[Business Banking]

Fitch affirms HSBC Lanka's 'AAA(lka)' rating

Fitch Ratings has affirmed HSBC Sri Lanka's (HSBCSL) National Long-term rating at 'AAA(lka)'.

The outlook on the rating remains stable.

HSBCSL is a branch of the Hongkong & Shanghai Banking Corporation Limited (HKB) and its rating is linked to HKB's 'AA'/Stable Outlook foreign currency Issuer Default Rating, as well as HKB's financial strength.

HKB is HongKong's largest banking group and is a wholly-owned subsidiary of HSBC Holdings Plc. ('AA'/Stable Outlook).

HSBCSL's loan growth slowed considerably in FY07 with a growth rate of just 6.0% yoy, which was well below the 16.5% growth witnessed by the domestic private Licensed Commercial Bank (LCB) sector.

Growth picked up in Q108 however, with the bank's loan portfolio growing by 10.7% in Q1 alone.

The loan portfolio is fairly well diversified and covers both corporate (large multinationals and medium scale corporates and an increasing SME exposure) and retail (credit cards, housing, personal installment loans) segments, which respectively accounted for 54% and 46% of its portfolio as at FYE06.

Asset quality, although strong by Sri Lankan standards, weakened in FY07 as evidenced by a gross NPL/loans ratio of 3.7% at FYE07, up from 0.97% at FYE06.

The deterioration was primarily a result of increased delinquencies on credit card advances, residential housing loans, and loans to medium-sized corporates.

In the face of the unfavourable macroeconomic environment, the bank has since tightened its credit underwriting standards in consumer banking (and credit cards in particular) and increased its focus on collections and recoveries during the latter part of FY07.

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NDB Bank among Sri Lanka's Top 10 companies

NDB Bank, the fastest growing commercial bank in Sri Lanka, was presented an award for being among the top 10 Sri Lankan Companies in Sri Lanka, selected by the leading business magazine "Business Today".

President Mahinda Rajapaksa presented the award to the bank's CEO Eran Wickramaratne at a function held at the Temple Trees in Colombo.

NDB Bank is a dynamic entity within the NDB Group and offers a broad range of services and products in the fields of corporate and retail financing. In 2001, NDB Bank entered the commercial banking arena. The bank was recognised among the top ten companies resulting from an 84 per cent growth in profits of the NDB Group. NDB Bank has 40 branches supporting various business areas, Corporate banking, Project Financing, SME lending, Retail Banking, Investment Banking and Insurance.

NDB Bank plays a vital, unique part in the nation's finances at home and abroad and is widely regarded as an integral element in the landscape of Sri Lankan business and finance. NDB Bank recently took another step towards its plans for local and regional growth through the purchase of shares owned by Bank of Ceylon in the Capital Development & Investment Company Plc.

Fitch Ratings Lanka also reaffirmed the bank's National long-term rating of 'AA (lka)" reflecting the bank's "strong financial profile in terms of its high capital base, good profitability and asset quality".

NDB Bank is one of the strongest capitalized local bank's in Sri Lanka with a highest capital adequacy of 18.8%. The bank's efficiency is reflected positively by its return on assets ratio that stands at 1.4% (profit after tax) compared to the industry ratio of 1.2%. NDB Bank's cost income ratio is 45.7%, which is below the industry average.

With a quality portfolio and an efficient risk management process NDB Bank records a gross Non-Performing Loans ratio of 2.6%, the lowest in the industry among local banks.

In addition, other companies within the NDB Group offer wide ranging products and services including Insurance from Eagle Insurance Company, stock brokering from NDBS stockbroker and Investment Banking from NDB Investment Bank, among others, which when blended in with the services and products of NDB Bank, provide a fully integrated full-service financial institution that has the capacity to cater to a multitude of needs across a wide customer base.

With a mission to be dominant in the financial services sector, creating superior long-term shareholder value and contributing to economic development in Sri Lanka by exploiting regional opportunities and delivering innovative solutions, with best-in-industry service excellence, through an inspired team - NDB Bank is firmly on track to achieve its vision to be a World-Class Sri Lankan Bank.

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NSB introduces latest technology to remit money from Korea

National Savings Bank (NSB) as its national duty mobilises funds from the general public and invests these funds in profitable ventures and also are involved in collecting foreign remittances through proper legal channels - from those who are employed in abroad and all these activities are performed to benefit the Sri Lankan economy immensely.

Chairman, NSB Upali Gunarathne said NSB has launched various campaigns. He said from April 2008, for the first time in Sri Lanka , the National Savings Bank introduced a low cost, fast and convenient system known as Eurogiro to sending money from Korea to Sri Lanka.

This offers additional benefits to prospective customers who open NRFC/RFC Accounts with NSB or send money from Korea.

The National Savings Bank has joined hand with Korea Post , the biggest post office network in Korea, consists of 2800 post officers .

The additional benefits that would accrue with the opening of these accounts are: highest attractive interest rates; special benefits for housing loans including - lower interest rates for housing loans; reduced deposit period for eligibility for housing loans under the Ranmasu Savers Housing loans scheme; express loan within 24 business hours, option of online opening of NSB NRFC accounts etc .

Gunarathne said one of the main objectives of the present system is to make the remittance much easier to the Sri Lankan nationals working in Korea.

He said that in this business NSB is quite new and the Central Bank has given them to get the deposits for NRFC Accounts only in 2005. He said people are now aware of the NSB could offer this facility and the progress of the account opening is very much up to target.

If those who go abroad for employment wishes to open accounts at NSB all what the person should do is - before going abroad, visit the International Division or any branch of NSB, complete an account opening form and obtain an account number or they can open up an account through the web www.nsb.lk.