First Citizens, a Trinidad and Tobago-based commercial bank with operations in Barbados, has taken a direct hit from the decision of credit ratings agency, Moody’s, to downgrade Trinidad and Tobago’s sovereign international credit rating.
In a media statement reporting on the company’s half-year performance up to March 2015, the bank said it had received a downgrade from Moody’s because it is majority-owned by the Government of Trinidad and Tobago.
“The debt ratings of the state-owned First Citizens have been moved by Moody’s to Baa2 from Baa1. Similarly, the Group’s outlook has been revised to negative from stable, once again in line with that given by Moody’s to Trinidad and Tobago,” the statement said.
However, the statement pointed out: “It should be noted that Moody’s affirmed First Citizens Baa3 baseline credit assessment (BCA), and this is due to First Citizens’ consistent profitability, the large capital base of the Bank, the large size and quality of the Bank’s loan portfolio and the Bank’s history of quality management.”
For the half year under review, First Citizens announced an after-tax profit of TT$325.6 million, representing an increase of 1.5 per cent over the corresponding period in 2014.
“This is a demonstration that the fundamentals of the Group remain strong,” Group Chief Executive Officer Karen Darbasie was quoted as saying.
The Group reported significant growth in its loan and investment portfolio, as well as a 2.7 per cent increase in the value of total assets which rose to TT$35.8 billion.
“Most remarkable were our loan and investment growth of 15.8 per cent and 7.2 per cent respectively,” said Darbasie.
Based on the half-year performance, the Group has declared a 58 cents per ordinary share dividend, to be paid on May 29 to the 12,000 plus shareholders who own approximately 20 per cent of the company.
“First Citizens will continue on our path to success and remains fully confident in our ability to sustain growth and profitability in 2015. We continue to execute our strategy of expanding the range of products we offer and growing our market share, while maintaining a conservative outlook on risk and expense management,” said the Group CEO.
The First Citizens Group serves over 300,000 customers in five countries via a network which includes in excess of 32 branches and 110 ATMs.