– pays its highest dividend ever

By Navendra Seoraj

DEMERARA Bank Limited has managed to evade the debilitating effects of the dreaded novel coronavirus (COVID-19) pandemic, recording $2.2 billion in profit for the financial year which ended on September 30, 2020.

While other sectors have recorded losses, Demerara Bank, through prudent management, planning and efficient deployment of resources, has managed to not just record a profit, but surpass its profit for 2019 by four per cent.

Owing to the profit, the bank’s board of directors recommended a final dividend payment of $1.25 per share while the interim dividend paid was $0.25 per share. This brings the total dividend payments to $1.50 per share for the full year– the highest in the history of the bank. Payment of dividend is subject to Bank of Guyana and shareholders’ approval.

“Despite an exceedingly difficult year, owing to the challenges of COVID-19 and the election impasse, the bank has done well for the year ended September 30, 2020 due to the prudent management and planning and efficient deployment of our resources,” said Chairman of Demerara Bank, Dr. Yesu Persaud, in his report included in the bank’s financial statements.
The global economic outlook remains uncertain due to the challenges of COVID-19, said Dr. Persaud, adding that Guyana and the bank have been no exception to the effects of this health pandemic, which has stalled economic progress and placed many persons on the breadline.

As cases continue to increase, both globally and locally, the chairman said it remains important for Guyanese to ensure that the health protocols are observed to curb the spread of the virus.

“We are grateful to our customers, the board of directors, management and staff of Demerara Bank at all levels. We shall continue to work for the betterment of Guyanese in Guyana’s economy and we hope that an effective vaccine would soon be available to alleviate this global health pandemic,” said Dr. Persaud.

It was reported recently that Guyana is the only country in the Caribbean and Latin American region projected to have positive real Gross Domestic Product (GDP) growth, pegged at 26.2 per cent, in spite of the ramifications of the COVID-19 pandemic, according to the International Monetary Fund (IMF).

The World Economic Outlook Report (WEO), published by the IMF and released this month, states that Guyana’s GDP is expected to grow by 26.2 per cent for 2020. Additionally, this report also projects that Guyana’s economy will grow by 8.1 per cent in 2021. In 2019, Guyana’s real GDP grew by 5.4 per cent.

In April, Guyana’s economy was projected to grow by 52.8 per cent, a revision to the pre-pandemic 86 per cent growth projection. That revision came about as a result of the less-than-usual global demand for oil due to pandemic and the oil-price war between Russia and Saudi Arabia.

Guyana’s growth is largely attributed to its nascent oil and gas sector. Vice-President, Bharrat Jagdeo, at a pre-budget press conference in August, said that Guyana’s oil economy grew by 45.9 per cent, but the non-oil economy, which comprises the traditional, labour-intensive sectors, shrunk by 4.9 per cent in the first half of the year.

Though Guyana’s 26.2 per cent is lower than the previous GDP growth projections for Guyana, the country is the only nation in the Caribbean and Latin America which is projected to record positive growth, despite the wide-reaching impact of the COVID-19 pandemic.

The entire Caribbean and Latin America region is projected to grow by -8.1 per cent, but this contraction is an upward revision of the previous projection of -9.4 per cent in June.