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JMMB's headquarters in New Kingston, Jamaica (Photo: JMMB)

JMMB targets bank acquisition in the region

JMMB's headquarters in New Kingston, Jamaica (Photo: JMMB)

JAMAICA Money Market Brokers (JMMB) Group has announced plans to acquire new banking operations in the region. The disclosure was made in the group’s annual report for the financial year ended March 31, 2021.

“Within the 2021/2022 financial year we anticipate closing on two important acquisition transactions that will grow the balance sheet of our banking business line and see us entering a new market within the Caribbean.”

Group chief strategy officer (CSO) at JMMB, Claudine Tracey told the Jamaica Observer that the initiatives are still in the early stages.

“We are actively working on two transactions that will support the expansion of our banking business line and expand our regional footprint, subject to regulatory approval,” she said.

Claudine Tracey, group chief strategy officer, JMMB (Photo: LinkedIn)

The JMMB Group has 15 client-facing entities in 3 countries, namely: Jamaica, Trinidad and Tobago and the Dominican Republic, offering financial services including investments, banking, remittances and insurance brokering.

The company is tight-lipped about which countries they are expanding into, however the CSO committed to sharing more about these acquistions in due course.

She said, “The JMMB Group has had a successful history of inorganic growth through acquisitions and expansion across the region. We are always seeking opportunities for future growth to improve shareholder value and expand our client-centric financial partnership business model across the region, which is a strategic imperative for the group.”

Performance and outlook

The announcement comes after a positive financial performance for the year ended March 31, 2021. The JMMB Group posted a net profit of JM$7.72 billion — an increase of four per cent over the prior year. JMMB Group saw its total operating income peak at JM$22.62 billion as at March 31 this year, even against the backdrop of a pandemic which has derailed the performance of several financial companies.

JMMB said its diversified portfolio strategy made the group resilient in these difficult times, and also enabled the group to adjust to the market developments and even capitalise on the ongoing opportunities in the market.

The group’s Trinidad and Tobago operations’ contribution to operating profit resultantly declined from 17 per cent in the prior period to seven per cent. However, the percentage contribution from operations in the Dominican Republic doubled, moving from seven per cent to 14 per cent, while the Jamaica operation’s contribution remained relatively stable at 79 per cent.

The company said it expects continued recovery of the economy and market, spattered with pockets of market volatility for the 2021/22 financial year. However, JMMB acknowledged that there will be a new normal as behavioural patterns as well as operational changes adopted during the pandemic will continue in years to come.

Diversification, market share and capital

Tracey noted that the new acquisitions will help improve the overall financial performance of the group.

“We are very excited about these transactions as they will facilitate further revenue and risk diversification, increase our market share, strengthen our capital base, and deliver higher and more sustainable returns to our shareholders,” Tracey continued.

JMMB said it will remain focused on the continued execution of its digital transformation initiatives aimed at enhancing clients’ experience while improving operational efficiency. There will also be a deliberate focus on the integration of the sales team in order to facilitate the objective of providing holistic financial solutions.

Notably, JMMB Securities Limited maintained its number one ranking for number of trades on the JSE for another consecutive year. Thus, despite lower trade volume and trade value as consistent with the overall market trend, the equity brokerage continued to cement its place as the top retail broker and has also made significant strides in building out institutional trading.

Additionally, further enhancements were also made to the group’s online trading platform, Moneyline, to improve the experience of everyday users as well as those who prefer active trading. The company says there will be further enhancements on Moneyline with additional functionalities in the near future, which should further improve user experience.