JN Bank nets $997m in year one


JN Bank nets $997m in year one

Tuesday, November 13, 2018

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Despite recording a decline in surplus, Chief Executive Officer of the Jamaica National Group Limited, Earl Jarrett, reassured members that the company performed creditably in its first full year of operation as a commercial bank.

JN Bank was launched in February 2017 following a seven-year long transformation process to bring the JN Group in line with regulations under the Banking Services Act.

Addressing some 550 members during the Group's annual general meeting in New Kingston recently, Jarrett revealed that JN Group realised profit of $977 million down from $1.5 billion in the previous year.

The decline was attributable to residual restructuring costs.

“In a challenging economic environment, the JN Group delivered another year of creditable results, reconfirming its core commitment to achieve a meaningful and efficient customer relationship, in tandem with the development of innovative products and services,” Jarrett said of the conglomerate's overall performance.

“We remain committed to delivering value to our members and customers,” he affirmed.

The conglomerate's financial subsidiary, the JN Financial Group Limited, comprises of JN Small Business Loans Limited, JN Fund Managers Limited, JN Money Services Limited, JN General Insurance Company Limited and JN Life Insurance Limited.

JN Financial realised profit of more than $2 billion, partly attributable to the disbursement of some $26 billion in loans to more than 42,000 people in the past financial year.

“A look at our loan portfolio indicates that we have contributed, in no small way, to the productivity of our people,” the CEO said. “In our business, our focus is on people as evidenced by our theme, People First; which reinforces the position that our members and customers are at the heart of what we do and who we are.”

According to Jarrett, more than 1,500 people benefited from approximately $11.2 billion in mortgages disbursed by JN Bank, which represented about 42 per cent of total loans disbursed by the JN Financial Group.

“Mortgages perhaps represent the lowest yield in asset and it's a large portion of our asset portfolio, so don't expect us to reflect profits similar to other banks,” Jarrett told members.

The Group also provided another $2.6 billion in insurance premium financing; and $1.9 billion in loans, for motor vehicle financing. In addition, roughly $1.28 billion was provided in corporate loans and $1.3 billion in business loans.

Jarrett expressed particular pleasure with the performance of JN Small Business Loans Limited. The company disbursed a record $5.5 billion in loans during the financial year ended March 31, 2018 to 27,601 clients, 20 per cent of whom were new clients.

On the subject of savings, the CEO said: “We have kept our promise to members and customers to prudently manage their life savings and investments.”

The Financial Group had combined savings and investments inflow of $156.13 billion for the year, with general savings of $95 million and $35.5 billion; while it also had some $15.8 billion in mutual funds under management; $15.8 billion in repos and $7.3 billion in pension funds.

Jarrett noted that JN Bank, performed to expectation achieving net savings of $6.8 billion and managing more than $113 billion in 700,000 accounts.

JN Fund Managers was also said to have performed well, noting the company's role as the lead broker in the successful initial public offering of shares for Stationery and Office Supplies Limited, which acquired $95 million.

“The company has set up an Investment Banking Division, to raise private equity and offer wider investment options for our members and customers,” Jarrett disclosed.

The Group's insurance firms, JNGI and JN Life Insurance also performed to expectation writing 79,000 policies with a combined insured coverage of $891 billion and valued at $809 billion, while some $5.7 billion were realised from premiums.

The Group's CEO noted that the JN's non-financial conglomerate, the MCS Group, recorded a surplus of $267 million. MCS Group comprises the technology firm Management Control Systems Limited; the Jamaica Automobile Association Limited, which provides roadside assistance and fleet management to the JN Group, JN members and customers; the advertising and event planning outfit, The Creative Unit Limited; and the debt collection agency, Total Credit Services Limited; as well as JN Properties Limited.

“We deliver value to our members by increasing the percentage of non-financial revenues in our overall income stream,” Jarrett underscored.

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