Boasting a seventh consecutive year of record earnings, the Bank of Bermuda outlined its restructuring strategy throughout the year and plans for the future in the 1999 annual report, released to the Press yesterday.

Over the past three years the bank has restructured to focus operation on the three core areas under corporate clients, private clients and retail services.

In the corporate services area the bank has added to its cash management services through a single corporate account and sub-accounts allowing clients to operate in a multiple of currencies.

The bank has been expanding foreign exchange services to 24-hour dealings in over 50 currencies through the Hong Kong, Luxembourg and Bermuda offices. The corporate credit team was restructured to develop relationships with insurance companies and multinationals. The team was centralised in London, with analysts in Hong Kong and Bermuda. The introduction of mandatory pension schemes in Hong Kong and the focus on private arrangements in some European markets are expected to bring more money to investment funds over the next ten years.

Hong Kong is projected to have annual inflows of US$4 billion in 2001. The bank is taking full aim at the market to get a "significant market share of the underlying investment business''.

The bank also completed the transition of the company's New York State Chartered Bank to a limited purpose trust company increasing the ability to provide offshore fund administration services from the US.

Electronic commerce is a developing area with the corporate client services.

The bank's alliance in May with First E-com.com is targeted at Asian merchants and allows them to provide e-commerce sales in their own currencies.

The bank has also developed a multi-currency transaction platform for the Internet which it hopes to market to corporate clients and other banks during the current fiscal year.

Corporate banking revenue rose 60 percent and assets under administration was $65 billion. In the private banking area Bank of Bermuda stated that it had substantially restructured the division over the past fiscal year.

The private banking business, for those with investable assets of $1 million or more, is projected to grow at nine percent a year worldwide for the next five years.

In extending its international network the bank bought private Swiss-based Banque Notz Stucki SA in partnership with Beat Notz, Christian Stucki, Christoph La Roche and Banco Santander (Suisse).

Money management services were extended through the development of the flagship All Points Multi-Manager giving clients access to money managers worldwide.

Bank sets out strategy Private clients net income was up 10 percent for the year.

The retail clients division has introduced technology for secure internet transactions and multi-currency settlement. During the year the bank's financial service department was integrated into the division. The bank also purchased outright the remaining shares in deposit company Bermuda Home Ltd.

The bank expects the implementation of the pension plan legislation by January 1, 2000 will increase contributions in Bermuda by $120 million. A pension plan section, to manage and administer plans has been set up.

Total revenue in the retail clients group rose 38 percent.

As reported previously by The Royal Gazette the bank had net interest income of $146.22 million in the year to June 30, 46 percent over the $100.06 million in 1998. Operating income was $81.2 million, 17 percent over the 1998 figure of $69.38 million.

Net income was a record $76.27 million, a 25 percent increase over $61.15 million the previous year. Total shareholder equity was $490.89 million. Basic net income per share was $3.77 compared to $3.04 in 1998.

In the year to June 30 the loans to customer deposits ratio shifted to 16.46 percent from 10.04 percent. The cash, deposit assets and securities to customer deposits ratio fell to 88.89 percent from 93.78. The return on common shareholders' equity rose to 16.32 percent from 14.58 percent.