JMMB Group Net Profit Up 56% for Q1

The regional financial entity, JMMB Group, has recorded a 56% growth in its net profit, year-over-year, totaling J$956.6 million, for the three-month period ending June 30, 2018.  Additionally, the Group posted net operating revenue of J$4.7 billion, which reflects an increase of 15%, compared to the corresponding prior period. 

The Group’s performance was largely driven by growth in its core business operations, namely: foreign exchange trading gains; fees and commission income; net interest income; and net gains on securities trading. Foreign exchange trading gains saw a significant increase of J$277.1 million, or 117%, amounting to J$514.6 million, as a result of increased trading activity and the faster pace of depreciation of the Jamaican dollar, over the period. Fees and commission income totaled J$481.6 million, an increase of 32%, over the corresponding prior period, driven by significant growth in managed funds and collective investment schemes, across the Group. Net interest income for the reporting period stood at approximately J$2.1 billion, reflecting growth of 8%, or J$155.9 million, in the Group’s loan and investment portfolios. Additionally, net gains on securities traded, showed a marginal increase of 4%, compared to the prior period, totaling J$1.6 billion, due to a decline in trading activities caused from the frequency of US Federal rate increases.  

Keith Duncan, JMMB Group CEO, noted that the positive performance achieved by the company reflects its commitment to build-out of its integrated regional financial strategy, even as the entity has intensified the consolidation and growth phases of its business model. In keeping with this thrust, “(There is) continued maximization of strategic synergies to extract operational efficiencies from the Group’s portfolio, while driving growth in our core business lines,” added Duncan. As evidence of this focus, JMMB Group has rolled out several initiatives across its regional subsidiaries, specifically: expanding online services in the Dominican Republic; improving the online banking platform – JMMB Moneyline, with added features, in Jamaica; and the standardization of client experience across the Group, with the implementation of sales training tools and other initiatives. 

During the quarter, costs were largely associated with the further build-out of the integrated Group sales support framework and continued roll-out of commercial banking operations in Jamaica; which resulted in an increase in expenditure of 11%, amounting to J$3.34 billion. However, the Group remains committed to managing its expenses, as evidenced by its operating efficiency ratio, which moved from 74% in the prior period to 72%.

Duncan highlighted his optimism towards the JMMB Bank’s credible performance, as the entity celebrates its first year in the commercial banking space. He shared that, over time, the build-out of the commercial banking operation in Jamaica is expected to reap greater synergies and operational efficiency, as the subsidiary seeks to better serve its clients and maximize shareholder value. Since making entry into the commercial banking foray, JMMB Bank (Jamaica) has expanded its footprint, upgraded its infrastructure and continues to review its client experience processes, to ensure that it provides exceptional service. 

Since the start of the financial year, the JMMB Group’s asset base grew by 8% or approximately J$23 billion, J$314.7 billion; as a result of higher cash holdings and larger loans and investment portfolios. 

The entities across the Group remain adequately capitalized, exceeding regulatory capital requirements, although the shareholder’s equity decreased by 9% to J$26.3 billion. Shareholder equity was impacted by the adoption of IFRS 9, at the start of the financial year, which resulted in the decline in investment revaluation reserve due to the movement in emerging market bond prices.

The JMMB Group CEO, in sharing the way forward, commented, “I am proud of the Group’s performance over the first quarter, which would not have been possible without a strong and motivated team, who has worked hard in yielding positive results and remained committed to providing financial solutions, in the best interest of our clients.” In sharing further insight to the Group’s direction, the JMMB Group CEO noted, “We look forward to the process of leveraging strategic synergies and improving operational efficiency, during the strategic period. Meanwhile, the JMMB Group is also looking to introduce innovative financial offerings across the markets in which it operates in order to drive growth, assist individuals to achieve their goals and support business expansion and growth; providing a win-win opportunity for all our stakeholders, through our financial partnership approach. As part of the growth focus JMMB Group is seeking to launch consumer financing service in Trinidad & Tobago and to expand the provision of automated teller machine (ATM) services in Jamaica.