“Trinidad and Tobago,” I patiently repeated for the second time.
“What?” She frustratingly retorted.
Scotiabank T&T Ltd (Scotiabank) has reported net income of $144.26 million for the three months ended January 31, 2014, an increase of $82.2 million or 1.6 per cent over the same period in 2012. For the period, earnings per share (EPS) was 81.8 cents while return on equity (ROE) was 17.23 per cent, down from 18.16 per cent in the comparative period last year. Return on assets also dipped slightly from 3.15 per cent to 2.91 per cent as at January 31, 2014.
The board of directors approved a first interim dividend of 40 cents per ordinary share payable on April 2, 2014 to shareholders on record at March 4, 2014. Commenting on the group’s first quarter Anya Schnoor, managing director, said in the release: “The bank has started the year with positive results across all business lines. For the quarter ended January 31, 2014, total loans grew $225.9 million, and our deposits grew by $267.7 million as we continued to be the bank of choice for our customers.
“Additionally, Scotia Insurance expanded its product offering through the launch of a new product called Solace which offers clients insurance against the costs for funeral expenses. This innovative product allows our clients to provide the peace of mind necessary to their families when they need it most.”
She added: “In November 2013, the bank was recognised as the Bank of the Year in T&T by the Banker Magazine, a Financial Times publication. This award, along with the other external recognition received in 2013, is a testament to the confidence our customers have placed in us and the hard work of our excellent team across the twin islands. As we celebrate our 60th year of operations in T&T, we remain committed to this country and to helping our customers become financially better off.”
Total operating income, comprising net interest income and other income was $364.6 million for the three months ended January 31, 2014. This represented overall improved earnings of 4.8 per cent or $16.7 million when compared to 2013.
“As we continue to operate in a low (interest) rate environment, ‘other income’ was the main driver of growth, earning $140.9 million in the quarter, which reflected a growth of $17.8 million or 14.5 per cent. Net interest income, which accounted for 61 per cent of the bank’s operating income for the quarter, was marginally down year over year as the bank earned $223.6 million compared to $224.7 million in the prior period,” the release said.
Total non-interest expenses (NIE) for the quarter was $173.9 million, which was $11.2 million or 6.9 per cent higher than the prior year. “Overall, the increase was due to an increased investment in our brand, people and infrastructure,” the release said. “Loan loss expense (LLE) fell by $4.6 million or 51 per cent year over year, due to our continued successful execution of our strategies to manage credit quality and recoveries, which is supported by our strong risk policies,” Scotia said.
The bank’s productivity ratio (operating expense/total revenue)—a key measure of cost efficiency—was 46.48 per cent for the three months ended January 31, 2014, which, while slightly higher than the prior year ratio of 44.19 per cent, remains best in class amongst Scotia’s peer group.
Total assets as at January 31 was $19.8 billion, representing growth of 1.7 per cent or $323.7 million. Loans to customers, the bank’s largest asset category, closed the period at $10.8 billion. The portfolio grew by $226 million or 2.1 per cent in the quarter, which is net of repayments. This growth is reflective of the market, as announcements by the Central Bank show credit demand remaining steady, supported by a tepid recovery in consumer lending.
As at January 31, total liabilities was $16.5 billion, up 1.9 per cent or $306.8 million in the three months to January 31, 2014. This growth was driven by increased customer deposits which climbed by $267.7 million or 1.9 per cent and closed the period at $14.7 billion. The Policyholders’ Fund in the bank’s subsidiary Scotia Insurance maintained its growth as it increased by 5.1 per cent or $37.5 million to close the quarter at $773.1 million.
Total shareholders’ equity closed the period at $3.3 billion, up $16.8 million in the three months to January 31, 2014. The bank’s capital adequacy ratio stood strong at 28.33 per cent as at January 31, 2014. This continues to be well above the minimum capital adequacy ratio of 8 per cent specified by regulators and is consistent with international standards.
The bank said it continues to maintain high liquidity reserves with cash and cash equivalents of $2.2 billion in addition to statutory reserve deposits of $3.2 billion at the Central Bank, which places Scotiabank in strong coverage position of 36.7 per cent of the bank’s customer deposits.