Corporate <strong>Bank</strong>ing Commentary on overall Group results
Horace Cobham Managing Director Corporate <strong>Bank</strong>ing Corporate <strong>Bank</strong>ing Another Successful Year 2007 proved to be another successful year for the Corporate Strategic Business Unit as we continue to build on the solid foundation over the past three years set around our customers, our employees and tailored financial solutions and service. Our excellent results have again underscored the diversity of our operations as we serve and support our customers in their business activities throughout <strong>FirstCaribbean</strong>’s footprint. We saw one of our newest businesses, Trinidad, perform exceptionally well with over 115% business volume growth over last year. Improved results were also registered in the Jamaica, Cayman Barbados and the OECS markets in the face of intense competition. Overall, our sales force of dedicated relationship managers, industry specialists and Small Business officers have kept focused on business opportunities and have helped us to retain our market position in all our key markets. Financials Corporate loans grew by 15.5% year over year to $3.6 billion, fuelled by the disbursement of over $1 billion in loan facilities for the third consecutive year. Deposits continue to be a growth priority for the business and this year we realised 5.6% growth, moving the portfolio to $2.9 billion. Profit and loss performance has also been strong in 2007. Total revenues increased by 10% to $247.7 million, with the primary contributor, net interest income, increasing by 13%. Operating expenses continued to be tightly controlled, with strong productivity metrics being achieved. These strong financial results have been achieved without diluting our risk acceptance criteria. Underlying asset and portfolio quality remain well within the <strong>Bank</strong>’s established risk parameters and well diversified loan portfolio has allowed us to manage our country and industry risks successfully, as we pursued opportunities across the region. Additionally, as the <strong>Bank</strong> moves into a Sarbanes Oxley era, the Corporate SBU is actively ensuring the correct governance and control structures are in place to achieve full compliance by the first quarter of 2008. Customer Service During 2007, Corporate has worked to deepen our understanding of our customers through better research, segmentation and tailoring products and services to meet their needs. Broadening the way we interface with customers through multiple channels has been another area of focus for us, as we respond to customer requests for more self-service options and technological solutions. In this regard, our Internet <strong>Bank</strong>ing platform, facilitating straight-through processing of incoming and outgoing wires in most markets, has been seen as an excellent option by our customers. People Our 280 staff members across the region played an integral role in the success of the Corporate SBU in 2007. Their work effort, dedication and commitment have resulted in our customers rewarding us with more of their business, and most importantly, their trust. In 2007, we continued with our accreditation programmes under our sales and service mandate. On the risk side, in addition to credit training, we have rolled out Anti-Money Laundering and Know Your Customer courses to equip our people to better manage in the current environment. We remain committed to providing our people with the right tools, training and leadership to serve our clients better. To our staff, I say thank you for your dedication and finding new, innovative ways towards being first for our customers. Outlook As we enter 2008, there are expectations for a weaker global economic environment, characterised by high oil prices, slowdown in business and consumer activity and lower interest rates. The region’s dependence on foreign direct investment, capital flows and tourism will heighten the potential for impact on our regional business. However, the Corporate SBU is confident that we can leverage the <strong>Bank</strong>’s excellent balance sheet strength, our deep customer knowledge and service excellence to post another good performance in 2008. Service excellence is integral to our value proposition to customers. We are committed to continually enhancing service levels through all our channels and contact points. We stand committed to delivering the best customer experience possible, one that is tailored, efficient and solution oriented. Thank you to our customers for your business and we look forward to continuing our partnership in 2008. 33