Republic Bank to introduce private banking

Republic Bank (Guyana) Limited is to introduce centralised private banking.

In his discussion and analysis of the bank’s performance for 2017 contained in its annual report, Managing Director Richard Sammy said as the bank looked to 2018, future customer service will encompass a “centralised private banking service to efficiently serve the needs of the professional segment of the market”.  The bank’s AGM is set for December 11 at the Pegasus Hotel.

In his review in the report, Chairman, Nigel Baptiste had also hinted at big developments next year.

Richard Sammy

He said “Notwithstanding the economic constraints, Republic Bank remains confident in, and committed to, the future development of Guyana. To this end, the Bank will make a number of bold moves in 2018 which we believe will help us to grow and remain competitive in the coming years. Our priority in the new fiscal (year) will be to enhance the overall experience we provide our customers, continue to innovate products and services across our markets, further develop and leverage our network of branches, strengthen our electronic banking capabilities, simplify processes, and invest further in our people, culture and brand promise”.

Sammy said that a notable challenge during the first and second quarters of the fiscal year was the limited availability of US currency to meet customer demand and the pressure on the market rate in Guyanese dollars.

“However, timely introduction of specific measures and closer monitoring by the Bank of Guyana, along with co-operation by sector players, assisted in addressing potential long-term currency and exchange rate movement”, Sammy asserted.

The Managing Director stated that the international regulatory climate has grown increasingly rigorous following money laundering and terrorist acts and legislation has heightened the risk and responsibilities linked to banking globally, regionally and locally. He said that the bank has responded to this challenge by taking “robust” measures to counter the possible use of its services to enable the illicit transfer of funds and terrorist financing.

Sammy said that efforts are continuing to ensure that the bank is compliant with the US Foreign Account Taxation Compliance Act and customers with US credentials are being engaged to ensure that documentation is in order.

Republic Bank registered an after-tax profit of $2.73b for the financial year ended September 30, 2017 – slightly above the previous year’s figure.

Its financial statements showed that the after-tax profit of $2.73b was 1.32% above the previous year’s figure of $2.7b.

Interest income was up a smidgeon for the T&T-headquartered institution, from $7.671b for the year 2016 to $7.705b for 2017. Interest expense on the other hand fell from $603.4m in 2016 to $574.9m this year.

The loan impairment expense was down 14% in 2017 compared to 2016 but was still significant. The loan impairment expense for 2016 was $786.6m compared to $675.7m this year.

Sammy in discussing the results said that interest paid on deposits for 2017 at $575m was below 2016’s $603.5m “as the Bank continued to manage its assets and liabilities in an environment of inadequate investment opportunities. It is recognized, however, that customers simultaneously use a range of products and the Bank strives to ensure that rates (deposit and lending) are competitive with the rest of the industry…”

On non-performing loans, Sammy noted that at September 30, 2017, the specific provision for this amounted to $589.4m which was a decrease of $78.5m over 2016.

“Overall in 2017, expenses related to loan-loss provisioning amounted to 675.7 million against a provision of $786.6 million in 2016. The Bank continues to strive to maintain a very prudent policy especially on its unsecured consumer lending portfolio. Recoveries on loans which were previously written-off amounted to $231.8 million in 2017” compared to $196.5m in 2016.

Sammy added that the bank’s ratio of non-performing to performing loans as of September 30, 2017 rose to 6.96% from 6.25% in 2016. However, the ratio of specific provision for loan losses to non-performing loans dropped from 18.74% in 2016 to 14.37% this year.

In relation to advances, Sammy said that these grew by $2.7b to $61.1b, an expansion by 4.63%. He said that the bank’s investment in agriculture remained at a “minimum” as it continues to reassess the position.

The Managing Director noted that the bank’s Water Street branch was the target of an attempted robbery on July 4, 2017 “which, due to the prompt tactical response by members of our security provider and the Guyana Police Force, was averted with preservation of employees and customer safety and no financial loss”.

The bank has 12 branches, 708 employees and 46 ATMs.

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