SCOTIA Group Jamaica Limited posted profits of just over $10 billion, down almost a per cent from last year, said Bruce Bowen, the company’s president and CEO.

“We exceeded almost all of our business line objectives, so it was seen as a good year internally,” Bowen said.

The group earned $10.62 billion for the year ended October 31, 2011. This is $84 million short of the profit posted for the same period last year.

He attributed the decline to increased operating expenses and the fall in interest rates due to the Jamaica Debt Exchange.

Operating expenses were $14.84 billion for the year, representing an increase of $358 million or 2.5 per cent, states the group’s year-end results. Staff costs increased due contractual salary adjustments that were negotiated between the group and its unionised workers.

Other operational expenses fell by eight per cent given efforts to centralise some functions of the group, which enabled it to reduce allocations to other subsidiaries.

With the downward trend of interest rates, income earned from this was $22. 4 billion, down $740 million or just over three per cent.

Scotia Group comprises the Bank of Nova Scotia (BNSJ), Jamaica Scotia Life Insurance Company (SJLIC), Scotia Investment Jamaica (SIJL) and Scotia Jamaica Building Society (SJBS).

BNSJ, the largest contributor to the group’s performance with 44 per cent, earned $4.5 billion, down from the $5 billion earned the previous year. The group has a strategy to improve its performance, however.

The bank is focusing on increasing its share of the mortgage market as people tend to be open to discussions about their other financial requirements with the bank that provides their mortgage, Bowen said.

“What we’ve been driving our business line on is growing market share,” said Bowen. “In this economy, this is the time to be building market share while some of our competition have other things distracting them.”

SJLIC contributed 36 per cent to the group’s net profit, SIJL 14 per cent and SJBS six per cent.

Going forward, the group’s strategy is to focus on its core areas of banking, insurance, investment and, most recently, micro-financing.

Among the areas that will be targeted are sustainable revenue growth, improving “customer experience” and operational efficiencies and strengthening leadership capacity.

A very small percentage of Jamaicans that have a bank account don’t have one with Scotia, Bowen said. The focus then is to see how revenues can be increased and sustained by having most of these people use Scotia as their primary banker and for all their other financial needs. He said this will involve cross-referencing potential clients among the various subsidiaries of the group.

The group’s customer experience has always been strong, Bowen said. However, the gap is narrowing as its competitors improve their services requiring the Scotia Group to adopt improved training methods. With customers numbering between 700 and 900 thousand, there will always be complaints so the quality of customer service including complaints management and problem-solving must be excellent, Bowen said.

“At my level leadership is a big part of my focus”, said Bowen. Hiring the best, who show potential for growth and significant contribution to the group, is a priority, he said. “We are fortunate to be able to attract the best people in the business .”

Bowen said that the group is expecting moderate growth next year. However, he warns that there are many external risks and uncertainties which may affect this. These may be more important than any single factor in Jamaica, including the outcome of the national elections. That said, “prudent banking”, which focuses on the long-term, will be important.