Photo Credit: gparchitect
For the six months ending June 30, 2021, Bank South Pacific Financial Group Ltd (BSP) reported a net profit of K449.3 million, up 17.6 percent from the same time the previous year (K381.9 million).
Sir Kostas Constantinou, the group's chairman, noted that the relaxation of pandemic-related domestic limitations, along with better liquidity levels in PNG and offshore branches other than Fiji, contributed to the group's success.
Fiji has been badly impacted by the Coronavirus (Covid-19) Delta variant effects, he added, with economic activity being muted when the results were announced.
Other outcomes include:
- Total group revenue increased by 8.4 percent, with progress in most revenue structures. The interest rate on loans was reduced by 6.9%.
- The group's foreign exchange-related income grew by 6.1% from 2020 to 2021, owing to better currency flows resulting from Bank of PNG actions.
- The amount spent on operating expenditures grew by 8.6% to K439.9 million. Depreciation related to the replacement of the new core banking system, professional service fees linked with the ASX listing, which was completed successfully in May this year, and higher employee costs all contributed to the rise.
- The group's total assets increased by 5% (K1.4 billion) in the first half of the year, owing to strategic expansion in investment securities that took advantage of available liquidity.
Due to the sluggish rate of economic recovery in all nations, lending growth remains a challenge.
- The total impairment charge was K62.6 million, down from K111.5 million in the previous period, which included a significant increase in provisions to account for the unknown possible effect of Covid-19 at the time. Provisioning costs have leveled out this year as macroeconomic conditions have improved and the impact of Covid-19 on the balance sheet has become more certain.
- The total amount of allowances for losses on loans and advances grew from K788.6 million (5.7%) in June 2020 to K872.6 million (6.1%) in June of this year.
The capital basis of the company is still robust. Total capital adequacy was 23.1 percent in June this year, compared to 21.3 percent in June 2020.
Reference:
The National (19 August 2021). “BSP reports K449m profit”.
