NCB post increased Q2 profit

NCB HQNational Commercial Bank is reporting net profit for the three months ended March 2015 of $3.27 billion versus $3.05 billion in the 2014 period.
Changes in the manner the tax of the groups assets are now being treated with all amounts due being booked as expenses up front has distorted the results in the early months of the fiscal year which are front loaded with these cost. Normalising the expenses would result, according to NCB in net profit for the three months ended March 2015 of $3.34 billion, 20 percent or $563 million over normalised net profit for the December 2014 quarter of $2,778 million, and 12 percent or $349 million over the previously reported net profit for the three months ended March 2014 of $2.99 billion. For the six months to March the banking group reported profit of $5.4 billion or $2.19 per shares compared with $5.55 billion in 2014. The up-fronting of the asset tax, resulted in the lower 2015 profit compared to 2014. NCB should go on to earn around $7 billion in the second half of the year or around $5 per share for the full year.
For the six months to March 2015, operating income increased by 14 percent, or $2.9 billion, compared with the six months ended March 2014, mainly as a result of gain on foreign currency and investment activities, up by $1.5 billion. This was due to higher levels of foreign exchange income and gains from the sale of debt securities compared to the prior year, NCB said.
Also contributing to the increased profit is net fee and commission income, increasing by $652 million or 16 percent, mainly due to Payment Services fees related to card usage and transaction volumes, credit related fees from the growth in loans and greater corporate finance and unit trust fees booked in the current period, the banking group stated in its release to the Stock Exchange. Net interest income, increasing by 4 percent, or $542 million, primarily due to growth in the net loan portfolio.
Loans and advances, totalled $157.9 billion (net of provision for credit losses) at March 2015, grew by 5 percent, or $7.4 billion, compared to the loan portfolio as at March 2014.
NCB declared an interim dividend of 45 cents per ordinary stock unit which is payable on May 21 for stockholders on record as at May 8, 2015.

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  1. […] A final dividend of 85 cents per share is to be paid December 11 with record date being November 27. NCB paid three interim dividends of 45 cents each during the year, the latest brings the total to $2.20 […]

  2. […] offered 982,465 units for sale at $6.80, Kingston Properties climbed $1 to $8 with 2,705 shares, National Commercial Bank rose 10 cents in trading 25,224 shares to close at $29.10, Sagicor Group fell 24 cents with 28,533 […]

  3. […] a small volume of 7,239 shares. JMMB Group traded 176,877 shares but remained unchanged at $7.50, National Commercial Bank closed trading with 52,710 units changing hands and gained 5 cents to $29.50, Sagicor Group traded […]

  4. […] in all the main indices with the main market indices up a bit. Helping the indices move up are National Commercial Bank trading at $29.99 for a 53 cents gain, Caribbean Cement adding 10 cent to $5.10 and Sagicor Real […]

  5. […] InvestmentsInvestments traded 467,745 shares at 22 US cents, up from 21.05 US cents on Monday. National Commercial Bank traded 524,170 units at $29.45, the stock last traded on Monday at $30 and Medical Disposables had […]

  6. […] hands at $7.45 for a 15 rise, Mayberry Investments had 11,195 units changing hands at $2.88, National Commercial Bank traded 48,527 units to close at $30, after gaining 50 cents. Pulse Investments had 306,000 shares […]

  7. […] & Poor’s Ratings Services upgraded the Jamaica’s most profitable bank, National Commercial Bank (NCBJ) on the grounds of a wider sovereign upgrade earlier, recently. S&P raised its long-term […]

  8. […] 134,900 shares, Kingston Wharves lost 49 cents with 8,000 shares trading at the close at $6.51, National Commercial Bank had 36,290 units trading unchanged at $29.50. Sagicor Group traded only 31,267 shares, was quoted at […]

  9. […] the close are, Clico Investment Fund with 4,400 shares trading, gained by 5 cents to end at $22.55, National Commercial Bank contributing 329,506 shares with a value of $283,784, to end at $1.80 up 4 cents and West Indian […]

  10. […] Dr Omar Davies will have found that his investments in Proven ordinary shares is working far better than funds placed in Credit Union, the latter seems to be his preferred choice for the placing of funds it would appear, based on a response he gave a few years ago to a reporter. Davies and his other political colleagues would have seen their investment in the company done exceedingly well with the stock now trading at 21 US cents, well above the low of 7.5 US cents it traded at in December 201. With the stock at a PE around 48 times ongoing earnings and well above any other stocks on the exchange, are investors pricing the stock right? There of course is a fallacious argument that the value is what willing buyers and sellers are prepared to pay, that may well be so, but if it based on unrealistic assumptions, the buyer may find that they over paid. What are investors paying a heavy premium for? It is not growth, for the company has not grown from increased profits after paying dividends, it not growth in profits since there is no growth in ongoing earnings since 2012, and it is not consistency of earnings either. The net asset value has not grown in the 2015 fiscal year over 2014 with net value of $32 million before new issued shares is adjusted for. The amount is lower than the $33 million in 2012 and $35.78 million in 2013, while this year’s operating profit is down on that of 2013 at $4.16 million and $3.3 in 2012. Proven just reported full year results showing a profit of US$5.9 million or 1.5 US cents per share, up on the earnings in 2014 of $3.78 million or 1.28 cents per share. On the surface, that seems great and would put the PE at 14, and based on the local market valuation, it’s a bit high but not extremely so, with stock prices having grown an average of 30 percent in value for 2015, raising the PE of most stocks. Overvalued| It is still around 40 to 50 percent above the valuation of the vast majority of the stocks on the market. The real rub is that the earnings include a one off extraordinary item of US$4.2 million that should not form part of the earnings on which the value of the stock ought not to be based. Excluding this amount that swelled the reported profit, earnings per share would 4.8 US cents which gives a PE of 48 and not 14. During the year, Proven enjoyed strong growth in revenues but cost jumped sharply as well, with net interest income more than doubling to $7.65 million from $3.2 million in 2014. Overall net income grew from $8.6 million to $11.38 million, operating expenses moved from $3.6 million to $8.28 million, including loan impairment that jumped to $442,000 from just $45,000 in 2014. Operating profit before preference dividend of $1.5 million (2014: $969,000) amounts to $3.1 million down form $5 million in 2014. The acquisition of the First Global Financial’s portfolio and the Access shares, incurred cost of $169,313 which is expensed is unlikely to recur in 2015, unless there are other take overs in the works, as such the net operating profit from ongoing operations would have been somewhat higher than the figure mentioned above but still leave the stock seriously overvalued, for a company that is not growing operating profit on a consistent basis year to year. Going forward, the acquisition of Access Financial Services contributed profit of US$1.2 million to the group’s profit and could end up around $4-5 million for the full year which would swell earnings considerably for the group for the year ending March next year. Proven raised US$30 million in fresh capital after the year end pushing the share capital to 551 million units, these funds will generate added income and profit and the group is looking at possible acquisitions, with shares in Guardian Holdings in Trinidad high on the list. Investors can look forward of profits hitting $7 million mark with earnings around 1.3 cents per share or somewhat more depending how the fresh capital is deployed. Regardless, earnings per share from ongoing operations would be up from the low level of 2015, but would still leave the value of the stock around 16 times earnings, more than 3 times that of National Commercial Bank. […]

  11. […] of the group’s shares on May 7, another amount of 77,886 shares on May 8 and 843,924 on May 11. NCB posted improved results in its latest quarterly report which shows a 7 percent increase in profits […]

  12. […] banker Proven Investments and National Commercial Bank, Jamaica’s number one banking group, are lining up to acquire some large blocks of shares in […]

  13. […] invest in the newest investing fad at the time – Alibaba. At the time Alibaba was around US$100 and NCB was sold around J$17. The chart below tells how wrong the investor was. NCB shot up 79 percent in […]

  14. […] traded 200,000 units at a new 52 weeks’ high of $2.55, after putting on 30 cents on the price. National Commercial Bank had 17,584 units changing hands for 50 cents higher to end at a new 52 weeks’ high of $28.50. […]

  15. […] National Commercial Bank traded 508,263 shares at a new 52 weeks’ high of $27 on the Jamaica Stock Exchange on Monday morning and helped to push the all Jamaican Index by 388 points. The stock subsequently traded at $28, while Supreme Ventures traded 20,000 units at a new 52 weeks’ high of $3.10. Trading resulted in 13 securities trading including 3 from the junior market. A total of 658,835 units traded at 10.45am. Carreras traded 3,878 units but slipped back $1 to $45. Stocks not trading as yet but look promising are Caribbean Producers with the bid at $2.70 to buy 18,348 shares, the stock last traded at $2.70 on Friday. AMG Packaging had a bid for 21,262 shares at $2.33 compared to last sale of $2.26, Caribbean Cream with a bid to buy 535,715 shares at 70 cents versus last sale of 65 cents, Dolphin Cove with 95,864 shares on the bid at $9.20 where it traded this morning, General Accident Insurance having a bid for 663,735 units at $1.70 the same as the last price. […]