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Business |
BSP net up to K111.62million
Assets jump 60.68%
to K4.74 billion
By BAEAU TAI
BANK South Pacific Ltd has reported an after tax profit of K111.62
million for 2006, up 12% from K99.22 million the previous year,
reflecting a strong banking system growth and sustained economy.
In the bank’s financial report for last year submitted to the Port
Moresby Stock Exchange yesterday, bank chairman Noreo Beangke said
total assets increased from K2.95 billion to K4.74 billion last
year, a massive increase of 60.68%.
“Growth in loans and receivables also continued,” he said.
A 44.51% increase from K873.54 million to K1.26 billion was
achieved, thus, maintaining the BSP market share of 54% of the
total commercial bank loan outstanding at year end.
Mr Beangke said a further improvement in the efficiency ratio also
featured during 2006.
The cost-to-income ratio reduced from 54.71% to 52.40% during the
year. “This important indicator confirms strong cost and budgetary
control across all BSP strategic business units and places BSP
favourably amongst peer regional banks,” he said.
A capital ratio of 26.10% is recorded for last year compared to
29.40% in 2005.
A strong growth in total balance sheet assets was the reason for
the slight reduction in this important indicator.
However, the capital ratio was significantly above the minimum
prudential requirement of 12% set by the Central Bank and
maintained the well-capitalised definition by international
banking indicators.
International ratings agency Standard and Poors completed the
annual analysis of the BSP undertaking during 2006 and revalidated
the BSP rating of B+ (stable) – the highest rating achievable in
accord with PNG’s sovereign rating.
A significant event last year was the acquisition of the Habib
Bank interests in Fiji.
This acquisition was settled and BSP began operations in Suva last
Dec 18.
A transformation exercise is in place to migrate the BSP banking
platform, including electronic banking capacity, to the Fiji
operations.
The board is confident that an increasingly profitable presence in
Fiji would be developed.
Final agreements are also in place for the acquisition of the
National Bank of Solomon Islands.
“Subject to the few remaining conditions precedent being
completed, indications are that this acquisition may be settled at
the end on this month.
“The prospects for 2007 are positive,” Mr Beangke said, adding
that the initial two months trading results exceed expectations.
“Indications are for continuing buoyant economic conditions with
export volumes and commodity prices to remain strong.”
He said the relatively broad agricultural tree crop export base,
together with the upsurge in mineral oil and gas development
augurs well for another year of significant progress.
 
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