Sagicor Group profit falls 40%
Published:Wednesday | November 20, 2024 | 12:05 AM
Sagicor Group Jamaica Limited, SGJL, saw its profit for the September 2024 third quarter fall to $2.7 billion, a 40 per cent decline compared to the same period last year, because of economic challenges.
“Despite the difficult economic climate and several one-off expenses that have contributed to the decline in year-to-date profit, SGJL has remained focused on improving service levels for its customers while driving internal efficiencies,” said Sagicor Group President and CEO Christopher Zacca in the company’s financial report to shareholders.
The financial conglomerate reported solid growth in insurance revenue and net interest income, compared to the prior year. However, overall expenses rose in line with inflation as the group continued to invest in digital platforms and data security.
Nine-month profit totalled $6.6 billion, down 34 per cent from the previous year. The largest profit decline occurred in the long-term insurance segment, which fell by 80 per cent, from $6.7 billion to $3.7 billion. Investment banking profit also dropped by 25 per cent, from $800 million to $590 million. However, other segments saw improvements, with short-term insurance profit rising from $1.4 billion to $1.6 billion, and commercial banking profit from $2.1 billion to $2.5 billion.
“Despite ongoing market volatility, the group’s asset portfolio shifted from unrealised mark-to-market losses last year to gains in the current period. Strong insurance sales continue to drive growth in insurance revenues,” Zacca noted.
The commercial banking segment reported growth in the loan and card payment portfolios, with improved net interest margins and fee revenue. Meanwhile, the investment banking segment saw improvements in interest margins, despite challenging market conditions.
During the quarter, the Bank of Jamaica reduced its policy interest from 7.0 per cent to 6.5 per cent, in two adjustments.
“While we note the easing of interest rates by the regulators, we maintain our conservative approach to managing liquidity and capital while looking for opportunities in markets that are beneficial to our stakeholders,” said Sagicor Group.
The group’s capital rose to $105 billion from $95.9 billion in the September quarter, while its cash holdings declined to $40 billion, from $45.1 billion.