BSP delivers strong underlying financial result in Q1-22
by PNG Business News - April 27, 2022
Photo credit: BSP
According to BSP Group CEO Robin Fleming, the pre additional company tax Q1-2022 financial results were driven by improving economic conditions and income growth, when compared to Q1-2021.
“Growth in BSP’s offshore branches and PNG Bank were the main drivers for the overall uplift in underlying Group NPAT,” according BSP Group CEO Robin Fleming.
Mr Fleming said in accordance with accounting standards BSP recognised the full K190m additional company tax in the first quarter this year, reducing Group NPAT to K69m despite our strong underlying performance.
“BSP’s share price on the PNGX finished 0.4 percent higher in the trailing 52 weeks at K12.05, with average prices of K12.21 in Mar-22. ASX prices reached an all-time high of A$6.00 after the K1.1bn profit announcement, but fell to A$5.00 in the weeks following the announcement of the additional company tax in March 2022,” said Mr. Fleming.
Mr. Fleming added that 2021 dividend yields were 14.4 percent and 13.6 percent on the PNGX and ASX respectively, and that BSP paid a record dividend to its shareholders of K626.1m on 22 April 2022. BSP’s market capitalisation on the PNGX was K5.6bn and A$2.2b on the ASX at 31 March 2022.
Meanwhile, Mr Fleming stated that BSP Group’s key performance ratios remained strong, with cost-to-income ratio increasing slightly to 37.8 percent but generally in line with recent levels.
He added that capital adequacy ratio decreased to 21.3 percent due to timing of the 2021 final dividend which was declared in February this year, while prior years had the final dividends declared in May at the time of the company’s Annual General Meeting of shareholders. Capital adequacy remains well above BPNG’s 12 percent requirement. Group Return on Equity (ROE) was 24.0 percent in Q1-2021, impacted by the ACT.
When presenting the first quarter results to investors and the media, Mr. Fleming concluded by stating that the additional company tax is unfair and inequitable, in that BSP is the only bank in
PNG that is targeted for this tax and our PNG shareholders are the hardest hit. “It dissuades investor confidence in PNG and sets a dangerous precedent for arbitrary taxes. Super Funds estimate that BSP shareholders will lose K1.0 billion in value directly and indirectly as a result of the tax.
“Despite the tax, BSP has and will continue to invest heavily in PNG, with its new core banking system, more ATMs and EFTPOS terminals, and additional branches in Lae and Mt Hagen, an upgrade of Maprik to a full branch and two additional hybrid sub-branches in Telefomin and Palmalmal.
BSP’s PNG branch footprint is the largest in the country, with 84 branches and sub-branches, which is significantly more than Westpac’s and Kina Bank’s combined 32 branches in total. Further, BSP branch access ranks highly when compared to other leading banks in comparable markets, with BSP branch coverage per 100,000 people being 1.56, compared to Phongsavanh Bank in Lao at 1.22, ACLEDA Bank in Lao of 1.04, First Bank of Nigeria at 0.56 and the other two retail banks in PNG at 0.32 and 0.28.
The first quarter financial results also highlighted that BSP has not increased its fees since 2014 and today forgoes in excess of K90 million per annum in fee income from our fee reductions and waivers since 2014. In addition, BSP provides a large number of fee free services to its customers, far more so than our competitors do and BSP fees are generally much lower than those of our competitors’.”
Article courtesy of BSP
PNG Business News - May 26, 2021
BSP Group Records Net Profit of K203 Million
In the first quarter of 2021, South Pacific Financial Group Ltd recorded a net profit of K203 million. According to the bank, this is a 2.6 per cent decrease from the first quarter of 2020, owing to a decrease in net insurance revenue and a rise in computing costs. Some highlights included net assets of K3.6 billion, a cost to income ratio of 40.3 per cent, a capital adequacy ratio of 25 per cent, a provision coverage ratio of 5.7 per cent, a market capitalisation of K5.6 billion, and earnings per share of 43 toea. The last 12 months had been tough, according to Group Chairman Sir Kostas Constantinou, "but we did well with the profits that we achieved." “We have an excellent staff, everybody’s committed,” he said. “It is unfortunate with the Covid-19, but we progress forward now with the inoculation of our staff who are behind it. The intention is to do most of the branches. We have had problems through the Pacific, places like Samoa, Tonga which have been restricted because of tourism. The Cook Islands have opened up so we are yet to see what happens. In spite of this, Sir Kostas remained positive. “Good times are coming for Papua New Guinea with the recent announcements on the progress of some of the country’s resource projects,” he said. “We are fortunate that we have the Papua LNG project that has been successfully completed and is proceeding with Total who’s the lead partner doing the upstream and Exxon doing the downstream. These projects are K48 billion and right on our doorstep and there’s not a lot of countries in the world that have these types of projects.” The news about P'Nyang was also embraced, according to Sir Kostas. Reference: The National (24 May 2021). Bank records first quarter profit of K203 million
PNG Business News - May 26, 2021
Bank South Pacific Joins ASX
The Bank South Pacific Financial Group Ltd has had its application to join the Australian Securities Exchange (ASX) accepted. The bank will be listed on the ASX this week, according to Group Chief Executive Officer Robin Fleming, and shareholders will be able to transfer partial shares to the ASX. “We were listed on the PNGX (PNG Stock Exchange) in 2003 but because of the size of BSP, that market capitalisation was close to K5.6 billion,” he said. “And because of the size of BSP, it was difficult for shareholders to have larger partials of shares and actively trade their shareholdings. Being listed on the Australian Stock Exchange, shareholders can move their shares either in full or in parts to the ASX and, therefore, trade their shares far more easily on a very liquid stock exchange market. PNG resident shareholders still have to go through a process in making sure their compliant with the Internal Revenue Commission (IRC) and Bank of PNG guidelines in respect to exchange control as to how they deal with any share sales. But once they move to the Australian stock exchange, they then have the capability to trade their shares far more readily and in a far more accessible format than is the case for PNG. He added, “While we have a good shareholding base in PNG because of BSP’s success, the composition of BSPs investment and the portfolio of some of the superannuation funds which is very high, we’ve been successful. Our portfolio continues to increase and even if they want to trade more actively, it is constrained by the absence of liquidity in PNG.” Sir Kostas Constantinou, the bank's chairman, said it was a watershed moment for the bank, allowing it to collect money and grow more. “It gives us liquidity, it gives our shareholders liquidity so that they can buy and sell shares and trade on the Australian Stock Exchange,” he said. Reference: The National (24 May 2021). BSP set to start trading on ASX
PNG Business News - March 31, 2021
BSP Changes Group Name
BSP Financial Group has replaced Bank South Pacific Limited as the company's name. Sir Kostas Constantinou, Chairman of the BSP, revealed this last week. The shareholders approved the name change, as well as other legislative amendments, according to Sir Kostas. BSP will now proceed with the filing of its application for listing on the Australian Securities Exchange (ASX). “The notice of the meeting is currently subject to advise and approvals, which are expected to be finalised during March 2021,” Sir Kostas said. According to BSP Group CEO Robin Fleming, the proposed ASX listing would provide access to new pools of capital on Australia's largest market. “While BSP has been listed since 2003 on the PNGX, there are a number of constraints that BSP faces in sourcing new forms of equity capital,” he said. “Accordingly, BSP is pursuing the proposed listing as a means of mitigating some of these constraints. Access to new sources of capital will allow BSP to explore future growth opportunities. Another benefit of joining the ASX is that it will facilitate increased liquidity for BSP’s shareholders (trading of BSP shares). The ASX is a much deeper (larger pool of investors) and (more) active market than the PNGX. Accordingly, shareholders will find it easier to trade BSP shares on the ASX.” The visibility of BSP would increase if it joined the ASX, according to Fleming. “It will provide the opportunity to better educate the international marketplace in relation to BSP and PNG,” he said. BSP's shares would be exchanged on both the PNGX and the ASX if authorised. When asked about the name change, CEO Robin Fleming confirmed that the iconic trade name of BSP would continue to be used throughout the Pacific.
PNG Business News - May 16, 2022
Get over it... with PNG Forest Products' NiuBridge
Photo: NiuBridge on the Boluminski Hwy, New Ireland, PNG You know how they say, “Build a bridge… and get over it”? Well with PNGFP NiuBridge you don’t have to build it, because it’s already built! These expertly designed and engineered modular bridges are prefabricated to your specifications by PNG Forest Products. With a design life of 50+ years and installed cost base typically under half that of equivalent concrete or steel, NiuBridge is the ideal, most cost-effective solution for bridging installations in Papua New Guinea. The NiuBridge System includes deck, girders, kerbing and accessories, and comes with a pre-applied bitumen surface. Little maintenance is required thanks to PNGFP’s unique veneer preservation treatment, ensuring complete protection from termites and rotting. NiuBridge is manufactured from PNG plantation pine to both AS/NZS 2269 and AS/NZS 1604 standards and exploits the advantages of natural timber, which is not subject to fatigue failure, unlike other materials such as steel and concrete. Available in single lane, dual lane, or custom design, NiuBridge is suitable for a range of load conditions including Austroads T44 and AS 500 Bridge Design. NiuBridge and sister product NiuDeck are widely used by local and state governments across Australia. The peak body for the timber industry in Queensland has welcomed these products as a demonstration of the versatility and innovation of using Engineered Wood Products in bridge construction. “Using prefabricated timber systems in bridges is gaining greater market recognition due to their inherent strength, light weight and low carbon emissions footprint compared to other construction materials”, said the CEO of Timber Queensland, Mick Stephens. So next time you need to get over it, don’t waste valuable time and loads of money building a bridge. Buy a NiuBridge and get over it sooner and more cost effectively!
PNG Business News - May 16, 2022
Need help with to live, work and study in Australia and with student enrolments in EQI accredited schools? Ask Migration Plus!
Photo credit: Migration Plus Migration Plus is a leading Migration firm in Cairns, in the Far North Queensland region providing professional migration advice to students, individuals, government, businesses and corporate groups including the mining, hospitality, tourism, agricultural and air services industries. Migration Plus are also Education Agents with Qualified Education Counsellors on their team and they represent a number of reputable universities and colleges across Australia, including Education Queensland International (EQI) for student enrolments. They work closely with EQI and have successfully assisted PNG students enrol in schools across Queensland and also assisted with visa applications for the students for many years. With Australian borders opening to international visitors, temporary workers and international students, they can assist you with all migration matters for your business and family to visit, work or study in Australia. Now is the time to start your children’s enrolment to study in any of the EQI’s accredited schools from Prep to Year 12. Education Counsellors at Migration Plus can assist your children’s enrolment for Year 10, Semester 2, the important pathway into senior high school subjects through the Senior Education and Training Plan. Semester 2 commences in July 2022. With an in-depth knowledge of migration law, their specialist team provides a complete solution to your migration requirements and coordinate all facets of your migration needs. The Migration Plus team is very passionate about what they we do – the rewards of being able to assist in changing lives and helping clients achieve their goals is first and foremost. With over 90 years of combined experience available to you, you can count on their highly specialised team for accurate advice. Contact the Specialist team for further information.
Marcelle P. Villegas - May 16, 2022
Australia Opens Its Doors to International Students
Photo credit: Education Queensland International “International students are an important part of the Australian community, and we are excited to welcome them back to our classrooms, campuses and communities.” This was the announcement posted on their website by the Australian Government last February to herald the reopening of international travel to students. “Australia’s borders are open to fully vaccinated international students and Temporary Graduate (subclass 485) visa holders.”  “From 21 February 2022, all visa holders who are fully vaccinated for international travel purposes can travel to Australia without a travel exemption. Unvaccinated visa holders will still need to be in an exempt category or hold an individual travel exemption to enter Australia.”  The Australian Government said that international students will be subject to Australian Government border restrictions and any State and Territory quarantine and testing requirements. Quarantine and testing arrangements for State and Territories are frequently changing. Therefore, international students are advised to visit www.Australia.gov.au/states to be updated with the latest information and announcements of the Australian Government. In relation to this, the Department of Education, Skills and Employment has developed a “factsheet on the reopening of international travel to students” which is available for downloading from the website.  “All visa holders who are fully vaccinated in accordance with Australia’s international border entry requirements are able to arrive in Australia without needing an approved travel exemption. This includes fully vaccinated international students.”  Here are more important reminders from the Australian Government: People who do not meet Australia’s vaccination requirements for international travel must apply for a travel exemption to travel to Australia, unless they are in an exempt category. Visa holders who arrive in Australia may have their visa cancelled and be detained and removed if they: are not fully vaccinated for international travel purposes in accordance with Australia’s border entry requirements; or do not have a medical contraindication to a COVID-19 vaccine as defined by the Australian Government; or are not in an exempt category or hold an individual travel exemption. To be considered as “fully vaccinated for international travel purpose” to or from Australia, one should have completed a primary course of a vaccine approved or recognized by the Therapeutic Goods Administration (TGA). This includes mixed doses. The currently approved or recognised vaccines for travel are the following: Two doses at least 14 days apart of AstraZeneca Vaxzevria, AstraZeneca Covishield, Pfizer/Biontech Comirnaty, Moderna Spikevax or Takeda, Sinovac Coronavac, Bharat Biotech Covaxin, Sinopharm BBIBP-CorV (for people under 60 years of age on arrival in Australia), Gamaleya Research Institute Sputnik V, Novavax/Biocelect Nuvaxovid. Single-dose dose of Johnson & Johnson/ Janssen-Cilag COVID Vaccine are also in the list of approved and recognized vaccines. “At least 7 days must have passed since the final dose of vaccine in a course of immunisation for you to be considered fully vaccinated for international travel purposes. Mixed doses count towards being fully vaccinated as long as all vaccines are approved or recognised by the TGA.” How about exceptions for vaccination requirements and arrangement for children? “People with acceptable proof they cannot be vaccinated for medical reasons, and children under 12, can access the same travel arrangement as people who are fully vaccinated for international travel purposes.” Moreover, temporary visa holders who are younger than 18 years old at the time of departure for international travel to Australia do not require an approved travel exemption when the child is travelling with at least one adult who is fully vaccinated for international travel purposes. “Unvaccinated or partially vaccinated children aged 12-17 years old entering Australia may be exempt from passenger caps and eligible for reduced quarantine requirements. Travellers should always check the quarantine requirements for the state or territory they plan to travel to, or transit through, prior to arranging their travel.” “If the child is travelling with unvaccinated adult family members, then the entire family group will be subject to managed quarantine and passenger caps.” For more information on vaccination travel requirements, quarantine rules, and other related matter, visit https://covid19.homeaffairs.gov.au/vaccinated-travellers. Reference:  https://www.dese.gov.au/reopening-international-travel-students  https://covid19.homeaffairs.gov.au/vaccinated-travellers  Factsheet on the reopening of international travel to students https://www.dese.gov.au/reopening-international-travel-students/resources/factsheet-reopening-international-travel-students