The NCB ‘777 aeroplane’ has come through the turbulence and landed safely with everything intact.

Earlier today at a virtual press briefing, NCB Financial Group announced an operating income of J$120 billion, a J$4.6 billion increase on 2023. This saw the group post a consolidated net profit of $23.3 billion for the year ended September 30, 2024, an improvement of 174 per cent or $14.8 billion over the previous year.

NCB did well in its banking and investment activities. Its insurance services took in $185 billion, an increase of 27 per cent or $14 billion. NCB continues to see growth across its diversified insurance products across the region. NCB is the parent of Guardian Insurance Holdings which is headquartered in Trinidad.

The insurance revenue line increased by $15 billion to $134 billion but insurance services expenses went up by 15 per cent to $11.8 billion. Here NCB saw a higher number of claims, many from the impact of Hurricane Beryl on July 3.

NCB has made a concerted effort to reduce expenses, slashing staff costs, marketing and advertising. It has paid off. Operating expenses of $92.2 billion fell by 11 per cent. Staff costs were slashed from $60.9 billion last year to $50.2 billion this year, an 18 per cent fall on 2023’s figure. 

NCB has in the main completed its restructuring exercise which began last year. 

Its core business of banking and investments proved a winner for the period under review. 

Loans and advances, net of credit impairment losses came to $626.2 billion an increase of $13.6 billion on the previous year. NCB’s loan portfolio is a behemoth with personal mortgages up 16 per cent and business mortgages up by 18 per cent.

NCB has placed emphasis on digital transformation and can take heart from digital loans booked rising by 25 per cent year-on-year. 

Of concern though is a rise in Non-Performing Loans (NPLs) which came to $26 billion, an increase of $461 million. NCB says here that it has faith in its credit risk management processes.

NCB is happy to see an uptick in its investment securities and reverse repurchase agreements which were up by 5 per cent to $1.18 trillion for the year ended September 30, 2024. This line represents 51 per cent of total assets. 

Customer deposits—the prime measurement of a bank’s performance—in NCB’s case rose by 5 per cent to $784 billion. This remains NCB’s primary funding source and reflects the faith reposed in the bank. 

NCB has total assets of $2.32 trillion, an increase on the $2.20 trillion posted last year. Its equity position stands at $212.89 billion, a jump on the$171.53 billion posted for 2023.

Shareholders can take joy from Earnings Per Share (EPS) moving substantially from $1.39 last year to $6.33 this year. A dividend of 50 cents per ordinary stock unit will be paid out on December 13, 2024. 

Return on Equity moved to 9.47 per cent for the financial year 2024 from 2.54 per cent last year. 

Chairman of NCB Financial Group Michael Lee Chin said: “The long-term rating from Fitch is positive. World Finance out of London votes NCB for the tenth consecutive year, the best pension fund in the Caribbean. Global Bank and Finance Awards saw NCB pick up the best private bank and for Jamaica the best CSR Bank and the Caribbean’s best digital bank.

“Let us compare 2024 with 2023. A year ago we embarked on a turnaround journey. We were not happy with our efficiency, governance and customer experience (EGC). Over the last year, our cost-to-income ratio has improved. Last year our cost-to-income ratio was 86.3 per cent. Today it is 71.6 per cent. At 86.3 per cent, our margin (what shareholders keep) is 13.6 per cent  At 71.6 per cent, our margin is 28 per cent. To go from 13.6 per cent to 28 per cent is a 107 per cent turnaround.

“Net profit in 2023 was just $8.5 billion. This year it is $23.3 billion. Is this evidence of a strong turnaround? Net profit attributable to shareholders was $3.29 billion. This year it is $15.02 billion. Is this again a sign of a true turnaround? Total assets went from $2.2 trillion last year. Today it is $2.32 trillion. Again is this evidence of a strong turnaround?

“To be clear the job is not yet done, we have just gotten started but the trend is fixed. We certainly are not going to resile from what we did last year. I have to compliment the over 5000 staff members of NCB and Guardian for doing a phenomenal job this year. The momentum is clear and we are seizing the day. We have gone from headwinds last year and we are now seeing tailwinds.”