Deposits grow by Rs 6.6 bn a month to Rs 588.9 bn; Loan book up 19% to Rs 481.9 bn
The Commercial Bank of Ceylon PLC has reported Profit Before Tax of Rs 12.190 billion for the nine months ending 30th September 2015, achieving a creditable 8.72 percent growth despite narrowing margins and substantially lower capital gains in comparison with the same period of the preceding year.
The Bank’s Profit After Tax of Rs 8.426 billion at the end the third quarter reflected growth of 7.96 percent, while Gross Income at Rs 56.694 billion was an improvement of 4.58 percent, according to interim financial statements filed with the Colombo Stock Exchange by Sri Lanka’s largest private bank. Profit Before VAT and NBT was up 8.51 percent to Rs 14.235 billion.
Interest Income for the nine months improved by 4.53 percent to Rs 48.605 billion, while Interest Expenses grew by a lower rate of 1.08 percent to Rs 26.207 billion, helped by the growth of low cost funds in the Bank’s deposit mix in the review period. Consequently, Net Interest Income grew by a higher rate of 8.88 percent to Rs 22.398 billion.
Other Income at Rs 7.432 billion was on par with that of the corresponding nine months of the previous year, during which the bank posted substantial capital gains on bond trading. The figure for 2015 was helped by an increase of Rs 554.6 million in net gains from trading, an increase of Rs 652.8 million in Recoveries, Exchange Profit and Investment Income, and an improvement of Rs 316.434 million in Net Commissions and Fees, the Bank said.
Commenting on the Bank’s performance up to the third quarter, Commercial Bank Chairman Dharma Dheerasinghe said: “The figures are a good indication of how the Bank has kept its momentum going throughout the review period in the face of changing conditions and reduced margins.
We have also had robust deposit and loan growth in the review period and hope to end the year with a characteristically solid result.”
Commercial Bank Managing Director/CEO Jegan Durairatnam noted that the impact of factors such as the absence of bond trading income and less favourable interest rates in 2015 had been effectively mitigated by the Bank’s strong attention to improving volumes in core business areas. “A focus on getting the fundamentals right has always been one of the strengths of Commercial Bank, and helps us navigate challenging conditions,” he said.
Loans and Receivables to other customers grew by a healthy 18.87 percent over the nine months to Rs 481.923 billion as at 30th September 2015, an increase of Rs 76.491 billion since end 2014, and a growth of Rs 94.474 billion or 24.38 percent YoY.
Deposits from customers totalled Rs 588.917 billion at the end of the nine months reviewed, up Rs 59.556 billion at an average of Rs 6.6 billion per month since 31st December 2014. Year-on-Year growth of the Bank’s deposit base was Rs 84.756 billion or 16.81 percent.
Total assets grew by 9.72 perccent since end 2014 to Rs 872.923 billion as at 30th September 2015, an increase of Rs 77.314 billion over nine months, and a YoY improvement of Rs 125.634 billion or 16.81 percent.
Loan growth and good management of non-performing loans enabled the Bank to reduce its Gross and Net NPL ratios to 3.01 percent and 1.52 percent respectively, from 3.84 percent and 2.1 percent a year ago.
The Bank’s Interest Margin declined from 3.91 percent at end September 2014 and 3.88 percent at end 2014 to 3.59 percent at the end of the review period.
At Group level, Commercial Bank, its subsidiaries and associates reported Profit Before Tax of Rs 12.225 billion for the nine months, an improvement of 8.28 percent, and Profit After Tax of Rs 8.435 billion, an increase of 7.43 percent.
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