Following recent regulatory approval for the sale of its Curaçao and St Maarten banking assets, FirstCaribbean International Bank Limited (FCIB) is looking to grow its presence in the 10 Caribbean territories which will now form its core business.

FCIB has been divesting different Caribbean markets since October 2021, nearly nine months after its parent company, the Canadian Imperial Bank of Commerce (CIBC), failed to sell the majority interest in FCIB to GNB Financial Group Limited. Since then, FCIB has successfully exited Aruba, St Vincent and the Grenadines, and Grenada through successful sales. Its St Kitts and Nevis sale was blocked by regional regulators while it ceased its operations in Dominica.

The regional banking group is now looking to become the number one or two bank in the remaining territories that it doesn’t have that market share already. For its 2023 financial year (FY), FCIB was able to grow its total income by 24 per cent to US$715.46 million, with its net profit attributable to shareholders rising 53 per cent to US$264.06 million.

“As far as we are concerned, at this point, we are finished. We have 10 core markets that we’re moving forward to, and we are now pivoting to growing our operations. We are more than elated to announce the completion of our divestment programme, which has worked for us. The financial metrics of the group have improved and now we can take these scarce resources we have and focus them on those areas that present great opportunities for growth,” said FCIB Chief Executive Officer (CEO) Mark St Hill at the 30th annual general meeting (AGM) held virtually last Friday.

The CEO even referred to FCIB’s return on equity (ROE), a metric meant to show how well shareholders are doing, rising from 7-10 per cent around 2019, prior to any divestments, to 21 per cent for 2023 after divesting around four markets. He mentioned that greater emphasis will be placed on seeking opportunities in expanding business lines, which includes placing greater emphasis on Jamaica and Trinidad and Tobago (T&T) which together represent about 80 per cent of the English-Speaking Caribbean’s population. To this end, FCIB will be injecting US$25 million in new capital into its Jamaican subsidiary.

FCIB’s 2023 earnings largely benefited from an uplift from higher United States dollar (USD) benchmark rates in their primary USD markets in The Bahamas and Cayman Islands. The Bahamas and Cayman Islands collectively represented about two-fifths of FCIB’s total revenue and total assets in 2023. Its other Caribbean markets include the Turks and Caicos Islands, British Virgin Islands (BVI), Antigua and Barbuda, St Lucia, and Barbados. The two Dutch Caribbean banking assets will be owned by Curaçao-based Orco Bank NV following the close of the transaction.

Part of this expanded business focus will be supported by the recent rebranding of its operations to that of its parent CIBC. While the rebranding of its branches took effect at the end of January, the legal name had not changed as yet due to shareholder and regulatory approval requirements. Following the requisition of a poll by St Hill, who was the proxyholder for CIBC, all resolutions at the AGM were approved, including one for FCIB to be renamed CIBC Caribbean Bank Limited.

“What this demonstrates is one of the most stable banks, if not the most stable bank in the world, demonstrating to put its brand and its continued operations in the region. That speaks volume and that alone will assist in fostering trade and the movement of capital and funds across the globe. It also allows our bank to access larger deals and give that confidence for large operations where it’s very important that the stability and rating of the bank is a key focus,” added St Hill on the benefit to be derived from having an aligned brand with its parent.

While many businesses have flocked to Guyana, which is the world’s fastest-growing economy, St Hill noted the size of Guyana’s population and the country being well-banked as a reason the bank is not hankering to enter the market. Although he didn’t exclude mergers and acquisitions (M&A) as part of FCIB’s growth strategy, St Hill said, “Anything that is going to be accretive to our business, we will look at. If something really good came across, we will definitely take a look.”

FCIB launched two co-branded JetBlue credit cards for personal customers last October and plans to launch one for its business customers in short order. FCIB currently has seven personal credit card offerings and three business credit cards. FCIB also recently launched a Mastercard prepaid card as a secure disbursement solution for government, corporate, and business banking clients who frequently disburse cheques.

“Certainly, that is part of the plan. Currently, we have launched two of the three offerings. Stay tuned. And coming very soon will be our offering for business clients,” said Chief Information Officer Esan Peters on the new JetBlue card.

FCIB’s first quarter saw its total revenue marginally increase to US$183.66 million, but its profit before tax for its continuing operations jumped 22 per cent to US$91.96 million due to a minor reduction in operating expenses and a reduction in its credit loss provisions. Net profit from its continuing operations grew 23 per cent to US$86.25 million, with net profit attributable to shareholders at US$82.59 million.

A large factor in the improved profitability came from its personal and business banking segment for which net profit nearly doubled compared to the January 2023 period. FCIB’s corporate and investment banking segment also saw a 17 per cent improvement while the wealth management segment saw a 24 per cent cut.

Total assets decreased three per cent to US$12.49 billion, with its loans and advances portfolio growing to US$6.74 billion, while its cash stood at US$2.22 billion. Total liabilities decreased five per cent to US$11.07 billion, with deposits at US$10.52 billion and equity attributable to shareholders at US$1.39 billion.

FCIB’s stock price on the Trinidad and Tobago Stock Exchange closed Tuesday at TT$7.05, which leaves it with a market capitalisation of TT$11.12 billion. FCIB plans to launch its third branch in San Fernando, T&T, later this year.

“There are varying reasons for deposits going down. I think when it comes to the reason where some of our clients have gone to alternate investments in treasuries and things like that and they have used deposits to pay down debt in a high interest rate environment. I think it would be natural to say we may see USD flowing back into deposits. You need to appreciate our bank is made up of multiple currencies. You have your sovereign and hard. If I take the Jamaica example, our deposit base has been growing there. So we have been growing deposits in Jamaica. It’s a mixed bag and within all of this, you have to appreciate we would have divested a number of countries,” St Hill closed on the observed figures on deposits.