Republic Bank records 42.8% decrease in revenue
Republic Financial Holdings Limited (RFHL) –the parent company of Republic Bank Ltd. – has recorded a 42.8% decrease in revenue at the end of September 2020 when compared to the same period last year.
Chairman of the company, Vincent Pereira, in a press release on Tuesday, announced that the profit garnered is US$134.93 million for the year ending September 30, 2020, which is a decrease of US$101.06 million.
In the previous financial year, Republic Bank recorded a profit of US$235.98 million. The Chairman attributed the loss to the COVID-19 pandemic and related challenges.
“These results are creditable despite reflecting the negative impact of the novel coronavirus (COVID-19), mainly through decreased economic activity, lower margins due to reduced interest rates, waiver of fees and commissions under the COVID-19 relief initiatives, increased provisioning to cover potential future losses on the loan and investments portfolios, and impairment of the remaining Goodwill held in our Barbados subsidiary,” Pereira was quoted as saying in the release.
He noted that the total assets stood at US$15.57 billion at September 30, 2020, an increase of US$2.51 billion or 19.2% from the previous year. This increase is mainly due to the acquisition of Scotiabank’s banking operations in St. Maarten and the Eastern Caribbean (Anguilla, Dominica, Grenada, St. Kitts and Nevis, St. Lucia, and St. Vincent and the Grenadines) on November 1, 2019, which added US$1.90 billion and the acquisition of Scotiabank’s operations in the British Virgin Islands (BVI) on June 1, 2020.
The company sought to acquire Scotiabank’s shares in Guyana as well but this was blocked by the former Government to avoid unfair competition in the local banking sector.
The Board of Directors has declared a final dividend of US$0.31 (2019: US$0.49), which brings the total dividend to US$65.64 million or US$0.40 per share for the fiscal year (2019: US$0.67). This represents a decrease of 40% in total dividend payment, reflective of the decrease in profitability in the current fiscal year.
The combination of this dividend and the increase in the share price of US$3.01 during the year, equates to a total shareholder return for the year of 18.5%. The final dividend will be paid on December 1, 2020, to all shareholders of record on November 18, 2020.
Pereira concluded, “While there continues to be uncertainty over the future direction and duration of the COVID 19 pandemic, we are confident that the Group’s strong capital base, diverse geographic footprint and robust governance culture leaves it well-positioned to support the recovery efforts of the economies within which we operate. We continue to be responsive to the evolving needs of our customers and clients, provide safe working conditions for our employees and support the communities.”