO. Belinda Williams did a fabulous job at Proven and now has joined the NCB team as Head of Corporate Affairs. Dr. Karrin Hepburn Malcolm who has come on board from Scotia Trinidad & Tobago   is now NCB’s Head of Wealth Management. Bruce Bowen enjoys an enviable reputation for what he accomplished with Scotibank’s Caribbean operations which put him in good stead to take the reins as CEO of NCBJ Bank.  Robert Almeida has worked with Lee Chin for decades and is a banker with 26 years experience whose strategic prowess is renown. He is well positioned as Group CEO.

All this speaks to the talent and personnel forming the executive cadre of NCB. Some of us are big football fans and we see the same winners time and time again. Would you doubt whether Manchester City would win this season’s EPL? No. Why? Because their coach Pep Guardiola and the team are always in the reckoning. They chalk up victories time and time again, winning the EPL four seasons in a row. Would you bet against Real Madrid losing this year’s Champions’ League? Unlikely. Carlo Ancelotti its the most successful Champions’s League coach and Real Madrid who has won La Liga  36 times has won the Champions’League the most times. Within Real Madrid’s ranks include: Antonio Ruddier, Jude Bellingham, Toni Kroos , Luka Modric, Vinicius Junior and Rodrygo. A formidable team. Would you bet against them winning next weekend? They say you can tell the winners at the starting gate. A proven  leader with a great team invariably spells success. Now with that in mind, think about NCB. 

8. Back in 2002 when Lee Chin acquired NCB, it was not paying dividends and was in disrepair. Work had to be done to transform it and get it somewhere near its competitors. Over the next twenty years it became market leader. We know all good things must come to an end but that end doesn’t have to be permanent. NCB 2.0 is now underway, with attention being paid to customer complaints and expense ratio. Last year many grumbled about no dividends,  a number of customer complaints and a high expense ratio. Today, less than a year later these have been substantially addressed. Now what does that tell you? NCB has the wherewithal to turn around its fortunes. It does possess muscle memory.  It has cut $8 billion ( US$50 million) of  annual recurrent expenses which is no small feat. It reallocated about J$15 billion (about US$100 million) with the Group to make capital more efficient. This assisted with debt reduction.

9. NCB has adopted an ownership mindset led by its Chairman and senior executives. This goes through its customers, staff and all Jamaicans. Ownership is the way to wealth. If you don’t own anything what then do you have? How can you secure your family? How can you” step up in a life?” As Robert Almeida says, “ an owner takes action and owns the consequences.”  You invest, you reap.  NCB was astute enough to delayer management and get closer to the customer. Hence why Michael Lee Chin is here every other week, meeting the people, going on road shows , spreading the word, gauging the temperature. You are seeing a leader making efforts. The vibe you get is that a better NCB is being built and you don’t want the opportunity to invest in it pass you by. 

10. For the last five years, operating income has grown  by 11 per cent per annum. NCB is also rated by global rating agencies ( Fitch, Moody’s, Standard & Poor’s, AM Best and CariCRIS ). This speaks to the confidence reposed in NCB by international players who note the progress being made. NCB is poised for growth. NCB is a harbinger of Jamaica’s economic growth. It enables capital to flow into Jamaican businesses because it possesses an intrinsic understanding of the Jamaica’s operating environment and what it takes for Jamaican companies to succeed. When these companies grow they will require financial services better still from an integrated provider like NCB who can offer asset management, banking, insurance, pensions, payroll accounts, health insurance. NCB can scale both banking and insurance in the wider Caribbean making it your one-stop shop for all your needs. This allows it to generate more revenue per customer. In regard to the APO, one sees here the value proposition.  NCB is now looking to take its expense ratio down to 60 per cent from 80 per cent thus increasing its profitability. 

In the first quarter of 2024, NCB generated J$5.9 billion in net profit and J$3 billion attributable to stockholders of the parent. For the six-month period ending March 2024, NCB’s cost to income ratio improved. Of significance and those looking to join the APO should note, is that net profit went up from J$4.6 billion to J$8.7 billion in just one quarter ( an increase of 89 per cent year over year). Now that bodes well and spells NCB is heading in the right direction with it also back to paying dividends regularly.  NCB is now seeing top line revenue growth and has managed to drop its cost to income ratio to 66 per cent from 75.6 per cent with operating income growing by 6 per cent. This saw a run rate of $22 billion per year with an EPS of $2.36.

Now what does this all mean? What’s it all about as Michael Cain would say. NCB is a good investment. Do get in touch with your broker.