The Barbados-based FirstCaribbean International Bank’s performance in the first quarter of its 2022 financial year is reflecting the turnaround in economic fortunes in the region. The bank’s chief executive officer Colette Delaney told shareholders in her review that accompanied the release of the condensed consolidated financial statements of the institution, that net profit for the quarter ended January 31, showed a 46 per cent increase over the corresponding period last year.
“The bank recorded net income of US$45.2 million (BDS $90.4 million), up US$14.3million (BDS$28.6 million) or 46 per cent from the net income of US$30.9 million (BDS$61.8 million) for the same period last year,” Delaney stated.
The senior banking executive also informed that after adjusting for US$3.0 million (BDS$6 million) of operating expenses related to the divestitures announced in 2021, net income was US$48.2 million (BDS $96.4 million). In this connection, the FirstCaribbean International Bank CEO revealed that it had received regulatory approval for the sale of its Aruba operations and the sale was effected on February 25.
According to the bank’s top executive, regional economic activity “started to improve heading into 2022, although the COVID-19 pandemic, fuelled by the more contagious Omicron variant, continues to affect the pace of the economic recovery”. She noted also that the bank’s consolidated revenue reflected the impact of a low interest rate environment. At the same time, she explained an increase in transaction activity by its clients, led to an eight per cent revenue growth over the corresponding quarter of 2021.
Operating expenses of the bank were up US$7.4 million (BDS$14.8 million) or eight per cent. “We continue to manage the inflationary pressures on our cost base closely. Provision for credit losses was a reversal of US$7.4 million (BDS $14.8 million) this quarter, significantly lower than the US$6.3 million (BDS$12.6 million) charge in the same quarter last year.
This was largely due to a favourable change in updated macro-economic regional forecasts, which is a key component in determining credit losses for the bank,” the CEO revealed. The disposal of the institution’s banking assets in the Organisation of Eastern Caribbean States (OECS) of St Vincent and the Grenadines, Grenada, St Kitts and Dominica are still being processed by the regulatory authorities in the region.
“We continue to work together with all parties to ensure a smooth transition for clients and other stakeholders regarding the announced divestitures,” Delaney pointed out.