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Bermuda Commercial Bank Reports Net Income of $680,000
Hamilton, Bermuda - 12 May, 2009 - Bermuda Commercial Bank Limited ("BCB") releases details of the financial results and operations for the six month period ended 31 March, 2009.
Financial Results
The Bank reported net income for the six month period ended 31 March, 2009 of $680,000 compared to $4.39 million at 31 March, 2008, a decrease of $3.71 million. Fully diluted earnings per share were $0.11 compared to $0.75 per share one year ago.
Net interest income for the period was $3.37 million compared to $5.43 million for the same period last year. This decrease results from the dramatic reduction in global and in particular U.S. interest rates to historically low levels. BCB is 100% invested in cash and cash equivalents, which ensures maximum liquidity and minimal credit risk, however it is a strategy that provides low returns in this low interest rate environment. Additionally, the global financial crisis continues to impact client deposit levels.
Fee and other income decreased by $2.04 million to $1.52 million. This decrease occurred primarily in the Bank's fund administration and custody divisions following the loss of two large clients which moved jurisdiction. The prior year fees were boosted by a one-time gain of $740,000 associated with the Visa and MasterCard IPOs. Additionally, the global slowdown resulted in a reduction of $270,000 in earnings from foreign exchange transactions due to reduction in volumes.
Total expenses for the six month period were $4.21 million compared to $4.60 million for the prior year period, a decrease of $390,000 or 8.50%. This decrease resulted from a decrease in performance related employee compensation costs.
BCB's balance sheet suffered a knock on effect from the global financial crisis which heavily impacted the transaction flow and deposit levels of some of our larger clients. Total assets fell from $486.84 million at 30 September, 2008 to $435.36 million at 31 March, 2009, a decrease of 10.6%. Total assets at March 31, 2008 were $696.45 million. BCB is well capitalized and remains fully invested in short-term cash and cash equivalents. The Bank has suffered no direct exposure or losses due to the current sub-prime issues and our capital ratios remain significantly higher than industry standards.
Shareholder Dividend
In light of the reduction in net income and with no expectation of a near-term recovery of profitability, the Board has decided not to pay a semi-annual dividend at this time.
About Bermuda Commercial Bank
Bermuda Commercial Bank is one of Bermuda's four licensed banks, established in 1969 and listed on the Bermuda Stock Exchange. Bermuda Commercial Bank is a corporate and private wealth bank, offering a range of services through it's subsidiaries International Corporate Management of Bermuda, BCB Trust Company Limited, Bercom Nominees Limited and BCB (Mauritius) Limited. Bermuda Commercial Bank takes pride in ensuring clients' assets are safely and professionally managed at our Hamilton based office. For more information on the Bank please visit our website www.bcb.bm.
For further information please contact:
Horst Finkbeiner
Chief Operating Officer
Bermuda Commercial Bank
(441) 299-2873