Trinidad and Tobago, home to four large commercial banks and
four smaller institutions, boasts a competitive financial
sector. But size and stability give Republic Bank an edge not
just over its domestic rivals but over most other Caribbean
markets as well.
The bank has the largest market share in terms of deposits
and loans, and in an environment of excess liquidity and
low interest rates profited from increases in credit
Assets at the bank have risen to about $47 billion, from
approximately $46 billion in 2010, and net profit after taxes
of $1.2 billion is up from approximately $1.1 billion in 2010.
Its return on average assets climbed to 2.51% from 2.43% while
its return on average equity stands at 16.0%, compared to 15.3%
Growth has come from its real estate and vehicle market
lending as well as credit card-related technology developments.
Banks able to improve their informational systems and curb
operational costs can make up for revenues from private
operations, says Moody¹s analyst Alexandre Albuquerque
a fact that¹s also positive for margins.
Mortgage lending continues to thrive, he says , and is the
only market segment where the outlook remains solid. The credit
system grew 3.1% nationally to March, driven by the real estate
market, which went up by 9.8% first quarter. Business lending,
by contrast, was 5.7% in June, and was down to 5.1% in
But compared to historical standards, overall credit growth
is weak, at 2.9% in August on an annual basis. This has led
banks to remain conservative in terms of their approach to new
and existing business.
³Most of the concern over the economy is due to the
fact that prices in the energy sector are still going
down,² says Albuquerque. Trinidad and Tobago is seeking to
expand its oil and gas output to take advantage of strong
demand for gas in South America, Europe and Asia.
Albuquerque predicts GDP growth forecasts ranging from 0.9%
to 1.2% for the year ahead following a 1.4% contraction in
2011. But he says that on the positive side, banks are well
capitalized, have quality assets and so are cushioned against
the worst effects of potential losses. LF