VMBS News & Events
We are a mutual organisation whose mission is to maximize value for our members and other key stakeholders by providing exceptional financial services locally, regionally and internationally to Caribbean nationals through enabling technology and a highly trained and motivated team.
Victoria Mutual undergoes Transformation; Near Doubles Profit; Expanding Remittance Network
July 31, 2014
- Victoria Mutual Building Society surplus after tax increased from J$714 million in 2012 to J$1.32 billion in 2013.
- Wealth Management arm to offer customized portfolios
- Remittance company to expand network locally and overseas
"In 2014, focus will be placed on a comprehensive streamlining of the Building Society's back office operations," said Michael McMorris, Chairman of Victoria Mutual.
The goal is to keep mortgage rates offered by the Building Society among the lowest by reducing administration costs. Lower costs also mean that transaction fees can be kept down. In fact, Victoria Mutual Building Society (VMBS) continues to allow its debit cards to be used free of charge at any teller machine or point of sale terminal on the Multilink network.
Greater focus has also been placed on sales and services. As a result, mortgage disbursements rose by 133 per cent to J$3.3 billion last year.
Moreover, VMBS managed to increase outstanding loans that were up to date. Performing loans, which were less than 90 days in arrears, rose from 93.1 per cent of total loans to 94.4 per cent last year.
The Building Society also enabled more Members who were facing financial difficulties to retain ownership of their homes. Foreclosures on properties totaled 10 last year, compared to 37 the year before.
The Victoria Mutual Group (VM Group) aims to improve profitability of its financial advisory and brokerage by growing the assets it manages on behalf of its clients. To do this, Victoria Mutual Wealth Management Limited (VMWM) is working on new products to allow clients to customize their investment portfolios.
VMBS Money Transfer Services Limited (VMTS) plans to expand its services, both locally and overseas. The remittance company became profitable two years ago, and saw earnings grow by 61 per cent last year, due largely to an increase in fees. VMTS also benefited from a 28 per cent increase in foreign exchange trading gains.
Better gains on foreign exchange in part reflected a more challenging business environment last year, when depreciation of the Jamaican dollar was higher than 12 per cent.
What's more, a government debt swap and a new asset tax cost Victoria Mutual Group over J$370 million last year.
But the Group still earned over J$960 million in surplus after tax. The Building Society and its subsidiaries made after-tax surplus of J$1 billion the year before.
Income was boosted by the purchase of Prime Pensions Limited last year. The shares in the pension fund company were paid to Victoria Mutual Group as a J$530 million dividend. Comparatively, the Group saw just J$20 million in dividend payments in 2012.
At the same time, costs have been shrinking. In 2013, personnel costs fell by 6.9 per cent from the year before. This was due to a reduction in the liability related to the Group's Defined Benefit Pension Plan.
But further transformation of VM Group's operations should lead to more cost reductions. Expansion plans should drive revenue growth.
"The Group will continue to place emphasis on growing the business," said McMorris. "Internally, the year 2014 will see a continuation of a number of projects and initiatives geared towards improving efficiency and service delivery throughout the Group."
"Significant rewards are already being realized from the projects that have been rolled out, and as others are executed, further benefits are expected to follow."