PERFORMANCE HIGHLIGHTS

	Quarter Ended Dec. 2007	Quarter Ended Dec. 2006
Net Profit	$1,869 Mill.	$1,502 Mill.
Earnings per Stock Unit	$ 0.76	$ 0.61
Cost to Income Ratio	54.09%	57.64%
Return on Avg. Equity	25.32%	23.61%
Return on Avg. Total Assets	2.90%	2.62%
Growth in Gross Revenues	12.66%	14.93%
Net Asset Value per Share	12.27	10.68

The Group recorded a net profit of $1.9 billion for the quarter ended 31 December 2007, compared to $1.5 billion for the corresponding period of the previous financial year; an increase of $357.4 million or 24%. The improved result is driven mainly by the continued focus on our core business, which has resulted in higher earnings from our major income streams.

SEGMENT RESULTS

A summary of the financial performance of the main revenue segments is highlighted below:

	Quarter Ended Dec. 2007 $J'M	Quarter Ended Dec. 2006 $J'M
Retail Banking	849	394
Corporate Banking	342	307
Treasury & Correspondent Banking	816	672
Wealth Management	563	558
Insurance	94	175

DIVIDENDS

On 24 January 2008, the Board declared an interim dividend in respect of 2008 of $0.15 per ordinary stock unit. The dividend is payable on 22 February 2008 for stockholders on record as at 11 February 2008.

OPERATING REVENUE

Gross revenue for the quarter was $9.1 billion, representing an increase of $1.0 billion or 13%, when compared to $8.1 billion for the corresponding period in 2006. The Banking and Wealth Management businesses contributed 73% and 20% respectively to the overall Group revenue. The major revenue highlights for the quarter were as follows:

• Total interest income increased by $695.2 million or 11% due mainly to the continued growth in the loan and investment portfolios.
• Net fee and commission income increased by $248.9 million or 28% which was mainly attributable to fees generated from card and other retail banking related products.
• Premium income from the insurance segment increased by $38.5 million or 58% over the prior year due to increased sales of both retail and group life insurance products.

OPERATING EXPENSES

Operating expenses (excluding interest and fee and commission expense) for the quarter totalled $3.2 billion, $286.5 million or 10% higher than the comparative prior year period. Staff costs increased by $176.0 million or 11% mainly due to negotiated increases in salary and allowances for the current financial year. Provision for credit losses of $129.7 million increased by $84.4 million or 186% over the December 2006 quarter, which was primarily attributable to the 34% growth in the loan portfolio. In addition, there was a lower level of recoveries in the December 2007 quarter when compared with the December 2006 quarter.

ASSET BASE

The total asset base of the Group of $234.6 billion, reflects an increase of $11.5 billion or 5%, compared to 30 September 2006. The major increases in the Group’s asset base were accounted for by investment securities which grew by $9 billion or 7% and loans and advances and cash and balances at Bank of Jamaica which grew by $2.7 billion or 6% and $2.5 billion or 21% respectively. Reverse repurchase agreements fell by $4.9 billion or 21%. The growth in the asset base over the three month period was mainly funded by an increase in customer deposits of $9.7 billion or 10%.

LOAN PORTFOLIO

Loans and advances totalled $60.0 billion (net of provision for credit losses) as at 31 December 2007 compared to $44.9 billion as at 31 December 2006; this growth is reflective of our focus on core business. The aggregate amount of non-performing loans was $1.5 billion and represented 2.51% of the gross loans compared to 3.73% as at 31 December 2006.

As at 31 December 2007 the accumulated provision for credit losses determined under Bank of Jamaica regulatory requirements of $2.4 billion represented an overall coverage of 153% of non-performing loans. Provisions for credit losses that exceed the amounts required by International Financial Reporting Standards (IFRS) are credited to a non-distributable Loan Loss Reserve. As at 31 December 2007 the balance in the Loan Loss Reserve was $287.6 million. The Bank’s provisioning policy is in compliance with Bank of Jamaica regulations.

FUNDING

The increase in the asset base was mainly funded as follows:

	INCREASE OVER PRIOR YEAR
	$B	%
Repurchase Agreements	8.0	17
Customer Deposits	7.7	7
Securitisation Arrangements	4.7	21

CAPITAL

The Group’s total stockholders’ equity as at 31 December 2007 was $30.2 billion, an increase of $3.9 billion or 15% when compared to 31 December 2006, and this increase can be mainly attributed to the continued increase in the Group’s profitability.

As at 31 December 2007, the Risk-Based Capital Ratio was 16.7% which exceeds the minimum requirement of 10% stipulated by the Bank of Jamaica.

	31 Dec 2007	30 Sep 2007	31 Dec 2006
Risk-Based Capital Adequacy Ratio	16.72%	14.50%	16.53%
Net Loans to Total Assets Ratio	23.14%	22.24%	18.92%
Net Worth to Total Assets Ratio	11.64%	11.23%	11.02%
Net Loans to Customer Deposits Ratio	51.56%	47.69%	42.63%

COMMUNITY RELATIONS

National Commercial Bank Jamaica Limited continues to initiate and support activities which help to enhance social and economic conditions in communities across the island. NCB remains focused on building a better Jamaica and by helping to enrich the quality of life for many Jamaicans through these activities, the Bank takes seriously its corporate social responsibilities.

Education
The area of education remains a key area of focus for the Bank. During the first quarter, the UTECH Debating & Public Speaking Society received financial support from NCB, which will allow the team to attend the 2008 World Universe Debating Championships. NCB’s philanthropic arm, the N.C.B. Foundation, continued to fund a range of projects geared at empowering young Jamaicans through education. Funded under the Bank’s Jamaica Education Initiative (JEI), tertiary level students from UWI, UTECH and the Edna Manley College of the Visual and the Performing Arts were recipients of scholarships. The Bank thanks all Keycard holders whose purchases continue to allow NCB to fund the JEI.

The Foundation, in response to some of the difficulties faced by schools across the island following the devastation by Hurricane Dean, provided $15 million towards underwriting repairs at 14 secondary schools, including Munro College,May Day High and Hampton High.

Sports
As part of the NCB's consistent drive to promote, sustain and propel the development of sports island-wide, NCB provided financial support towards nutritional supplements for Olympic athletes and gears for swimmers to participate in international championship meets. Additionally, The Jamaica Table Tennis Association received funding which will allow the team to attend the 2008 World Table Tennis Championships. The Bank continuesto support initiativesthat further the development of our young athletes.

Community Development
NCB remains intent on enhancing our communities and transforming them into more buoyant vicinities in which to live, work and conduct business. Late in the quarter, funds were earmarked for the 170th Anniversary Building a Better Jamaica Donation which spanned 16 projects island-wide. This initiative in addition to helping charities in need, helped to further cultivate volunteerism among the Bank's employees across the branch and subsidiary network.

In addition, the Bank fortified its ties with local service clubs by supporting their fundraising efforts to help in carrying out various community projects.

NCB thanks its employees for their significant contribution and customers for their loyalty and ardent support, as together we continue working to uplift our communities and build a better Jamaica.