Home' Trinidad and Tobago Guardian : September 28th 2014 Contents SEPTEMBER 28 • 2014 www.guardian.co.tt SUNDAY BUSINESS GUARDIAN
STOCKS | SBG13
East Caribbean Financial Hold-
ings Company Ltd (ECFHCL)
is a holding company that
owns 100 per cent of Bank of
St Lucia Ltd, Bank of St Lucia
International Ltd and ECFH
Global Investments Ltd.
The company also owned 70 per cent of
EC Global Insurance Ltd. Many readers would
be aware that, on September 12, 2014, ECFH-
CL sold 50 per cent of its shares in this com-
pany to GraceKennedy Ltd; it still retains a
20 per cent stake.
ECFH s other major subsidiary is Bank of
St Vincent and the Grenadines Ltd in which
it has a 51 per cent shareholding.
The company also owns a 28 per cent stake
in EC Amalgamated Bank Ltd of Antigua; this
entity was created to salvage and restructure
the former Bank of Antigua Ltd. Very probably,
this was related to problems inherited from
the Allen Stanford era, more than five years
ECFH is listed on the Eastern Caribbean
Securities Exchange, where its shares were
recently quoted at EC$6.25. Three of its major
shareholders are: Government of St Lucia (20
per cent), Republic Bank Ltd (20 per cent)
and St Lucia s National Insurance Board (17
The bank s assets have grown from EC$2.17
billion as at December 2009 to EC$3.72 billion
as at December 2013. Over this same period
net interest income moved from EC$76.7 mil-
lion to last year s EC$85.9 million. This meas-
ure peaked at EC$97.2 million in 2011 and
declined in the two succeeding years.
On the other hand, operating income, which
included credit and asset management related
fees, improved in every year since 2009. From
EC$111.8 million in 2009 this measure rose
steadily and clocked in at EC$153.6 million
Net income after taxes and minority inter-
ests declined in every year since 2009, when
it posted a profit of EC$25.56 million. In 2010
and 2011 profits declined precipitously. In
2012, ECFHCL reported a huge loss of
EC$125.5 million. In 2013, the loss was only
The major reason for the large loss in 2012
was the charge-off of EC$162 million of
impairment losses, related to both loans and
investments. This figure declined to EC$40
million in 2013.
Total net interest income of almost EC$86
million for 2013 was sourced from its two
major jurisdictions, St Lucia (EC$60 million)
and St Vincent (EC$26 million).
Though small in terms of both assets and
revenues generated, the offshore segment
remained profitable in both periods.
Although net interest income declined at
the banking division, healthy advances were
noted in both fee and other income lines. Sig-
nificant declines in impairment charges at
this division helped it to register a minute
profit for 2013.
The other segment includes net insurance
premium revenues of EC$3.7 million (2012:
Turning to some individual company results,
the major subsidiary, Bank of St Lucia Ltd
(BOSL) posted net interest income of EC$54.6
million (2012: EC$60.4 million) and had
impairment losses on loans of EC$40.4 million
(2012: EC$128.5 million).
The net effect of these and other changes
resulted in a loss for BOSL of EC$8.8 million
for 2013. This was relatively better than the
loss of EC$122.8 million incurred for the 2012
Bank of St Lucia International Ltd posted
lower profits of US$2.69 million for 2013
(2012: US$3.29 million). In contrast, ECFH
Global Investment Solutions Ltd delivered an
improved performance as its net income
moved from EC$736k in 2012 to EC$1.22 mil-
lion last year.
Another strong performer was the Bank of
St. Vincent and the Grenadines Ltd. Despite
a small dip in net interest income, this majority
owned subsidiary delivered an after-tax profit
for 2013 of EC$7.49 million; this result was
33 per cent greater than the EC$5.63 million
recorded for the 2012 fiscal period.
Movements in asset values
Total assets rose by 10.7 per cent to EC$3.72
billion from the restated 2012 figure of EC$3.36
Cash and balances with Central Bank
declined by more than EC$30.3 million to
EC$166.6 million from EC$196.9 million as
at the end of 2012. The principal change was
due to the lower cash balances, which fell
from EC$70.8 million to EC$42 million.
In contrast, deposits with other banks
almost doubled to EC$845.5 million from the
previous year s level of EC$442.9 million. Of
particular note was the increase in interest
bearing deposits to EC$692 million from
EC$386.6 million at the end of the previous
Financial assets held for trading contracted
from EC$28.1 million as at December 2012 to
EC$13.9 million last December. While all of
the listed debt securities of EC$26.7 million
were sold, there was an increase of more than
EC$13.6 million in the amount of unlisted
For both periods loans and advances to
customers were almost identical at EC$1.87
billion. The weighted average interest rate on
productive loans increased from 7.34 per cent
in 2012 to 7.45 per cent in 2013. This augurs
well for its 2014 results.
Total liabilities increased by 12.2 per cent
to reach EC$3.46 billion from EC$3.09 billion
as at December 2012.
Amounts due to customers rose by almost
13 per cent from EC$2.7 billion as at year-
end 2012 to EC$3.05 billion last December.
Savings deposits balances remained at
EC$840 million for both sessions. Meanwhile,
term, call and demand deposits all posted
Borrowings advanced to EC$213.1 million
from the previous year-end figure of EC$203.9
million. Loans due to First Citizens Bank Ltd
fell to less than EC$5 million from EC$20.5
million as at the previous year-end. The FCB
debt is due to be fully settled in 2014. In
contrast, the Prodev Bond, at 7.5 per cent
interest, increased from EC$13.3 million to
Meanwhile, other liabilities expanded to
EC$54.1 million from the previous figure of
EC$38.6 million. The trade and other payables
component of this item increased from
EC$32.4 million to EC$49.3 million last
Shareholders equity declined to EC$210.6
million from EC$230.3 million as at the end
of 2012. A major reason for this was an unre-
alised loss on investment of EC$17.7 million.
In addition, there was a contribution with-
drawal of EC$3 million, which was utilised
against impaired student loans.
With 24,465,589 shares outstanding, each
share had a book value of EC$8.61. As at
year-end 2012, this value was EC$9.41.
The recent quote of EC$6.25 represents a
discount of 27 per cent to the current book
Interest income declined while interest
expenses rose. This vicious combination saw
net interest income contract to EC$85.9 million
from the previous level of EC$93.1 million.
All components of interest income, that is,
loans, investments and short-term funds
exhibited declines. In the case of interest
expense, the only declining element was bor-
rowings, which fell to EC$8.9 million from
EC$9.4 million during 2012.
Helping to offset this shortfall were healthy
increases in fees and commission income,
foreign exchange trading income and other
Assisted by reduced loan impairment losses,
the operating profit registered at EC$4.56
million; this result was a huge improvement
over the previous year s loss of EC$121.1 mil-
lion. The share of profits from associates
improved from EC$1.48 million in 2012 to
EC$1.58 million last year.
After deducting dividends on preference
shares of EC$291k, the pre-tax profit came
in at EC$5.85 million (2012: EC$119.9 million).
At the after-tax level, the result was EC$3.41
million for 2013 versus a loss of EC$122.95
million for 2012.
The sum attributable to equity-holders was
a loss of EC$95k while non-controlling inter-
ests accounted for a profit of EC$3.5 million.
Half-year 2014 results
ECFHCL s results for the half-year to June
2014 were released on September 15, 2014.
These show that, in spite of progress being
made in many areas, ECFHCL sustained a
loss to shareholders of EC$634k.
Offshore banking continued to make an
outstanding contribution to these results as
that segment delivered EC$4.41 million in
profits. Both domestic banking and other divi-
sions incurred losses of EC$2.97 million and
EC$2.08 million respectively.
To a limited extent, these results will
adversely impact Republic Bank Ltd s profits
for its fiscal year ended September 30, 2014.
East Caribbean Financial Holdings' 2013 results
Bank's assets now at EC$3.72B
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