JMMB Group Records J$6.3B in Profit in Challenging Market Conditions 

JMMB Group, regional financial conglomerate, recorded J$6.3 billion in net profit for the financial year ending, March 31, 2023, according to its recently published audited financials. This reflects a 46% decline in its profitability compared to the record- high profit of 2021/22. The financial conglomerate also reported J$23.4 billion in operating revenue, a falloff of 12% compared to the prior year. The Group indicated that its financial performance continues to be impacted by the challenging economic conditions, characterized by rising interest rates, inflationary pressure coupled with depressed trading activities in emerging markets. 

Patrick Ellis, JMMB Group chief financial officer outlined, “JMMB Group continues to maintain credible performance and remains committed to our diversification strategy, which has driven our core earnings. As such we have bolstered our financial performance with our business line and regional diversification as evidenced by the 32% contribution to profit from the banking business line. Additionally, operations in the twin island republic – Trinidad & Tobago has driven 17% of the Group’s profit, which is an increase from 7%, in the prior year. JMMB Group’s 23.32% investment in Sagicor Financial Company Limited (SFC) has also contributed 43% to the Group's profitability with $2.7 billion in share of profit and J$1.1 billion in dividends.” 
In sharing more details on the regional financial conglomerate’s performance, Ellis outlined that its net interest income had a slight decline by 5%, year-over-year, moving from J$11.8 billion to J$11.2 billion. Gains on trading took the hardest hit, with a 52% decline compared to the prior year, totaling, J$3.5 billion. The Group however saw a 26% uptick in foreign exchange gains, totaling, J$3.3 billion. Additionally, fees and commission grew by 19% to J$3 billion. This was mainly driven by increased economic activity in all the territories in which the Group operates, as well as growth in managed funds, collective investment schemes and 46% increase in capital market segment across the Group. 

At the end of the reporting period, the JMMB Group’s asset base totalled J$665.3 billion, up 8% relative to the start of the financial year. This was mainly on account of a larger loan portfolio which grew by 25% to J$178 billion. The credit quality of the loan portfolio continued to be comparable to international standards. Growth in the asset base over the financial year was funded in part by increases in customer deposits, repos and multilateral funding. Deposits grew by 14% to J$173.1 billion, while repos increased by 7% to J$317.7 billion.

The Group has maintained its capital adequacy for all individually regulated companies within the Group in keeping with regulatory capital requirements. 

The Group’s operational expenses increased to J$19.9 billion, as result of inflation and its active pursuit of its strategic imperatives, designed to drive medium to long-term growth. In line with its strategic outlook, during the financial year, JMMB Bank rolled out its point-of-sale solutions in Jamaica; deepened its investment into alternative investment classes such as real estate and introduced its first JMMB SL managed private equity vehicle, Vertex SME Holdings. 

‘Smart Growth’ & Digital Acceleration to Drive Growth 
Keith Duncan, JMMB Group CEO, maintained a positive view of the Group’s financial performance noting that its diversification strategy and the leveraging of its ‘smart growth’ initiatives, has delivered sound results, despite the challenging macroeconomic climate.  The CEO also shared his cautious optimism, based on more favourable economic outlook predicted, and the signals from central banks thus far in relaxing their monetary policy regime as global inflation adjusts to targeted levels. 

In speaking to the way forward, Duncan outlined that the Group is looking to deliver on several of its digital imperatives, in line with its smart growth strategy that is centered on revenue diversification, stronger capital management, and growing core activities.  As such, the Group is expected to expand its digital payments solutions and add-value to its clients by introducing innovative payment solutions and accelerating digital projects to improve its client experience. “We have begun the Group-wide roll-out of our queue management system that is designed to enhance our client experience by reducing in-branch wait time. Additionally, we are set to roll-out the pre-paid money transfer card, to provide our clients with added convenience and safe access to cash.” 

Other digital projects are expected to bolster the Group’s digital portfolio offerings, including: its digital onboarding, that is designed to empower clients to start their client journey with added convenience; introduction of its virtual assistant, to offer clients an omni-channel client experience and add new features to its Moneyline platform. 

Head honcho, Duncan notes JMMB Group continues to explore inorganic growth opportunities as it eyes expansionary plans across the region, citing medium-term plans to expand its remittance business lines into other countries of operation.