million, and return on equity and operating efficiency also improving. The results have delighted management. Mairi Mallon reports.

The Bank of Bermuda has seen profits soar by 44 percent to record levels for the eighth year running, according to figures released yesterday.

The bank recorded a net income this year of $106.1 million, compared to $73.6 million in 1999. It is the first time the bank has gone over the $100 million mark.

The 2000 year end figures to June 30 showed that diluted earnings per share were $4.47, up from $3.22 last year.

President and Chief Executive Officer of the bank, Henry Smith, said he was delighted at the results adding the high profit margins were due to the hard work of the over 2,000 Bank of Bermuda staff.

"We are obviously delighted with these results. Our strong performance highlights an enduring demand for our relationship-based approach, as well as our success in creating the global products and services our clients require.

"In both these respects the bank's performance is due to the commitment and creativity of our talented staff, whom I would like to thank for their superb performance during the current year.'' The increase has been attributed to both an increase in earnings and efficiencies in operating costs.

Bank announces record results In 1993 the company's net income stood at just $35.9 million. Since then it has nearly tripled in eight years.

Edward Gomez, Chief Financial Officer at the bank said: "This marks our eighth consecutive year of record earnings and the first time in Bank of Bermuda's history that net income has surpassed $100 million.

"This year's performance also sets new records for return on equity and operating efficiency. The 44 percent annual increase in earnings, which follows last year's 25 percent increase, was driven by the increasingly effective delivery of our client-focused products across a well placed international franchise.'' Mr. Gomez also said that the result reflected solid growth in all the company's lines in all regions as well as tighter controls on operating costs.

He added: "Of particular note is the continued growth of our private clients business, which brings added strength and balance to Bank of Bermuda's fee-based revenues.'' Revenues totalled $419 million, up 18 percent from $354 million last year.

The increase was attributed by the bank to "broad-based fee revenue growth and continued strength in interest earnings''.

Net Interest Income was $181.3 million, up 26 percent on the year before.

Operating expenses totalled $304 million, up 11 percent on last year.

This increase was attributed to higher salaries and related costs as well as annual pay rises at the beginning of the year. Systems costs rose 9 percent after Y2K preparation. Marketing and corporate expenses rose 5 percent, while the cost of property fell 4 percent due to sayings in Bermuda and the Far East.

Assets stood at $10.4 billion, compared to $9.6 billion the year before. These assets were made up of reinvestment of customer deposits, which grew because more money was left in cash deposit balances due to uncertain financial markets, the bank said.

Total shareholders' equity increased from $120 million in 1999 to $604 million at the end of the 2000 financial year. The bank said this reflected the retention of earnings and the exercise of the bank's millennium warrants during the current year.

Henry Smith