The President and CEO of Republic Financial Holdings Ltd (RFHL) Nigel Baptiste has expressed that the impact of the COVID-19 pandemic would be felt in the economies in which the group operates for another financial year.
In RFHL’s 2020 annual report Baptiste said: “Over the next 12 months, the economies in which we operate will likely continue to be impacted by the COVID-19 pandemic.”
Baptiste added that in most regional countries, domestic economic activity has resumed, with many reopening their borders and tourism sectors to international visitors.
However, he posited that while commodity exporting countries may perform better at lower levels of economic activity, “the tourism industry may not cope well at this time as safety concerns by potential travellers are likely to cause reduced visitors to the Caribbean.”
The RFHL CEO also asserted that unemployment levels will likely increase over the next year as companies would be forced to reduce staff. Baptiste argued that growth projections for 2020 and 2021 may be uncertain.
Nonetheless he noted that RFHL progressed with its strategy of acquisition and geographic diversification of income sources with the acquisition of Scotiabank’s banking operations in St Maarten and the Eastern Caribbean (Anguilla, Dominica, Grenada, St Kitts and Nevis, Saint Lucia, and St Vincent and the Grenadines).
Additionally, Baptiste noted that the drive to improve efficiency through the implementation of a common IT platform across all of RFHL’s Caribbean subsidiaries also continued over the past year.
He noted: “To date, conversion of the IT systems has been completed for subsidiaries in Suriname, Cayman Islands and Guyana, with work in the new territories, Grenada and Barbados currently underway and other subsidiaries to follow thereafter.”
According to Baptiste, successful implementation of this common platform would enable RFHL to offer its Caribbean clients a common experience and facilitate the introduction of a shared support services infrastructure for improved efficiency.
In his analysis and discussion, Baptiste highlighted that the group’s general administrative expenses increased by $115 million or 13 per cent.
Included in this assessment was T&T’s total administrative expenses increasing by $86.9 million due to increased legal and professional fees for digitisation, strategic initiatives and software licenses.
RFHL recorded profit attributable to equity holders of the parent of $904 million for the year ended September 30, 2020, a decline of $677.1 million or 42.8 per cent below the profit of $1.58 billion reported in the prior year.
According to Baptiste, these results reflect the financial impact of the COVID-19 pandemic on the group.