PB hits record profit in 2006

PROFIT: The People’s Bank has recorded over Rs 4.2 billion profit before taxation in the 2006 financial year while profit before tax for the group surpassed at Rs 5.1 billion.

The bank’s unaudited financial shows 20.8% growth in profit after tax last year and profit before taxation has showed 4.7% increase in the 2006.

Speaking to the media Senior Deputy General Manager (Corporate and Institutional Banking, Domestic and Development Credit) of the People’s Bank Kapila Ariyaratne said key sectors such as pawning, housing, SME lending and lending for business showed excellent growth last year.

Bank’s total deposits grew by 19.7% last year taking the total deposits to Rs 270 billion.

The student savings grew by 47% and current accounts grew by 45% while Vanitha Wasana savings showed 30% growth. Bank managed to maintain high level of customer services and this has resulted in rapid growth of deposits.

Net loans and advances grew by 45% to Rs 207 billion last year. Non Performing Loan (NPL) ratio has declined to 7% last year due to high quality in lending and implementation of recovery program. The bank was able to recover Rs 1.8 billion last year.

In 2005 NPL ratio was 11%. Lending to SME and micro sectors grew by 65% and there was a very good recovery rate in this segment, he said.

The bank’s contribution to the government in the form of taxes and levies increased by 11.5% to reach Rs 3.6 billion.

Chairman of the People’s Bank Dr P.A. Kiriwandeniya said that the bank is in the process of developing a corporate plan targeting Government’s 10 year development program.

‘Through this plan we expect to develop the entrepreneurship in the country. Bank is also targeting sectors such as paddy, dairy and tea smallholders under the plan, he said.

CEO/ GM of People’s Bank Asoka de Silva said that in 2007 they will focus on improving SMI portfolio, customer relationships and increasing foreign remittances. ‘We will specially focus on NRFC inward remittances in Middle East, South Korea and Europe, he said.

The Bank is also concentrating on minimising the cost income ratio this year. Investing in advanced technology and HR development is another target for this year.