BSP Financial Group (BSP) recently reported impressive financial results for the year ending December 31, 2024, highlighting a statutory net profit after tax of K1.038 billion ($F0.60 billion). This marks a significant 17% increase compared to the previous year, reflecting strong performance that was communicated on various stock exchanges, including the South Pacific Stock Exchange and the Papua New Guinea Stock Exchange.
The growth in profit is primarily driven by substantial increases in volume and revenue across nearly all business segments of BSP. Moreover, improvements in managing bad and doubtful debts, along with a notable company tax settlement from the first half of 2024, have positively influenced their financial standing.
BSP Group chairperson Robert Bradshaw reported an 8% growth in net operating income, bringing it to K3 billion ($F1.74 billion). Net interest income also rose to K2 billion ($F1.16 billion), which is a 7% increase from the previous year. Even though total expenses grew to K1.3 billion ($F0.75 billion) due to ongoing modernization efforts and inflation, the cost-to-income ratio saw a slight adjustment from 37.8% in FY23 to 41.3% in FY24. Notably, if excluding expenses related to modernization, the ratio remained relatively stable at 38.2%.
Further strengthening their financial foundation, BSP’s capital adequacy ratio stands at a strong 26.2%, well above the Bank of Papua New Guinea’s minimum requirement of 12.0%. This figure marks an improvement of 230 basis points since December 2023. As a testament to its robust performance, the board announced a final dividend payment of K1.21 ($F0.70) per ordinary share, contributing to a total FY24 dividend of K1.66 ($F0.97) per share, maintaining a consistent 75% payout ratio in alignment with previous years.
Bradshaw expressed pride in the bank’s performance, noting that the pre-tax profit reached a record K1.8 billion ($F1.04 billion), a 14% increase from FY23. He pointed out that the final statutory profit figures were just short of their record set in FY22 before the recent bank tax increase to 45% in Papua New Guinea.
This financial performance conveys a message of strategic foresight and effective management within the competitive banking landscape, showcasing a solid groundwork for continual growth and investment in modernization. BSP’s commitment to adapting to market demands while maintaining financial stability is an encouraging sign, potentially fostering ongoing success and bolstering economic development in the region.
Overall, BSP’s results reflect not only strong current performance but also a sustainable approach to future prospects.
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