The Board of Directors is pleased to release the following audited results for National Commercial Bank Jamaica Limited (NCBJ) and its subsidiaries for the financial year ended 30 September 2008

PERFORMANCE HIGHLIGHTS
Year ended September 2008 compared with Year ended September 2007

• Net Profit of $8,701 million, grew by 32%.
• Earnings per Stock Unit of $3.54 increased by $0.86 or 32%.
• Operating Revenue of $24,720 million, a 20% increase.
• Cost to Income Ratio of 50.1% vs. 57.3%.
• Risk-Based Capital Ratio of 13.02% vs. 14.50%.
• Net Loans of $82.2 billion, grew by 45%.
• Investment Securities of $154.6 billion, grew by 8%.
• Customer Deposits of $126.1 billion, an increase of 6%.
• Return on Average Equity of 29.07% vs. 24.84%
• Return on Average Assets of 3.19% vs. 2.77%.

The results for the period reflect strong growth in our core businesses as well as:

• A gain of $1,059 million on the sale of Visa Incorporated shares. These shares were issued to NCBJ during the Visa Incorporated initial public offering in March 2008.
  • $530 million of the gains were realised in March 2008 and represents the proceeds from the mandatory sale of a portion of the shares allocated to NCBJ,
  • $529 million of the gains were realised in September 2008 and represents the proceeds from the sale of the remaining shares allocated to NCBJ.
• A provision of $1,230 million representing the maximum potential loss on certain transactions governed by master repurchase arrangements with members of the Lehman Brothers group (Lehman).

Fourth Quarter 2007/2008 compared with Fourth Quarter 2006/2007

• Net Profit of $1,944 million, grew by 13%. This quarter’s results include $529 million of the gain on the sale of Visa Incorporated shares and the Lehman provision of $1,230 million.

Fourth Quarter 2007/2008 compared with Third Quarter 2007/2008

• Net Profit fell by 14%. Excluding the one-off gain earned in the fourth quarter and the Lehman provision, Net Profit increased by 1%

The main contributors to these results are:

NET PROFIT	Qrtr. Ended Sept 2008 $J'M	12 Mths. Ended Sept 2008 $J'M	12 Mths. Ended Sept 2007 $J'M
National Commercial Bank Jamaica Limited	2,120	6,724	4,295
NCB Capital Markets Limited	(581)	776	1,567
NCB Insurance Company Limited	277	712	452

SEGMENT RESULTS

The results for the companies listed above have been incorporated in our segment report as follows: 

 Banking
The Banking segment’s results reflect an increase of $3.2 billion or 49% over the 2007 financial year and are driven mainly by impressive growth in the Corporate and Retail loan portfolios, fee and commissions income and securities income:

• net fee & commission income growing by 19% (volume-driven),
• interest income from securities growing by 13% due to the increase in the investment portfolio,
• interest income from loans increasing by 29% due to the growth in the loan portfolio.

NCB Jamaica Limited remains the largest commercial bank when measured by assets and branch network, and we believe these advantages provide significant opportunities for strong growth. Based on the latest commercial banking industry information as at June 2008 from the Bank of Jamaica, NCB had the #1 market share of Total Assets.

Wealth Management
Our wealth and asset management arm contributed operating profits of $855 million for the twelve months ended September 2008 after accounting for the maximum potential loss on realisation of securities held by Lehman. In the normal course of business, NCB Capital Markets Limited (NCBCM) entered into Master Repurchase arrangements with Lehman.

Under these arrangements, Government of Jamaica bonds, with a value of US$44.88 million at year end, were pledged as security for the liability of US$27.92 million to Lehman. Given the insolvency proceedings that have been initiated with respect to members of the Lehman group, full recovery of the excess of the value of the pledged assets held over the liability is considered doubtful and accordingly, a full provision for this amount has been made in the financial statements. Despite the impact of this Lehman provision on results for the year, NCBCM achieved a net profit of $776 million, maintains a solid capital base of $7.2 billion and remains a strong, stable player in the industry.

Insurance
Our insurance segment contributed operating profits of $766 million for the year ended September 2008, representing an increase of 38% over the prior year. NCB Insurance Company (NCBIC) is the major contributor to this segment and achieved a net profit of $712 million, a 57% increase when compared to the previous year. These results reflect the impact of the restructuring changes made at NCBIC during the financial year as we position ourselves to focus on the bancassurance business and pension and investment management services.

CAPITAL
The Group’s Stockholders’ Equity of $31.3 billion increased by $2.5 billion or 9% when compared to 30 September 2007, mainly attributed to the growth in the Group’s profitability. The Statutory Capital of the Group increased from $14.0 billion at the end of September 2007 to $19.0 billion as at 30 September 2008.

• The Risk-Based Capital Ratio for NCBJ was 13.02% which exceeds the minimum requirement of 10% stipulated by the Bank of Jamaica.
• The Capital Base to Total Assets Ratio for NCBCM was 11.17% which exceeds the minimum requirement of 6% stipulated by the Financial Services Commission.
• NCBIC reported a Solvency Ratio of 16.2% which exceeds the minimum requirement of 10% stipulated by the Financial Services Commission.

DIVIDENDS
On 3 November 2008, the Board declared an interim dividend of $0.40 per ordinary stock unit. The dividend is payable on 1 December 2008 for stockholders on record as at 18 November 2008.

COMMUNITY RELATIONS
Consistent with our mandate to “Build a Better Jamaica” by enriching the lives of many Jamaicans through our support of a number of activities within communities island-wide, we, mainly through our philanthropic arm, NCB Foundation, contributed $115 million to Education, Health, Sports, Entrepreneurship and Community Development during the year ended 30 September 2008.

EDUCATION
This year, we focused on infrastructure and resources in schools and scholarships and grants. A number of schools were damaged by Hurricane Dean in 2007 and we responded by assisting in the restoration efforts of 14 schools. We also financed improvements to the physical conditions of a number of schools at various levels. In addition, we donated computer equipment to a number of schools.

Our scholarship program was revised and relaunched during the year and now includes the award of scholarships to 14 Parish Champions and an Island Champion and one hundred tertiary scholarships. Grants are also provided. These scholarships and grants were awarded based on academic performance and financial need.

SPORTS
This continues to be one of the areas in which Jamaica excels and is one of our areas of focus. We have assisted Jamaican athletes with their preparation for the 2008 Olympics in Beijing and provided funding towards the cost of competing in the Olympics. The National Premier League received funding that enabled them to complete the season and meet their obligations.

ENTREPRENEURSHIP
A number of skill-based community organizations and programs benefited from funding by the NCB Foundation. Notable among these is the training provided to persons living in the community around the Holy Cross Cathedral in Kingston. These persons will receive training in refined techniques in conservation and restoration, including mural restoration, pipe organ technique and maintenance, which will be facilitated by Spanish and German specialists.

At the end of yet another robust financial year as we reflect proudly on our commitment to consistently doing well and doing good, we express heartfelt thanks to our employees for the indelible impact they make on this nation, every day, through their commitment to excellence through service and philanthropy and are equally thankful to our customers for their loyalty and fervent support year after year, in their effort to uplift the communities in which they serve and build a better Jamaica for us all.