Commonwealth Bank, today, reported unaudited total profit of $53 million in 2014. Total assets were $1.47 billion at December 31, 2014. Earnings were up 7 per cent over 2013 when the bank reported total profit of $50 million. Total assets were up 3 per cent over 2013.

“I am pleased with the bank’s results in 2014,” says William Sands Jr, executive chairman of Commonwealth Bank.

“They confirm that our business strategy remains appropriate and that our staff remains both capable and dedicated to the plan as laid out by the board and executive management.”

The improvement reported in total profit for the year was despite the introduction of a new $5 million turnover based business license fee in 2014.

Interest expense declined in 2014, as the chronic excess liquidity in the system continued to depress deposit interest rates. For 2014 interest expense was $31.7 million compared to $35.5 million a year earlier.

Sands notes: “Although the bank grew its loan book by 3 per cent in 2014–the timing of the growth was such that it did not materially impact fiscal 2014. We expect to see the full impact of the growth in 2015 when the new loans would have earned interest for a full year.”

Amid an environment of high nonperforming loans, Commonwealth Bank continued to record low levels of impairment in its portfolio when compared to the industry averages.

As a result the bank was able to reduce its loan impairment expenses by $3.4 million compared to 2013.

Charged off loans declined by almost $6.5 million in 2014 to $28.4 million, while at the same time, balance sheet allowances for loan impairment increased by $1.2 million over 2013 to $55.5 million.

On December 31, 2014, Commonwealth Bank’s impaired loans represented 5.8 per cent of its total outstanding loans. The industry’s impaired loans, as reported by The Central Bank of The Bahamas, were 16.1 per cent of aggregate loans of all banks.

The bank’s total expenses grew by 10 per cent in 2014 which equated to $5.9 million.

Total group taxes and license fees increased by $4.2 million over 2013. Apart from the increase in tax and government license fees, most of the remaining increase was in variable costs.

Commonwealth Bank continues to report strong capital and liquidity ratios with a capital ratio of 27.9 per cent and a liquidity ratio of 33.6 per cent, compared to Central Bank requirements of 17 per cent and 20 per cent respectively.

The bank’s earnings per share was $0.49, return on assets was 3.3 per cent and return on equity was 23.1 per cent.

These compare favourably with 2013 when the Bank reported $0.46, 3.1 per cent, and 23.0 per cent, respectively.

The bank continued uninterrupted quarterly dividend payments. Dividend payments totaled $0.30 per share in 2014 and were unchanged from 2013.