you’re safe with us...• creditor life certificates increased by 8.6% from 40,978 to 46,104. •...
TRANSCRIPT
You’re Safe With Us
2006 Annual Report
We are committed to being the
institution of choice in the financial sector,
providing superiorproducts and services
and being a goodcorporate citizento the benefit of our customers,
shareholders and staff.
We Live
Our Miss ion
Table of Contents
2 Scotiabank 2006 Performance
4 Financial & Other Highlights
6 Notice of Annual General Meeting
7 Directors’ Report
8 Ten-Year Statistical Review
10 Report to Shareholders
14 Corporate Governance
17 The President’s Council
19 Our Subsidiaries
21 You’re Safe with Our People
25 Our Children are Safe With Us
28 Your Dreams are Safe With Us
32 Your Business is Safe With Us
35 You’re Safe with Us Anytime
39 Your Future is Safe With Us
42 Our Nation is Safe With Us
46 Our Awards
48 Management’s Discussion & Analysis
57 Shareholdings
58 Financial Report 2006
133 Economic Review
135 Glossary
136 Subsidiaries, Board Members and Senior Officers
138 Senior Management Officers
140 Branches & Branch Managers by Districts
142 Branches & Managers
Proxy Form
Productivity Ratio
Scot iabank At A Glance
Performance:
$2.32EPS is the net income a company
has generated per common share. I t i s ca lcu lated by d iv id ing net
income avai lab le to shareholders by the average number of
common shares outstanding.
Performance:
52.59%The Product iv i ty Rat io measures
the overa l l eff ic iency of the Bank. I t expresses non- interest expenses as a percentage of tota l revenue.
A lower rat io ind icates better product iv i ty. By th is measure,
Scot iabank has h istor ica l ly been s igni f icant ly better than the
internat ional Benchmark of 60%.
1.32
1.862.00 2.01
2.32
0.00
1.00
2.00
3.00
* Restated For Bonus issue
Earnings Per Share (EPS)
Performance:
26.35%ROE measures how wel l the Bank is us ing common shareholders ’
invested money. I t i s ca lcu lated by d iv id ing net income avai lab le
to common shareholders by average common shareholders ’
equi ty.
Performance:
28.36%The Risk based Capi ta l Adequacy rat io is a measure of the Bank ’s overa l l s t rength. I t requires that
the Bank mainta in a rat io between i ts capi ta l base and the aggregate
of i ts r isk weighted assets at no less than 10%. Scot iabank Jamaica has
cont inued to mainta in a strong capi ta l adequacy rat io.
Scot iabank 2006 Performance
Return on Average Equity (ROE)
Risk Based Capital Adequacy
.Financ ia l & Other
Highl ights
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Financial Position ($ Millions)
2006 2005
Total Assets 200,017 183,461 Earning Assets
Performing Loans, net of provisions 58,582 57,325 Repos 29,600 28,650 Non performing Loans 1,005 918 Investments & Others 90,133 78,877
Deposits by the public 113,280 107,547 Stockholders' Equity 27,390 23,525
Earnings and Dividends ($ Millions)
Gross Operating revenue 27,047 25,008 Profit before Taxation 9,316 8,330 Profit after Taxation 6,799 5,886 Dividends paid and proposed 3,015 2,927
Financial Ratios
Earnings per stock unit ($) * 2.32 2.01 Dividends per stock unit ($) * 1.07 1.00 Dividend payout ratio (%) 46.07 49.74 Return on average equity after tax (%) 26.35 26.33 Return on assets at year-end (%) 3.40 3.21 Net Interest Margin (%) 7.91 7.34 Risk based Capital Adequacy Ratio (%) 28.36 29.54
Other Statistics
Number of stock units (ordinary shares) 2,927,232,000 2,927,232,000 Stock price at year-end ($) 22.06 21.14 Number of stockholders 14,352 14,105 Number of staff 1,895 1,843 Number of offices 47 47
Where necessary, comparative figures have been restated to conform with changes in presentation in the current year.
Scotiabank
Financ ia l & Other
Highl ights (cont inued)
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Scotia Jamaica Investment Management Limited
• Total asset growth of 5.6% moved from $18,892 million in 2005 to $19,954 in 2006.
• ROE of 15.5% as compared to 16.84% in 2005
• Total client Repo portfolio (on and off Balance Sheet) increased from $30 billion in 2005 to $34.9 billion in 2006. Increase of 16.3% over 2005
• Revenues from repurchase agreements increased from $120.3 million in 2005 to $136.9 million in 2006
• SJIM’s net profit after tax grew by 7.8%, increasing from $206 million in 2005 to $222 million in 2006
• Revenues from Mutual Funds increased by 89% from $14.2 million to $26.8 million
• Revenues from securities trading activities increased by 5.4%
• Pension and Asset Management unit increased assets under management by 13.26%, growing from $19.6 billion in 2005 to $22.2 billion in 2006
Scotia Jamaica Life Insurance Company Limited
• Total Asset Growth of 21% moved from $24 billion in 2005 to $29 billion in 2006
• ROE of 28% as compared to 32% in 2005.
• Inforce ScotiaMINT policies grew from 59,349 to 66,266.
• Creditor Life certificates increased by 8.6% from 40,978 to 46,104.
• Combined Gross Premium Income increased by 8% from $4.2 billion to $4.56 billion.
• Several Scotia Insurance agents again qualified for membership in the prestigious Million Dollar Round Table (MDRT) and attended the last annual conference held in San Diego, California.
• Net Profit after Tax increased by 17 percent from $1.09 billion in 2005 to $1.28 billion in 2006.
The Scotia Jamaica Building Society
• Total asset growth of 17.2% moved from $6,744 million in 2005 to $7,903 million in 2006
• ROE of 15.15% as compared to 14.99% in 2005
• Mortgage portfolio, net of provision, moved from $3,558 million in 2005 to $3,949 million in 2006 an increase of 11%
• Repo portfolio declined from $1,973 million in 2005 to $1,745 million in 2006
• Total investments increased by 98%, moving from $695 million in 2005 to $1,375 million in 2006
• Total deposits was $4,544 million in 2006 compared to $4,195 million in 2005 an increase of 8%
• Shareholders’ Equity moved from $2,097 million in 2005 to $2,445 million in 2006
• Net profit after tax increased from $297 million in 2005 to $347 million in 2006
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Not ice of
Annual General Meet ing
NOTICE IS HEREBY GIVEN that the Fortieth Annual General Meeting of THE BANK OF NOVA SCOTIA JAMAICALIMITED will be held on Wednesday the 28th February 2007 at 10:00 a.m. at the Jamaica Pegasus Hotel, 81Knutsford Boulevard, Kingston 5, Jamaica for the following purposes, namely:-
1. To consider the Company’s Accounts and the Reports of the Directors and the Auditors for the year endedOctober 31, 2006 and to consider and (if thought fit) pass the following resolution:
Resolution No. 1“That the Directors’ Report, the Auditors’ Report and the Statements of Account of the Company for theyear ended October 31, 2006 be approved and adopted.”
2. To approve and ratify interim dividends: -
To consider and (if thought fit) pass the following resolution:
Resolution No. 2“That the interim dividends paid of 25 cents on March 31, 2006, 25 cents on July 7, 2006, 28 cents on October 5, 2006 and 29 cents on January 8, 2007 be and are hereby ratified.”
3. To elect Directors and fix their remuneration. The Directors retiring from office by rotation pursuant to Article 90 of the Company’s Articles of Association are Mr. Anthony Chang, Professor Celia Christie, Mr. William McConnell, and Mr. Richard Waugh who being eligible, offer themselves for re-election.
To consider and (if thought fit) pass the following resolutions:
Resolution No. 3
a) “That retiring Director Anthony Chang be and is hereby re-elected a Director of the Company.”b) “That retiring Director Celia Christie be and is hereby re-elected a Director of the Company.”c) “That retiring Director William McConnell be and is hereby re-elected a Director of the company.”d) “That retiring Director Richard Waugh be and is hereby re-elected a Director of the Company.”
4. To appoint Auditors and authorise the Directors to fix the remuneration of the Auditors.To consider and (if thought fit) pass the following resolution:
Resolution No. 4“That KPMG, Chartered Accountants, having agreed to continue in office as Auditors, be and are hereby appointed Auditors of the Company to hold office until the next Annual General Meeting at aremuneration to be fixed by the Directors of the Company.”
6. Any other business for which due notice has been given.
BY ORDER OF THE BOARD
David NoëlSecretaryNovember 23, 2006
REGISTERED OFFICEScotiabank CentreDuke & Port Royal StreetsKingston
A member entitled to attend and vote at this meeting may appoint a Proxy to attend and vote in his/her stead. A Proxy need not also be aMember of the Company. Enclosed is a Proxy Form for your convenience, which must be lodged at the Company’s Registered Office at leastforty-eight hours before the time appointed for holding the meeting. The Proxy Form shall bear the stamp duty of $100.00 before beingsigned. The stamp duty may be paid by adhesive stamp(s) to be cancelled by the person executing the Proxy.
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The Directors submit herewith the Statement of Consolidated Revenue, Expenses, Unappropriated Profits,Assets and Liabilities of the Bank for the year ended October 31, 2006.
The Consolidated Statement of Revenue and Expenses shows pre-tax profit for the year of $9,316 Millionfrom which there has been provided $2,517 Million for corporate income tax, leaving a balance of $6,799Million.
The appropriation of earnings detailed in the financial statements includes:
i. An interim dividend of 29 cents per stock unit payable to stockholders on record as at December13, 2006 payable on January 8, 2007. This brings the total distribution for the year to $1.07 perstock unit compared with $1.00 per stock unit for the previous year, after adjustment for the 1 for 1 bonus shares in 2005.
ii. A transfer of $750,000,000 to the Retained Earnings Reserve.
In view of the interim dividends paid, and to be paid, as mentioned above, the Directors do not recommendthe declaration of a final dividend at the Annual General Meeting to be held on February 28, 2007.
Mr. Anthony Chang, Professor Celia Christie, Mr. William McConnell, and Mr. Richard Waugh retire from theBoard by rotation in accordance with Article 90 and being eligible offer themselves for re-election.
The Auditors, KPMG, have signified their willingness to continue in office.
Your Directors wish to thank the Management and Staff of the Bank for their performance during the yearunder review.
On behalf of the Board
R.H. PitfieldChairman, Kingston, JamaicaNovember 23, 2006
Directors ’
Report
Ten-Year
Stat ist ica l Review
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detatseR detatseR
000'$ 3002400250026002
21771,356,741946,761,861875,064,381206,610,002STESSA LATOT
3910,111,74601,024,25546,423,75362,285,85SNAOL GNIMROFREP
596,369693,930,1461,819154,500,1SNAOL GNIMROFREP-NON
1444,395,71063,640,52817,946,82735,995,92SOPER
5328,809,06442,455,56415,678,87361,331,09STESSA GNINRAE REHTO & STNEMTSEVNI
7233,760,78918,018,89636,645,701835,972,311 CILBUP EHT YB STISOPED
EMEERGA ESAHCRUPER REDNU DLOS SEIT TIRUCES N 1699,292,51924,645,81042,913,71501,432,81
1791,156,71710,506,02359,425,32555,983,72YTIUQE 'SREDLOHKCOTS
304,703,7336,271,8218,923,8426,513,9XAT EROFEB TIFORP
076,654,5750,658,5685,588,5809,897,6XAT RETFA TIFORP TEN
823,165,2986,707,2232,729,2940,510,3SSORG ,DIAP SDNEDIVID
702,085,6283,017,9637,819,11595,259,41DNE RAEY TA STIFORP DETAIRPORPPANU DNE RAEY TA STINU KCOTS FO REBMUN )1( 232,729,2232,729,2232,729,2232,729,2
SOITAR LAICNANIF
TINU KCOTS REP SGNINRAE )1( 68.100.210.223.2
08.426.2115.0115.9OITAR SGNINRAE ECIRP TINU KCOTS REP DIAP SDNEDIVID )1( 578.0529.000.170.1
DLEIY DNEDIVID )1( %87.9%14.4%88.3%00.4
%49.64%42.64%47.94%70.64OITAR TUOYAP DNEDIVID
%38.54%56.14%62.73%01.63XAT-ERP YTIUQE EGAREVA NO NRUTER
%22.43%58.92%33.62%53.62YTIUQE EGAREVA NO NRUTER
%07.3%84.3%12.3%04.3DNE RAEY TA STESSA NO NRUTER
ATAD REHTO
DNE RAEY EHT TA ECIRP KCOTS )1( 59.862.5241.1260.22
%03.41%81.281%13.61-%53.4RAEY TSAL MORF EGNAHC ECIRP
403,06100,401544,201659,58DNE RAEY TA XEDNI ESJ
%39.64%64.27%05.1-%01.61-RAEY TSAL MORF XEDNI ESJ NI EGNAHC
158,1468,1348,1598,1FFATS FO REBMUN
74847474 SECIFFO FO REBMUN
104,9289,01501,41253,41SREDLOHKCOTS FO REBMUN
6610.02610.06510.01510.0$SU=1$J ETAR EGNAHCXE
%31.41%06.11%09.51%08.5RAEY REVO RAEY ETAR NOITALFNI
945,09508,49160,29573,201$SU NI TIFORP TEN
YLRETRAUQ DIAP DNEDIVID
304,644644,585808,137808,1371 RETRAUQ
304,644726,856808,137808,1372 RETRAUQ
209,625808,137808,137808,1373 RETRAUQ
026,141,1808,137808,137526,9184 RETRAUQ
823,165,2986,707,2232,729,2940,510,3LATOT
(1) Amounts have been retroactively adjusted to reflect the one-for-one bonus issues on March 10, 2005 and October 6, 1997.Where necessary, comparative figures have been restated to conform with changes in presentation in the current year.
Ten-Year
Stat ist ica l Review (cont inued)
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detatseR detatseR
7991899199910002100220023002
483,629,45426,516,56795,917,77004,034,88279,365,201334,763,721771,356,741
557,180,91871,691,71081,966,61481,753,02097,442,52856,315,83910,111,74
564,027039,732,1123,423,1650,712,1543,119758,609596,369
266,745,7025,809,7351,339,9222,171,9981,517,41366,021,41444,395,71
,71295,995,63008,941,93714,585,44743,356,64339,623,25328,809,06 812,231
076,776,14308,222,64187,735,45501,483,06952,908,76806,749,67233,760,78
940,752,4344,270,6675,610,8050,107,8202,293,8236,665,11699,292,51
844,249,4245,619,5342,699,6262,353,8208,088,11677,560,41791,156,71
821,262,2282,775,2374,649,2679,484,3834,814,4537,803,5304,703,7
955,485,1744,467,1150,130,2481,755,2871,412,3287,968,3076,654,5
808,137353,097053,159561,002,1616,364,1851,386,1823,165,2
322,102959,833688,536557,830,1042,928,2468,562,4702,085,6
232,729,2232,729,2232,729,2232,729,2232,729,2232,729,2232,729,2
45.006.096.078.001.123.168.1
50.965.538.483.769.629.508.4
52.072.033.014.005.0575.0578.0
%01.5%60.8%07.9%53.6%45.6%43.7%87.9
%81.64%97.44%48.64%39.64%45.54%94.34%49.64
%90.05%23.64%00.44%50.44%27.44%00.04%38.54
%90.53%17.13%33.03%23.23%35.23%61.92%22.43
%88.2%96.2%16.2%98.2%31.3%40.3%07.3
09.453.353.364.646.738.759.8
%45.13%36.13-%00.0%48.29%72.81%94.2%03.41
741,81050,02421,12677,92595,23440,14403,06
%34.81%94.01%63.5%69.04%74.9%29.52%39.64
666,1478,1757,1196,1657,1508,1158,1
15059405849474
849,7370,8219,8040,9561,9744,9104,9
8720.01720.00520.04220.00120.03020.06610.0
%89.9%41.7%44.6%03.8%65.7%40.5%31.41
250,44647,74677,05182,75894,76783,87945,09
327,292163,641259,281259,281413,923394,204304,644
327,292263,641259,281259,281685,853131,714304,644
409,563263,641259,281327,292222,373131,714209,625
662,215635,207494,204835,145494,204304,644026,141,1
616,364,1126,141,1053,159561,002,1616,364,1851,386,1823,165,2
Robert H. PitfieldChairman
William E. Clarke, CDPresident and CEO
You’re Safe With Us
FINANCIAL REVIEW
Strong Financial Performance2006 was one of Scotiabank’s most impressive years. It was a year in which we achieved record resultsand reported net profits of $6,799 millionrepresenting a 15.5% growth over last year. Theseresults were achieved in spite of continuedreductions in market interest rates, and reflect thestrength of our well-diversified business lines. We
accelerated growth by attracting, retaining anddeepening customer relationships and launched anumber of initiatives that added and created valuefor our customers, employees and shareholders.
As the most profitable financial services group inJamaica in 2006, we paid more dividends toshareholders than any other financial institution inthe country, while continuing to invest in ourbusiness. We remain focused on our core business
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Report to
Shareholders
Report to
Shareholders (cont inued)
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to achieve solid earnings and long-term sustainablegrowth. Strong growth in retail banking continuesto be a major contributor to our solid performance,with volume growth in retail and credit card loans,and fee income being major contributors to retailbanking profits.
Earnings per share was $2.32 up 15.5% from $2.01last year, and total revenue rose 12.1% over theprior year with net interest income increasing by10.3%, and other income increasing by 19.2%. Thisstrong performance resulted in return on equity of26.35% for this year.
Total RevenueTotal revenue was $19,650 million in 2006, anincrease of $2,124 million from the prior year. Thisincrease was due to growth in net interest revenueas well as other revenue, which was fuelled bystrong growth in foreign exchange trading profitand commercial and retail banking fees.
Net Interest IncomeNet Interest income was $15,523 million in 2006, up$1,458 over last year, despite the continuedreduction in market interest rates. We achievedgrowth in net interest income due to strongportfolio volume growth, particularly on the retailside.
Premium IncomeFor the period under review, ScotiaMINT, theinterest sensitive life insurance policy marketed by
Scotia Jamaica Life Insurance Company Limited, aswell as Creditor Life, made significant gains ininsurance premium. Combined net premium incomefor both products increased by approximately $96million when compared to the same period last year.Scotia Life reported gross premium income of $4.3billion for the twelve month period.
Other IncomeOther income, defined as all income other thaninterest income and insurance premium income,increased by $568 million, this was driven by retailand commercial banking fees and foreign exchangetrading profit.
Non-Interest Expenses and ProductivityNon-Interest expenses, excluding changes inpolicyholders’ reserves and loan loss provision, were$7,863 million in 2006, an increase of $1,032 millionor 15% from last year. Salaries and employeebenefits is the major contributor to this expensecategory and was $4,651 million, up 16% from lastyear.
Our productivity ratio at 52.59% continues to leadthe financial services industry in Jamaica, due to ourfocus on managing costs across the Group. We willcontinue our focus on finding new ways ofimproving operational efficiency by consolidatingand streamlining processes and structures,eliminating duplication, and sharing best practicesthroughout our network.
Report to
Shareholders (cont inued)
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Credit QualityScotiabank’s credit quality continues to beoutstanding both by international standards andwhen compared with our peers locally. Non-performing loans as at October 31, 2006 was $1,009million, an increase of $91 million when comparedto last year. The Group’s non-performing loans nowrepresent 1.69% of total loans and 0.5% of totalassets compared to 1.59% and 0.5% respectively inthe prior year.
Provision for loan losses on an IFRS basis was $478million at year-end. However, the total provisionsbased on the BOJ’s statutory requirements were$1,285 million. The difference between thestatutory and the IFRS provision is reported in theLoan Loss Reserve, as a component of Shareholders’Equity. We continue to experience significantgrowth in the loan portfolio, however our loan lossprovision has remained relatively stable. This is dueto Scotiabank’s strong credit policy and loanadministration procedures, which has ensured thehigh quality of the loan portfolio. We are confidentthat with this level of provisioning, the Group isadequately protected should the economy suffer ashort-term down turn.
DividendsOur shareholders received increased dividendsduring 2006 in keeping with our policy to increasedividends in line with the trend in earnings, whileensuring that adequate levels of capital are kept forthe purpose of protecting depositors and growingthe business of the Bank.
Dividends per share totalled $1.07 in 2006 anincrease of 7% from 2005. The gross dividends paidfor 2006 was $3,132 million up $205 million fromlast year. The steady growth in dividends is a majorcontributor to the high long-term returns generatedfor shareholders. The dividend payout ratio for 2006was 46.07% compared to 49.74% last year. Bothratios are within the target payout of range of 40%- 50%.
Shareholders’ EquityTotal shareholders’ equity rose by $3,865 million in2006, fuelled by internally generated capitalincrease. Scotiabank maintains a strong capital baseto support its diversified business activities. Ourcapital ratios remain among the highest in thefinancial services sector in Jamaica. This strengthcontributes to the Bank’s safety, fosters shareholderconfidence, and provides us with the potential toenhance shareholder return through increaseddividends.
Assets and LiabilitiesThe Bank’s total assets were $200 billion as atOctober 31, 2006 up $17 billion or 9% from last year.Growth was spread across most asset categories.
Performing LoansPerforming Loans as at October 31, 2006 were $59billion, up $1.2 billion over the previous year. Whileprivate sector commercial loan demand remainedsoft, we achieved significant growth during 2006 inretail loans.
Report to
Shareholders (cont inued)
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Cash Resources and Government of JamaicaSecurities Our cash resources held to meet statutory reservesand the Bank’s prudential liquidity targets stood at$46 billion at October 31, 2006, compared to $45billion at the previous year-end. These assets are heldin liquid form at levels and terms that enable us torespond effectively to swings in our cash flow,without severe adverse consequences. The amountsheld exceed the statutory minimum for such assets inrelation to our prescribed liabilities.
The Bank’s portfolio of government securities(including repurchase agreements) grew from $70billion at last year-end to $82 billion at October 31,2006 as deposit and repo liability growth outpacedloan growth. The average yield on the portfoliodecreased year-over-year in line with market trends.
DepositsOur Bank continues to increase its deposits despitethe noticeable market shift from traditional bankdeposits to investments in a wide variety of marketinstruments, ranging from Government of Jamaicasecurities to money market products. The Bank’sdeposits grew by 5%, from $114 billion at last year-end to $120 billion at this year-end, as publicconfidence in the Bank remains very high.
The mix of the portfolio was dominated by retailsavings accounts, however term deposits alsocontinued to grow steadily.
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Our Shareholders are Safe With Us
R. E. Waugh (left)Mr. Richard E. Waugh is the President of The Bank of Nova Scotia, Canada. Mr. Waugh is a member of theBoard of Directors of The Bank of Nova Scotia and several of the Bank’s subsidiaries and affiliates.He was appointed to the Board of Directors of The Bank of Nova Scotia Jamaica Limited on February 20,2003.
W. E. Clarke, C.D. (centre)Mr.William Clarke, President and CEO of the Bank, was appointed to the Board on May 18, 1995. He is a memberof the Executive and Pension Committees of the Board and is also a Director of Scotia Jamaica InvestmentManagement Limited, The Scotia Jamaica Building Society, Scotia Jamaica Life Insurance Company Limited, ScotiaJamaica General Insurance Brokers Limited, Scotia Financial Services Limited and Scotiabank Jamaica Foundation.
Dr. H. J. Thompson (right)Dr. Herbert Thompson is the President of The Northern Caribbean University. He was appointed to the Board of theBank on August 19, 1998 and is a member of the Pension Committee of the Board. Dr. Thompson is also DeputyChairman of the Board of The Scotia Jamaica Building Society.
Corporate Governance
Board of Directors of the Bank
EXECUTIVE COMMITTEE OF THE BOARD
Hon. M. M. Matalon, O.J.Chairman
Hon. W. A. McConnel, O.J.Deputy Chairman
W. E. Clarke, C.D.Dr. J. A. DixonC. H. JohnstonJ. M. Matalon
AUDIT & CONDUCT REVIEWCOMMITTEE
J. M. MatalonChairman
C. H. JohnstonHon. W. A. McConnel, O.J.Miss M. M. IssaProf. S. C. VasciannieA. V. Chang
HUMAN RESOURCESCOMMITTEE
Dr. J. A. DixonChairperson
W. A. McDonaldMiss M. M. IssaProf. C. D. C. Christie
PENSION COMMITTEE
Hon. W. A. McConnel, O.J.Chairman
W. E. Clarke, C.D.W. A. McDonaldDr. H. J. ThompsonMiss S. A. Wright
Board & Committee Members
We Live
Our Miss ion
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M. M. Issa, (left)Miss Muna Issa is the Treasurer of SuperClubs. She has been a Director of the Bank since August26, 1999 and is also a member of the Human Resources and Audit & Conduct Review Committeesof the Board. Miss Issa is also the Chairperson of the Board of Scotia Jamaica Life InsuranceCompany Limited and a member of the Board of The Scotia Jamaica Building Society.
Hon. M. M. Matalon, O.J., Deputy Chairman (centre)Mr. Mayer Matalon is the Deputy Chairman of the I.C.D. Group Limited. He is also the DeputyChairman of the Board of the Bank and Chairman of the Executive Committee of the Board.Mr. Matalon has been a Director of the Bank since 1966.
Prof. C. D.C. Christie, (right)Celia Christie is a Professor of Pediatrics and a specialist in Pediatric infectious diseases,epidemiology and Public Health at the University of the West Indies. Professor Christie has been aDirector of the Bank since February 5, 2001 and is a member of the Human Resources Committee ofthe Board. She is also a Director of Scotia Jamaica Life Insurance Company Limited.
W. A. McDonald (left)Mr. Warren McDonald is the Managing Director and Chief Executive Officer of Berger PaintsJamaica Limited. Mr. McDonald was appointed to the Board of the Bank on February 5, 2001and is a member of the Human Resources and Pension Committees of the Board. He is also aDirector of Scotia Jamaica Investment Management Limited.
Dr. J. A. Dixon, (centre)Dr. Jean Dixon is the Permanent Secretary in the Ministry of Industry, Commerce and Technology. Shehas been a Director since February 19, 1998 and is a member of the Executive and Human ResourcesCommittees of the Board. Dr. Dixon is also the Chairperson of the Board of Directors of The ScotiaJamaica Building Society and Scotiabank Jamaica Foundation.
J. M. Matalon (right)Mr. Joseph M. Matalon is the Chairman and Chief Executive Officer of the I.C.D. Group Limited. He wasappointed a Director on September 1, 2005 and is a member of the Executive and Audit & ConductReview Committees of the Board.
Hon. W. A. McConnell, O.J. (left)Mr. William McConnell is the Managing Director of Lascelles DeMercado Company Limited. He hasbeen a Director of the Bank since February 18, 1988. He is also a member of the Executive, Pensionand Audit & Conduct Review Committees of the Board and Chairman of Scotia Jamaica InvestmentManagement Limited.
A. V. Chang, (centre)Mr. Anthony Chang is the Managing Director of T. Geddes Grant Limited. He was appointed to theBoard of the Bank on February 5, 2001 and is a member of the Audit & Conduct Review Committeeof the Board. Mr. Chang is also a Director of Scotia Jamaica Life Insurance Company Limited.
C. H. Johnston, (right)Mr. Charles Johnston is the Chairman and Managing Director of Jamaica Fruit and Shipping CompanyLimited. He was appointed to the Board of the Bank on August 22, 2002 and is a member of theExecutive and Audit & Conduct Review Committees of the Board.
R. H. Pitfield, Chairman (left)Mr. Robert H. Pitfield is the Executive Vice President, International Banking, of the parent Company,The Bank of Nova Scotia, Canada and is responsible for all of the Bank’s retail and commercialoperations outside of Canada & USA. He was appointed a Director and Chairman of The Bank ofNova Scotia Jamaica Limited on May 22, 2003.
S. A. Wright (centre)Miss Stacie-Ann Wright is the Executive Vice President and Chief Financial Officer of the Bank and wasappointed to the Board on September 1, 2005 and is also a member of the Pension Committee. Miss Wrightis also a Director of Scotia Jamaica Life Insurance Company Limited, The Scotia Jamaica Building Society,Scotia Jamaica Investment Management Limited, Scotia Jamaica Financial Services Limited and ScotiabankJamaica Foundation.
Prof. S. C. Vasciannie (right)Dr. Stephen Vasciannie is currently Professor of International Law at the University of the West Indiesand Head of the International Division of the Attorney General’s Chambers. Professor Vasciannie wasappointed a Director on September 1, 2005. He is a member of the Audit & Conduct ReviewCommittee of the Board and is also a Director of Scotia Jamaica Life Insurance Company Limited andScotia Jamaica Investment Management Limited.
Corporate Governance (cont inued)
Board of Directors of the Bank
Corporate Governance (cont inued)
Accountability, Openness and Integrity
S cotiabank believes that sound and effectivecorporate governance practices are essentialto our long-term success. Our corporategovernance practices are designed to ensure
the independence of our Board of Directors and itsability to effectively supervise management’soperation of the Bank. Good corporate governancepractices are important to the creation ofshareholder value and maintaining the confidence ofdepositors and investors.
Board independence ensures that the Bank ismanaged for the long-term benefit of allstakeholders – shareholders, employees, customersand the communities in which we operate. Our Banktherefore ensures that the majority of our directorsare independent, with eleven of our fifteen currentdirectors being independent of the Bank, its parentor its affiliates, and thirteen being non-executivedirectors. The composition of the Board thereforeprovides management with independent andobjective oversight, and strategic guidance. TheBoard also ensures that key committees (such as theAudit & Conduct Review Committee and the HumanResources Committee) are comprised of independentdirectors who have the requisite skills to carry outthe respective mandates.
The effectiveness of any Board of Directors will alsobe dependent on the quality of the individuals whoserve as directors. Our Bank prides itself on havingindividuals serving as directors who are business andcommunity leaders who have distinguishedthemselves in various fields of business andacademia. Our directors have contributedsignificantly to the Bank’s success over the years andwe are confident that they will continue to do so inthe future.
From time to time, new directors are appointed tothe Board who are able to provide a differentperspective to the Board’s deliberations. The processof continually appointing new directors as othersretire ensures that the Board continues to evolve inchanging times.
The Scotiabank Group is committed to goodcorporate governance and will continue to complywith international best practices, the Jamaica StockExchange, the Bank of Jamaica and the FinancialServices Commission.
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David NoëlSenior Vice President / Senior Legal
Counsel & Corporate Secretary
Our strong compliance and risk managementculture enables us to balance the need for
careful observance of regulations while fulfillingour commitment to providing our customers
with superior products and services.
Michael Jones Senior Vice President,
Human ResourcesWe believe our people are at the heart of our
business. As an Employer of Choice ourinvestments in employee programmes have
become industry standard. These partnershipshave enabled the creation of a committed family
of Scotiabankers.
Rosemarie PillinerExecutive Vice President,
Operations Our commitment to our customers transcends a
purposeful, memorable and consistent experience.As we implement innovative technology to deliver
cutting edge solutions, our daily mantra is toensure that each customer experience will be
exceptional across all touch points.
Stacie-Ann WrightExecutive Vice President & Chief Financial Officer
At Scotiabank, we are committed to providing ourshareholders with an attractive long-term return on
their investment by achieving superior financialperformance while managing risk effectively.
Over the past 10 years, we have consistently paidincreased dividends to our shareholders every year.
Anya SchnoorSenior Vice President, Wealth
ManagementGeneral Manager, SJIM
We recognize that wealth creation andmanagement are important to everyone. That’s
why we have developed a comprehensivestrategy that considers a person’s tangible and
intangible assets, as we believe that true wealthlies in good health, family security, qualityrelationships, and sustainable lifestyles.
Yvonne PandohieVice President and Chief Auditor
We recognize that a sound internal controlenvironment is the cornerstone of financial
stability and growth. This has been Scotiabank’shallmark and an effective tool for protecting our
stakeholders’ interests.
H. Wayne PowellExecutive Vice President,
Branch BankingWe know and understand our customers andwe provide our staff with the tools to enable
them to focus on our customers’ needs at everystage of life. We are dedicated to building
long-lasting relationships with our customers.
Audrey Tugwell HenrySenior Vice President,
Retail & Electronic Banking
We have been able to keep pace with ourcustomer’s changing needs by delivering
innovative products and services. This has keptus where we need to be – in step with the restof the world and in tune with our customers’
expectations.
The Pres ident ’s Counci l
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The Pres ident ’s Counci l (cont inued)
William Clarke (centre), President & CEO and members of the President’s Council
Rosemarie Voordouw Director, Employee Communications
& Consultations
At Scotiabank we pride ourselves on cultivatingan environment that is supportive and
empowering. We are pioneers in providing anindependent, confidential conflict resolution
resource that is immediately accessible to our staff.
Ronald BourdeauVice President,
Risk ManagementOur enviable position as the market leader in
managing risk is as a result of our strong focus onmaintaining our high standards of accountability
throughout the years. This has consistentlyallowed us to achieve an acceptable level of
exposure while maximizing shareholder value.
Heather ShieldsVice President,
MarketingOur stakeholders’ confidence in us has made us
one of the strongest brands in Jamaica. This brand equity gives us a real strategicadvantage in an increasingly competitive
industry.
Wayne Hewitt Vice President,
Corporate & Commercial Banking
Relationships are the cornerstone of ourbusiness. Our competitive edge as the strongest
and most experienced commercial bank inJamaica is testament to our ability to develop
customized solutions to meet the needs of ourcorporate and commercial clients.
Joylene Griffiths IrvingDirector - Public, Corporate
& Government Affairs,Executive Director,
Scotiabank Jamaica FoundationOur commitment to corporate philanthropy
distinguishes Scotiabank from the rest of corporateJamaica and each year we raise the bar. We are
building and enhancing an image that all ourstakeholders can continue to be proud of.
Our Subs id iar ies
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Scotia Investments
From left to Right - Nadine Hines, Manager Trust and Registration Services, Camille Whym-Stone, Human ResourcesRelationship Manager, Kevin Harris, Senior Manager, Investments, Anya Schnoor, Senior Vice President, Wealth Management
and General Manager, Scotia Investments Management Ltd., Brian Frazer, Manager, Securities Trading, Pamela Douglas, Investment Field Consultant, Cheverton Wisdom, Manager, Finance & Operations,
Monique Todd, Senior Marketing Manager.
Scotia Insurance
From left to Right - Jacqueline Sharp, Vice President & General Manager, Evette Hendricks, Manager, Marketing & Communications,
Monique Anthony, Manager, Finance & Compliance Officer, Lois Heslop, Senior Manager, Operations & Service Delivery,Lorna Gordon Elliot, Manager, Creditor Life Insurance.
Our Subs id iar ies (cont inued)
The Scotia Jamaica Building Society
From left to Right - Phillip Williams, Manager Mortgage Services, Janelle Brown, Marketing Manager, Gladstone Whitelocke, General Manager,
Latoya Fuller, Manager, Finance & Operations. 20
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When our Scotiabank customersinteract with our staff, whether inperson or on the telephone, there arehigh expectations of courtesy,
professionalism, efficiency, respect, expertise, andaccuracy from staff. Our customers deserve no lessand our human resource policies and practices aregeared to help us achieve this goal. Our corevalues: integrity, respect, commitment,insight and spirit, underscore our strongdedication to our core purpose, which is ‘to be thebest at helping customers become financiallybetter off by finding relevant solutions to theirunique needs.’ Another way of saying this is‘you’re safe with our people’.
The over 1,800 Scotiabankers who serve ourcustomers in different capacities include some ofthe best people in their field and our humanresource policies are geared towards continuallyimproving both their expertise and their level ofjob satisfaction. That is because we recognise thatsatisfied, well-trained employees give betterservice. We have been seeing continualimprovement in response to our efforts in thisarea. This year, 89 percent (versus 84 per cent in2005) of our staff say that they feel that theirbranch/unit/department provides high quality
service. Our customer service surveys indicate thatour customers share this view, as they reportimproved customer satisfaction and loyalty scores.In addition, more and more employees (87 percentas against 82 percent in 2005) feel confident thattheir branches/units/departments have plans toeffectively meet targets which will help the Bankto meet and achieve stakeholder objectives.
Moreover, in 2006, 82 percent of our employeessaid that Scotiabank is a great place to work and86 percent said we respected individual diversity.Our placement among the top ten Employers ofChoice in Jamaica, in the 2006 Jamaica Employer’sFederation survey reinforced this view for thesecond consecutive year.
Recruitment PracticesAt Scotiabank, we recognise that sometimes greatcustomer service is a matter of having the rightperson for the job. That is why we have takendeliberate steps to ensure that the persons weselect for particular jobs have both the technicaland behavioural characteristics to perform theirrole. We utilise strong predictive tools tostrengthen our recruitment processes and we areusing these tools for key jobs throughout the
Rosemarie Edwards, training facilitator speaks with credit officersand retail administrative clerks during a collateral securities trainingsession held at our Training Centre.
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organisation. Our customers can be assured that asa result of our focus on establishing job andorganizational fit, our staff will have both the ‘softskills’ and technical competencies to satisfy theirrequirements.
Training and CoachingOnce you have the right people, you have to ensurethat they remain on the cutting edge in terms oftheir skills and knowledge base. If they do not, ourcustomers will not be served at the standard theyexpect and deserve. At Scotiabank we take on-going training seriously and we provide access tointernal and external training for our employees.In 2006 over 120 managerial and supervisory stafftook time out from their regular schedule to learnabout Peripheral Vision, as a part of a ManagementRetreat.
Developed by two Universityof Harvard professors, thisconcept emphasizes theimportance of being awareof developments in theimmediate industry and thewider society. Since theretreat, we have expandedtraining in this concept tothe entire Bank, to ensurethat all our team membersare constantly on thelookout for ways to betterserve our customers.
In 2006, 1,030 staff membersparticipated in trainingprogrammes at our well-equipped Training Centre.The programmes coveredtechnical and people skillsand included topics such as computer softwarecompetency, supervisory skills, sales management,conflict management and career planning. Inaddition, this year we invested heavily in two keycustom built competency based programs-‘Delivering the customer experience’ and‘Managing the employee experience’. We alsoplaced great emphasis on educational assistanceand our staff continue to testify to the outstandinglevel of support we provide in this area. Thisprogramme helps them to achieve personaldevelopment goals as well as equip them to delivermore compelling customer service.
In addition to our formal training initiatives,Scotiabankers participate in a structured coachingprogramme under which each employee receives
individual coaching at least once each month fromhis/her supervisor. This coaching helps our staffmembers to continually improve their performance.
Succession PlanningThere is more to an effective training programmethan performance in one’s current job. The fact is,our customers expect to receive the same level ofservice even when there are personnel changes. At Scotiabank we recognise that to achieveseamless changes we must have effective successionplanning. That is why we are a learningorganisation with a deliberate programme ofcontinuous learning. This programme is aimed atcreating a multi-skilled team and ensuring that ourcustomers receive quality service at all times.
It is this same thinking thatconvinced us that it isimportant to ensure continuityin our cadre of leaders and tonurture leaders who will beable to respond to ourcustomers’ needs and desires inthis rapidly changingenvironment. Of course, wealso recognise that leadershipis a key competitive advantagein the building of our business.In the quest to maintain thisadvantage, we have identifiedkey people from among ourjunior employees who showthe promise of assumingleadership positions in thefuture and have initiatedmentoring programmes to aidin their development.
Innovations We recognise the value of efficient communicationin maintaining a strong team and ensuring that allour people are focused on our core purpose. Thisyear, Scotiabank Jamaica became the first countryin the Scotiabank Group outside of Canada to gainits own portal on the Bank’s Intranet – HR Passport.This has enabled more widespread dissemination ofinformation, and plans are in place for audio feedsto supplement this service next year. Through ourEmployee Communications and Consultations (ECC)unit (itself a unique innovation), we re-launchedour internal magazine, ScotiaVibes, which serves toreinforce corporate values and engendercommitment to the Bank’s goals. We also launcheda new leadership journal from our HR Departmentto support our efforts at leadership development.
At Scotiabank we recognisethat to achieve seamlesschanges we must haveeffective successionplanning. That is why wehave become a learningorganisation with adeliberate programme ofcontinuous learning. Thisprogramme is aimed atcreating a multi-skilledteam and ensuring thateven when we change ourpeople, our customerscontinue to receive qualityservice.
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In addition, the ECC continued to provideassistance to teams and their leaders in practicingeffective interpersonal communication andresolving conflict effectively.
This year we renewed our focus on wellnessinitiatives through certification of wellnessfacilitators, an innovative and new concept in theJamaican workplace. We also invested in morerecreational facilities and activities for our staff.This effort at work-life balance is yielding results:we are seeing increased employee satisfactionwhile our customers experience better servicelevels.
Customer Service We know that our efforts at staff training andemployee satisfaction have resulted in betterservice for our customers. But we are not takinganything for granted. Last year we made adeliberate effort to promote a customer centricculture amongst our staff so that persons using ourfacilities at any location would experience aconsistently high standard of service. Our ScotiaWay programme, launched during the year, helpedScotiabankers at all levels to live the servicestandards of attitude, appearance, communication,ownership, expertise, efficiency and communica-tion. We are committed to pursuing our goal ofexceeding our customers’ expectations in all areasof the Bank.
In the coming year, our focus on improving thecustomer experience will see the Bank establishingseveral support initiatives in back office operationsto enable our frontline staff to be more efficient inhandling transactions. The most far-reaching ofthese is the Customer Service Charter, whichprovides team members with clear guidelines fordelivering seamless customer service in everyaspect of customer facing care, and outlines ourpromise of the best service to our customers. Ourcomplaints management department will also beable to more efficiently log and resolve complaintsusing our new electronic Customer ComplaintTracking System. In short, we’re using everyavenue available to ensure that “you’re safe withour people”.
At Scotiabank, we recognise that our nation’schildren hold the future in their hands. We alsobelieve that it is our responsibility to play ourpart in nurturing their total growth and
development. That is why it is important to us to make surethat ‘our children are safe with us.’
Our commitment to our children is visible in the focus ofour corporate social responsibility activities and theproducts and services we have designed specifically forthem. Many of the projects that our Scotiabank JamaicaFoundation undertake, as well as our staff outreach effortsare aimed at improving the lives of our children. On theother hand, our range of accounts helps adults to secureour children’s future and encourages children to develop asaving habit for themselves.
Saving for the futureOur youngest stakeholders: children from birth to elevenyears have their very own product to introduce them to thediscipline of saving. It is called ScotiaFirst and in additionto attractive interest rates, our young savers have thechance to win computers or bursaries. ScotiaFirst saversalso have the opportunity to vie for one of our six Grade SixAchievement Test (GSAT) bursaries.
Once our children move into the teen years - between 12and 21 - their goals change and we have tailored a productto help them achieve their objectives. This product isScotiaWise, which also offers competitive interest rates andthe chance to qualify for one of five bursaries each termand six university bursaries. More and more teens arefinding ScotiaWise to be an excellent savings vehicle andthe 2006 results reflect this trend with a 35% growth over2005.
We also make it possible for adults to secure theeducational future of their children using ScotiaMINT,which is offered through Scotia Insurance. This insurancepolicy is ideal as it allows our clients to invest an affordableamount each month in a tax-sheltered instrumentproviding they meet certain requirements. By laying astrong foundation in the early years, parents and guardianswill find the cost of their children’s tertiary education lessburdensome.
Our Foundation and our childrenAt Scotiabank, corporate social responsibility is animportant part of who we are and we focus our attentionin the areas of health, education and communitydevelopment through the Scotiabank Jamaica Foundation.Naturally, our nation’s children are at the heart of many of
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Sergeant Andrea Clarke of the Police Road Safety Unit assistedby School Crossing Warden David Garriques, gives road safetyinstructions to students from Jessie Repoll Primary School. Thisprogramme is sponsored by Scotiabank.
these activities. For example, since we began our GSATscholarship programme in 1998, 103 children havereceived financial assistance valued at $33.5 million.These scholarships recognise excellent performance andthey also help to ease the pressure for parents whowould otherwise find it difficult to send their childrento high school.
The Foundation awards 15 GSAT scholarships each year;however we conferred three additional awards in 2006to three girls who lost their homes to fire on the day oftheir primary school graduation. We are pleased thatthey are now enrolled in the high schools of theirchoice.
Schools all over the island have also benefited from theFoundation’s support in upgrading infrastructure andproviding equipment at their schools. One example isthe Iris Gelly Primary School – located in one of themore ‘challenging’ areas of Central Kingston, which hasalready produced one Foundation scholar. The childrenshow signs of great potential and in September of 2006the Foundation boosted their chances of success withour contribution of a $5.5 million multimedia computerlaboratory, boasting 17 computers and othermultimedia equipment. The new facilities havesparked the enthusiasm of students and teachers alike.
The students at the Willowdene High School in SpanishTown were also happy to have classes return to normal,with the help of a $2.9 million contribution by theFoundation to repair damage to the walls and roof of aclassroom block caused by Hurricane Ivan. WillowdeneHigh is one of five schools which benefited from a $19million fund that we set aside to help schools recoverfrom the ravages of this hurricane.
Our Staff in the CommunityOur involvement in the lives of our children is notrestricted to the Foundation’s projects or specialproducts and services. Our employees’ closeengagement with their local communities brings manysituations of need to our attention. One example is theRevival All Age School in Westmoreland, where a lackof resources meant that class work and examinationpapers could not be reproduced for the students’ use.The staff of our Savanna-la-mar branch saw the needand obtained the Bank’s support in providing aRisograph for producing the material.
Altogether, we have provided tuition, books, furnitureand equipment, and repaired classroom facilities forstudents and teachers from 80 primary, secondary andtertiary institutions across Jamaica this year.
Scotiabank has always been concerned about ourchildren’s safety on our roads. That is why, in 2006, inthe face of an alarming increase in the number ofchildren killed on the road, we decided to giveadditional support to the Police Road SafetyProgramme. On Teachers’ Day in May, our ScotiabankVolunteer Teachers spent over 266 hours in 153 schoolsspeaking about Road Safety. This complemented ourexisting Road Safety programme, which provides allSchool Crossing Wardens islandwide with uniforms andcrossing signs.
Scotiabank remains committed to uplifting the welfareof our nation’s children, whether through providingproducts and services designed especially for them, orthrough our corporate social responsibility activitiestargeting their particular needs in the areas of healthand education. We are constantly seeking more ways toensure that ‘our children are safe with us.’
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Scotiabank believes that to have the best kindof life, it is essential to have dreams. We allhave different kinds of dreams depending onour background, our age and the unique
picture of the ‘ideal’ that we carry in our hearts.However, some dreams are common to all of us, evenif different in the details: perhaps a new car(independence), a vacation (renewal), a home of ourown (stability), or a plan to build wealth (security).
We readily recognize the importance of the dreamsour customers share with us and treat them withcare, as if they were our own. Our products andservices reflect this approach and assure thesedreams the place of importance they deserve. Onefundamental commitment we keep in focus, is todeliver products and services that give our customersthe best prospects for making those dreams a realityand keeping safe what they have gained.
Owning a HomeWith this in mind, our Scotia Jamaica BuildingSociety (SJBS) launched the Gold Key Mortgage in2006, tailored for individuals 50 years and over. TheGold Key Mortgage is the only product of its kind inJamaica and responds to the largely-ignored, later-in-life aspirations for home ownership.
We also sought ways to make the mortgageapplication process easier for our customers, and ajoint arrangement with the National Housing Trust(NHT) was a good way to accomplish this. In January,after discussions with the NHT, we launched theJoint Financing Mortgage Programme which meansthat persons can now access NHT entitlementsthrough SJBS when they apply for a mortgage, bysimultaneously completing the NHT form. In thepast, they would have had to go to the NHT toreceive a referral letter before being able tocomplete the application process.
Our customers’ dream of owning a home can oftenbe frustrated simply because they do not knowabout the housing options in the real estate marketor they are not sure about the legal requirementsand the financing opportunities available to them.We understand the difficulty of working through thedifferent elements of such an important decisionand we constantly seek to ensure that our customershave the information and guidance they need.
This year, SJBS collaborated with a leading realestate developer to draw attention to model unitswe felt our customers would like and which wethought would meet their needs. The event waswell-received and in the future we plan to extend
In 2006, Scotiabank loaned $734.6 million to finance newhomes for families and individuals across Jamaica, helping ourcustomers fulfil their dreams of owning a home.
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our collaboration with more developers to furtherfacilitate goals regarding home ownership.
These initiatives have helped tremendously, andwe intend to continue into next year and beyond.Our Building Society plans to host a homeimprovement forum in 2007; we are formulating ahome improvement product for existing SJBSclients, and we are developing a tiered mortgageproduct.
Our clients will be hearing more from us directly bymail, as we present our SJBS Mortgage solutionsboth current and new.
Other DreamsOur range of Scotia Plan Loans remains theconsumer loan product of choice, attesting to thewinning elements of a good product coupled withthe high level of customer service provided by ourPersonal Banking Officers. This year, we raised thebar even further when we were able to offer cash-secured Scotia Plan Loans at a lower interest rate.This was made possible by our ongoing evaluationof risk management.
Our Scotia Home Equity Loan, which is a specialtype of the Scotia Plan Loan, was launched inJanuary 2006, and has quickly become a popularavenue for our customers to finance their dreams.The rates are competitive and the new productallows homeowners to tap into the accumulatedequity in their home, with a one-time lump sumadvance that is paid off over a fixed period.
The multi-purpose Home Equity Loan product hasalso been quickly utilised for other financialpurposes such as personal debt consolidation,education, travel and medical expenses, as well asmotorcar purchases.
In 2005, the positive response to our ScotiaWheelsfinancing programme – another Scotia Plan Loanoption which provides loans to purchase new cars –convinced us that it was important to continue toprovide this service in 2006. We were thereforepleased to continue our partnership with five ofthe island’s leading new car dealers to providepremium motor vehicle financing.
We further lowered the rates for the 2006ScotiaWheels programme, which started in Marchand offered reduced rates to persons who soughtcommercial or agricultural vehicle loans, andmembers of selected tour companies who were
seeking loans for passenger transport.
Our ScotiaLine Gold, which is our most exclusiveborrowing solution, also continues to provide ourclients with an excellent line of credit for a rangeof purposes - home improvement, vacation, newcar, debt consolidation, and investmentopportunities - at an interest rate which is lowerthan most personal loans. Our customers accesstheir ScotiaLine account via their Scotiabank GoldMasterCard and personalized ScotiaLine cheques.
Wealth CreationIn 2006, in addition to helping our customers tofulfil their dreams of acquiring a new car or home,taking a vacation or furthering their education, wecontinued to augment our range of products andservices to help them to save, invest and generatewealth in a vigorous but stable fashion.
The Scotia Rate Booster Certificate of Deposit isone of our newest products, it was introduced in2006 and has already shown promise. The RateBooster is a competitively priced product designedto provide our customers with greater flexibility ininvestment choices, as well as attractive rates. Thisinstrument is available for 18 months, with equalsub-terms of six months each. Interest ratesincrease in each successive sub-term as long asfunds are left undisturbed through to maturity.
In 2006, we made every effort to ensure that ourcustomers were fully aware of all the excellentwealth creation opportunities we have developedto make their lives better.
Scotiabank has been successfully providing wealthcreation solutions to our customers for many yearsthrough our subsidiaries.
Over the next 18 months even more emphasis willbe placed on the expansion of our wealthmanagement division, and communicating theproduct and service offering to our customers.
Starting early in 2007, our InvestmentManagement team will be hosting a number ofworkshops and discussion fora, to help equipexisting and potential customers to makeimportant decisions related to their individualwealth dreams, or plans for business endeavours.We will be increasing our communication channelsthrough e-newsletters and face-to-face contact toguide and support them. Our support will includeincisive market analysis, which will ensure that our
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customers make the right decisions at the righttime. We are also taking steps to improve theturnaround time in our services. We arestrengthening our internal referral mechanism, toensure that our clients have access to teammembers who can assist them at each phase oftheir wealth creation journey.
We are committed to building strong andmeaningful relationships with our clients, whichwill enable us to keep track of all their dreams andrespond quickly with the products and services tohelp fulfil them. Our customers can dream withconfidence, knowing that we are making sure‘their dreams are safe with us.’
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Good relationships are essential in providing the right financialsolutions. Brian Frazer (right), Manager of Securities Trading forScotia Investments in discussion with Andrew Peart of GoodyearJamaica Limited.
At Scotiabank Jamaica, business clients of everysize are important members of theScotiabank family. We have very deep rootsin all the industries that drive Jamaica's
economic performance with commercial clients thatspan the broad spectrum of Jamaican businesses:agriculture, tourism, distribution (retail and wholesale),construction, manufacturing (from concrete blocks toice cream), health services, oil and gas, service industriesand government.
We serve our corporate and commercial clients throughour 42 branches, our Corporate and CommercialBanking Centre (CCBC) and our investmentmanagement subsidiary, Scotia Investments. Ourmission is to add value to the operations of our clientsby providing valuable, convenient financial solutionsand facilitating their growth. All our efforts are aimedat living our promise: ‘your business is safe with us.’
Our focus on relationship building ensures that wemeet our clients’ lending and non-lending needs,including improving their cash flow. We feel a sense ofaccomplishment when we can partner with them toexpand their businesses through mergers andacquisitions or organic growth. We also providefinancing for equipment purchases and improving theirliquidity position.
Day-to day bankingAll our commercial clients require similar services on adaily basis: deposit accounts, loans, lines of credit andguarantees. Some, depending on their line of business,also need access to Ex-Im Bank facilities. At Scotiabank,we are committed to providing these day-to-daybanking products and services in a timely manner tohelp our clients to conduct their business efficiently,both through our branches and the CCBC. In 2006, ourcustomers also began to enjoy the added convenienceof Business Internet Banking, which replaced the CashManagement Solution and offers a broader, more user-friendly suite of electronic banking functions to assistthem with their daily cash management.
Investment Products and ServicesOur Scotia Investments subsidiary provides a number of products and services geared towards helping firmsto increase their revenue through investments. ScotiaInvestments also offers efficient and secure escrowservices. Currently, 250 corporate clients are enjoyingthe benefits of the Scotia Investments expertise and thesubsidiary has $20 billion under management. ScotiaInvestments partner with our clients to:• maximize their interest income on excess funds• manage their pension funds and• manage large specialized funds.
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This is all possible through the Scotia Investments productrange, which includes Jamaican dollar repos, treasury bills,bonds and local registered stock. Clients can also opt topurchase US dollar global bonds and mutual funds. Theend result is that our corporate clients benefit fromcompetitive rates and an improved customer serviceexperience.
Structured FinancingThe aim of all companies is to grow or expand. In thesedays of globalisation, our clients aredemanding products and services tohelp them identify and exploitfunding opportunities both locallyand overseas. The commercialbanking arm of Scotiabank isfacilitating this growth strategy byproviding relevant financingsolutions. This includes expandingour suite of market products to offermore structured transactions. Wehave also stepped up our efforts atoriginating syndicated deals in themarket.
So far the results have beenencouraging: in 2006 we arranged atotal of US$147 million in structuredtrade finance. We also engineeredUS$31.25 million in financing ofcross-border mergers andacquisitions, in support of those ofour clients who grew their businessesthrough acquisitions within theCaribbean and even as far a field as Europe. Our Corporateand Commercial Banking Centre (CCBC) acted as arrangersfor these deals either by providing direct funding fromScotiabank or through our affiliates overseas. In addition,we won the mandate for a syndicated deal in the localmarket, an indication of our thrust to increase ourtransaction execution capabilities to better satisfy ourcustomers.
Market InformationWe also pay attention to our clients’ non-financialrequirements, like the need for up-to-date accuratemarket information. Our research team at ScotiaInvestments is equipped to provide clients with both localand global information on trends and developments intheir particular sectors. Our branch managers make sure tokeep abreast of happenings in their communities and ourrelationship managers at the CCBC can put our clients intouch with information on major global economicdevelopments from the database of the Scotia Economicsgroup. In 2006, our CCBC focussed on the education of ourclients by arranging a seminar on derivatives. Thisprovided guidance on ways of reducing/managing their
business risk and their exposure to commodity, interestrate and foreign currency movements.
Small and Medium EnterprisesResearch suggests that small and medium businesses arethe main vehicle of economic growth, both in Jamaica andglobally. Scotiabank is responding to this trend byestablishing a Small and Medium Enterprise (SME) unit tostrengthen our ability to serve the special needs of thesefirms in the areas of financing and general support. We
have already signalled ourdesire to partner with SMEs intheir growth and developmentby sponsoring the launch of theYoung Entrepreneurs Assoc-iation in 2006.
Making sure your businessremains safe with usAs part of our broadercommitment to buildingJamaica, Scotiabank willcontinue to facilitate growthand development in thebusiness community. We seeexciting possibilities for us tofacilitate intra-regional trade.Caricom is the fastest growingregion for imports into Jamaica(at 15 percent per annum) andScotiabank has a dominantfootprint in the region. On theother hand, the fastest
growing market for exports from Jamaica is Canada at sixpercent per year, and again we are able to leverage ourextensive network in that country for the benefit of ourcorporate clients.
We are always enhancing the way we serve the businesscommunity. We are currently improving the after-salesservice and turnaround times to our commercial customersthrough the introduction of a new approach to accountmanagement called Commercial Optimization.
This means that instead of a single relationship officer, ateam of account managers will cater to the needs of eachcustomer. This will play a pivotal role in boosting ourability to act as a financial arranger for our clients, whichwill yield better results for them.
Scotiabank Jamaica is poised to play an even more definingrole in serving all sectors of the business community in thecoming year, proving again to our clients ‘Your business issafe with us.’
• During 2006 we were very honoured when the Jamaica Exporters’ Association conferred us with the Financial Services Award for “being the financial institution that was most supportive to the export community during 2005.”
• Scotiabank’s International Banking division also recognized us as the leading Bank in the Caribbean and Central America with respect to the origination and closing of structured Trade Finance Transactions
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S cotiabank customers can be found in everynook and cranny of the island: a testimonyto our 117 years presence in Jamaica andour status as Jamaica’s number one bank.
Our customers come from all walks of life and arelikely to have multiple demands on their time:work, family, continuing education, communityinvolvement and other competing priorities. Werecognise that our customers need convenientbanking services that facilitate this hectic lifestyle.So we make it easy for them to do business with uswhile taking care of their other commitmentsthrough innovative products and services. That iswhy we can say to our customers: ‘you’re safe withus - anytime.’
We are constantly searching for new ways toprovide banking that is flexible, relevant, cost-effective and convenient. In the past year, weimproved our branch facilities as well as providedalternative methods of delivering a wide range ofservices. We undertook the renovation andexpansion of our branch premises and enhancedour back office operational efficiencies to helpproduce a seamless in-branch experience. Weintroduced technology upgrades to our systems tosupport our electronic delivery channels andensured that our branch staff received the
requisite training to help our customers use thesetools.
From Negril to Morant Bay, from Junction to OchoRios, the Scotia ‘flying S’ proclaims the far reachingpresence of Scotiabank Jamaica. With 42 branches,and 170 ABMs (Automated Banking Machines)island wide, customers can do business with usseven days a week, 24 hours a day. To facilitate ourclients, we have strategically located our ABMs inshopping malls, gas stations, hotels, grocery storesand throughout the Branch network. Ourcustomers are making increasing use of the ABMnetwork and in the past year over 10 milliontransactions were made at our machines. We havealso ensured that our clients can access bankingservices at their convenience via Internet Banking -from the comfort of their homes, while onvacation or during business trips overseas. Andwhen our customers need that personal touch todeal with their queries, our contact centre - whichnever closes - is there for them.
The ‘Anytime’ ScotiaCardThe ‘passport’ to accessing these services is theScotiaCard and Scotiabank has led the way inpaperless banking by the introduction of the
Excellent service means making contact with the right people atthe right time, and Sharol Brown and her colleagues at theContact Centre play a critical role in providing quality service toour customers.
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International Banking Platform, which allows ourclients to access their accounts at any branch acrossour network by using their ScotiaCard. They canalso use their card to perform transactions via ourelectronic channels - telephone banking(TeleScotia), Internet Banking, ABM network anddebit Point of Sale system. Over 200,000 customersacquired ScotiaCards in 2006, bringing toapproximately 500,000 the number of retail clientsenjoying the convenience and flexibility the cardoffers. Customers performed over fourteen millionautomated transactions using our variouselectronic channels in 2006.
All our electronic channels provide customers withreliable, user-friendly alternatives to pay utilitybills, transfer money between accounts, pay theircredit card bills and checkaccount balances anywhere,anytime. Customers can makepayments to over 115 billpayment merchants(including utility companies).TeleScotia offers customersthe convenience ofconducting their bankingtransaction via telephone.Our Internet Banking serviceprovided free of cost to ourretail customers, offerssimilar functions with theadditional benefit ofcustomers being able to viewup to one year of transactionhistory.
In 2006, we added a number of enhancements toour Internet Banking service. As a result,customers can now set up bill payments andtransfers to occur at future dates; easily reconciletheir account balances, organize their transactionsinto categories (for example, household payments)and produce reports on specific types oftransactions. In the past year, usage of the facilityincreased by over 100 percent with customersmaking over 300,000 transactions.
Shop ‘Anytime’ with our credit cardsCredit cards are a feature of modern life. Theyallow us the flexibility to shop anywhere, anytime,without having to worry about carrying cash. Theyare also a means through which our customers canacquire a small unsecured revolving loan with asafe and convenient payment scheme. As themarket leader in credit cards our portfolio offersour customers the widest choice of cards and themost rewards cards, including the very popular
Magna MasterCard. Due to the market acceptanceof our suite of credit card products, we were ableto exceed our growth targets in outstandingbalances by over 15 percent and our new accounttarget by over 25 percent in fiscal 2006.
‘Anytime’ support and informationWe established our Contact Centre in order toprovide customer support 24 hours a day, sevendays per week. Our highly trained customer servicerepresentatives handle customer queries aboutissues relating to accounts or products and services.Scotiabank customers made over 600,000 calls tothis Centre in 2006. During the year we expandedthe function of the Centre with theimplementation of Customer Connect. This
enhancement provides moreefficient call handling forcustomers calling our branches.Since its introduction in June2006, customers made over160,000 calls to branches viaCustomer Connect and reportedsignificant improvement of thesystem. Persons wantinggeneral information aboutScotiabank – including reportsand news releases - can alsovisit our upgraded websiteanytime. The website(www.jamaica.scotiabank.com)contains links to all theScotiabank franchises in our
global network and is a popular resource forstudents seeking information on the Bank.
Scotia Insurance… ‘Anytime’Customers of our Scotia Insurance subsidiary arealso finding it easier to do business with us becauseof a number of developments during 2006 such asour improved operational efficiency throughautomation and enhanced workflow.
We also boosted our customer relationshipmanagement strategy so that we could betterunderstand and meet the needs of our policyholders, implementing a number of enhancementsto our customer service delivery to satisfy therequirements of our clients’ demanding lifestyles.
Scotia Insurance policy holders now have moreflexible premium payment options via TeleScotiaand Scotiabank Internet Banking. Customers canalso get the information they need on products andservices via the user-friendly, updated ScotiaInsurance website. But we went one step further
Customers of ourSpanish Town branch
were especially delightedby the establishment of a
new state of the artfacility in 2006. The newbranch is spacious, withadequate parking and
easy access from theSpanish Town bypass.
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this year and established a new customer carecentre and placed customer care representatives inselect branches across the island. Thiscomplements our pool of insurance sales agents soour policy-holders have access to personalisedservice whenever they need it. Our customer carerepresentatives are skilled and experiencedprofessionals who are dedicated to providingexpert advice on financial planning to our clients,and processing their transactions in a timely andefficient manner.
Running a Business …‘Anytime’The demands on business people are many andvaried and at Scotiabank, we continously look forways to partner with our commercial customers tomake it easier for them to complete theirtransactions. In 2006, these customers benefitedfrom the launch of our Business Internet servicewhich replaced our dial-up Cash ManagementService (CMS) with a modern, web-based solution.
We have commercial clients of all sizes who neededan Internet banking solution to satisfy theirrequirements. We have converted 95 percent ofour CMS customers and we’re happy to offer anefficient and user friendly system to them.
This new service joins our Internet MerchantAcquiring Business Facility, which is offered in avery secure environment based on internationalstandards. We are capable of processing electronicpayments with all major credit cards in bothJamaican and US currencies. A number of largecorporations have been successfully utilizing thisfacility for efficient collection of payments fromtheir customers. For example, hundreds of CustomsBrokers, importers, traffic violators, property andlandowners can do their transactions onlinebecause the Government of Jamaica is one of ourlarge e-payment customers.
At Scotiabank we aim to provide solutions whereeveryone wins and that is why in 2006 welaunched our QuickPay Card, which is available forclients using Business Internet Banking. This is anelectronic solution for small and mediumenterprises with at least five employees and anyemployer who utilizes cheques to pay staff.
Employers benefit from having a safe, automatedway to process wages/salaries that saves on the costof cheques and reduces the time spent on payrollactivities. On the other hand, employees using theQuickPay Card avoid the risks attached to carryingaround lots of cash, as they can use their card toshop at any merchant with debit Point of Sale, payutility bills at bill payment companies and obtaincash back from participating merchants. Inaddition, they can withdraw cash at theirconvenience from any Scotiabank ATM or theMultiLink network.
Our ‘Anytime’ commitmentScotiabank Jamaica remains committed toproviding flexible reliable and convenient bankingexperiences for our clients by improving theefficiency of all our electronic delivery channelsusing up to date technology. Our ABM users willbenefit from our expanded network of ABMs andan increase in the types of transactions that theymay perform at these machines. We will alsomaintain our drive to improve the efficiency of ourbranch operations so that visitors to our locationscan enjoy a pleasant, efficient experience.Commercial and youth customers can look forwardto new credit cards especially designed to meettheir needs, plus we plan to expand our merchantprocessing facility into the travel andentertainment sectors. In other words, we willcontinue to make good on our promise: ‘you’resafe with us - anytime’.
We Live
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Every Jamaican wants to have a comfortableretirement, and in this age of modern medicaladvancements, persons generally live up to 20years after they stop working. In most cases,
their pension is not enough to cover all their financialneeds during this stage of life. Therefore, whether or notyou have a pension, every worker needs to build aretirement fund. This takes careful planning andpreparation. It is never too early to think aboutretirement; in fact, financial planners say that the besttime to start saving for retirement is at the start of one’sworking life. However, the truth is many of us never startthis kind of planning until later in our lives, in our 30s, 40sand for some, even 50s.
We are aware of the importance of a knowledgeablepartner to assist with this essential process; trainedexperts to help with common questions like: “How muchmoney will I need to pay my bills?” “What’s the bestsavings/instrument to use?” “What will be the impact ofinflation on my nest egg?” Our customers’ future is safewith us because we have the experts to answer thesequestions and a number of exciting products and servicesto help our clients to plan for their financial future. Weassess our customers’ individual and distinctive needs anddesires, and then assist them to customise a savings planto meet their financial goals.
Choosing the retirement packageThe approach you choose will depend on several factorssuch as your current financial situation, the number ofyears until retirement, the income available for savingtowards retirement and your appetite for risk. In theworld of investments, higher risks usually accompanyhigher returns and vice versa. No matter what your stagein life, everyone needs a portfolio that includes a diversemix of savings, protection and investment instruments tomaximize security and returns.
Customers can receive assistance in deciding on thecomponents of their portfolio from the InvestmentSpecialists at our Scotia Investments subsidiary, whointerview clients to obtain information on their financialobjectives, time horizon, risk profile and current financialsituation. These highly qualified investment professionalsare trained to use the Investment Selector, an importantfinancial planning tool which augments their experienceand expertise in advising clients in portfoliodiversification.
Saving for a safe futureFinancial advisors agree that savings are an importantingredient in any retirement portfolio, because they offerthe ultimate in security. Our customers can choose froma wide range of savings accounts to include in their nestegg. Our subsidiary, Scotia Jamaica Building Society
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Through our comprehensive range of services our customers arefinancially prepared and supported at every stage and phase oftheir lives – from education and marriage to home-ownershipand retirement – and all the special moments in between.
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6(SJBS) provides a menu of savings accounts with somethingfor everyone. One of the most popular is ScotiaGROW, along- term savings account (LSA) which is tax-free as long asthe principal is held for five years and the saver withdrawsless than 75 per cent of the interest. Many of our customersfind this an attractive option for their portfolio because ofthe tax-free benefit and the higher interest rates.
Customers can also take advantage of our Building Societyterm deposits which also offer higher interest rates but withmore flexibility than the LSA because they have varied terms.These deposits allow savers to make decisions about whereto place funds at different times and therefore takeadvantage of other wealthbuilding options. To give our customers more investmentoptions, we introduced the RateBooster in 2006, a special 18 monthCertificate of Deposit availablethrough the commercial bank. TheRate Booster gives customers theflexibility of a short-terminvestment, while they enjoy therates of a long term instrument.
On the other hand, aggressivesavers will like the Scotia Optimumaccount, which grants higherinterest rates as savingsaccumulate. And for those youngpeople who want to develop ahabit of thrift and start their nestegg early, the Scotia Achiever, withits competitive interest rates is theaccount of choice. Both theOptimum and the Achiever have the added advantages ofannual educational grants and discount cards for selectedmerchants. At Scotiabank, we recognise that it’s not onlyyoung people who need some help to develop a savingshabit; many persons reach retirement without adequatesavings because they did not make saving a regular activity.That is why we developed the PAC: a pre-authorisedcontribution that allows our customers to make the decisionabout saving and relax while we take care of the rest. Inaddition, we offer the ScotiaPlus 55 account which carries anumber of extra benefits like fee and service charge waiversand discounts on selected services for these customers.
Protecting the futureOne of our more popular products for general long-termsavings is ScotiaMINT, which provides the dual benefit ofsavings and protection and is available through ourinsurance subsidiary, Scotia Insurance. ScotiaMINT policyholders enjoy tax advantaged long-term savings as well asguaranteed and optional life insurance coverage. Jamaicanshave responded enthusiastically to these features, makingScotia Insurance the market leader in the interest-ratesensitive insurance market. Scotia Insurance’s qualified andprofessional team of insurance sales agents is equipped withan invaluable tool: our Needs Analysis System (NAS) to helpclients make the best choices for their particular needs.
Through NAS we help our customers to determine theirfuture nest egg goals as well as the amount they need tosave regularly to achieve these goals. The NAS also helps ourcustomers to understand the impact of inflation andtaxation on their savings.
Investing for the futureWhile savings are the traditional, safe means to building anest egg, many of our customers want the option to investin more risky instruments with potentially higher yields. Wehave leveraged our membership of an internationalorganisation to offer our clients personalized portfolios
which are diverse bothgeographically and by type ofinvestment. For example, we areone of the few Jamaicancompanies providing US Dollarmutual funds: including the MoneyMarket Funds, US Dollar BondFunds, Global Growth Funds, USGrowth Funds and CanadianGrowth Funds. Our clients havefound these to be valuablecomponents of their overallinvestment strategy because theyprotect against devaluation of theJamaican dollar and allow clientsto choose funds according to theirtolerance for risk. The numbers tellthe story: in 2006 our Mutual Fundaccount holders increased by sixtypercent over the previous year.Many of our customers also take
advantage of our Jamaican dollar investment instruments,such as repos, Local Bonds, Treasury Bills and LocalRegistered Stocks.
More choices to help secure your financial future At Scotiabank we recognize that Jamaicans are becomingmore aware of the role of wealth creation in planning forretirement and they are demanding more options. Inkeeping with our promise: ‘Your future is safe with us’, weare diversifying our wealth management products andservices under the umbrella of Scotia Wealth in the comingyear. Scotia Wealth comprises our investment and insurancesubsidiaries as well as our Private Client Services and willfocus on developing and delivering a wide range of wealthmanagement products and services. From the universitygraduate to the businessman, clients will have access to awide array of investment, protection and wealthmanagement vehicles. We are designing these products tosatisfy our clients’ age, life-stage and short, medium andlong term needs. Our aim is to help fulfil the goals of ourexisting clients while attracting new ones.
Our clients who wish tohave their future needs
taken care of in anexclusive setting can
enjoy the convenience,comfort and
confidentiality of ourScotia Private Client
Services whererelationship managers
handle all of our clients’banking requirements -
including retirementplanning - seamlessly
and efficiently.
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We believe our position as the leadingbank in Jamaica carries with itresponsibilities beyond nurturing thefinancial interests of our shareholders
and customers. We understand that we have aparticular role to play as corporate citizens and it is aresponsibility we take seriously and bear willingly.
Certainly, there is no shortage of ways in which wecan help to build our nation and help to ensure animproved life for all our citizens.
Health CareOur awareness of the many unmet needs in ournation’s life convinced us to establish the ScotiabankJamaica Foundation (SJF) in 1996, the only one of itskind in the Scotiabank family worldwide. Since theinception of the Foundation, we have been activelysupporting projects in the education and healthsectors, as well as other projects relating tocommunity development, to the tune of over $439million.
The Scotiabank Centennial Accident and EmergencyUnit, at the University Hospital of the West Indies(UHWI), is perhaps one of our better-known projects,and its establishment even pre-dates the beginning of
the Scotiabank Jamaica Foundation. We fundedconstruction of the Unit in 1989 - the centennial yearof the Bank’s presence in Jamaica – as we recognizedthat the provision of adequate facilities for such aUnit was one of the most critical health services forJamaicans. At the time, the hospital, which is also theisland’s premier medical teaching institution, did nothave an Accident and Emergency Unit.
By 2005, the staff had outgrown the facility and wereadily responded to the need for the Unit’sexpansion. In May 2006, we officially handed over the$36 million extension to the hospital, and madearrangements for the provision of new equipmentvalued at $32 million, including a digital x-ray unit, anultra-sound machine, and infusion pumps.
But the UHWI is only one hospital. Over the years, webecame aware of other opportunities to help tostrengthen the sector and improve the quality ofhealth service in the nation. In response, we alsoestablished the Scotiabank Jamaica FoundationHaemodialysis Centre at the Cornwall RegionalHospital, and the Scotiabank Jamaica FoundationAccident and Emergency Unit at the Port AntonioHospital. In addition, we funded the refurbishmentof the Renal Unit of the Kingston Public Hospital andprovided an annual maintenance. This year, we
Meet our Top Boy and Top Girl in the 2006 Grade Six AchievementTest, Kevin Robinson of Mount Alvernia Preparatory and RacquelWhyte of Immaculate Preparatory, recipients of the ScotiabankJamaica Foundation Scholarships for Excellence, as they pose withMr. William Clarke, President and CEO.
The unique mix of services provided by the Micro EnterpriseFinancing Limited, MEFL, supports a fruitful partnership with itsclients. Angella Graham-Stewart (right), Field Co-ordinator andField Loan Officer, Shevaun Hart examine the high qualityproduce sold by client, Ena Smith (left).
provided an electrocardiogram machine, cardiacmonitors, defibrillators, a portable resuscitator andsuction machines for the Spanish Town and PortAntonio hospitals.
We also continued to strengthen our longstandingrelationship with the Jamaica Cancer Society. Amongthe Society’s many outreach programmes was a visitby the Mobile Mammography Unit to Port Antonio inPortland, where over 75 women who wouldotherwise not be able to access this service, werescreened for breast cancer.
Our belief that the life-saving services of these healthinstitutions should be provided on a sustained basishas meant a commitment which focuses beyondmerely a ‘one-off’ donation; therefore, we continueto provide an annual disbursement to maintain thefacilities in almost every project.
These projects mean a great deal to us because weknow they contribute substantially to preserving andimproving the quality of life of many Jamaicans.
Education and Community ProjectsOur commitment to supporting education also restson a conviction that there can be no real, long termdevelopment of our nation without an adequately
funded education system. To help fulfill this goal, wecommitted to a number of new projects in 2006: theconstruction of a multi-purpose lecture theatre at theMontego Bay Community College at a cost of $25million; sponsorship of a Scotiabank JamaicaFoundation/Mayer Matalon Scholarship forundergraduate studies in Management Studies at theUniversity of the West Indies (UWI), and two fullscholarships for primary school teachers to pursue atwo-year degree programme at the UWI; as well ascontinued sponsorship of scholarships at theMontego Bay Community College, NorthernCaribbean University, the University of Technologyand the UWI.
Our community development projects form the thirdleg which supports our philanthropic contribution tothe life of our nation. We continue to supportinitiatives that are geared towards nation building. Inthis context, we have increased our contribution toorganisations with objectives focused on buildingbetter communities, such as Youth OpportunitiesUnlimited (YOU) – a voluntary organization thatprovides positive interventions for adolescents. Wealso continued with our provision of meals daily forthe 45 elderly residents of Cluster F at the Golden AgeHome.
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Micro-financingOne of our most important initiatives to aid our nation’sdevelopment is our involvement with the MicroEnterprise Financing Limited (MEFL), which wasestablished in May 2002. The MEFL was the fruit ofcareful research to assess how Scotiabank could best helpto bring fundamental change to vulnerable communitiesacross Jamaica and is in partnership with the CanadianInternational Development Agency (CIDA) and theKingston Restoration Company.
The MEFL is intended to be a catalyst for changespecifically aimed at breaking the cycle of poverty in thetargeted areas by assisting residents to gain access tocollateral-free financing. The enterprise has alreadybecome a recognized leader in Jamaica’s microfinanceindustry. Over the past four years, the MEFL has refinedmicro-financing and continues to far surpass initialestimates of its effectiveness in breaking the cycle ofpoverty in an efficient and sustainable way.
The MEFL provides loans ranging from $10,000 to$300,000 to persons who are already involved in somekind of revenue-generating activity, who need help togrow, but would not qualify for a bank loan eitherbecause of the small size of the venture, lack of collateral,insufficient equity, or lack of credit history anddocumentation. Loan repayment periods range between3 and 14 months. In the targeted communities, typicalventures supported may include selling fruits, handbagsor clothing on a very small scale, shoe making and repairs,and, more recently, farming.
Initially established in Kingston and St. Andrew, theMEFL now has branches in Santa Cruz in St. Elizabeth andSavanna-la-Mar in Westmoreland. In November 2006 itextended its outreach to the town of Linstead in St Catherine.
Growth in its outreach in urban Kingston, especially theinner city areas initially targeted, has slowed, mainlybecause of the violence which plagues such communities.However, the organisation is determined to not onlycontinue, but to expand the project, particularly giventhe exceptionally positive effects of the programme.
MEFL isn’t just about lending people money; it is in thebusiness of transforming peoples’ lives. The enterpriseprovides much broader support for its clients than merelyfinancing; clients are trained and mentored to help themmake the kind of lifestyle and mindset changes thatensure success not only in their business ventures but intheir lives.
As at the end of June 2006, the enterprise had disbursedmore than $209 million in loans, with the average size ofloans being about $39,000. Even more exceptional is the
fact that the MEFL has a 96% repayment rate on theseloans – an excellent repayment rate in any loan financingbusiness.
Loan holders with the MEFL – (currently just over 1,600)have a total of $18 million in savings in Scotiabank,thanks to the savings component which is a compulsorypart of every loan agreement.
Good Corporate Citizenship We are gratified by the expressions of appreciation forthe work we have sought to do in the nation andhonoured by the recognition we’ve received from anumber of civic and trade associations, including theMontego Bay Chamber of Commerce, the Jamaica CancerSociety, Heart Foundation of Jamaica and the United Wayof Jamaica.
Good corporate citizenship is at the heart of every greatcompany. The Scotiabank Jamaica Foundation iscommitted to helping to ensure that Jamaica’s health,education and community infrastructure is equipped tomeet the needs of our people and fulfill the incrediblepotential of our people.
Our contribution to our country was highlightedinternationally when the National Center for BlackPhilanthropy, Washington DC, presented its distinguished2006 Philanthropist Award to our President and ChiefExecutive Officer, William Clarke. This award was madein May 2006 at the Conference on CaribbeanPhilanthropy held in Montego Bay. Mr. Clarke wascredited as bringing international acclaim to Scotiabank,through his far-sightedness in utilizing philanthropy as ameans of significantly contributing to nation building.
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Best Bank in Jamaica
Euromoney - The Journal of the world’s capital and money markets
2006Awards for excellence
Recipient of the 2006 Philanthropy Award“Business Philanthropist of the Year”
from the National Centre for Black Philanthropy Inc.
We honour William E. Clarke, CD
of Kingston, Jamaica who has beenhighly successful in the bankingindustry and philanthropy.– National Centre for Black Philanthropy, Inc
(From the left) The Honourable Dennis H. Lalor,recipient of the first Philanthropy Award 2005,
awardee William Clarke, CD, President and CEO,Scotiabank Jamaica, and Rodney M. Jackson
President and CEO, the National Centre for Black Philanthropy Inc
We Live
Our Miss ion
Our Awards
SSccoottiiaabbaannkk aawwaarrddeeddBBeesstt BBaannkk iinn JJaammaaiiccaa ffoorr 22000066 bbyy LLaattiinn FFiinnaannccee MMaaggaazziinnee
LatinFinanceBANKER OF THE YEAR AWARD 2006
A leading magazine of finance and Investments in Latin America
Scotia controls costs rigorously and enjoysthe best productivity ratio in the country at 52.47%The Bank is also working to improve operational efficiency by consolidating and streamliningprocesses and structures, eliminating duplicationand sharing best practices through its network
– Latin Finance Magazine
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Best PracticesAnnual Report1st Place (2004)
1st Place (2005)
Best PracticesCorporate Disclosure& Investor Relations1st Place (2004)
2nd Place (2005)
Jamaica Stock ExchangeBest Practices Awards
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Management’s Discussion & Analysis
FINANCIAL RESULTSScotiabank achieved record results, with net income forthe fiscal year of $6,799 million, an increase of $913million or 15.5% when compared to the same period lastyear. We also delivered solid results for the fourthquarter, with net profit of $1,815 million, which was $218million above the net profit for the fourth quarter of2005.
This marks the tenth consecutive year of increased profitsfor Scotiabank and we exceeded our 2006 targets byremaining committed to our strategy of diversificationacross business lines. One of the major contributors toour success this year was significant growth in retailloans. Retail loans (Scotia Plan Loans, credit cards andmortgages) increased by $5.4 billion or 30%. Thesestrong results reflect Scotiabank’s core strengths in riskmanagement and cost control and our continued focuson customer satisfaction. They are also a reflection ofcustomer-focused execution by our talented anddedicated employees, contributing to exceptionalperformance in growing profits. We are proud to berecognized as an employer of choice in Jamaica,obtaining recognition from many internationalorganizations.
Scotiabank’s capital base continues to be very strong.Total shareholders equity rose to $27.4 billion, $1.2billion more than the previous quarter and $3.9 billion
higher than last year. Our risk based capital adequacyratio is a measure of the Bank's overall strength, and at28.32% stands way above the regulatory requirements,which requires that the Bank maintain a ratio betweenits capital base and the aggregate of its risk weightedassets at no less than 10%.
Our solid financial performance continues to drive strongshareholder returns. Shareholders received dividends of$1.07 per share, an increase of 7% over 2005.
Total RevenueTotal revenue was $19,650 million in 2006, an increase of$2,124 million from the prior year. This increase was dueto growth in both net interest revenue as well as otherrevenue that was fuelled by strong growth in foreignexchange trading profit and commercial and retailbanking fees.
Net Interest IncomeNet Interest income was $15,523 million in 2006 up$1,458 over last year, despite continued reduction inmarket interest rates. We achieved growth in net interest
• Earnings per share of $2.32, compared to $2.01 for last year
• Return on Average Equity 26.35%, compared to 26.33% for last year
• Productivity ratio of 52.59%, compared to 52.47% for last year
• Dividend of $1.07 per share, compared to $1.00 per share last year
(1) Compound annual growth rate (CAGR)(2) Total annual shareholder return assumes reinvestment of quarterly dividends, and therefore may not equal the sum of dividendand share price returns in the table.
Total Shareholder ReturnFor the year ended October 31 2006 2005 2004 2003 2002 5-yr CAGR
Closing market price per common share ($) 22.06 21.14 25.26 8.95 7.83 23.0%Dividend paid ($per share) 1.07 1.00 0.93 0.88 0.58 13.2%Dividends paid (%) 5.06 3.96 10.34 11.17 7.53Changes in share price (%) 4.26 -17.81 103.76 13.37 2.46Total Annual Shareholder return (%) 9.41 -12.35 192.57 25.48 10.01
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income due to strong portfolio volume growth,particularly on the retail side, where we experiencedgrowth in retail loans of 30%.
The Bank’s net interest margin (net interest income as apercentage of average assets) was 7.91% in 2006, anincrease of 57 basis points from the previous year. Thiswas due primarily to an increase in USD net interestmargin as a result of the increase in Federal Reserve BankFunds rate, as our JMD net interest margin declinedwhen compared with the prior year.
Other Income
Other income, defined as all income other than interestincome and insurance premium income, increased by$569 million; this was driven by retail and commercialbanking fees and foreign exchange trading profit.
Credit card revenues rose 24% to $578 million in 2006.This was due to strong growth in activity and volume onthe credit card portfolio resulting from variouspromotional activities.
Revenue from Retail Banking fees grew by 24% to $856million in 2006. This growth was from higher volume andpricing changes.
Foreign currency trading profit increased 11% to $880
million. This was primarily driven by growth in volume,as margins declined due to increased competitivepressures in the foreign exchange market.
Credit fees increased by 15% to $1,145 million driven byincreased loan volume as well as fees earned forarranging off shore loan facilities.
Scotia Jamaica Life Insurance Company had anothersuccessful year with total gross premium income of $4.6billion. ScotiaMINT, the interest sensitive life insurancepolicy, as well as Creditor Life, made significant gains inInsurance Premium. Combined net premium income forboth products increased by approximately $96 million,when compared to last year
Non-Interest Expenses Non-Interest expenses excluding changes inpolicyholders reserves and loan loss provision were$7,863 million in 2006, an increase of $1,032 million or15% from last year. Salaries and employee benefits is themajor contributor to this expense category and was$4,651 million up 16% from last year. This is primarilydue to a salary increase of approximately 12%, effectiveNovember 2005 to unionized staff in accordance withthe Union Contract. Additionally, costs totalling $110million was incurred to provide uniforms to theunionized group. Uniforms are provided bi-annually asper the Union Contract.
Property related expenses were $1.2 billion in 2006, anincrease of 20% from last year. This was driven mainly byincreases in security and utilities costs.
Advertising, public relations and business developmentcosts remained relatively flat at $317 million. During theyear we had a number of promotional campaigns forcredit cards, home equity loans, and ScotiaWheels.
Management’s Discussion & Analysis (continued)
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Management’s Discussion & Analysis (continued)
ProductivityWith strong revenue growth and our continuedunwavering focus on managing costs across the group,our productivity ratio (non-interest expense as apercentage of total revenue and a key measure of costefficiency) - was 52.59%. If insurance premium andrelated actuarial expenses were excluded, to recognizethe significant dissimilarities between the revenue/expense pattern of the insurance business and the otherfinancial services offered by the Scotiabank group, theproductivity ratio for the period was 42.48%, which issignificantly better than the international benchmark of60%. Our productivity ratio continues to lead the financialservices industry in Jamaica due to our focus on managingcosts across the group. We will continue our focus onfinding new ways of improving operational efficiency byconsolidating and streamlining processes and structures,eliminating duplication, and sharing best practicesthroughout our network.
Credit QualityScotiabank’s credit quality continues to be outstandingboth by international standards and when compared withour peers locally. Non-performing Loans at October 31,2006, were $1,009 million, an increase of $91 million whencompared to $918 million a year ago, and $65 millionabove the previous quarter ended July 31, 2006. TheGroup’s non-performing loans now represent 1.68% oftotal loans and 0.50% of total assets compared to 1.59%and 0.50% respectively in the prior year.
The IFRS Loan Loss Provisioning requirements arecomputed using a different methodology from theRegulatory requirement. The difference in the amountcomputed under the two methodologies is reported asLoan Loss Reserve in the equity component of the BalanceSheet. The loan loss provision as determined by IFRS is$478 million, of which $333 million is specific and $145million is general.
The loan loss provision as determined by RegulatoryRequirement is $1,285 million of which $794 million isspecific and $491 million is general. The total provision of$1,285 million exceeds total non-performing loans by$276 million, and provides coverage of 127% of non-performing loans. Over the years, we continue toexperience significant growth in the loan portfolio,however the loan loss provision has remained relativelystable, due to Scotiabank’s strong credit policy and loanadministration procedures, which has ensured the highquality of the loan portfolio.
ASSETSTotal assets increased year over year by $17 billion or 9%to $200 billion as at October 31, 2006. Growth was spreadacross most assets categories, with Investment Securitiesand Loans, after allowing for credit losses showingappreciable improvements.
Government Securities purchased under resaleagreementsGovernment Securities purchased under resaleagreements rose to $29.6 billion in 2006. The increase of$1 billion is largely attributable to Scotia Insurance, as thenumber of policyholders and premium income continueto grow, and demonstrates the continued success of itsflagship product, ScotiaMINT.
LoansThe Bank experienced solid growth in its loan portfoliothis year, with loans, after allowance for impairmentlosses growing to $59.5 billion. The retail loans showedvery good performance, with Scotia Plan loans and creditcards, increasing by 39.1% and 27.0% respectively.Residential Mortgages also increased by $393 million or10.9% to $3.9 billion in 2006.
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Due to our proven risk management practices, thequality of the loans booked continue to be high, and ournon performing loans, and allowance for impairmentlosses continue to be stable despite the growth in theloan portfolio. As at October 31, 2006 our non-performing loans were $1.0 billion, an increase of 1%over the prior year, and our IFRS allowance forimpairment losses declined to $478 million, from $495million in prior year.
Investment SecuritiesInvestment Securities increased to $52.5 billion, anincrease of $11.5 billion or 28% when compared to 2005.This consists wholly of fixed and variable rateGovernment of Jamaica JMD and USD securities. As atOctober 31, 2006, the surplus of the fair value over bookvalue of the Bank’s investment securities was $199million.
LIABILITIESThe Bank’s total liabilities increased by $12.6 billion to$172.6 billion as at October 31, 2006, with underlyinggrowth in Deposits and Policyholders’ Fund at SJLICaccounting for the changes.
Deposits Deposits grew to $120.5 billion, up $6.6 billion from theprevious year, reflecting continued confidence inScotiabank. Personal deposits were up $5.5 billion or 9%.Our core suite of deposit products, which includescurrent accounts, savings accounts, and term depositsshowed continued growth year over year, and ourdeposit portfolio remains very diversified.
Securities sold under repurchase agreementsSecurities sold under repurchase agreements represent asource of wholesale funding. The year-over-year increasewas $915 million, or 5%.
Policyholders’ FundScotia Insurance Policyholders’ Fund increased to $23.7billion, an increase of $3.7 billion or 18.8% over 2005.This was due to the net increase in gross premiumincome.
Management’s Discussion & Analysis (continued)
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Management’s Discussion & Analysis (continued)
Retail Banking had an exceptional year, with GrossExternal Revenues increasing by 24.4% to $8.0 billion.Strong growth within our Scotia Plan Loans, Credit Cardsand Mortgages portfolios resulted from increased andfocussed sales activities. Profit before taxes increased by29.7% to $3.2 billion this year. Non-interest expenses andprovisions for credit losses remained well controlled.
Corporate and Commercial Banking had a good year, withprofit before taxes of $1.8 billion, an increase of 6% fromlast year. This result was achieved despite the challenges oflow loan demand in this market segment.
The Treasury Unit experienced a decline in profit beforetaxes, from $2.5 billion in 2005 to $2.3 billion this year. Thiswas due to the continued reduction in Jamaican Dollarinterest rates, hence a reduction in Jamaican Dollar netinterest margin. However, this was partially offset by theyear over year increase in net foreign exchange tradingincome by 11% to $880 million.
Scotia Insurance also had a good year as profit beforetaxes rose by 15.5% to $1.5 billion in 2006. ScotiaMINTcontinues to enjoy significant market share, in terms ofgross premium income and number of policies issued.
The Other category includes activities of InvestmentManagement, and other corporate adjustments, that arenot allocated to an operating segment.
BUSINESS LINE OVERVIEW
RetailBanking
($'000) Treasury Retail BankingCorporate &
Commercial BankingInvestment Management
ServicesInsurance Services
Total Revenue 2,496,045 10,833,115 7,094,470 2,656,681 4,085,319Net Interest Income 1,890,433 6,100,449 3,585,780 304,097 3,625,181Profit Before Taxation 2,395,716 3,229,155 1,828,549 318,753 1,521,626
Total Assets 76,724,912 34,050,567 36,565,984 19,953,653 29,143,957
Total Liabilities 923,918 68,296,243 59,323,166 18,413,940 23,912,070
Corporate &CommercialBanking
Treasury
Insurance
Other
Management’s Discussion & Analysis (continued)
Risk Management
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OOVVEERRVVIIEEWWThe Scotiabank risk management framework has beendeveloped to address the diversity of the Bank’sbusiness activities. We manage risk through aframework of risk principles, organizational structuresand risk measurement and monitoring processes thatare closely aligned with the activities of our businessunits. This framework is supported by a robust riskmanagement culture and a strong commitment toactive management of risks by both the Board ofDirectors and senior management. Scotiabank’sprimary risk management objectives are to protectand ensure the safety and stability of customers’ fundsthat are placed in our fiduciary care, and to create andprotect shareholder value by properly assessing therelationships between risks and rewards.
Through our various business activities we are exposedto specific banking risks and reputational risks, as wellas risks arising from the general business environment.The four major types of specific banking risks are:credit risk, market risk, liquidity risk and operationalrisk.
The risk management framework is driven by theprinciples set out below; these principles are appliedto all businesses and risk types.
• Board oversight – Risk strategies, policies andlimits are subject to Board review and approval.Policies provide guidance to the businesses andrisk management units by setting the boundarieson the types of risks the Bank is prepared toassume. Limits are set to ensure risk takingactivities will achieve predictable results withinthe tolerances established by the Board ofDirectors, as well as to establish accountabilityfor key tasks in the risk-taking process, andestablish the level or conditions under whichtransactions may be approved or executed. Risk strategies, policies and limits are designed with aview to ensuring that risks are well diversified.
• Assessment – Processes are designed to ensurethat risks are properly assessed at thetransaction, customer and portfolio levels.Processes are the activities associated withidentifying, evaluating, documenting, reportingand controlling risk.
• Review and Reporting – Risk profiles of individual customers and portfolios are subject to ongoing review and reporting to seniormanagement and the Board. Reporting tools arerequired to aggregate measures of risk acrossproducts and businesses for the purposes of
ensuring compliance with policies, limits and guidelines and providing a mechanism for communicating the quantum, types and sensitivities of the various risks in the portfolio.This information is used by the Board and seniormanagement to understand the Bank’s risk profile and the performance of the portfolioagainst defined goals.
• Audit Review – Individual risks and portfolios aresubject to comprehensive internal and external audit review, with independent reporting to the Audit Committee of the Board on the effectiveness of the risk management policiesand the adherence to internal controls.
The various processes within the Bank’s riskmanagement framework are designed to ensure thatrisks in the various business activities are properlyidentified, measured, assessed and controlled. Riskmanagement strategies, policies and limits are thendesigned to ensure that the Bank’s risk taking isconsistent with its business objectives and risktolerance. The Asset and Liability Committee (ALCO)ensures that risks are managed within the limitsestablished by the Board of Directors. The Committeemeets at least once monthly to review risks, evaluateperformance and provide strategic direction.
CREDIT RISKCredit risk is the risk of loss resulting from the failureof a borrower or counterparty to honor its financial orcontractual obligations to the Bank. Credit risk iscreated in the Bank’s direct lending operations and itsfunding, investment and trading activities, wherecounterparties have repayment or other obligations tothe Bank.
Management’s Discussion & Analysis (continued)
Risk Management (continued)
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Scotiabank’s credit risk is managed through strategiespolicies and limits that are approved by the Board ofDirectors. These strategies include centralized creditprocesses, portfolio diversification, enhanced creditanalysis and strong Board oversight. The Bank’s creditrisk limits to counterparties in the financial andgovernment sectors are also managed centrally tooptimize the use of credit availability and to avoidexcessive risk concentration.
Credit ProcessesScotiabank employs a highly centralized creditgranting process that ensures all major lendingdecisions are referred to a Senior Credit Committee, orwhere appropriate, to a Loan Policy Committee. Clientrelationship officers in the business lines submit creditproposals on major corporate and commercial accountsdirectly to the Credit Department. Credit specialists,who are independent of the business line, analyse theproposal. A risk rating system is used to quantify andevaluate the risk, and determine whether the Bank isbeing adequately compensated, and the Board reviewsand ratifies all major credits.
Once a credit proposal has been authorized, acompany’s financial condition is monitored by businessline and Credit Department personnel for signs ofdeterioration, which could affect the borrower’s abilityto meet its obligations to the Bank. In addition, a fullreview and risk analysis of each client relationship isundertaken at least annually. Additional reviews arecarried out more frequently in the case of higher riskcredits.
Decisions on small and medium-sized commercialcredits are made utilizing a centralized loanunderwriting system, which uses a computerizedscoring model. This process is significantly moreefficient than the previous manual scoring system, thusthe turnaround time is significantly improved.
Retail loan portfolios continue to be reviewed on amonthly basis for emerging trends in credit quality, inaddition to regular analytical reviews to confirm thevalidity of the parameters used in the scoring models.
The Bank’s credit adjudication and portfoliomanagement methodologies are designed to ensureconsistent underwriting and early identification ofproblem loans. Special attention is paid to themanagement of problem loans. Intensive managementand control is exercised over problem loans, in order tomaximize recoveries of doubtful debts.
MARKET RISKMarket risk is the risk of loss of value in the Bank’sportfolios resulting from changes in interest rates andforeign exchange rates. The Bank assumes market riskin both its trading and non-trading (funding andinvestment) activities. Market risk exposures aremanaged through key policies, standards and limitsestablished by the Board of Directors, which areformally reviewed and approved by the Board at leastannually.
Within the policy and limit framework established bythe Board, ALCO provides senior managementoversight of the Bank’s market risk exposure. The ALCOis primarily focused on asset liability management,which includes lending, funding, trading andinvestment activities. All market risk limits arereviewed at least annually. The key sources of marketrisk are described below.
Interest Rate RiskInterest rate risk arises when there is a mismatchbetween positions, which are subject to interest rateadjustment within a specified period. The Bank’slending, funding and investment activities give rise tointerest rate risk. For these activities, the impact ofchanges in interest rates is reflected in net interestincome.
Scotiabank’s Asset Liability Management (ALM)Programme focuses on measuring, managing andcontrolling the risks arising in the Bank’s lending,funding and investing activities. Scotiabank’s ALMprocess is designed to maintain a balance betweenenhancing interest revenue and maintaining strongliquidity within a framework of sound and prudentpractices.
The ALCO evaluates interest rate risk exposure arisingfrom the Bank’s funding and investment activities atleast monthly. This supervisory role is supported by riskmanagement processes, which include gap andsensitivity analysis. Under gap analysis, interest ratesensitive assets and liabilities are assigned topredefined time periods on the basis of expected re-pricing dates. A liability gap occurs when moreliabilities than assets are subject to interest ratechanges during a given time period. Conversely, anasset sensitive position arises when more assets thanliabilities are subject to rate changes. Interest rateexposures in individual currencies are controlled bygap limits. Sensitivity analysis assesses the effect ofchanges in interest rates on current earnings and onthe economic value of assets and liabilities.
Management’s Discussion & Analysis (continued)
Risk Management (continued)
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Foreign Exchange RiskForeign exchange risk arises from trading activitiesand foreign currency operations. In its tradingactivities, the Bank buys and sells currencies in thespot market for its customers. Foreign exchange gainsand losses from these activities are included in otherincome. The Bank mitigates the effect of foreigncurrency exposures by financing its net investments inits operations with borrowings in the same currencies,as the functional currency involved.
Foreign currency risk arising from the Bank’s foreigncurrency trading is subject to Board approved limits.The ALCO reviews and manages these exposures.
LIQUIDITY RISKLiquidity risk is the risk that the Bank is unable to meetits financial obligations in a timely manner atreasonable prices. Financial obligations includeliabilities to depositors, settlement of securitiesborrowing and repurchase transactions, and lendingand investment commitments.
Liquidity management includes estimating andsatisfying the liquidity requirements of the Bank in themost cost effective way.
The Board of Directors approves the Bank’s liquidityand funding management policies and establisheslimits to control the risk. The Bank assesses theadequacy of its liquidity position by analyzing itscurrent liquidity position, present and anticipatedfunding requirements, and alternative sources offunds. This process includes:• Projecting cash flows for each major currency;• Monitoring balance sheet liquidity ratios against
internal and regulatory requirements;• Monitoring of depositor concentration both in
terms of the overall funding mix and to avoidundue reliance on large individual depositors; and
• Maintenance of liquidity and funding contingencyplans
The Bank maintains large holdings of liquid assets tosupport its operations. These liquid assets can be soldor pledged to meet the Bank’s obligations. As atOctober 31, 2006, liquid assets stood at $78 billion,which represents 39% of total assets.
The objectives of the liquidity management processesare to ensure that the Bank honors all of its financialcommitments as they fall due. To fulfill this objective,
the Bank measures and forecasts its cashcommitments, maintains diversified sources offunding, sets prudent limits, and ensures immediateaccess to liquid assets. Our strong performance andsolid reputation also ensure timely access toborrowing at favorable rates and terms. The ALCOevaluates the Bank’s liquidity profile on a monthlybasis or more frequently as required.
FundingScotiabank relies on a broad range of funding sourcesand applies prudent limits to avoid undueconcentration. The principal sources of funding arecapital, core deposits from retail and commercialcustomers, and wholesale deposits raised in theinterbank and commercial markets. Scotiabank’sextensive branch network provides a strongfoundation for diversifying its funding and raising thelevel of core deposits. Considerable importance isattached to this core deposit base, which, over theyears, has been stable and predictable. In 2006, coresavings deposits continued to grow, reaching $64billion as at October 31, 2006, representing 57% oftotal funding.
OPERATIONAL RISKOperational risk is the risk of loss, whether direct orindirect, to which the Bank is exposed due to externalevents, human error, or the inadequacy or failure ofprocesses, procedures, systems or controls.Operational risk, in some form, exits in each of theBank’s business and support activities, and can resultin financial loss, regulatory sanctions and damage tothe Bank’s reputation.
The Bank has developed policies, standards andassessment methodologies to ensure that operational
Management’s Discussion & Analysis (continued)
Risk Management (continued)
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risk is appropriately identified, managed andcontrolled. The Bank’s risk control self-assessmentprogram, entails a formal review to identify andassess operational risks. This program provides abasis for management to ensure that appropriateand effective controls and processes are in place onan ongoing basis to mitigate operational risk and, ifnot, that appropriate corrective action is beingtaken.
Operational risks are managed and controlled withinthe individual business lines and a wide variety ofchecks and balances to address operational riskshave been developed as an important part of our riskmanagement culture. They include theestablishment of risk management policies, arigorous planning process, regular organizationalreview, thorough enforcement of the Bank’sGuidelines for Business Conduct, and clearly definedand documented approval authorities.
Regular audits conducted by an experiencedindependent internal audit department includecomprehensive reviews of the design and operationof internal control systems in all business andsupport groups, new products and systems and thereliability and integrity of Data Processingoperations.
As part of our strong internal control culture, unitsare also subject to a standard, documentedcompliance program. The elements of which areregulatory awareness, regulatory risk assessment,compliance monitoring, non-compliance andproblem resolution and compliance reporting.Compliance matrices, which outline the variouslegislative and regulatory requirements for eachunit, have been developed. The Bank’s ComplianceOfficer manages the Compliance programme.
The Bank maintains and tests contingency facilitiesto support operations in the event of disasters, toensure efficient operational recovery in the shortestpossible time frame.
Reputational RiskWithin our risk management processes, we defineReputational Risk as the risk that negative publicityregarding the Bank’s business practices, whethertrue or not, will adversely affect its revenues,operations or customer base, or require costlylitigation or other defensive measures.
Negative publicity and attendant reputational riskusually arise as a by-product of some other kind ofrisk management control failure. Reputational risk ismanaged and controlled throughout the Bank bycodes of conduct, governance practices and riskmanagement programs, policies, procedures andtraining.
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Shareholders Holding the Ten Largest Blocks of Sharesin The Bank of Nova Scotia Jamaica Limited
as at October 31, 2006
Units
1. The Bank of Nova Scotia, Toronto, Canada 2,049,062,400
2. Scotia Jamaica Investment Management Limited
- A/C 3119 70,699,347
3. Life of Jamaica Pooled Equity Fund No. 1 47,068,744
4. Scotia Jamaica Investment Management Limited
- A/C 560 37,212,695
5. Capital & Credit Merchant Bank Limited 26,979,271
6. National Insurance Fund 26,541,440
7. Investment Nominees Limited - AC Lascelles
Henriques S/A Fund 15,153,996
8. Guardian Life Limited Pension Fund 13,549,451
9. Manchester Pension Trust Fund 13,017,444
10. West Indies Trust Co. Ltd. A/C WT89 12,983,520
Shareholdings of Senior Management Officers of The Bank of Nova Scotia Jamaica Limited as
at October 31, 2006*
Units
William E. Clarke, CD 367,980
Egerton Anderson 102,270
- Joan Anderson 19,598
Ronald Bourdeau NIL
Keri-Gaye Brown NIL
Bevan Callam 1,072,158
Roger Cogle 154,860
Sharon Colquhoun 8,790
Joylene Griffiths Irving 52,694
Wayne Hewitt 2,000
Michael Jones 247,142
Bridget Lewis 113,800
Marcette Mcleggon 64,860
Hugh Miller NIL
- Sheila McDonald 5.172
Suzette McLeod 160,000
David Noël 150,745
Yvonne Pandohie 120,640
Rosemarie Pilliner 294,538
H. Wayne Powell 1,224,686
- Yanissa Investments 144,448
Shirley Ramsaran and
- Reginald Ramsaran 60,229
Anya Schnoor 237,000
Jacqueline Sharp 98,000
Heather Shields NIL
Michael Thompson 50,000
Audrey Tugwell Henry 12,446
Maroya E. Villafana-Sylvester NIL
Rosemarie Voordouw 13,520
Gladstone Whitelocke 60,000
- Elaine Whitelocke 65,000
- Justin Whitelocke 1,200
- Renee Whitelocke 1,320
David M. Williams 157,482
Frederick Williams NIL
Stacie-Ann Wright 58,501
*Inclusive of shares in Jamaica Central Securities Depository
Shareholdings of Directors and Connected Personsin The Bank of Nova Scotia Jamaica Limited
as at October 31, 2006*
Units
Robert Pitfield 9,270
William E. Clarke, CD 367,980
Anthony Chang 3,274
Professor Celia D. C. Christie 20,000
Dr. Jean A. Dixon 90,102
Muna M. Issa 29,986
Charles Johnston 2,328
- Marine Management Services 64,472
Warren McDonald 10,000
Joseph M. Matalon NIL
Hon. Mayer M. Matalon, OJ 100,000
Hon. William A. McConnell, OJ 10,000
Dr. Herbert J. Thompson 29,640
Professor Stephen Vasciannie 24,579
Richard E. Waugh 100,000
Stacie-Ann Wright 58,501
*Inclusive of shares in Jamaica Central Securities Depository
Sharehold ings
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To the Members ofTHE BANK OF NOVA SCOTIA JAMAICA LIMITED
Auditors' Report
We have audited the financial statements of The Bank of Nova Scotia Jamaica Limited (“the Bank")and the consolidated financial statements of the Bank and its subsidiaries (“the Group") as of andfor the year ended October 31, 2006, set out on pages 59 to 132, and have obtained all theinformation and explanations which we required. These financial statements are the responsibilityof the Bank's management. Our responsibility is to express an opinion on the financial statementsbased on our audit.
We conducted our audit in accordance with International Standards on Auditing. Those standardsrequire that we plan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free of material misstatements. An audit includes examining, on a testbasis, evidence supporting the amounts and disclosures in the financial statements. An audit alsoincludes assessing the accounting principles used and significant estimates made by management,as well as evaluating the overall presentation of the financial statements. We believe that our auditprovides a reasonable basis for our opinion.
In our opinion, proper accounting records have been kept and proper returns adequate for thepurpose of our audit have been received from branches not visited by us. The financial statements,which are in agreement therewith and have been prepared in accordance with InternationalFinancial Reporting Standards, give a true and fair view of the state of affairs of the Group and theBank as at October 31, 2006, and of the results of operations, changes in equity and cash flows ofthe Group and the Bank for the year then ended and comply with the provisions of the CompaniesAct, as far as concerns members of the Bank.
The previous year’s financial statements were audited by another firm of chartered accountantswho issued an unqualified reported dated November 24, 2005.
November 23, 2006
KPMG P.O. Box 76Chartered Accountants KingstonThe Victoria Mutual Building Jamaica6 Duke Street Telephone +1 (876) 922-6640Kingston Fax +1 (876) 922-7198Jamaica, W. I. +1 (876) 922-4500
e-Mail [email protected]
KPMG, a Jamaican partnership Raphael E. Gordon Caryl A. Fenton Elizabeth A. Jonesis the Jamaican member firm of KPMG Patrick A. Chin Patricia O. Dailey-Smith Linroy J. MarshallInternational, a Swiss cooperative. R. Tarun Handa Cynthia L. Lawrence Rajan Trehan
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6Statement of Consolidated Revenue and Expenses
(expressed in thousands of Jamaican dollars unless otherwise stated)
Year Ended 31 October 2006
Consolidated Balance Sheet(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
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Consolidated Balance Sheet (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
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Stacie-Ann S. Wright
Robert H. Pitfield William E. Clarke
David A. Noël
Statement of Consolidated Changes in Stockholders’ Equity(expressed in thousands of Jamaican dollars unless otherwise stated)
Year ended 31 October 2006
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6Statement of Consolidated Cash Flows
(expressed in thousands of Jamaican dollars unless otherwise stated)
Year ended 31 October 2006
Statement of Consolidated Cash Flows (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
Year ended 31 October 2006
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6Statement of Revenue and Expenses
(expressed in thousands of Jamaican dollars unless otherwise stated)
Year ended 31 October 2006
Balance Sheet(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
66
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ort
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06
67
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6
31 October 2006
Stacie-Ann S. Wright
Robert H. Pitfield William E. Clarke
David A. Noël
Statement of Changes in Stockholders’ Equity(expressed in thousands of Jamaican dollars unless otherwise stated)
Year ended 31 October 2006
68
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ep
ort
20
06
Statement of Cash Flows(expressed in thousands of Jamaican dollars unless otherwise stated)
Year ended 31 October 2006
69
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Statement of Cash Flows (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
Year ended 31 October 2006
70
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ep
ort
20
06
Notes to the Financial Statements(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
71
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ba
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An
nu
al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
72
Sc
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ab
an
kA
nn
ua
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ep
ort
20
06
31 October 2006
73
Sc
otia
ba
nk
An
nu
al R
ep
ort 2
00
6Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
74
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ab
an
kA
nn
ua
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ep
ort
20
06
31 October 2006
75
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ba
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An
nu
al R
ep
ort 2
00
6Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
76
Sc
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ab
an
kA
nn
ua
l R
ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
77
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ba
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An
nu
al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
78
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ab
an
kA
nn
ua
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
79
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ba
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An
nu
al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
80
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an
kA
nn
ua
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ep
ort
20
06
81
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ba
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An
nu
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ep
ort 2
00
6
31 October 2006
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
82
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an
kA
nn
ua
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ep
ort
20
06
31 October 2006
83
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ba
nk
An
nu
al R
ep
ort 2
00
6Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
84
Sc
oti
ab
an
kA
nn
ua
l R
ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
85
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ba
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An
nu
al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
86
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ab
an
kA
nn
ua
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
87
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ba
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An
nu
al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
88
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ab
an
kA
nn
ua
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
89
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ba
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ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
90
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ab
an
kA
nn
ua
l R
ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
91
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ba
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An
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al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
92
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ab
an
kA
nn
ua
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
93
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ba
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ep
ort 2
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6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
94
Sc
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ab
an
kA
nn
ua
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
95
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ba
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An
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al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
96
Sc
oti
ab
an
kA
nn
ua
l R
ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
97
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ba
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nu
al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
98
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ab
an
kA
nn
ua
l R
ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
99
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ba
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An
nu
al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
100
Sc
oti
ab
an
kA
nn
ua
l R
ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
101
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ba
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An
nu
al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
102
Sc
oti
ab
an
kA
nn
ua
l R
ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
103
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ba
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al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
104
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ab
an
kA
nn
ua
l R
ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
105
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ba
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An
nu
al R
ep
ort 2
00
6
106
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ab
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
107
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ep
ort 2
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6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
108
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ab
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ua
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
109
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ba
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An
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al R
ep
ort 2
00
6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
110
Sc
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ab
an
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nn
ua
l R
ep
ort
20
06
111
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ba
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nu
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ep
ort 2
00
6Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
112
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
113
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ep
ort 2
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6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
114
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
115
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ep
ort 2
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6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
116
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ab
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nn
ua
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ep
ort
20
06
117
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nu
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ep
ort 2
00
6Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
118
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ab
an
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nn
ua
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
119
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ort 2
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6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
120
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ua
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
121
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ort 2
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6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
122
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
123
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ort 2
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6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
124
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ep
ort
20
06
31 October 2006
125
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ba
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ep
ort 2
00
6Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
126
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ep
ort
20
06
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
127
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ort 2
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6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
128
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ep
ort
20
06
31 October 2006
129
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ep
ort 2
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6
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
130
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ua
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ep
ort
20
06
31 October 2006
131
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ep
ort 2
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6Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
Notes to the Financial Statements (continued)(expressed in thousands of Jamaican dollars unless otherwise stated)
31 October 2006
132
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6
Review (Nov 2005 – Oct 2006)
Jamaica’s economic performance in the past fiscal year(Nov 05 – Oct 06) has been one where the country hascontinued to rebound from the various internal and
external shocks of 2005. In the fourth quarter of 2005,Jamaica had returned to the pre-Hurricane Ivan GDPgrowth levels of just below 3%, which has beenmaintained in the 2006 calendar year to date. Theeconomy has been helped by a relatively uneventfulhurricane season in Jamaica, strong growth in the servicessector (tourism, transport, storage, & communication andmining & quarrying sub-sectors) and rebounding of theagriculture sector.
The tourism sector was buoyed by the fallout in theMexican tourism industry as a result of a particularlydevastating hurricane season in 2005 as well as theplanned capacity expansion of 10,000 hotel rooms mainlyfrom the Spanish hotel chains over the next five years,close to 4,000 of which will be completed by the end of the2006 calendar year.
Mining and Quarrying continued its growth path from theprevious year and has been fairly resilient to theinflationary effects of the hurricane season as well as theoil price escalation during the period.
Air and sea transportation increased over the period underreview and this accounted for most of the growth in thissub-sector.
All these activities have more than offset the fallout in theconstruction and installation sector since the latter part of2005. This was due to a chronic shortage of cementresulting from a breakdown in the manufacturingprocesses at the monopoly cement producer, insufficientmanufacturing capacity and a global cement shortagecaused by disaster rebuilding efforts globally, as well aseconomic expansion in China.
Over the fiscal year in review, inflation has steadily trendeddownwards in the absence of natural disasters or othereconomic shocks. Inflation, as at September 2006, stood at6.5% and has been fuelled by increases in food & drink,and housing sections of the index that have been driven byincreases in imported food supplies as a result of thegradual but steady devaluation of the Jamaican dollar andthe increase in cement prices as a result of the shortage.
Over the year in review, the Jamaican dollar declinedagainst its US counterpart by $2.45 or 3.69%. This relativestability has been reinforced by central bank operationsbacked by buoyant net international reserves of US$2.34billion at the end of September.
The stable environment as well as the government’scommitment to the medium-term fiscal targets, has alsoallowed the Central Bank to systematically reduce interestrates during the fiscal year. In September 2006, BOJreduced interest rates by 30 basis points on the entirespectrum of instruments and on all tenors (30 –180 days).Tax adjusted real rates of return have been negative andare expected to remain negative.
While the government continues to surpass itsexpenditure targets through aggressive capitalexpenditure cuts ($4.5 billion less than projected to date),tax revenues for the April – August period1 was $0.86billion were less than projected (compared to a $7.3 billionunder-collections at the same time last year). The neteffect on the fiscal accounts at the end of August was afiscal deficit of $16.7 billion, which is $5.8 billion less thanprojected.
The index of business confidence rose by 13% whencompared to last year and by 15% over the precedingquarter this year. The index reflects perceptions ofimproved prospects (profit margins) for businesses despitea decline in expectations for the rate of economic growth.However, businesses also reported that they were lesslikely to make additional investments in expanding theirbusinesses at this time due to reduced expectations about
Figure 1: Source: PIOJ
Figure 2: Source – BOJ
1 Provisional data - Ministry of Finance
Economic
Review
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Economic
Review (cont inued)
cost recovery within the economic climate
Continuing the trend since the start of the period underreview, consumer confidence has outpaced businessconfidence as consumers register higher expectations foreconomic growth, job availability and future incomeincluding income from remittances. Nonetheless, spendingplans have been depressed since the first quarter of theyear with vehicle, home buying and vacations purchaseplans down by an average of 20% since the early part ofthe year.
The Financial SectorThe Central Bank during the year, removed the SpecialDeposit Reserve Requirement for Commercial Banks andFIA institutions. This development, led to declines inaverage lending rates over the majority of the period.
The low interest rate environment has fuelled a growth inloans and advances from commercial banks to $140.6billion representing an increase in outstandings of 11%since the start of the period under review.
Deposits lodged with Building Societies grew by 9.2% sincethe start of the review period (November 2005) to $68.7
billion at the end of July 2006. Loans and advances madeat Building Societies at the end of July 2006 stood at $40.6billion, representing an increase of 16% since the start ofthe review period.
Merchant Banks and other Finance houses posted depositgains of 10.7% over the previous year to balances of $13billion at the end of July 2006.
The Jamaica Stock Exchange Index as at the end of October,decreased by 15.86% over the previous year and isreflective of the performance of the stock market over theyear in review.
OutlookOverall, the economic and financial indicators are expectedto remain stable over the next year. Continued expansionin agriculture, mining, construction, basic services andmiscellaneous services which includes tourism, are expectedto be the drivers for overall growth. Expansion in realsector activities should be enhanced by a relatively stableexchange rate supported by continued strong inflowsassociated with tourism and remittances, declininginflation and low interest rates. These developments, aswell as continued fiscal prudence should sustain investorconfidence. Against this background, growth for the fiscalyear is projected in the range of 3.0 - 4.0%.
Crime and violence will continue to have an adverse impacton the growth potential for the economy and the level ofFDI that is attracted, despite recent positive trends in thisregard.
Finally, the government’s major challenge over the nextfiscal year continues to be to manage the fiscal deficit andcontain the debt burden, while encouraging local andforeign investment through a stable exchange rate, asustained low interest rate environment and moderateinflation. Achieving the budget objective will hinge on theauthorities’ tax administration efforts geared at wideningthe tax base and implementing aggressive collectionpolicies.
Figure 3: Source Conference Board, JCC
Figure 4: Source – BOJ
Figure 5: Source – Ja. Stock Exchange
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Assets held in TrustAssets administered by the Bank and its subsidiaries,which are beneficially owned by customers and aretherefore not reported on the consolidated balancesheet. Services provided in respect of these assets areadministrative in nature, such as security custody,trusteeship, stock transfer and personal trust services.
Bankers’ Acceptances (BAs) A type of negotiable, short-term debt security,generally issued by a non-financial entity andguaranteed for a fee, by the issuer’s bank.
Basis PointA unit of measure defined as one-hundredth of oneper cent.
Capital Consists of common shareholders' equity andpreferred shareholders’ equity. Capital funds supportasset growth, provide against loan losses, and protectthe Bank’s depositors.
General ProvisionEstablished against the loan portfolio in the Bank’s business lines when the Bank’s assessment of economictrends suggests that losses may occur, but that suchlosses cannot yet be determined on an item-by-itembasis.
Guarantees & Letters of CreditAssurances given by the Bank that it will makepayments on behalf of customers to third parties in theevent that the customers default. The Bank normallyhas recourse against its customers for funds advancedunder such arrangements.
Net Interest Margin Net interest income, expressed as a percentage ofaverage total assets.
Non-Performing LoansLoans on which the Bank no longer has reasonableassurance as to the timely collection of interest andprincipal, or where a contractual payment is past due aprescribed period. Interest is not accrued on non-performing loans.
Off-Balance Sheet InstrumentsThese instruments are comprised of indirect creditcommitments, which include the Bank’s commitmentsto extend credit facilities to its customers which are notyet drawn.
Productivity RatioProductivity ratio measures the efficiency with whichthe Bank incurs expenses to generate revenue. Itexpresses non-interest expenses as a percentage of thesum of net interest income and other income. A lowerratio indicates improved productivity.
Provisions for Loan LossesAn allowance set aside from income, which, inmanagement’s opinion, is adequate to absorb allcredit-related losses in its portfolio of both on and off-balance sheet items. It is decreased by write-offs,realized losses and recoveries, and increased by newprovisions for loan losses. The provisions for loan lossesis deducted from the related asset category on thebalance sheet.
ReposRepos is the short form for “obligations related toassets sold under repurchase agreements” - a short-term transaction whereby the Bank sells securities to acustomer and simultaneously agrees to repurchase thesecurities on a specified date and at a specified price. Itis a form of short-term funding.
Return on Equity (ROE)Net income, less preferred share dividends, expressedas a percentage of average common shareholdersequity.
Reverse ReposReverse Repos is the short form for “assets purchasedunder resale agreements” -a short-term transactionwhereby the Bank purchases securities from acustomer and simultaneously agrees to resell thesecurities on a specified date and at a specified price.It is a form of short-term collateralized lending.
Risk-Adjusted AssetsCalculated using weights based on the degree of creditrisk for each class of counterparty. Off-balance sheetinstruments are converted to balance sheetequivalents, using specified conversion factors, beforethe appropriate risk weights are applied.
Tier 1, Tier 2 Capital RatiosThese are ratios of capital to risk-adjusted assets, as stipulated by the Bank of Jamaica, based on guidelinesdeveloped under the auspices of the Bank forInternational Settlements (BIS). Tier 1 capital, the morepermanent, consists primarily of commonshareholders’ equity plus non-cumulative preferredshares, and certain designated retained earningswhich by statute may not be distributed or reducedwithout permission from the Bank of Jamaica. Tier 2 ismainly the general provision.
Glossary
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Subsid iar ies, Board Members
and Senior Off icers
SCOTIA JAMAICA INVESTMENT MANAGEMENT LIMITED
4th Floor, Scotiabank CentreCnr. Duke & Port Royal StreetsP.O. Box 627 Kingston, Jamaica
Board of DirectorsHon. W. A. McConnell, O.J. - ChairmanW. E. Clarke, C.D.Ms. E. M. Brown Mrs. A. M. Tugwell HenryC. H. JohnstonW. A. McDonald R. U. PatrickH. W. PowellProf. S. C. VasciannieMiss S. A. Wright
Senior Officers:Miss A. SchoorSenior Vice President Wealth Management & General Manager, SJIM
K. HarrisSenior Manager Investments
Miss N. K. HinesManager, Trust & Registration Services
C. M. WisdomManager, Finance & Operations
B. O. FrazerManager, Securities, Trading
SCOTIA JAMAICA LIFE INSURANCE COMPANY LIMITED
5th Floor, Scotiabank CentreCnr. Duke & Port Royal StreetsKingston, Jamaica
Board of DirectorsMiss M. M. Issa - ChairpersonW. E. Clarke, C.D.A. V. Chang Prof. C. D. C. ChristieMs. E. LeungH. W. PowellH. A. ReidDr. A. E. SamuelsP. B. ScottProf. S. C. VascianieMiss S. A. Wright
Senior Officers:Mrs. J. T. SharpVice President & General Manager
Mrs. M. AnthonySenior Manager, Finance & Investments
Mrs. E. A. HendricksManager, Marketing & Communications
Ms. L. S. HeslopManager, Operations & Customer Service
THE SCOTIA JAMAICA BUILDING SOCIETY
95 Harbour StreetP.O. Box 8463Kingston, Jamaica
Board of DirectorsDr. J. A. Dixon - ChairpersonDr. H. J. Thompson - Deputy Chairman Dr. C. D. ArcherW. E. Clarke, C.D.Miss M. M. Issa H. W. PowellMiss J. A. ThompsonMiss S. A. Wright
Senior Officers:G. F. WhitelockeGeneral Manager
Ms. L. FullerManager, Finance & Operations
P. F. WilliamsManager, Mortgage Services
SCOTIA JAMAICA FINANCIAL SERVICES LIMITED
Scotiabank CentreCnr. Duke & Port Royal StreetsP.O. Box 709Kingston, Jamaica
Board of DirectorsW. E. Clarke, C.D.- Chairman Mrs. A. M. Tugwell HenryH. W. PowellMiss S. A. Wright
SCOTIABANK JAMAICA FOUNDATION
Scotiabank CentreCnr. Duke & Port Royal StreetsP.O. Box 709Kingston, Jamaica
Board of DirectorsDr. J. A. Dixon - ChairpersonE. H. AndersonMs. E. M. BrownW. E. Clarke, C.D., Deputy ChairmanMrs. J. A. Griffiths IrvingM. JonesMrs. R. A. PillinerH. W. PowellMrs. R. VoordouwMiss S. A. Wright
Senior Officer:Mrs. J. A. Griffiths IrvingExecutive Director
SCOTIA JAMAICA GENERAL INSURANCE BROKERS LIMITED
5th Floor, Scotiabank CentreCnr. Duke & Port Royal StreetsKingston, Jamaica
Board of DirectorsW. E. Clarke, C.D. - Chairman H. W. PowellMrs. R. A. Pilliner
BRIGHTON HOLDINGS LIMITED
Scotiabank CentreCnr. Duke & Port Royal StreetsKingston, Jamaica
Board of DirectorsW.E. Clarke, C.D. - ChairmanE. H. AndersonH. W. PowellMiss S. A. Wright
WHOLLY-OWNED SUBSIDIARIES AND SCOTIABANK JAMAICA FOUNDATION
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AUDITORS
KPMG6 Duke StreetKingston, Jamaica
Telephone: (876) 922.6640Fax: (876) 922.7198
922.4500
REGISTERED OFFICE
Scotiabank CentreCnr. Duke & Port Royal StreetsP.O. Box 709Kingston, Jamaica
Telephone: (876) 922.1000Fax: (876) 922.6548Website: www.jamaica.scotiabank.comTelex: 2297SWIFT Bic Code: NOSCJMKN
REGISTRAR & TRANSFER AGENT
Scotia Jamaica Investment Management Limited4th Floor, Scotiabank CentreCnr. Duke & Port Royal StreetsP.O. Box 627Kingston, Jamaica
Telephone: (876) 922.1810Fax: (876) 922.3378
SECRETARY
David A. NoëlSenior Vice President/Senior Legal Counsel& Corporate Secretary
The Bank of Nova Scotia Jamaica LimitedExecutive OfficesScotiabank CentreCnr. Duke & Port Royal StreetsP.O. Box 709Kingston, Jamaica
Subsid iar ies, Board Members
and Senior Off icers (cont inued)
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Senior
Management Off icers
EXECUTIVE OFFICERS
William E. ClarkePresident & CEO
Miss Stacie-Ann WrightExecutive Vice President & Chief Financial Officer
Mrs. Rosemarie A. PillinerExecutive Vice President,Operations & Service Delivery
H. Wayne PowellExecutive Vice President,Branch Banking
Michael D. JonesSenior Vice President,Human Resources
David A. NoelSenior Vice President,Senior Legal Counsel & Corporate Secretary
Miss Anya M. SchnoorSenior Vice President, Wealth Management & General Manager, Scotia Jamaica Investment Management Limited
Mrs. Audrey M. Tugwell HenrySenior Vice President,Retail & Electronic Banking
SENIOR MANAGEMENT OFFICERS
AuditMiss Yvonne M. Pandohie Vice President & Chief Auditor
MarketingMiss Heather D. M. ShieldsVice President
Corporate & Commercial Banking CentreWayne P. HewittVice President,Corporate & Commercial Banking
Miss Marcette McLeggonAssistant General Manager,Credit Solutions
Barrington C. ChisholmDirector,Commercial Business Development
Credit Risk ManagementHenri R. BourdeauVice President, Risk Management
Bevan A. Callam Vice President,Credit Risk Management
District Vice Presidents
Egerton G. Anderson
Roger R. Cogle
Michael A. Thompson
Employee Communications & Consultations UnitMrs. Rosemarie A. VoordouwDirector
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FinanceMiss Shirley K. Ramsaran Assistant General Manager,Finance & Comptroller
Hugh G. MillerAssistant General Manager,Treasury & Foreign Exchange
Information Systems CentreMiss Sharon A. Colquhoun Director
Operations and Shared ServicesMrs. Suzette A. M. McLeodVice President, Shared Services
David M. WilliamsAssistant General Manager,Operations & Sales Support
Private Banking Services
Miss Bridget A. LewisGeneral Manager
Retail & Electronic Banking
Mrs. Maroya E. Villafana-Sylvester Director Electronic Banking Products & Solutions
Mrs. Karen TomlinsonDirectorRetail Banking
Public, Corporate & Government Affairs
Mrs. Joylene A. Griffiths IrvingDirector& Executive DirectorScotiabank Jamaica Foundation
Senior
Management Off icers (cont inued)
140
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Branches & Branch Managers
by Distr icts
District A
District B
Metro West
1 Georgia MorrisonManager, Victoria & Blake Branch
2 Egerton AndersonDistrict Vice President
3 Althea HowardManager, Old Harbour Branch
4 Janet Billings-FrithManager, Christiana Branch
5 Valerie OmessManager, Hagley Park Road Branch
6 Anthony BoydManager, Premier Branch
7 Claudia SandersonManager, Junction Branch
8 Donovan HansonManager, Scotiabank CentreBranch
9 Terrence V. AllenManager, King Street Branch
10 David JamesManager, Santa Cruz Branch
11 Steve DistantManager, Liguanea Branch
12 Michael LeeSales & Service Manager
13 Carl BrightManager, Mandeville Branch
14 Regald ReidManager, Black RiverBranch
1 2 3 4 5 86 7
9
1011
12 13
14
District AMetro East
1 Roger CogleDistrict Vice President
2 Phoebe BuchananManager, UWI Mona Campus Branch
3 Marlene DavidsonManager, Highgate Branch
4 Junior CarterManager, Linstead Branch
5 Janet SutherlandManager, Oxford Road Branch
6 Fitzaudy WrightManager, Port Antonio Branch
7 Courtney SylvesterManager, New KingstonBranch
8 Raphael SangsterManager, Spanish Town Branch
9 Junior ClarkeManager, Cross Roads Branch
10 Andre JohnsonManager, Portmore Branch
11 Conrad WrightManager, Morant Bay Branch
12 Dudley WaltersManager, Half-Way-TreeBranch
13 Opal WhittakerManager, Port MariaBranch
1 2 3 4 5
8
6 7
9 10 11 12
13
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Metro North
1 Doreen MortimerManager, Ironshore Branch
2 Norma HaughtonManager, St. Ann’s Bay Branch
3 Stredic ThompsonManager, Falmouth Branch
4 Michael ThompsonDistrict Vice President
5 Donna MaxwellManager, Brown’s Town Branch
6 Caswell DawesManager, Lucea Branch
7 Glen GrayManager, Negril Branch
8 Owen StephensonManager, Westgate Branch
9 Michael ShawManager, Savanna-La-Mar Branch
10 Milton ElliotSales & Service Manager
11 Linley RenoldsManager, Montego BayBranch
12 Tanya PalmerManager, Ocho Rios Branch
1 2 3 4 5 6
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Branches & Branch Managers
by Distr icts (cont inued)
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Branches
& Managers
BLACK RIVER6 High StreetP. O. Box 27Black RiverSt. Elizabeth
R. R. Reid, Manager
BROWN’S TOWNMain StreetP. O. Box 35Brown’s Town St. Ann
Mrs. D. A. Maxwell, Manager
CHRISTIANAMain StreetP. O. Box 11Christiana, Manchester
Mrs. J. D. Billings-Frith, Manager
CORPORATE & COMMERCIAL BANKING CENTREMiss D. R. Coubry, Snr. Relationship ManagerMiss A. C. Leonce, Snr. Relationship ManagerMiss M.A. Flake, Snr. Relationship ManagerH. C. Mair, Snr. Relationship ManagerMrs. D.A. Mighty, Relationship ManagerH. D. Stephens, Relationship ManagerK.A.Townsend, Relationship ManagerH. P. Ebanks, Relationship ManagerMrs.A. M. Buckley, Relationship ManagerM. G.Verley, Relationship Manager
CROSS ROADS86 Slipe RoadP. O. Box 2Kingston 5
J. A. Clarke, Manager
FALMOUTHTrelawny WharfP. O. Box 27Falmouth,Trelawny
S. H. Thompson, Manager
HAGLEY PARK ROAD128 Hagley Park RoadP. O. Box 5Kingston 11
Miss V. I. Omess, Manager
Mrs. Y. T. Leslie, Asst. Manager
HALF-WAY-TREE80 Half-Way-Tree RoadP. O. Box 5Kingston 10
D. E. Walters, Manager
Miss G. N. Crawford, Senior Account Manager
Mrs. V. J. James, Account Manager
Mrs. D. M. Lounges,Assistant Manager, Operations & Service
Miss D. A. Hyman, Account Manager,
Mrs. K. N. Chang, Account Manager
HIGHGATEMain StreetP. O. Box 9HighgateSt. Mary
Mrs. M.V. Davidson, Manager
IRONSHORE SERVICE CENTREShops 2 & 3, Golden Triangle Shopping CentreIronshoreMontego Bay
Miss D. M. Mortimer, Manager
JUNCTIONJunction P. O.St. Elizabeth
Mrs. C.A. Sanderson, Manager
KING STREET35-45 King StreetP. O. Box 511, Kingston
T. V. Allen, Manager
Mrs. W. D. O’Connor, Asst. Manager
C.C. Wiggan, Asst. Manager
Mrs. L. D. Stewart, Asst. Manager, Operations
D. W. Quarrie, Asst. Manager,Personal Banking
LIGUANEA125-127 Old Hope RoadP. O. Box 45Kingston 6
S.A. Distant, Manager
LINSTEAD42 King StreetP. O. Box 19Linstead St. Catherine
Miss J. Carter, Manager
Mrs. M. T. Fay White, Asst. Manager
LUCEAWillie Delisser BoulevardP. O. Box 63Lucea Hanover
C. A. Dawes, Manager
MANDEVILLE 1A Caledonia RoadP. O. Box 106Mandeville, Manchester
A. C. Bright, Manager
Miss A. E. Senior, Asst. Manager, Credit
N. L. Stultz, Manager,Personal Banking
Mrs. L. M. Vickers, Asst. Manager,Operations & Service
MAY PEN36 Main StreetP.O. Box 32May Pen Clarendon
Mrs. B. M. Corrie, Manager
MONTEGO BAY6-7 Sam Sharpe SquareP.O. Box 311 Montego BaySt. James
L. M. Renolds, Manager
E. Blake, Asst. Manager
Mrs. A. E. Bell-Grant, Account Manager
Mrs. A. M. Walters, Asst. Manager, Operations
D. Bryan, Asst. Manager,Personal Banking
MORANT BAY23 Queen StreetP. O. Box 30 Morant Bay St. Thomas
C. A. Wright, Manager
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NEGRILNegril Square Negril P. O.Westmoreland
G. E. Gray, Manager
NEW KINGSTON2 Knutsford BoulevardP. O. Box 307Kingston 5
C. Sylvester, Manager
G. A. Hogarth, Asst. Manager
A. O. Harvey, Asst. Manager,Personal Banking
M. S. Nelson. Asst. Manager, Operations
OCHO RIOSMain StreetP. O. Box 150Ocho RiosSt.Ann
Miss T. M. Palmer, Manager
L. S. Estick,Asst. Manager
OLD HARBOUR4 South StreetP. O. Box 43Old HarbourSt. Catherine
Mrs.A.Y. Howard, Manager
OXFORD ROAD6 Oxford RoadP. O. Box 109Kingston 5
Miss. J.A. Sutherland, Manager
PORT ANTONIO3 Harbour StreetP. O. Box 79Port Antonio Portland
F. O.Wright, Manager
PORT MARIA57 Warner StreetP. O. Box 6Port MariaSt. Mary
Mrs. O.A.Whittaker, Manager
PORTMORELot 2 Cookson Pen, Bushy Park P.O. Box 14.Greater Portmore,St Catherine.
A. D. Johnson, Manager
PREMIER 10 Constant Spring RoadP. O. Box 509Kingston 10
A.A. Boyd, Manager
ST. ANN’S BAY18 Bravo StreetP. O. Box 2St.Ann's Bay St.Ann
Mrs. N. F. Haughton, Manager
SANTA CRUZ77 Main StreetP. O. Box 20Santa CruzSt. Elizabeth
D. A. James, Manager
SAVANNA-LA-MAR19 Great George’s StreetP.O. Box 14Savanna-La-MarWestmoreland
M. E. Shaw, Manager
Miss T. E. Buddo,Asst. Manager
SCOTIABANK CENTRECnr. Duke & Port Royal StreetsP. O. Box 59Kingston
D.A. Hanson, Manager
T. C. James, Asst. Manager
Mrs. K. HoSang-Bancroft, Operations Manager
SPANISH TOWN27 Adelaide StreetSpanish Town St. Catherine
R.A. Sangster, Manager
Mrs. I. C. Tucker, Asst. Manager
UWI, MONA CAMPUSCnr. Ring Road & Shed LaneKingston 7
Miss P. N. Buchanan, Manager
VICTORIA & BLAKE29 Victoria AvenueP.O. Box 625Kingston
Mrs. G.A. Morrison, Manager
WESTGATEWestgate Shopping CentreP.O. Box 11Montego BaySt. James
O.W. Stephenson, Manager
SUB-BRANCHES
BARNETT STREET (Sub to Montego Bay)51 Barnett StreetMontego BaySt. James
CLAREMONT(Sub to St.Ann’s Bay)Claremont P.O.Claremont St.Ann
CLARK'S TOWN (Sub to Falmouth)Clark's Town P. O.Trelawny
FRANKFIELD (Sub to Christiana)FrankfieldClarendon
GAYLE (Sub to Ocho Rios)Gayle P. O.St. Mary
ORACABESSA(Sub to Port Maria)Oracabessa P. O.St. Mary
PARK CRESCENT(Sub to Mandeville)17 Park CrescentMandevilleManchester
Branches
& Managers (cont inued)
Proxy
Form
I/We......................................................................................................................................................................................of..........................................................................................................................................................................................in the parish of ...........................................................being a Member of the above Company, hereby appointthe Chairman of the Meeting or failing him (see Note 1)....................................................................................................................................................................................................................................................................................of...................................................................................................................................................................or failingthem.................................................................................................................................................................................of............................................................................................................................................as my/our Proxy to vote forme/us on my/our behalf at the Annual General Meeting of the Company to be held on the 28th day ofFebruary 2007 and at any adjournment thereof.
Please indicate by inserting a cross in the appropriate square how you wish your votes to be cast. Unlessotherwise instructed, the Proxy will vote or abstain from voting, at his discretion.
....................................................................................Signature
1. If you wish to appoint a proxy other than the Chairman of the Meeting, please insert the person’s name and address and delete (initialing the deletion) "the Chairman of the Meeting".
2. To be valid, this form of proxy and the power of attorney or other authority (if any) under which it is signed must be lodged at the office of the Registrar of the Company, Scotia Jamaica Investment Management Limited (formerly Scotiabank Jamaica Trust and Merchant Bank Limited), 4th Floor, Scotiabank Centre, Cnr. Duke & Port Royal Streets, Kingston, at least 48 hours before the time appointed for the holding of the meeting.
3. To this form must be affixed a $100.00 stamp in payment of stamp duty.
4. In the case of joint shareholders, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the vote(s) of the other joint holder(s) and for this purposeseniority shall be determined by the order in which the names stand in the register of members.
5. To be effective, this form of proxy must be signed by the appointer or his attorney, duly authorised inwriting or, if the appointer is a corporation, must be under its common seal or be signed by some officer or attorney duly authorised in that behalf.
RESOLUTION
NO. 1
NO. 2
NO. 3(a)
NO. 3(b)
NO. 3(c)
NO. 3(d)
NO. 4
FOR AGAINST
As witness my hand this...............................................................................................................day
of................................................................................................................................200...................
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*Trademarks of The Bank of Nova Scotia. Trademarks used under license and control of The Bank of Nova Scotia. The Bank of Nova Scotia Jamaica Limited
www.jamaica.scotiabank.com
Photography: Peter Ferguson Lenox Quallo Jeremy Francis Franz MarzoucaCraig Walsh
Design & Production: Marketing Department, The Bank of Nova Scotia Jamaica Limited
Colour Separations: Tropicolour Limited
Printing: Lithographic Printers Limited
LatinFinanceBanker of the Year Award 2006