NBIC reports sharply higher profits
Commercial loans remain sluggish
Stabroek News
December 9, 2003
The National Bank of In-dustry and Commerce (NBIC) achieved a 190.3% increase in profits to $373M for 2003, compared to $129M in 2002 although bank credits to the commercial sector remain sluggish.
An interim dividend of $0.10 was paid ($30M in total) per stock unit during the year and a final dividend of $0.15 ($45M in total) per stock unit for the year ended September 30 was recommended.
The overall loan portfolio benefited from steady growth in retail credit and grew by 1.1% from $13B to $13.2B. Meanwhile, provisioning for bad loans increased by $730M in part a result of continued problems in the rice sector.
This is according to Managing Director of the NBIC, Michael Archibald, who spoke at the bank's Annual General Meeting (AGM) held at Le Meridien Pegasus yesterday. NBIC is a subsidiary of Republic Bank Ltd.
He said he was very pleased with the 29% growth in operating profits from $712M to $921M.
Loans and advances accounted for $1.8B in interest income in 2003 while for 2002 it was $1.9B. Interest on investments was $1.1B for 2003 ($742M). Total interest income for 2003 was $3B, up from $2.6B in 2002.
The bank's total assets increased to $52.7B, up from $34.6B for 2002.
In his review, Archibald said that the bank took an important step in purchasing the Guyana National Co-operative Bank (GNCB) in March.
He said the purchase, together with normal growth, resulted in an increase in deposits by 57.5% from $30.9B in 2002 to $48.6B in 2003. This, as at August 2003, meant an increase in total assets from $34.6B in 2002 to $52.7B in 2003.
He added that the purchase of the GNCB combined with a more aggressive search for new investment opportunities both locally and throughout the Caricom region resulted in the increase in other investments by 41.1% from $4.7B in 2002 to $6.7B in 2003. Treasury bills also recorded an increase of 29.9% from $8.4B in 2002 to $10.9B in 2003 as the bank sought to invest the available surplus liquidity. He said increased earnings from the larger investment portfolio had offset the decline in earnings from the loan portfolio.