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The $28 billion of profit made by NCB Financial Group last year is the most earnings ever reported by a listed company, and an all-time record for the banking conglomerate, and both shareholders and bank staff and managers are seeing rewards.
Jamaica’s largest banking group increased quarterly dividends to shareholders from 60 cents per share to 70 cents during the past calendar year, which served to increase annual distributions by 17 per cent, from $5.9 billion to $6.9 billion.
The first quarterly dividend to be paid for this year was further upsized to 90 cents per share, which will see the bank distributing a total of $2.22 billion to shareholders on February 22.
Meanwhile, key managers of the bank shared compensation of $2.8 billion last year, which doubled from $1.3 billion; executive directors were paid $1.37 billion, inclusive of what appears to be a special bonus, which more than doubled their annual compensation from $639 million; while the pay for bank staff rocketed from $16.5 billion to $23.8 billion, up 44 per cent.
Outspoken minority shareholder Orette Staple, for whom dividends and executive salaries have been core issues, made note of the compensation packages at NCB’s annual general meeting on Friday as he gave the bank a thumbs up.
“We all benefitted,” said Staple. “We give thanks to the board of directors for making everybody happy,” he said, referring to the distribution to shareholders, as well as key managers and executives, led by President & CEO Patrick Hylton and Deputy CEO and Chief Financial Officer Dennis Cohen.
The pay for executive directors included a new disclosure of “share benefits” of $609 million, which did not exist in 2017.
“We are thankful that we were taken into consideration in making us feel as happy as the management felt happy,” said Staple.
The dividend to be paid next month was declared alongside the release of NCB Financial’s first-quarter results in which it recorded profit of $7.4 billion for the period ended December 2018.
As Jamaica’s largest banking group, NCB Financial holds assets of more than $940 billion, while its net worth tops $140 billion. Its businesses and holdings span commercial banking, insurance and wealth management, while its geographic footprint has extended beyond Jamaica to places such as Cayman Islands, Barbados, Trinidad, and Bermuda.
NCB is poised to grow even more this year, assuming its US$207-million takeover bid for insurance conglomerate Guardian Holdings Limited of Trinidad succeeds. Under the takeover offer, which closes February 7, the bank aims to increase its stake in the Trinidadian company from $29.99 per cent to 62 per cent.
“We are bullish on the future in the island and region and are focused on capturing those opportunities,” said Hylton during his presentation to shareholders at the annual meeting. “While we have aspirations to dominate the region, we want to do it with entities that are profitable and increase shareholder value,” he said.
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