PanCaribbean's New Kingston headquarters. - CONTRIBUTED
PAN CARIBBEAN Financial Services [PCFS] has been given the go-ahead by the regulators to convert its merchant bank licence to a commercial bank operation.
The Jamaica Stock Exchange (JSE) yesterday advised that, "Pan Caribbean Financial Services has issued a release informing the public that it has been issued the relevant approvals to operate as a commercial bank and will receive requisite licence once the appropriate change of name to [Pan Caribbean Merchant Bank] is effective."
A commercial bank focuses on receiving demand deposits and makes short-term loans while a merchant bank specialises in facilitating trade and commerce. There are currently six commercial banks operating in Jamaica and five merchant banks.
The chief executive officer of PCFS, Donovan Perkins, recently acknowledged in an interview with this newspaper that, "We are always looking to broaden the appeal of the institution and one of the ways to do it is to continue to expand the products and service you have, for example, converting a merchant bank licence to a commercial bank licence."
NEW SERVICES
Contacted by Wednesday Business yesterday, he said the conversion means that PCFS "will be able to provide new services to our clients on both sides of the balance sheet. On the asset side it means we will be able to offer overdraft facilities and lines of credit. On the liability side we will be able to offer checking, and depot account facilities."
BROADENING SCOPE
Perkins explained that the move will ensure "a broader menu of existing products and be able to compete in an intense and increasingly competitive market."
Importantly, Pan Caribbean will be seeking to grow its loan portfolio. "We have a pretty good portfolio of existing clients [and] we see growth opportunities there. We expect our loan portfolio to grow again this year," Perkins said in an earlier interview.
For its financial year to 31 December 2005 PCFS saw a 23 per cent increase in its interest income from loans which climbed to $520 million from the $422 million in 2004. The financial institution saw its net profit climb by 23 per cent, to just over $1 billion.
