JAMAICA National Group is targeting an 80 per cent reduction in consolidated losses for the financial year ending March 2026, according to an email sent to members on Monday, marking its sharpest financial improvement since losses peaked during a period of sustained restructuring and capital strain.

Losses that reached roughly $4 billion at peak stress narrowed to $2.5 billion in FY2025 and are tracking materially lower this financial year, according to management, as the Group works to restore earnings momentum and stabilise its balance sheet.

At the centre of the rebound is JN Bank, the Group’s flagship subsidiary, which reported unaudited pre-tax profit of $1.2 billion for the nine months ended December 2025 — more than double the $582 million recorded for the full financial year ended March 2025. If sustained, that performance would materially alter the Group’s consolidated position.

The recovery, however, is unfolding under scrutiny. At its recent annual general meeting, CEO Earl Jarrett acknowledged that credit rating agency CariCRIS maintained JN’s ratings but shifted the outlook from stable to negative, citing concern over continued losses.

“They didn’t change the ratings, but the outlook moved from stable to negative,” Jarrett told members, signalling that the next review cycle will test whether the stabilisation holds. The Group did not elaborate on specific performance thresholds required to restore a stable outlook. Attempts to reach CEO Earl Jarrett for additional comment were unsuccessful.

From retrenchment to refocus

JN’s current position follows two years of balance-sheet contraction and asset sales aimed at rebuilding capital and restoring financial flexibility.

The Group liquidated its investments in JN General Insurance and JN Fund Managers and reduced its stake in JN Bank UK, concentrating capital on core operations: Banking, remittance services, life insurance and digital platforms.

Impairment losses declined year over year, and proceeds from divestments are being used in part to prepay borrowings incurred during the restructuring period. Capital adequacy remains under close watch as management recalibrates risk appetite.

Customer deposits, which fell sharply during the most strained phase, have begun to recover. JN Bank reported deposit growth of 5 per cent in 2025, while its net loan book expanded by 2 per cent for the year. Momentum strengthened in the current financial year. Up to September 2025, the Bank’s net loan book rose 7 per cent to $165.10 billion, while deposits increased 5 per cent to $220.37 billion over the six-month period. Earlier contraction in mortgage lending reflected tighter underwriting standards and exposure recalibration during the restructuring phase.

The Group’s recovery now rests squarely on JN Bank’s performance. The bank remains one of the island’s dominant mortgage lenders and the Group’s largest revenue earner. Improved net interest margins, firmer cost discipline and stronger operating efficiency drove the latest earnings surge. If replicated through March, that momentum would decisively strengthen the Group’s financial trajectory.

Digital scale, physical shrink

The restructuring is visible beyond the balance sheet. JN Bank has announced the permanent closure of its Sovereign on the Boulevard and Half-Way Tree Transport Centre branches effective March 31, 2026, consolidating accounts into its centrally located Half-Way-Tree branch.

Management cited sustained migration toward digital channels — including ONE JN Passport onboarding, JN Bank LIVE online banking, the JAMDEX-enabled JN Pay Wallet and upgraded Smart ATMs. The branch rationalisation reflects more than shifting customer behaviour. Operating expenses remain elevated, and executives conceded that the cost-to-income ratio is above target. Reducing fixed overheads while scaling digital infrastructure is central to restoring margin stability. Over the past five years, JN has invested more than $3 billion in technology architecture. The focus has now shifted from investment to measurable returns.

Project Rubicon — the Group’s data-driven loan adjudication platform — has cut unsecured loan approval times roughly in half and is being extended to mortgage processing, tightening risk controls while accelerating credit decisions.

The digital push extends beyond banking. JN Money Services is expanding into additional international markets, including Ghana and Nepal, while upgrading digital capabilities to improve efficiency and customer access. JN Life Insurance is maintaining its sales force and expanding services, particularly in underserved communities, reinforcing the Group’s emphasis on core, capital-efficient business lines.

Risks remain

Despite the improving trajectory, material risks persist. Asset quality pressures continue across the financial sector, and hurricane-related disruptions have affected parts of JN’s branch network and loan portfolio. While mortgage exposures are largely insured, unsecured lending remains more vulnerable. Reliance on more expensive repo funding during the restructuring period continues to pressure margins.

CariCRIS’ negative outlook underscores the fragility of the transition. Sustained profitability — not merely narrower losses — will be required to shift that assessment. JN’s mutual ownership model heightens the stakes, directly linking earnings stability to member confidence and long-term institutional resilience.

A proving year ahead

After 151 years in operation, Jamaica National has navigated multiple economic cycles. The current phase represents one of its most consequential resets — a pivot from expansionary diversification toward disciplined focus, capital preservation and digital scale.

An 80 per cent reduction in losses would mark the first decisive financial inflection since the restructuring began. But the outlook revision makes clear that progress must be sustained. The next review will determine whether the Group has truly turned the corner — or whether the stabilisation remains provisional.

JN Group headquarters in Kingston. The 151-year-old institution is targeting an 80 per cent reduction in losses as it pivots toward core banking and digital growth. (Photo: Joseph Wellington)

Earl Jarrett, chief executive officer of JN Group.