National Bank Reports EC$111 Million Profit For 2008

St. Kitts - Nevis Bank Profits

St. Kitts – Nevis Bank Performs Well In Current Economy

Basseterre, St. Kitts – Nevis
April 20, 2009 (CUOPM)

The indigenous St. Kitts – Nevis – Anguilla National Bank is reporting a profit of EC$111 million for 2008.

Chairman of the Bank’s Board of Directors, His Excellency Ambassador Walford Gumbs disclosed in the company’s annual report an operating income before tax of EC$161 million and a net income of EC$110.9 million and that the local financial institution passed the two billion dollar mark in total assets.

Managing Director, Mr. Edmund Lawrence said that National Bank’s gross operating income of EC$260.9 million in 2008 was EC$99.7 million or 61.8 percent more than the gross operating income of EC$161.2 million in the previous year.

“The core operating income in 2008 was EC$180.7 million which was EC$19.5 million or 12.1 percent higher than the core operating income in 2007 which was EC$161.2 million,” said Mr. Lawrence in the report released at the recent Annual General Meeting.

He said the gross operating expense in 2008 was EC$99.1 million compared with EC$80 million in 2007, resulting in an increase of EC$19.1 million or 23.9 percent in 2008 over 2007.

According to the Managing Director, total performing assets decreased by EC$1.4 million in 2008 compared to 2007.

“Provision for loan impairment of EC$10.2 million in 2008 was relatively unchanged from EC$10.6 million in 2007 as charge-offs of EC$3.5 million was off-set by an addition of EC$3.2 million to the provision,” said he said.

Mr. Lawrence stated that liquid assets increased by EC$42.6 million or 6.2 percent to EC$727.7 million in 2008 compared with EC$685.1 million in 2007 with liquid assets amounting to 53.2 percent of customers deposits compared with 52.3 percent in 2007.

“This very large pool of liquid assets coupled with the high quality of the loan portfolio help to make National a sound, solid and stable Bank in which customers deposits are safe and secure,” he added.

Mr. Lawrence further reported that other reserves grew by EC$170 million or 113.1 percent to EC$321.6 million in 2008 from EC$150.9 million in 2007. Other reserves and provisions amounted to EC$331.8 million or 45.6 percent of the liquid assets in 2008.

“This position demonstrated that reserves and provision were held in the form of liquid assets and were not loaned out,” said Lawrence, adding that this policy further strengthens National and gives increased comfort and confidence to depositors and other customers as well.

The Bank Chairman said the milestone was achieved in spite of the challenges affecting the global economic environment pointing out that the global economy and the world’s financial markets weakened during the review period due to losses in the United States “sub-prime” mortgage market which resulted in the tightening of credit and the reduction in earnings of many financial institutions.

Gumbs said the Bank was challenged to maintain its international corresponding relationships and to keep abreast with international regulations and controls. As a result the Board of Directors separated the compliance function and makes it an independent and specialised unit within the bank.

He said National Bank also experienced intense competition from other banks opening new offices in the federation and expects this trend to continue as the economy grows and continues to be attractive to business and investments.

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