NASSAU, BAHAMAS — Bank of The Bahamas (BOB) saw an overall net income of $6.4 million for its financial year that ended June 30, according to Managing Director Kenrick Brathwaite.
Brathwaite noted: “Comparing the current year ended 2021 to the prior year ended 2020, the bank’s total operating income decreased by $2.1 million (14.93 percent) for the quarter and $2.4 million (5.12 percent) for the year due to lower net interest income and net non-interest income.
“Despite higher interest income owing to the bank’s efforts in consumer loan campaigns and a decrease in interest expense due to a decline in certain deposit balances and interest rates, the overall decrease in net interest income of $2 million and $1.3 million for the quarter and year, respectively, were attributable to the deferred loan fees of $3.3 million recognized in the prior year.
“The decline in non-interest income of $1.1 million year to date was largely due to the adverse impact of the pandemic on the bank’s auxiliary revenue streams, which was immediate, substantial and continues to date.”
Brathwaite noted that the bank’s operating expenses increased by $300,000 or 3.01 percent for the current quarter and $2.9 million or 8.88 percent year to date as a higher bank license fee of $800,000 was recognized due to the increase in levy imposed by the Central Bank.
“Increases were also noted in staff costs, depreciation and IT-related expenses as the bank invested in the human resources, system innovation and upgrades to support the bank’s planned growth and strategic initiatives,” noted Brathwaite.
“Net credit loss expenses of $7.5 million were recorded year to date compared to $15.3 million during the same period of the prior fiscal year, a 51.42 percent positive variance.
“Reversals of provisions for impairment of $5.3 million were also recorded during the current year, compared to impairment losses of $6.3 million in the prior year as the ECL estimates and assumptions used on its sovereign and corporate exposures in the prior year did not materialize.
“Management continues to use its judgment in the assessment of any significant changes in the underlying assumptions on its financial assets due to the pandemic.”
The BISX-listed lender continues to maintain a strong financial position with total assets of $902.8 million and loans and advances, net of $391.3 million as of June 30, 2021.
Brathwaite noted that the bank’s equity position has remained strong.
“Total equity closed at $161.2 million and the bank’s liquidity position also remained strong as its cash and cash equivalents stood at $236.8 million, a $30.7 million or 14.9 percent increase since June 30, 2020,” said Brathwaite.
“The bank’s key capital ratios continued to comply with regulatory requirements, with CET1 Ratio of 36.9 percent, well above the Central Bank’s requirement of 9.6 percent.”
He added: “Experience gained in responding to the pandemic will undoubtedly be a catalyst for further change, with an opportunity for a more streamlined and efficient banking model, moving towards a position of sustainable profitability and growth.
“As we remain committed to keeping health and safety at the forefront, we would like to thank our dedicated and qualified BOB team of employees, management, directors, shareholders and, most importantly, our customers for their loyalty and continued support of the bank.”
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