REPUBLIC Financial Holdings Ltd (RFHL) ended its 2019 financial year with a profit of $1.58 billion, an increase of $258.3 million or 19.5 per cent over the previous year.
RFHL, the parent company of all of the banks in the Republic Bank Group, yesterday released its financial results for the year ended September 30.
In a statement accompanying the results, RFHL’s outgoing chairman Ronald Harford said the results included two significant one-off items, the net impact of which increased profits by $83.5 million.
“Firstly, the bank in Trinidad and Tobago amended the terms of its post-retirement medical benefits plan in line with market, resulting in a write back net of deferred taxes of $275.3 million. Secondly, Barbados reduced its corporation tax rate from 30 per cent to a range between one per cent and five per cent, which resulted in a charge to our income statement of $191.8 million due to the re-measurement of deferred tax assets at the lower tax rate,” Harford explained.
Excluding the impact of these items, the Group’s core profit was $1.5 billion, $174.8 million or 13.2 per cent more than the prior period, he said.
He said the increase in core profit was driven mainly by Cayman National Corporation ($92.6 million) and the Republic Bank Ltd T&T Group ($39.2 million).
Total assets stood at $87.5 billion at September 30, 2019, an increase of $17 billion or 24.2 per cent over that of the prior year.
Harford outlined that the Group continued to progress with its strategy of acquisition and diversification of income sources with two major acquisitions—Republic Bank (Barbados) Ltd’s acquisition of 74.99 per cent of the outstanding ordinary shares of Cayman National Corporation (CNC) on March 13 and the completion of the group’s acquisition of Scotiabank’s banking operations in seven Caribbean countries on October 31.
The Cayman acquisition increased RFHL’s asset base by $11.1 billion and added $92.6 million in profits (after minority interest) for the seven months period under RFHL’s ownership, Harford noted.
He said on a pro-forma basis, the acquisition of Scotiabank’s operations will add 350 team members to RFHL’s staff complement, $10.1 billion to total asset size, while net profits are expected to be in the region of $133.6 million.
“We are very pleased to welcome the new staff members and clients to the Republic family. The outlook for the economies in which we operate are generally positive and we expect continued growth in our subsidiaries in those territories. This combined with our recent acquisition of CNC and completion of the acquisition of Scotiabank’s operations in the Eastern Caribbean and St. Maarten, and the implementation of a number of efficiency initiatives will boost profitability over the coming years,” Harford stated.
Harford, who has been chairman of RBL and RFHL for the last 16 years, retires from the board of directors of both companies at the end of this year.
BHP T&T president Vincent Pereira is designated to replace him.