Scotia Group Jamaica posted net income of $2.5 billion for its third quarter ended July 31, 2011 — $164 million above the quarter ended July 31, 2010 bringing net profit for the nine months ended July 31, 2011 to $7.96 billion, or $142 million higher than year-earlier levels.

The commercial bank contributed 46 per cent to the overall net profit of the group, or $3.5 billion, while Scotia Jamaica Life Insurance Company posted $2.8 billion.

Scotia Investments contributed 13 per cent or $969 million while Scotia Jamaica Building Society posted $391 million profit, or five per cent of the group’s net income.

“Scotiabank continues to lead the market in reducing lending rates which has correspondingly led to the growth of our loan portfolio,” said Scotia’s group president and CEO Bruce Bowen in a statement accompanying the financials. “This strategy

evidences our commitment to supporting economic growth and increased production in Jamaica. In the upcoming months we will launch new products and services as we continue to focus on meeting the needs of our customers while driving growth and value for our shareholders.”

Indeed Scotia’s loan portfolio, after provisions were made for losses, totaled $100.4 billion at the end of July, up from $94.4 billion a year earlier and which represented almost 40 per cent of all loans outstanding to commercial banks.

At the same time, Scotia’s non-performing loans at July 31, 2011 totaled $4.04 billion, down $45 million below prior year, and $178 million below the previous quarter ended April 30, 2011.

“The reduction is due to recoveries made during the quarter, coupled with strong credit policy and loan administration procedures, which have ensured stability in the portfolio,” said the bank in its financial statements. “Non-performing loans now represent 3.95 per cent of total gross loans compared to 4.17 per cent one year ago and 4.2 per cent as at April 30, 2011.

The group’s total loan loss provision at July 31, 2011 was $4.19 billion, providing over 100 per cent coverage of the total non-performing loans.

Total operating income, comprising net interest income and other revenue, was $22.96 billion, representing a decline of $16 million or 0.07 per cent relative to prior year.

Net interest income for the nine-month period was $16.823 million, down $648 million or 3.71 per cent when compared to the corresponding period last year. The decline in interest margins was due to the significantly lower yields earned on the securities and loan portfolios year over year, as market interest rates continued to trend downwards.

Other revenue for the period was $6.14 billion, up $633 million when compared with the prior year. This was primarily due to increased fee and commission income and net gains from securities trading, resulting from increased trading activity.

The group’s total assets increased year over year by $19 billion to $334 billion as at July 31, 2011. This was due mainly to the growth of $6.7 billion in cash resources, $6.2 billion in investments and pledged assets, and $6 billion in the loan portfolio. Customer liabilities (deposits, repo liabilities and policyholder’s funds) stood at $256 billion, $9.3 billion above prior year.

Total shareholders equity grew to $62 billion, $9 billion more than the prior year.