THE Bank South Pacific Financial Group Ltd (BSP) recorded a net profit of K449.3 million for the six months to June 30, 2021 – a 17.6 per cent increase compared to the same period last year (K381.9 million).
Group chairman Sir Kostas Constantinou said the easing of pandemic-related domestic restrictions, combined with improved liquidity levels in PNG and offshore branches, other than Fiji, contributed to the improved results.
He said yesterday that when the results were released, Fiji had been severely affected by the Coronavirus (Covid-19) Delta variant impacts with economic activity subdued.
Other results include:
- TOTAL group revenue increased by 8.4 per cent, with improvements noted across most revenue streams. Interest on loans was lower by 6.9 per cent;
- FOREIGN exchange-related income across the group increased by 6.1 per cent compared to 2020, driven by improved currency flows derived from the Bank of PNG interventions;
- OPERATING expenses increased by 8.6 per cent to K439.9 million. Depreciation relating to the new core banking system replacement project, professional service fees associated with the ASX listing, which was successfully completed in May this year and increased staff costs contributed to the increase;
- THE group’s total assets grew by 5 per cent (K1.4 billion) in the first six months of the year, driven by strategic growth in investment securities leveraging on available liquidity levels.
Lending growth remains challenging due to the slow rate of economic recovery across all countries;
- TOTAL impairment charge was K62.6 million, a decrease from K111.5 million in the prior period, which included a large lift in provisions to cater for the uncertain potential impact of Covid-19 at that time.
Provisioning expenses have normalised this year as macro-economic factors improved and the balance sheet impact of Covid-19 became more certain; and,
- TOTAL balance of allowances for losses on loans and advances increased from K788.6 million (5.7 per cent of loans) in June 2020 to K872.6 million (6.1 per cent of loans) in June this year.
The group’s capital base remains strong. Total capital adequacy as at June this year stood at 23.1 per cent, compared to 21.3 per cent as at June 2020.