VM aiming to emerge stronger post-COVID
PRESIDENT AND CEO of the Victoria Mutual Group, Courtney Campbell, said COVID-19 will have a financial impact on the group, but they have put in place cost saving measures to ameliorate any fallout.
“If our members and clients are impacted it will flow through to us,” he said.
“We expect to see reduced fee income, compressed net interest margins and credit losses. Clearly there is need for greater liquidity. Last year we benefited from fair value gains in stock market movement. This year we are likely to have fair value losses,” he added.
While all of those will present a challenge, Campbell said “the good news is that we have done what is within our control. We have identified some cost saving initiatives to ameliorate the financial impact.”
Beyond that the ICT and digital transformation unit has implemented several measures to ensure that VM’s services continue to be available to its members and clients; and the group has provided moratoriums on existing loans, offered top-up loans, and increased transaction limits.
“So members and clients, while responding to COVID-19, we continue to prepare our business for a brighter future,” he said.
VM Group’s core business is mortgage lending, through Victoria Mutual Building Society, but it is also engaged in property services, wealth management, and pension fund management, among other holdings.
In reviewing VM’s financial results, Campbell reported that the number of active members increased by just over 7,600 in 2019 to 323,545, and that VM’s surplus grew to $1.39 billion.
The loan portfolio increased by 20.5 per cent to $59 billion, while total assets rose to $129.3 billion.
VM’s offices in the United Kingdom and the United States disbursed loans totalling £19.7 million and US$4 million, respectively.
At the end of 2019, the savings fund held $90 billion, up $7 billion over 2018. VM’s capital adequacy ratio was measured at 18.6 per cent, or nearly double the required minimum of 10 per cent.
The VM Wealth Property portfolio – unit trust – had an annual return of 14.3 per cent, which Campbell said made it the top performing real estate portfolio in Jamaica.
Victoria Mutual Property Services recorded revenue growth of 19.5 per cent to nearly $149 million. Over the course of the year, 123 properties valued at $1.6 billion were sold and 792 valuations were completed at a combined value of $16.4 billion.
Campbell also reflected on what he described as a regrettable incident at VW Wealth in February, with the unintentional distribution of non-financial client information, which affected about 5,000 clients. The incident also made headlines.
VM has since implemented restrictions on the dissemination of mass email, screening emails as part of the data loss-prevention mechanism, and has engaged external consultants to enhance security protocols.
mcpherse.thompson@gleanerjm.com