Excellence in Digitalization & Customer Experience Underpins Difficult Year
Victoria Mutual Investments Limited (VMIL) recorded strong wins in 2020, rising above the economic fallout of the COVID-19 pandemic to record a consolidated revenue of $1.88 billion, while implementing a suite of solutions to improve excellence in service delivery and digitalisation.
This was announced at the company’s 4th Annual General Meeting, which was streamed virtually via a private-user platform from its Half-Way Tree-based corporate offices in St. Andrew on Tuesday (May 25).
STRONG FINANCIAL PERFORMANCE
VMIL consolidated revenue for the year reflected an increase of $192.63 million or 11.4 per cent over the $1.68 billion recorded for 2019. This growth in revenue was primarily driven by gains from investment activities, which increased by $108.09 million. The company’s Net Profit After Taxes, amounted to a commendable $433.59M.
Total assets increased year-over year by 17.4% to $29.72 billion as at December 31, 2020, primarily attributable to an increase in resale agreement balances.
Total liabilities were $25.34 billion as at December 31, 2020, an increase of $4.34 billion or 20.7 per cent over the prior year, driven mainly by the increase in borrowings and repurchase agreements.
VMIL’s capital base continued to be strong throughout the year, with total shareholders’ equity standing at $4.38 billion, up from $4.33 billion, which resulted in a book value per share of $2.92 (2019: $2.88). The growth in total equity was mainly attributable to the net increase of $388.59 million in retained earnings, representing the undistributed portion of the 2020 retained earnings; and the year over year decrease of $332.48 million in the investment revaluation reserve, representing revaluation losses on investment securities and equity instruments.
VM WEALTH CONTINUED TO BE WELL CAPITALISED
Victoria Mutual Wealth Management Limited, VMIL’s licensed securities dealer, continued to be well capitalised, with a risk weighted capital adequacy ratio of 15.56 per cent, which is above the regulatory requirement of 10 per cent. The capital to total assets ratio of 14.24 per cent far exceeded the regulatory minimum of 6 per cent.
Assets managed on behalf of Clients, on a non-recourse basis, grew by an impressive $3.35 billion or 11.4 per cent, from $29.48 billion as at December 31, 2019 to $32.82 billion as at the end of 2020. The year over-year growth was fueled by strong net inflows of $2.18 billion from VM Wealth’s Portfolio Management Clients. The company saw net inflows of $1.17 billion into the Unit Trust portfolios.
DRIVING DIGITALISATION AND EXCELLENCE IN CUSTOMER EXPERIENCE
In 2020, VMIL launched an innovative Client Management Portal, its first digitalisation project, which allows Clients the convenience of accessing their statements and making transaction requests online.
REGIONAL EXPANSION OF CARILEND
The year saw the regional expansion of Carilend, a peer-to-peer lending platform with the launch of Carilend Jamaica, a significant milestone for the business and a win for the local economy. VMIL acquired a 30 per cent stake in Carilend in 2019. Carilend, the first online lending platform company in the Caribbean, is an integrated end-to-end solution providing loans to qualified, creditworthy borrowers in the region.
MEETING THE NEEDS OF CLIENTS
The business successfully launched two additional products based on feedback from its Clients. These are the VM Unit Trust Goal Maximizer Portfolio and a US Equity Trading platform, which allows online trading in US equities.
Additionally, it launched the Premium Wealth Service catering to ultra-high net worth clients. This was launched in November 2020 to expand the Investment and Customer Service needs of affluent clients with balances in excess of J$100 million.
Notwithstanding the upheaval in the local and global economies, VMIL accelerated the expansion of its local footprint, with the establishment of additional branches, taking the number of touchpoints to ten. This demonstrated the company’s sound commitment to providing personalised services to Clients as well as its confidence in the future rebound of the financial sector.
RESULTS-FOCUSED LEADERSHIP AND TEAM
Michael McMorris, Chairman, VMIL, said the Board of Directors are grateful to the results-focused leaders and Team Members for their outstanding work “of guiding and empowering our Clients in their financial affairs especially in the face of the pervasive effects of the global pandemic. This makes us most proud. The significant achievements of the year make it clear that the future holds great things for the business”.
In his address to the AGM, Rezworth Burchenson, CEO, VMIL & VM Wealth Management Ltd, said while 2020 was a difficult year, it reinforced the resilience of his team and drove innovation and creativity.
“It tested our adaptability, innovation and creativity. However, through the resilience of our team, we embraced the changes, and we achieved some significant wins in 2020 that were in keeping with our vision to be the leading Caribbean-based provider of financial services,” he said.