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by Ravi Ladduwahetty

The DFCC Bank sees opportunities through the recovery of the national economy, accelerated privatisation and investor confidence which could translate into better prospects for the bank's core business of long term lending and also for new business for the shorter end.

Chairman of DFCC Bank Mahinda Wijenaike has told shareholders in his annual report that the reforms expected in the financial sector which present the bank with new opportunities offer its clientele a wider range of products and opportunities than those offered now.

Commenting on the relationship with the Commercial Bank of Ceylon Ltd, he said that the two institutions have jointly submitted a proposal for the holding company corporate structure. However, the regulatory authority did not wish that we structured our partnership in the manner proposed. There have been some unwarranted accusations that the DFCC Bank has acted in a hostile manner towards the Commercial Bank when formulating the proposals for a holding company structure.

"This is untrue and I wish to state that the Board of Directors were willing to proceed in a way which addressed the concerns that were communicated to us by the commercial banks. It was disappointing that we did not proceed," Wijenaike has told shareholders.

Looking ahead, the DFCC Bank sees significant opportunities in infrastructure development and the provision of services such as power and energy, telecommunications information and healthcare and a role in rehabilitation if peace is achieved.

DFCC Bank's Director/ CEO Nihal Fonseka has told shareholders in his annual report that the depressed economic conditions and the high interest rate environments were not conducive to investment banking activities, despite the bank's support for both the large and the small scale industrial sector by approving loans and other credit products valued at Rs. 10,453 million.

The high interest rates during the first half of the year and the political uncertainty in the second half affected the utilisation of approved facilities. These factors saw the loan disbursements roughly equalling repayments resulting in only a marginal growth in loan portfolios. The financial performance of the company revolves round a Rs. 4 billion turnover for the year ended 2002, up from Rs. 3.4 billion a year ago, an operating income of Rs. 1.8 billion, up from the Rs. 1.3 billion a year ago. Profit for the year has also improved to Rs. 837 million, up from the Rs. 627 million a year ago. The Earnings Per Share has risen to Rs. 20.26 from Rs. 14.83 between the two years.

The Board of Directors of DFCC Bank comprises: E.M. Wijenaike (Chairman/ Managing Director), M.J.C. Amerasuriya, T. Caglan, Ms M.A.R.C. Cooray, Sarath De Silva, A.N. Fonseka (CEO), G.A.E. Gunatilake, Dr. T.N. Jinasena, M.L. Mack, M.R. Prelis and Rienzie.T. Wijetilleke.

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Copyright 2001 The Associated Newspapers of Ceylon Ltd.
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