DFL reports increased profits

Development Finance Ltd (DFL) has reported a “spike” in profits for 2017, following the final clean-up of some $30 million in bad debt that weighed down its balance sheet for years.

DFL said its year-on-year profits jumped 249 per cent from $13.3 million at the end of 2016 to $46.4 million in 2017, driven by the one-time impact of legacy loan remediation as well as increased interest income.

DFL chairman Andrew Ferguson said doing so was “the final step in cleaning up the company’s balance sheet. Over that period, DFL’s equity base has grown year-on-year from $105.47 million in 2011 to $216.22 million as at the end of 2017, which resulted in the company now having a capital-to-assets ratio of 43.96 per cent and a very robust capital adequacy ratio of 62.48 per cent.”

Putting these figures into context, DFL — in its April 12 statement — said “capital-to-assets and capital adequacy ratios for local commercial banks and non-bank financial institutions averaged 12.5 per cent and 23.8 per cent respectively at the end of 2016, according to the Central Bank’s Financial Stability Report.”

DFL CEO Duane Hinkson said, “These ratios both measure a bank’s financial strength and stability, so the numbers are telling us we are ahead of the curve.

And now that we’ve dealt with the non-performing assets, we’re turning our attention to growth across our major business lines and revisiting our roots as a champion of development finance.”

DFL, a licensed non-bank financial institution, is a limited-liability company reborn as a joint-venture in 2011 after capital restructuring saw the government retain a 49.75 per cent stake in it.

The company’s other major shareholders are Maritime General Insurance Company Ltd, with 33.17 per cent, and Maritime Life (Caribbean) Ltd with 16.58 per cent — the Maritime Group — with an aggregate shareholding also equal to 49.75 per cent.