Demerara Bank Limited (DBL) registered an after-tax profit of $853.4 million, almost a 5% increase over last year’s earnings.
According to DBL’s annual report, a gross profit of $1.2 billion was recorded for the year ending September 30, 2010, up from the $1 billion achieved the previous year. DBL’s after-tax profit was pegged at $853.396 million, which represents a 4.24% increase from the $818.271 million achieved in 2009.
The bank’s deposits totaled $28.9 billion, an increase of 16.06% over the $24.9 billion recorded the previous year. Bank Chairman Yesu Persaud, in his report, said that the entity’s savings deposits increased by 45.45% from $8.8 billion to $12.8 billion. While the demand deposits increased by 15%, Persaud noted that it had recorded a marginal decrease in its term deposits. “We are strategically trying to improve our deposit mix to rationalize the cost of deposits,” he added.
DBL’s investments increased from $7.2 billion to $9.9 billion over the previous year, Persaud said.
According to him, more than 40.54% of its assets are liquid. He said too that earnings from investments increased from $792 million to $866 million. “The value of our investment on a market-to-market basis is positive $454 million,” he further said.
Meanwhile, DBL’s Chief Executive Officer Pravinchandra Dave, in his report, said the bank’s advances moved from $8.7 billion to $9.9 billion, which was an increase of 13.79% over the previous year. He noted an increased exposure to the agriculture industry, with a particular emphasis on the rice sector.
During the year, interest income on loans and advances went up from $943 million to $1.08 billion, a rise of 14.42% over the previous year, Dave said. The gross non-performing loans were valued at $299 million, representing a decrease of 48.45% from the September 30, 2009 figure of $580 million, he added. Net non-performing advances totaled $31 million as of the end of the year, Dave said, stating that this was “indicative of the health of borrowers’ accounts” and the bank’s “continuous drive for recovery of non-performing loans.”
Meanwhile, the interest expenses of the bank have gone up by $100 million on account of its “unfavourable deposit mix,” Dave said. “Our Non-Interest Expenses have gone up from $405 million to $466 million, which shows a rise of 14.81 percent over the previous year,” he added. According to him, the bank’s expanding network of branches, increased costs for consumable items plus increase in staff expenses have contributed to this.
Regarding the bank’s plans, Dave said that in addition to its Diamond branch, a survey of other locations has been looked at and it will be applying for licences for opening branches in those areas if found suitable.
He said that the bank will be expanding its ATM network by having such a facility at Charity and at another location in Georgetown.
He said too that the bank’s Information Technology Department is exploring the possibility of introducing mobile banking in Guyana.
Meanwhile, Dave said that the establishment of the bank’s SWITCH mechanism will help customers “in a big way.” The SWITCH mechanism integrates the ATM Services of the banks and Dave opined that this will be “cost-effective and customer-friendly.”
He said that the Guyana Association of Bankers has taken the initiative to formulate a common SWITCH mechanism for all banks. “Hopefully with the participation of all banks, we shall have national SWITCH in the near future,” he said.
