UTC secures $1.4b income for 2021

The content originally appeared on: Trinidad and Tobago Newsday

THE Unit Trust Corporation (UTC) has reported a total income of $1.4 billion stemming from positive contributions from its nine mutual funds for the year ending December 31, 2021.

The financial institution held its 2022 annual general meeting on Thursday, virtually, under the theme For It is in Unity We Find Our Strength.

This year, UTC will also be celebrate its 40th anniversary.

Director Douglas Camacho said it was another historic milestone, with growth of seven per cent or $25.5 billion in total assets under management, an increase from $23.8 billion recorded in 2021.

“Of particular importance to us was our commitment to maintaining dividend distribution payments to our unitholders to provide support during these trying times and aid in our country’s economic recovery.

“We have once again upheld this distribution philosophy, paying out dividend distributions of $221 million in 2021,” Camacho said.

Executive director Nigel Edwards said UTC was able to capitalise on equity markets while mitigating the impact in fixed-income markets, which realised gains across the board and generated good results from its nine mutual funds.

“Our conscientious stewardship of the funds under our management is further reflected in a hat-trick of high ratings from Caribbean Information and Credit Rating Services (CariCRIS), the region’s leading rating agency.

“For the third consecutive year, CariCRIS awarded the UTC a CariAA rating on the regional rating scale and ttAA on the TT national scale. This recognition serves to affirm our diligent efforts to maintain excellent creditworthiness, strong cash balances and a robust risk management framework,” Edwards said.

He said distributions for the growth and income fund increased by 47.8 per cent or $10.8 million amounting to $33.6 million in 2021, an increase from $22.7 million in 2020.

UTC also reported an increase in net income of 25 per cent from $57.9 million in 2020 to $72.2 million in 2021; growth by five per cent in retained earnings pushing it to $1.6 billion; and a nine per cent increase in the group’s investment income due to improved dividend.

Edwards said, “These results speak for themselves, and we are on track to continue to deliver solid performance. This is evidenced by the 2022 first quarter figures of distributions to unitholders which totalled $46 million, net income of $29.7 million, and growth in retained earnings to $1.62 billion.

“Despite challenging local and global circumstances, the UTC continues to demonstrate our expertise in identifying opportunities while managing risk. We aim to build and maintain resilient portfolios that will provide you, our loyal unitholders, with the ability to weather turbulent conditions and enjoy excellent returns on your investments.”

Among the changes and advancements, Edwards added, were robust operational practices, technological transformation with the installation of its cloud infrastructure, installation of eight new ATMs which included an improved anti-skimming protection and contactless feature and expansion into the Jamaican market.

“We continued the development of our partnership in Jamaica via a strategic alliance with GraceKennedy, with whom we have signed a joint venture agreement.

“We are also in the process of securing regulatory approvals for a separate initiative in the Caribbean. In both territories, our expectation is that we will fully meet the regulatory requirements and begin the establishment of our footprint before the end of 2022,” Edwards added.

He said with improved financials there was anticipation that interest rates would increase but was not able to give a timeframe by which this would happen.

“Our distribution is dependent on the performance of the economy and the performance of the economy to a large extent driven by both local and international factors.

“The global interest rate environment appears to be an increasing interest rate environment; we are seeing across the world central banks increasing interest rates including most recently in the US. So, we do anticipate there will be some increased rates paid to investors as the markets move.” Edwards said.