Investment sector profits rise sixfold in June quarter

Higher income and trading gains led the securities sector to post a sixfold rise in profit during the June 2025 quarter, according to regulator Financial Services Commission.

Licensed securities dealers collectively generated $6.51 billion in pre-tax profit – a 551 per cent surge over the same period last year.

“The primary factor driving the positive jump in profit before tax is the growth rate of total revenue outpacing total expenses,” said the FSC in its quarterly review of the securities sector published last Wednesday.

The increase in total revenue is itself “driven by the growth in trading profits in debt and equities securities”, the regulator added.

The quarterly report focused on 19 of the 33 licensed dealers, representing some 90 per cent of the sector’s total value.

Across the securities sector, total assets climbed to $981 billion, up 5.3 per cent year-over-year, while aggregate funds under management, reached $1.9 trillion, a 7.81 per cent increase.

The Financial Gleaner reviewed the financial results of some of the securities companies based on disclosures by their listed parent companies, as well as investment companies that are themselves listed.

NCB Capital Markets, the wealth management and investment banking arm of NCB Financial Group Limited, reported operating profit of $4.5 billion for its June 2025 third quarter, up from $2.4 billion a year earlier. The firm benefited in part from executing a series of bond raises, including on behalf of its parent company.

Sagicor Investments Jamaica Limited, the wealth arm of Sagicor Group Jamaica Limited, recorded pre-tax profit of $1.3 billion for the June 2025 quarter, compared to $513 million a year earlier. The company attributed the improvement to a rise in revenue “primarily due to net trading income”, according to Sagicor Group’s financial report issued under the signatures of CEO Christopher Zacca and Chairman Peter Melhado.

Scotia Investments Jamaica Limited, the investment management arm of Scotia Group Jamaica Limited, posted $1.6 billion in pre-tax profit for its July quarter, up from $1.26 billion a year earlier.

“Scotia Investments Jamaica Limited delivered another commendable performance with assets under management increasing by 12 per cent year-over-year,” said Audrey Tugwell-Henry, president and CEO of Scotia Group Jamaica, in comments accompanying Scotia Group’s financials.

Jamaica Money Market Brokers Limited, a local securities dealership owned by JMMB Group Limited, tripled its profit to $3 billion for the full year ending March, up from $963 million, driven by higher interest income and trading gains.

In the parent company’s quarterly report, JMMB Group CEO Keith Duncan said: “The quarter’s results reflect continued recovery in core operations” and that Jamaica, which is one of four regional markets for the financial conglomerate, benefited from “opportunistic trading”.

Mayberry Group Limited, which holds a dealer licence, made $227 million in profit for the June 2025 quarter, more than double the $101 million recorded a year earlier. The increase was attributed to growth in its Widebase subsidiary, which invests in various entities, including US-based fintech firm Keoworld, and local microlender Dolla Financial Services Limited. Quarterly financial results for Mayberry’s securities subsidiary, Mayberry Investments Limited, were not available.

VM Investments posted a $9-million pre-tax loss for the June quarter, compared to a $60-million pre-tax profit a year earlier. However, when factoring in movements in stock prices and bond valuations, the company reported $17 million in net comprehensive income, reversing a $50-million loss from the prior year.

“While the expectation of additional rate cuts, supported by stable inflation and a resilient labour market, could brighten the investment outlook later in the year, current market conditions remain challenging for generating outsized returns,” VM Investments CEO Rezworth Burchenson said in the company’s earnings report.

In its industry report, the FSC indicated that capital held by licensed dealers grew 10.7 per cent to $146 billion, with the sector’s capital-to-risk-weighted-assets ratio remaining well above the 14 per cent benchmark, the FSC indicated.

Clients’ unit trust and mutual fund portfolios grew 10 per cent to $396 billion, reflecting steady demand for long-term investment schemes. Within that pool, cash holdings grew the fastest, up 52 per cent to $16 billion, followed by real estate, up 14 per cent to $46.5 billion, fixed income, up 10 per cent to $220 billion, and equities, up 2.0 per cent to $94 billion. The remaining $17 billion was allocated to other assets.

Exempt distributions – securities issued without a prospectus under specific guidelines – also gained momentum. The number of registered instruments rose to 514, up from 446 a year earlier, with a total value of $461 billion. Local currency distributions rose 4.0 per cent, while foreign currency issuances dipped 10 per cent to US$1 billion.

steven.jackson@gleanerjm.com