Top Caricom banks: Trinidad and Tobago sees dip but keeps crown

Dependent on economic trends in either oil and commodities or tourism, Caribbean economies grew at varied rates in 2017. The Dominican Republic expanded at a rate of 4.5%, while Trinidad and Tobago remained in recession, according to the World Bank. 

Of the 20 full and associate members of the Caribbean Community (Caricom), which promotes regional integration, 16 countries are represented in The Banker’s ranking, though non-member the Dominican Republic is excluded from them.

Trinidad and Tobago continues to have the largest banking sector in the region with $29.68m in assets, followed by Bermuda’s $20.59m. The smallest are Grenada’s $359m and Anguila’s $174m.

By Tier 1 capital, Trinidad and Tobago’s size is even more overwhelming. The country’s banks’ total Tier 1 capital surpasses $4.26bn, more than two-and-a-half times that of second placed Bermuda’s.

Capital falls

But not all is well in Trinidad and Tobago’s banking sector: assets and Tier 1 capital fell during 2017 while profitability failed to surpass other countries in the region.

Data from Port of Spain-based RBC Financial Caribbean, the region’s leader, makes this trend all the more evident: Tier 1 capital and assets fell nearly 17% and 22%, respectively, in 2017, while an even bigger 48% was slashed from pre-tax profits. Economic conditions took their toll.

Although on even more precarious ground in economic terms, Haiti’s banks paint a more hopeful picture. While the country's gross domestic product growth has hovered just above 1% in 2017 and the previous two years, its banking sector has strengthened. Three Haitian names lead the Tier 1 capital change table, and a fourth is found further down the list. Banque de l’Union Haitienne’s 39.6% Tier 1 capital growth is by far the largest in the region and mirrors the pace of its assets’ expansion.

Another Haitian bank, Unibank, tops the profitability ranking. Although its three-digit return on capital ratio is explained by still relatively low levels of capital in relation to the size of the lender, its 11.09% return on assets ratio confirms the bank’s ability to deliver results. At $182m, Unibank’s pre-tax profits were 71.43% up on the previous year, the fourth biggest profit increase in the region.

High climbers

When it comes to efficiency, the Cayman Islands’ Atlantic Security Bank takes the lead with an 18.17% cost-to-income ratio. It is followed by MMG Bank & Trust and Inteligo Bank, both from the Bahamas.

Haitian names continue to pop up elsewhere in the regional analysis. In terms of positions within the overall ranking, for example, the biggest jumps come from Haiti’s Banque Nationale de Credit, up five places to 26th place, alongside Sagicor Bank Jamaica's five-places rise to 16th.

Furthermore, Banque de l’Union Haitienne is among the four new entrants in the ranking, in 46th place, along with Dominica Agricultural Industrial and Development Bank in 40th place, Transcom Bank Barbados in 42nd and JMMB Trinidad & Tobago in 45th.