Commonwealth Bank reported impressive positive third quarter results with a Comprehensive Net income of $39.3 million for the first nine months of the fiscal year, up 35% over the same period last year, largely as a result of lower costs associated with reductions in non-performing and charged off loans.
While the upbeat report is welcome news for the Bahamian Bank’s 6,000+ shareholders, it was accompanied by a statement from Executive Chairman William B. Sands, Jr., advising that the bank was still only “cautiously optimistic” – a phrase it has used to capture the state of the economy for the past five years – and it was watching government action closely before making future predictions.
“While we are cautiously optimistic about the remainder of 2013, the Bank is closely monitoring pending changes in the regulatory and tax environments for 2014,” said Mr. Sands.
Although he couched results in careful terms looking to a future that includes major regulatory and taxation changes, with increased Business Licence Fees as well as the proposed implementation of Value Added Tax, there was no arguing with the bank’s fiscal 2013 success, a success it shares with its Bahamian shareholders from every walk of life and every island throughout the archipelago.
The Bank’s positive results stretched across the board with Comprehensive Net Income for the three months ending September 30, 2013 standing at $13.2 million, nearly three times more than the previous year when results for the third quarter landed at $4.7 million, after being heavily impacted by increasing loan impairment expenses.. Total assets inched up slightly from $1.43 billion at the end of 2012 to $1.44 billion. There were impressive increases in the Bank’s earnings per share ratio, $0.36, up 45% over 2012’s ratio of $0.25. The Bank also showed dramatic improvement in its loan portfolio with its nonperforming loan ratio of 4.4% outperforming the industry average of 13.9% as reported by The Central Bank.
The Bank also reported strong capital and liquidity positions with capital adequacy at over 24% and a liquidity ratio of 35%, both significantly in excess of Central Bank’s requirements of 17% and 20% respectively.
“In this 40^th anniversary year of Independence for The Bahamas, I wish to thank our shareholders, our customers and the public at large for their ongoing support, and our complement of hardworking and devoted employees who are instrumental in achieving our outstanding results,” said Mr. Sands.
Commonwealth Bank operates branches in New Providence, Grand Bahama and Abaco and has paid consistent quarterly dividends since it went public in the year 2000.
Diane Phillips and Associates
