America

Bank profitability recovered in 2021

AAfter a net loss of $ 6.7 million caused by a pandemic in 2020, domestic banks recovered a net profit of $ 254.7 million in 2021.

The Central Bank of the Bahamas said the improvement was the result of reductions in allowance for doubtful accounts and non-labor costs.

In 2021, banks reduced their allowance for doubtful accounts by $ 62.5 million (about 10 percent) compared to the $ 149.3 million reserve in 2020.

“Net interest margin decreased by $ 5.8 million (1.1%) to $ 533 million after a similar reduction in the previous quarter. In particular, interest income decreased by $ 4.3 million (0.7%). Increased to $ 573.1 million and interest expense increased by $ 1.5 million (4%) to $ 40.1 million. In contrast, fees and revenue from foreign exchange transactions were $ 9.3 million (22.7%). It increased to $ 50.5 million, resulting in a total margin increase of $ 3.5 million (0.6%) to $ 583.6 million, “said the 2021 CBOB Annual Report. ..

“Operating expenses fell 11.6% ($ 53.8 million) to $ 411.3 million. Contributions to this development contributed 20.8% (non-staff spending on professional services, government fees, maintenance, etc.) Decreased by $ 60.7 million. In addition, occupancy costs decreased by 4.1% ($ 600,000), while labor costs increased by 4.1% ($ 6.4 million). “

In addition, banks amortized an estimated $ 171.4 million in delinquent loans during the review year, for a total recovery of $ 31 million.

“The increase in total delinquency is primarily focused on the non-performing loan (NPL) segment, up $ 53.4 million (11.2%) from $ 20.6 million (4.5%) in 2020 to $ 527.9 million. Short-term (31-90 days) delinquency decreased by $ 46.6 million (15.6%) to $ 251.9 million, partially up $ 66.2 million (28.5%) in the previous year. With these developments, the ratio of non-performing loans to total private sector loans increased 1.2 percentage points to 9.6%, while the short-term delinquency rate of total private sector loans was 74. Basis points decreased to 4.6%. “

https://thenassauguardian.com/bank-profitability-rebounded-in-2021/ Bank profitability recovered in 2021

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