NCB Financial Group 2022 Annual Report (2024)

Clarien Group provides personal, commercial, and private banking services to clients primarily based in Bermuda.

It is one of the largest independent, privately-owned integrated financial services organisations in Bermuda, with an extensive portfolio of offerings. These include personal banking, business banking and payment services through Clarien Bank Limited; exclusive wealth management services through Clarien Investments Limited; and customised trust and fiduciary services through Clarien Trust Limited.

Guardian Holdings Limited is the parent company of the Guardian Group, an integrated financial services provider that focuses on life, health, property, and casualty insurance, as well as pensions and asset management.

The Group currently serves markets in 21 territories across the English- and Dutchspeaking Caribbean, including Aruba, Barbados, Bonaire, Curaçao, Jamaica, St. Maarten, and Trinidad and Tobago.

The NCB Entities provide an expansive range of products and services aimed at meeting all the personal and commercial banking, payment services, wealth, insurance, and asset management needs of customers primarily in Jamaica, the Cayman Islands, Barbados and Trinidad and Tobago.

The NCB Entities comprise National Commercial Bank Jamaica Limited (NCBJ), TFOB (2021) Limited (TFOB) and NCBJ’s subsidiaries - the main subsidiaries being NCB Capital Markets Limited, NCB Capital Markets (Barbados) Limited, NCB Insurance Agency and Fund Managers Limited, NCB (Cayman) Limited, and NCB Merchant Bank (Trinidad and Tobago) Limited.

NCBJ and its Jamaican subsidiaries have over 20 locations – including digital and full-service branches and six financial centres – and more than 300 ABMs and financial kiosks. TFOB is a fintech company providing digital financial services. TFOB introduced Lynk, a mobile wallet, in 2021, enabling customers to send and receive money from their mobile devices via peer-to-peer transfers.

My Fellow Shareholders,

My fellow directors and I have the responsibility of stewarding a portion of your investment portfolio. It is a responsibility we take seriously, and we are grateful for your confidence and the privilege you have bestowed on us. I am proud of NCB Financial Group’s financial performance within the context of continued global challenges. You can be confident that you are investing in a company that is built to last – with leaders expertly navigating the balance of strength and innovation. We are fortifying the institution to withstand shocks while re-imagining and re-engineering our business model for future growth. A well-run organization is focused on long-term viability and sustainable returns.

NCB has evolved from a predominantly Jamaica-based banking group into the NCB Financial Group - a full service regional financial conglomerate, present in over 21 territories. The journey has not been without challenges, as the institution successfully navigated and emerged stronger following local and global financial crises.

In 2022, we also recognised NCB’s 185-year anniversary, with roots dating back to 1837 when the Colonial Bank of London, England established a presence in Jamaica. The journey since that time has included a series of mergers and acquisitions and the emergence from a colonial past into an indigenous institution with world class ambitions. We acknowledge the full history as we pay homage to the customers and employees who contributed along the way. This year, we also celebrated 60 years of independence for Jamaica as well as Trinidad and Tobago – the countries where we currently have our largest presence.

A well-performing financial institution has the unique opportunity to enable wealth creation for its shareholders, its customers and the countries in which it operates. What each NCB Financial Group shareholder owns is a stake in a company committed to building indigenous wealth in all the communities we serve.

For our shareholders, total long-term shareholder returns have been strong. Our investment and mortgage solutions enable our clients to grow their wealth and create a legacy to pass on to

the next generation. Our insurance business enables clients to protect their health and property, which in turn plays a key role in preserving and transferring wealth. For our business customers, our debt, public and private equity solutions, provide the necessary capital for business growth. Owning businesses creates wealth for families and generates economic growth.

Through the launch of Lynk, our digital payments solution, we have laid a strong foundation for enhancing financial inclusion for the unbanked, and putting them on a path for wealth creation.

For the countries in which we operate, we have been a primary taxpayer. For the period October 2021 to August 2022, our tax payments were equivalent to 1.1% of the total tax revenue base of the Government of Jamaica and 0.5% of total tax revenues for the Government of Trinidad and Tobago.

In FY 2022, we collaborated with Factories Corporation of Jamaica on the Morant Bay Urban Centre. We provided debt and equity financing to facilitate this transformational project, which is estimated to provide over 3,000 jobs and revitalise the Morant Bay Community.

Through the foundations across the NCB Financial Group, we have donated over J$2 billion and positively impacted the lives of over 250,000 citizens.

I believe that today we are as clear as we have ever been, in all 185 years of our existence, about our purpose. Every single action we take is deliberate and grounded in the prospect of empowering people, unlocking dreams and building communities. This recent period of social, political, and economic volatility and uncertainty has reshaped and redefined life and business. While it continues to be unsettling for many, it has sharpened our focus and unearthed new opportunities. The ability to find such opportunities amid crisis is a skill we have honed and a mindset we have adopted along our journey. I embrace the present with the knowledge that “In the middle of difficulty, there is opportunity. The bigger the difficulty, the bigger the opportunity.” – Albert Einstein.

With our 2024 aspiration to become a world-class Caribbean financial ecosystem in full focus, I take this opportunity to thank all shareholders and customers for their continued trust and confidence, and each employee for helping to steer the ship to the next destination.

With our continued partnership, I am excited about what is to come.

“Our shareholders can rest assured that we are taking full advantage of this moment in history. It is within this context that I affirm that the NCB Financial Group remains focused and committed to its aspiration of becoming a world-class Caribbean financial ecosystem and its purpose of Empowering People. Unlocking Dreams. Building Communities.”

Dear Shareholders, Colleagues, Customers and Partners,

I will start this year’s letter in the same way I closed last year’s letter to you

“These are the times in which a genius would wish to live. It is not in the still calm of life, or the repose of a pacific station, that great characters are formed. The habits of a vigorous mind are formed in contending with difficulties. Great necessities call out great virtues.”– Abigail Adams

Since then, despite a relaxation of pandemic precautions on a global scale, we have seen several challenging developments – among these the Russia-Ukraine conflict, a number of local and global benchmark rate increases to tame inflation, and in July 2022, the World Health Organization classification of monkey pox as a “public health emergency of international concern.” No country or business has been exempt from the leadership challenge of a lifetime due to the economic and social effects of this unusual chain of events.

Using a strategic alliance with an online pharmacy in Trinidad and Tobago, Guardian Life began offering e-pharmacy services to its clients in 2021. Through the use of an integrated platform, our customers have access to a service that links patients and doctors with an online pharmacy, streamlining the prescription filling procedure and providing integrated delivery.

Both of these ideas, would have been considered but not implemented before the pandemic. However, with the urgent need to adapt to the constraints of the new environment, both initiatives were accelerated and implemented, ultimately creating significant value for customers.

Building new capabilities

As a financial group, we have begun to deploy artificial intelligence and machine-learning enabled solutions to enhance our customers’ experiences and drive key business outcomes. At Guardian, we are leveraging artificial intelligence tools to mitigate claims fraud and identify measures to reduce claims costs. At National Commercial Bank Jamaica Limited, our WhatsApp chatbot, Simone, has assisted over 100,000 customers with sales and service transactions since its inception in 2021.

Through the launch of our fintech solution, we have leveraged capabilities such as cloud technology and marketing automation. In addition, we continue to invest in recruiting and developing talent in advanced analytics, software engineering, user experience design and cloud engineering, among other next generation capabilities.

Focusing on our people

In the same way that the pandemic reminded us to stay close to our loved ones, we continue to stay close to our customers and employees. Without our team and our customers, we would be unable to deliver desired returns to our shareholders.

Our focus on organisation health continues, as well as our investments in building the capabilities and supporting the engagement of our team members.

With respect to our customers, we continue to listen and respond to feedback.

At Guardian Group, our One Guardian Digital Platform for customers unifies all our Trinidad and Tobago business product lines delivering an omnichannel experience for our customers across web, phone, walk-in and text messages. Key features include quick quotes, online payments, client portfolio view across insurance and investment products, a health e-card and an artificial intelligence bot built into the platform for real-time customer queries that are connected to our Customer Service for real-time support.

Based on the feedback of several of our stakeholders, we have developed new ways of making banking, investing and overall wealth building easier for our customers and business partners. We launched NCB Assist Biz which is an automated self-managed solution for business customers to submit and track the fulfilment of service requests/ resolution of complaints.

We also launched the NCB Capital Markets Limted (NCBCM) mobile app, NCBCM Wealth Connect, which allows customers to view their portfolio balances, transaction history, and stock market data from the Jamaica Stock Exchange. It also allows them to execute unit trust and equity trades and make transfers between their National Commercial Bank Jamaica Limited (NCBJ) and NCBCM accounts.

All these solutions were guided by customer feedback. To get continuous input from our customers, versus relying exclusively on semiannual surveys, we leverage our WhatsApp chatbot to get feedback from customers on their experiences with us across a number of customer journeys and interactions.

Strengthening resilience

This year, we commemorate a significant milestone for our Group, whose roots date back 185 years to 1837, the year the Colonial Bank of London, England, opened its doors on Harbour Street in Kingston, Jamaica. Throughout this 185- year history, the organisation has overcome many challenges and so our resilience continues to be a strength. But like any muscle, it weakens if you stop working on it and it gets stronger if you continue to work on it and challenge yourself to take on more. We have invested in developing the resilience of our team members and the resilience of our organisation.

We have invested in a series of wellness activities, and skills-based workshops and trainings that equip our employees with relevant skills for the future. We have expanded our leadership development programmes, many of which equip our managers and senior leaders with skills to lead in uncertainty. Our hybrid work model has facilitated operational resilience and greater workforce productivity and flexibility.

As an organisation, NCB Financial Group maintains strong capital positions across its Group companies. The Group’s liquidity positions are robust and supports its resilience to market shocks. In continuance of the strategy to grow liquidity buffers, NCBJ successfully raised US$300 million in August 2022 via a Merchant Voucher Securitisation transaction in the international private placement markets. NCBFG continues to have access to funding in the international markets despite market volatility. The resilience of our Merchant Acquiring and Payments franchises led to the following Fitch rating upgrades in June 2022:

„Merchant Voucher Receivables programme to ‘BBB-’ from ‘BB+’ (Investment Grade) with stable outlook

Diversified Payment Rights programme to ‘BB+’, from ‘BB’ with stable outlook