NTB demonstrates strong performance in 3Q

• Higher trading gains and sharp reduction in impairment charges boost bottom line

Nations Trust Bank (NTB) continued its solid financial performance into the third quarter of 2023, with a profit before tax (PBT) of Rs.19.4 billion and a profit after tax (PAT) of Rs.9.4 billion, a year-on-year (YoY) increase of 78 percent for the nine months ended on September 30. 

The bank recorded a 24 percent YoY growth in operating income for the nine months, supported by higher net interest income and fees as well as substantially lower impairment charges.
For the third quarter (3Q23), the bank reported earnings of Rs.10.39 per share or Rs.3.31 billion, compared to earnings of Rs.8.11 a share or Rs.2.59 billion reported for the corresponding period of the previous year.
The bank’s bottom line was boosted by trading gains and sharp reduction in impairment charges.

NTB Director and Chief Executive Officer Hemantha Gunetilleke said, “We’re pleased to report a strong result for the nine months to September 30, 2023, highlighting steady growth across our customer segments and gains in market share. The bank’s strengths lie in its continued focus on digital empowerment, robust risk management models and a strong capital base, in addition to healthy liquidity buffers.” 
NTB’s financial position remained strong with the Tier 1 capital adequacy ratio at 13.95 percent and total capital adequacy at 15.61 percent against the regulatory requirements of 8.5 percent and 12.5 percent, respectively. The statutory liquid asset ratio was 43.49 percent as of September 30, well above the regulatory requirement of 20 percent.

Proactive investment management, yields from fixed income securities, combined with the efficient cost of fund management, contributed to the growth in net interest income. The utilisation of low-cost funds generated through FX Swaps further enhanced interest margins, while fee-based income also experienced steady growth.  
The return on equity increased from 17.1 percent in December 2022 to 24.3 percent as of September 30, 2023.  The bank’s earnings per share also improved significantly, reaching Rs.29.53 for the nine months ending on September 30, 2023, compared to 16.56 during the same period last year.
John Keells Group owns about 29.5 percent of the issued shares of NTB.