Tuesday 2 June, 2020

NCB Financial Group retains its good ratings

Caribbean Information and Credit Rating Services Limited (CariCRIS) has retained ‘good’ creditworthiness rating for NCB Financial Group (NCBFG) and at the same time ranked the institution as having the ‘highest’ local currency rating in Jamaica.

CariCRIS reaffirmed local currency ratings of CariA for NCBFG and CariA- for foreign currency rating on the regional rating scale. The financial institution was also assigned local currency rating of mAAA and foreign currency rating of jmAA+ on the Jamaica national scale.

According to CariCRIS, the national scale ratings indicate that the relative creditworthiness of NCBFG, in comparison to other issuers in Jamaica is the ‘highest’ for local currency rating while its foreign currency rating was labeled as ‘high’.

NCBFG’s creditworthiness level at ‘good’ was also adjudged in relation to other issuers in the Caribbean.

“The ratings of NCBFG are supported by the group’s leading market share in the Jamaican commercial banking industry with a strong presence in the securities and insurance industries coupled with it being an emerging player in the regional financial services industry,” CariCRIS reasoned.

The rating agency also maintained a stable outlook on NCBFG’s rating noting that the group’s financial performance will continue to be strong over the next 12-15 months, as the loan portfolio of the Group’s bank subsidiary, National Commercial Bank Jamaica Limited (NCBJ), continues to expand, spurred by improved economic activity in Jamaica.

Further, CariCRIS expects NCBFG to benefit from its investment in NCB Global Holdings Limited and from the several business development initiatives being pursued across the Group.

“The comfortable capitalization levels of NCBFG and its subsidiaries, together with its improved financial performance also support the ratings. Rating strengths also include the group’s continuous improvement in its risk infrastructure and technology, which support its strategic goals,” CariCRIS said.

“Although its non-performing loans ratio increased, the group recorded good asset quality and maintained a healthy resource base,” it continued.

Nonetheless, NCBFG’s rating strengths are tempered by the group’s high sovereign risk exposure to the Jamaican economy as well as the prevailing macroeconomic challenges in Trinidad and Tobago and Barbados.

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