Stable financial year for First Citizens Bank
Although COVID-19 has had a more deleterious impact on the top and bottom lines of regional banks, Trinidad-based First Citizens Bank Limited had a fairly stable financial year (FY) as the group recorded a two per cent decline in total net income to TT$2.23 billion ($47.1 billion) and 19 per cent decline in net profit at TT$606.9 million ($12.8 billion).
Against a backdrop of closed borders, compounding restrictions and the closure of its Bureau de Change at Piarco International Airport, First Citizens managed to grow its net interest income marginally to TT$2.05 billion ($43 billion) on its loan portfolio, which was valued at TT$19.2 billion ($402.7 billion). This was even during a time when the bank reduced interest rates and increased deferrals on loans.
However, net interest income came up slightly lower than the prior year at TT$1.63 billion due to interest expenses rising to TT$420.6 million as a result of customer deposits growing by 12 per cent to TT$28.9 billion ($606.9 billion).
Fees and commissions declined by seven per cent to TT$432.9 million due to fee waivers during the period and fewer corporate deals occurring.
Despite the total net income being relatively stable and expenses declining by seven per cent, credit impairment provisions grew by 873 per cent to TT$216.7 million based on the IFRS 9 provision related to the uncertainty in the environment. This was reflected in the growth of non-performing loans by 41 per cent to TT$655.1 million accompanied by a 96 per cent and 92 per cent respective increase in stage 2 and 3 provisions, while stage 1 provisions on gross loans declined by 15 per cent. As a result of the increased provisions, operating profit declined by 22 per cent to TT$812.3 million.
The share of profit contribution from its 19.11 per cent stake in St Lucia Electricity services remained flat at TT$15.8 million while its joint ventures contributed 15 per cent less at TT$3.5 million. Earnings per share for the year ended at $2.40 compared to the $2.98 in the prior FY.
Total assets grew by nine per cent to TT$47.4 billion ($999.2 billion) fuelled mainly by growth in cash and cash equivalents which rose by 84 per cent to TT$2 billion during the period.
First Citizens also acquired a five per cent stake in Barita Investments Limited, which was valued at TT$134.1 million ($2.82 billion) and grew by 84 per cent before year end. Total liabilities also grew by 10 per cent to TT$40 billion while shareholders equity rose by four per cent to TT$7.4 billion ($156.3 billion).
Subsequent to the end of the FY, First Citizens declared a dividend of $0.45 per share (TT$113.1 million/$2.38 billion) which will be paid on January 7. First Citizens also exercised its one time call option and paid down TT$270 million of its TT$900 million bond payable in October 2022.