NCB Profits Declined by Almost 70%
There was a 68% drop in NCB Financial Group Limited’s (NCBFG) net profit attributable to shareholders in the first quarter, from $2.64 billion to $835.79 million, as the banking and insurance giant prepares for a strong recovery in 2023.
The announcement was made at the company’s virtual annual general meeting last Friday.
An actuarial adjustment of $3.5 billion and additional reserve movements at its subsidiary, Guardian Holdings Limited, contributed to the significant reduction in profitability. A majority stake of 61.77% in the Trinidad-based insurance company ( Guardian Holdings Limited) belongs to NCB Financial Group.
On the contrary, NCBFG’s asset base has increased four per cent to $2.11 trillion despite a decline in profitability, with equity attributable to shareholders rising from $163.88 billion to $172.22 billion as a result of reclassifying specific investment securities to hold to collect.
Continuing its streak of not paying dividends, NCBFG isn’t paying any interest for the seventh consecutive quarter. To push the total to $75.27 billion, the financial conglomerate elected to transfer $8.1 billion from retained earnings to retained earnings reserves rather than pay a dividend to shareholders.
At the end of a financial year, insurance companies make actuarial adjustments to the estimates they made at the beginning of the financial year as a result of a number of factors, such as an increase or decrease in claims or other factors, that have occurred during the period.
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This adjustment is made by insurance companies ahead of the end-of-year audit of their financial statements. Unlike the parent company NCBFG, which ends its fiscal year on September 30, GHL’s financial year closes on December 31.