November 22, 2023
NCB Financial Group Limited (NCBFG) for the year ended September 30, 2023, reported a 19% increase in interest income totaling $101.30 billion compared to $84.92 billion in the corresponding period last year. Interest Income for the fourth quarter had a 35% increase to close at $26.96 billion compared to $19.96 billion for the comparable quarter of 2022.
Interest Expense amounted to $38.50 billion (2022: $25.72 billion), this represents an increase of 50% year over year. Consequently, net interest income increased by 6% to $62.80 billion compared to $59.20 billion in 2022. The company booked net interest income of $15.99 billion for the fourth quarter versus $13.26 billion reported for the similar quarter of 2022.
Net fee and commission income increased by 7% to close at $28.08 billion (2022: $26.13 billion). Net Result from Banking and Investment Activities increased by 5% from $107.29 billion in 2022 to $113.03 billion in the period under review. Net revenues from insurance activities for the year amounted to $24.23 billion, a 36% decrease relative to $38.02 billion reported in 2022.
Net operating income for the year amounted to $137.26 billion, a 6% decrease relative to $145.31 billion reported in 2022. Net operating income for the fourth quarter amounted to $40.45 billion (2022: $39.69 billion).
Total operating expenses totalled $117.67 billion, an 11% increase from the corresponding period last year. (2022: $105.69 billion). Management noted, “During the September 2023 quarter additional staff costs related to separation and restructuring activities were incurred by NCBFG and National Commercial Bank Jamaica Limited (NCBJ). Included in these costs were separation provisions for the previous executive directors of the Company, which will be settled by a cash payment and the allotment of shares. There was also an increase in operational losses and property, vehicle, ABM maintenance and utilities during the year.”
Operating Profit for the year amounted to $19.59 billion, a 51% decrease relative to $39.62 billion reported in 2022. Operating Profit for the fourth quarter amounted to $1.68 billion (2022: $11.25 billion).
Profit before taxation for the year had a 51% decline to reach $19.96 billion (2022: $40.35 billion). Taxation for the year ended amounted to $4.63 billion, an 11% decrease from the $5.22 billion reported in 2022.
Net Profit decreased by 56% to $15.34 billion (2022: $35.13 billion). Net Profit for the quarter totalled $1.61 billion relative to the $9.25 billion booked in the prior year’s quarter.
Net profit attributable to shareholders for the period totalled $7.59 billion, relative to the $23.89 billion reported twelve months prior. For the quarter, Net loss attributable to shareholders amounted to $2.12 billion compared to a net profit attributable to shareholders of $5.25 billion reported in 2022.
Consequently, Earnings Per Share for the year amounted to $3.08 (2022: EPS: $9.68), while Loss Per Share for the quarter totaled $0.86 (2022: EPS: $2.13). The number of shares used in these calculations was 2,466,762,828.
Notably, NCBFG’s stock price closed the trading period on November 21, 2023, at a price of $69.65 with a corresponding P/E ratio of 22.63x.
Balance Sheet Highlights
The company’s assets totalled $2.23 trillion (2022: $2.08 trillion). The increase in assets resulted from a 16% rise in ‘investment securities’ closing at $827.12 billion. The Company highlighted, “were primarily funded by repurchase agreements, deposits, liabilities under annuity and insurance contracts and other borrowed funds.”
Shareholder’s equity was $170.02 billion (2022: $146.10 billion), representing a book value per share of $68.93 (2022: $59.23).
Disclaimer:
Analyst Certification -The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation (s) or view (s) expressed by that research analyst in this research report.
Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may affect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.