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Chairman and majority shareholder of NCB Financial Group, Michael Lee Chin, has over the better part of the last two years, set about transforming Jamaica’s largest financial institution and is intent on making it globally investable.

It continues to be a work in progress, progress being the operative word. NCB is heading in the right direction, and the unaudited financial results for the six-month period ended March 31, 2025, would attest to that.

 Profits jump significantly 

For the period under review, consolidated net profit came to J$22.2 billion, $11.5 billion or 108 per cent more than the registered figure for the corresponding period in 2024. Net profit attributable to stockholders stood at $13.3 billion, a jump of 94 per cent or $6.5 billion on the six-month period in the prior year.

The Group registered net operating income of J$77.3 billion, an increase of $15.3 billion the same period last year.

Underpinning NCB’s performance for the six-month period was Guardian Holdings sale of its Dutch insurance brokerage business Thoma, which boosted the Group’s net profit by $15 billion. Guardian has taken the decision to focus on core businesses and be lean and efficient. This subsidiary is no longer part of the Group and is another of NCB’s divestments.

 Equity position continues to progress 

While NCB’s share price continues to languish, a key indicator of corporate strength, equity continues to be on the rise. NCB’s equity position from October 2022 to March 2025 has increased by 70 per cent.  This is a true indicator of shareholder value and the strength of the company. Many have raised eyebrows at the turgid performance of the stock price, but NCB’s equity is up while its debt-to-equity position is way down from October 2022. Progress made.

At a press conference on Friday, NCB Financial Group CEO Robert Almieda said, “ We are financially strong, but we have work to do on efficiency and our cost-to-income ratio. Profitability has to improve.”

As it currently stands, NCB Financial Group’s retained earnings are growing.

Staying with equity, NCB’s consolidated equity for the period under review came in at $230.4 billion, an increase of 19 per cent or $37 billion. Consolidated equity attributable to stockholders was $182 billion, an increase of 12 per cent or $20 billion over the prior year. The growth in equity was due in the main to increased retained earnings and the uptick in profitability. The Group’s share capital also increased by $2.4 billion.

In its meeting on May 8, 2025, the Board approved an interim dividend of $0.50 per ordinary stock unit. The dividend is payable on June 9, 2025, to stockholders on record as at May 26, 2025.

Banking

The banking and investment revenue segment did well, posting net revenues of $79 billion, an increase of 24 per cent or $15.3 billion over the same period last year.

However, gains on foreign currency and investment activities dropped by $1.4 billion or 12 per cent due to unrealised fair value gains on debt and equity securities. Net fee and commission income fell marginally to $15.3 billion.

NCB’s insurance business held steady with revenue across the two segments increasing. This line weighed in with $9.6 billion, a 3 per cent increase on the corresponding period in 2024.

Operating expenses

The task is to always reduce operating expenses, particularly given the uncertain financial environment in an economy that is technically in a recession. NCB Financial Group posted $51.8 billion here an increase of just $4 billion, 8 per cent over the prior year. NCB has poured considerable sums into digitalisation and cybersecurity while boosting its technological apparatus.

The Group saw its asset base increase by 4 per cent to $2.35 trillion due to improved liquidity and increased investment securities. This growth was driven by deposits and insurance contract liabilities.

Deposits on the rise

NCB also saw its deposits on the rise, which as of March 2025 stand at an impressive $800 billion, an increase of $45.5 billion. The Group is seeing growth in its deposit products and deposits remain its largest source of funding. Jamaican customers are keeping faith with NCB. 

The loan book saw a marginal decline due to lower origination in the banking arm. For the period under review, NCB’s loans came to $623 billion, with an increase in non-performing loans of $440 million. Non-performing loans came to $26.8 billion as of March 31, 2025.

Turnaround in effect

Speaking at Friday’s press conference, Chairman Michael Lee Chin said: “We embarked on a turnaround on the 17th of July 2023 and by the 27th of July 2023, we had made some significant management changes. That really kicked off the turnaround of the NCB Financial Group. One of the irritants was the Group hadn’t paid a dividend in nearly three years. Myself and Group CEO Robert Almeida came back to the Group in a more active way. In August 2023, we made an announcement that dividends would resume before  Christmas. On the 18th of December 2023, the first dividend was paid to shareholders, which was 50 cents per share.

“When we came back, we implemented what we call “ EGC- Efficiency, Governance and Customer Service. We were forthright on this. At the time, are cost-to-income ratio was 84 per cent. When I bought the bank in 2002, the aim was to see to it that NCB operated at world standards. If you look at today, a well-run bank anywhere in the world has a cost-to-income ratio of around 50 to 55 per cent.  With a cost-to-income ratio of 84 per cent, it meant our margins were 16 per cent. At 50 per cent, the margin operates at 45 per cent – a big difference.

“We made it clear to the staff that governance is not a function of just the Board of Directors but rather a function of everybody’s adherence to the corporate goals and policy of procedures and to do so at world standards.

“We brought in internationally eminent board members and so reconstituted the board with a brilliant mix of international board members combined with our existing local board members. We now have the best board in the Caribbean to guide the institution to ensure we achieve the turnaround we have embarked upon.

“The results for the six-month period reflect the job the institution has done since July 2023.”