ScotiaGroup Jamaica yesterday reported net income for the fiscal year ended October 31, 2009 of $11.1 billion, an increase of $1.7 billion or 19 per cent above the comparable period last year.

The growth was despite a decline in net income of the banking division, which the firm said took the brunt of the recession.

At a press briefing held at the Terra Nova All-Suite Hotel to announce the financial results, Scotia president and CEO Bruce Bowen expressed satisfaction with the performance of the firm over the period under review.

“Scotia Group Jamaica continues to report solid earnings due to the Group’s strong capital and liquidity positions, and our diverse revenue streams,” he said.

Earnings per share (EPS) over the period was $3.58 compared to $3.02 last year, while the group’s Return on Average Equity (ROE) is 26.35 per cent.

Total revenues, comprising net interest revenue and other income, increased by 23 per cent from the prior year to $35.2 billion.

Net interest income was $29.3 billion, up 32 per cent over last year. The firm said that this was due to strong growth in earning assets combined with improved interest margins resulting from increased market rates.

Total assets increased by $35 billion to $316 billion, or by 35 per cent, year over year.

The group’s loan portfolio increased by $2.5 billion to $92 billion over the year, with growth coming mainly in the commercial loan portfolio. At the end of the period, the firm’s loan portfolio comprised of 45 per cent retail loans, 44 per cent commercial loans and 11 per cent government loans.

However, the tough economic climate was evident in the fact that non-performing loans increased by $616 million over last year and stood at $3.5 billion at the end of the period under review. Retail loan customers have especially been affected by the downturn in the economy and this affected the banking segment’s performance.

“There really was no growth in the retail areas, we were affected by the layoffs in the bauxite and tourism sectors, non-performing loans, etc” Wayne Powell, executive vice-president of branch banking and retail management of Scotia Jamaica, told Caribbean Business Report.

The banking segment posted net profit attributable to common stockholders of $5.6 billion, a five per cent reduction compared to last year. But Bowen said the fact that the group still put in a solid performance despite the fall-off in the banking segment is testament to the strength of the firm’s diversified revenue stream.

“That is one of the benefits of the diversification,” noted Bowen. “While one area is experiencing downward pressure, other areas do well.”

Scotia DBG was the star performer as it saw its net profit attributable to common stockholders grow by 94 per cent to $1.5 billion over the period under review. The investment management segment of the group had EPS for the year of $5.03 compared to $2.93 last year. The company’s return on average equity improved to 30.16 per cent.

Scotia DBG CEO Anya Schnoor said “I am extremely pleased with our performance over this dynamic financial year… Our performance this year was achieved against the backdrop of an extremely challenging economic environment which saw interest rates rising and significant movement in the foreign exchange rate.”

She said that the solid results were due to the company being able to enhance its efficiencies and expand its product offerings.

One of these new product offerings is the Caribbean Income Fund, which was launched in the fourth quarter. Schnoor said the fund has been doing tremendously well, with five million units sold some three weeks after launch.

The firm’s life insurance segment also posted solid results with Scotia Jamaica Life Insurance Company posting net profit attributable to stockholders of $3.5 billion, a 58 per cent growth above the comparative period last year.

Scotia Jamaica Building Society increased its net profit attributable to stockholders by 12 per cent to $498 million over the period under review.