Scotiabank Jamaica Group will be aggressively going after the private sector loan market this year, as it realigns its loan portfolio away from government borrowing, which is drying up.

Scotiabank President and CEO David Noel, who made the announcement while addressing the bank’s annual general meeting yesterday, declared that private sector loan growth represents the biggest opportunity for growing the bank.

“We are focused on loans to the private sector, we have loan with Government as well as other entities but private sector loan growth is what we are focused on,” Noel told shareholders, who were gathered at the Jamaica Pegasus Hotel in New Kingston.

The move, although not surprising, comes in wake of the Government’s thrust, over the past few year, to reduce debt, in particular curtailing its appetite for borrowing to pay off current maturing debt.

The shift is also informed by the measure announced by Finance Minister Dr Nigel Clarke last Tuesday to pay off as much as $73-billion in debt this fiscal year, in particular for bonds maturing this year, rather than borrowing to pay off principal payments as they are due.

The Scotiabank boss boasted that private sector loan growth for 2019 was 27 per cent year-over-year pointing out that the bank has been lending in many areas of business and commerce.

COVID-19

He stated, “Despite the challenges that will come with COVID-19 we are there for our customers, we have the capital and liquidity to support our customers and we will be doing that. We expect that number [loan growth] to grow even further over time.”

For 2019 Scotiabank Group reported strong growth in its core business with its total loan portfolio increased year-over-year by 13 per cent. This includes an increase of 17 per cent over prior year in the Scotia Plan retail loan portfolio, and another year of double-digit growth for the mortgage portfolio, which increased by 13 per cent.

In its just-approved 2019 annual report to shareholders, Noel pointed out that the growth in these portfolios was achieved through consistent execution of its strategic initiatives to improve service to customers, making it more convenient for them to access our suite of products and services.

The Insurance and Investment subsidiaries delivered strong results for fiscal year 2019 with Scotia Investments exceeding last year’s good with an increase in revenues of 10 per cent year-over-year and a 13 per cent increase in assets under management.

He pointed to the successfully executed initial public offering (IPO) for Fontana Pharmacy by its investment subsidiary noting that Scotia Jamaica Life Insurance continues to improve sales productivity and also delivered a 20 per cent increase in policies sold year-over-year.

For 2019 the group recorded net income after tax (NIAT) of $13.2 billion for the year, which represents an increase of $419 million or three per cent versus the previous year. Excluding gains on the sale of a subsidiary of $753 million that occurred in the prior year, net income increased year on year by $1.2 billion or 10 per cent.

Noel announced that Scotiabank’s new mobile banking app, which possess a number of security features as well as easy access to online banking services, “ will be delivering real value for customers, while ensuring you are protected as you bank”.