NCB second quarter profits dip 22 per cent
NCB Financial Group is reporting a 22 per cent decline in net profit for the second quarter ending March 2019, down from $6.4 billion in the previous quarter to $5 billion.
The company’s profit was impacted by a significant decline in gains on foreign currency and investment activities, which decreased by 56 per cent, down from $4 billion during the three months ended March 2018 to $1.7 billion in the review period.
“Despite the decline in net profit in the second quarter, the progress being made in our transformation journey has contributed to a strong foundation which augers well for long-term growth for the group,” NCB said in its audited financial statements.
During the three months ended March 2019, net interest income increased by 21 per cent, up from $8.3 billion in the comparative period of 2018.
The company kept its operating expenses down, spending 20 per cent less than it did in the comparative quarter of 2018. Staff costs however increased by $1 billion for the three months ended March 2019. Credit impairment losses also increased during the quarter, moving from $286 million to $875 million.
During the year, NCB said it made significant investments to improve its card system infrastructure, as well as to upgrade its ABM network and core banking system.
“These enhancements will offer customers increased self-service options using more intuitive technology, provide more data and transaction security, reduce downtime and improve overall customer experience,” NCB said.
Net profit for the six-month period stood at $12.4 billion, with profit attributable to stockholders at $12.5 billion, a decline of 10 per cent from the prior year.
The prior year’s results included a gain (negative goodwill) of $4.4 billion related to the acquisition of Clarien Group Limited, which was only partially offset by an extraordinary gain of $3.3 billion from the disposal of an associate in the current year’s results.
Without these one-off transactions the results would have been $9.2 billion for the current period compared to $9.4 billion for the prior year, representing a three per cent decline, NCB said.
“The group’s efforts continue to be concentrated on enhancing customer experience, developing our digital capabilities by introducing value-added technological innovations, and strengthening our core business.”