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Big deal in the making? NCB Jamaica transfers $2.7b worth of shares

Over $2.7 billion worth of National Commercial Bank of Jamaica (NCBJ) shares were transferred last week in a quiet move that hints at a big deal to come.

It's the largest transfer of NCBJ shares in years. NCBJ, often seen as the nation's most profitable bank, advised the Jamaica Stock Exchange (JSE) that there had been a transfer of ownership of 92 million units of NCBJ shares previously held in trust on July 27. The shares closed at $29.50 as the stock rallied higher on the day.

The Jamaica Observer still awaits a formal response from the bank as to which entity transferred the shares and the rationale for the transfer. Additionally, two key sources declined to comment whether on or off record.

The largest entities with shares capable of such a transfer includes AIC (Barbdos) Ltd with 1.15 billion shares or 46.8 per cent, Harprop Ltd 314.3 million shares or 12.7 per cent, Sagicor PIF Equity Fund with 95.9 million shares or 3.9 per cent, according to the latest annual report.

NCBJ chairman Michael Lee-Chin holds 1.58 billion in shares held through connected parties.

The share transfer comes as media reports have suggested that NCBJ aims to acquire a sizable stake in a financial company.

Last week the directors at NCBJ described the bank's reduced profit performance as commendable within the context of a tight economy. The banking conglomerate made $3.15 billion net profit after tax for its June third-quarter 2015 or 7.5 per cent less than a year earlier due to slightly higher expenses.

Although the group made less profit, its total revenues actually increased to $11.68 billion in the quarter compared to $11.1 billion a year earlier.

Meanwhile, within the quarter its gains on foreign currency and investment activities dipped by one-quarter to $827 million from $1.1 billion a year earlier. The group registered increased profits in five of its seven banking segments over nine months. The two segments which declined included payment services and wealth, asset management & investment banking.

The segments with operating profits included its retail division at $1.28 billion; payment services at $1.07 billion; corporate banking at $952 million; treasury & correspondent banking at $3.65 billion; wealth, asset management and investment banking at $2.5 billion; life insurance & pension at $2.4 billion; and general insurance at $1 billion.

Courtesy: Jamaica Observer

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