By NEIL HARTNELL
Tribune Business Editor
CIBC FirstCaribbean plans to open more dedicated ‘Mortgage and Loan’ centres in the Bahamas this year following the inaugural location’s “tremendous success”, its regional chief executive pledging further investment in this nation.
Rik Parkhill told Tribune Business that the first ‘centre’ had boosted both sales volumes and the bank’s ability to identify - and help - troubled borrowers before they “hit a brick wall”.
Speaking after CIBC FirstCaribbean unveiled a 74.8 per cent increase in year-over-year first quarter regional profits, Mr Parkhill promised that the Bahamas would receive its ‘fair share’ from the bank’s regional capital investment plans.
Apart from opening more ‘Mortgage and Loan’ centres, the Bahamas operation will also benefit from CIBC FirstCaribbean’s three-year technology investment plan.
And with this nation accounting for between one-third to 40 per cent of the bank’s financial performance, Mr Parkhill pledged that it would receive a similar share of capital investment dollars if not more.
While unable to disclose figures because the Bahamian subsidiary’s first quarter results have not yet been released to the market, Mr Parkhill said its contribution to CIBC FirstCaribbean’s best quarterly performance in four years “was quite substantial”.
The bank, both regionally and in the Bahamas, has now achieved three consecutive quarters of profitability, leading its chief executive to express optimism that the worst was now behind both itself and regional economies.
“We’ve been able to successfully adapt the business model to be profitable in a low growth environment,” Mr Parkhill told Tribune Business, adding that this had not been the case two years ago.
“We have a lot of upside leverage from the potential recovery in Caribbean economies regionally.”
Indicating that several recently-launched initiatives were already paying dividends, Mr Parkhill said CIBC FirstCaribbean was already seeking to expand its centralised Mortgage and Loan centres.
“It’s been a tremendous success,” he told Tribune Business, “not only in terms of increasing our sales volumes from the centre but also providing our customers with a one-stop shop in terms of financing advice and planning.
“A lot of customers experiencing stress in paying their mortgages come into the centre for advice, and we can deal with problems proactively. It’s been a very useful exercise. The last thing we want to have is more non-performing loans.”
Mr Parkhill reiterated wanting to achieve his target of processing all loan applications - from origination to finish - within 48 hours during “the next couple of months”.
And, while declining to place a dollar figure on CIBC FirstCaribbean’s Bahamian investment plans, Mr Parkhill said further Mortgage and Loan centres would figure prominently.
Although the number and location of these ‘centres’ was also not disclosed, he added: “You are going to see more Mortgage and Loan centres opening. There will be more this year that will open.
“We want to invest further in the Bahamas. We’ve made that investment in the private wealth management centre, and have a three-year technology plan; some of that will get spent in the Bahamas.”
Promising that this nation would receive its fair share of CIBC FirstCaribbean’s investment dollars, Mr Parkhill told Tribune Business: “The Bahamas has traditionally accounted for about one-third of the revenues and profitability of the bank, so it will get that share of investment if not more than that.
“We’re not stopping investing in the Bahamas. It’s such a significant part of the bank that we need to grow there, protect our operations and continue to add value for the customers.”
Mr Parkhill said CIBC FirstCaribbean had identified private wealth management as another growth area, leading to the recent creation of its second dedicated unit in the Bahamas.
“There’s already been a lot of new business onboarded and new customers,” he told Tribune Business. “There’s been some gaps in the wealth management business in terms of various organisations exiting, and we’re very determined to build up that business because we think there are some gaps in the market.”
CIBC FirstCaribbean’s private wealth unit is targeting high net worth Bahamians and residents, plus foreigners with a nexus/connection to this nation and wider Caribbean. It is also seeking to “pull” on the heritage and foundation established by CIBC Trust Company (Bahamas) and its international private banking operations.
Mr Parkhill said the private wealth management unit was designed to combine with CIBC FirstCaribbean’s existing businesses to offer “one-stop shopping” to clients.
“The idea will be to maximise our share of customers’ baskets, so to speak, and what they’re spending on banking services,” he explained, “so there’s a full court press to make sure that when the customer comes in to establish a retirement account, to establish a child’s savings account, that we become the bank for their credit cards, personal wealth management, to offer trusts.
“We’re eliminating silos between these businesses, and getting them to co-operate.”
Mr Parkhill said CIBC FirstCaribbean was now “about three-quarters of the way through” its region-wide restructuring programme. He added that most of the tasks in the plan, which completes this October, had been concluded.
While “additional work” was set to move from the Bahamas to the bank’s larger, purpose-built operations centre in Jamaica, no further redundancies were scheduled.
Confirming that CIBC FirstCaribbean’s Bahamian subsidiary had been able to avoid one-third of its projected lay-offs, Mr Parkhill said: “We had some success in terms of redeploying people in redundant positions to other areas of the bank.”