ComBank’s 6-month PBT up to Rs 7.7 b
Exceptional balance sheet indicators, with deposit growth averaging
nearly Rs 7 billion per month and gross loan book growth of more than Rs
5 billion per month in the first six months of 2012 have combined with
strong gains in non-interest income to generate stellar 1st half results
for Commercial Bank of Ceylon PLC. ComBank reported profit before tax of
Rs 7.708 billion for the six months ended June30 2012, recording growth
of 34.06 % over the first half of the previous year, and profit after
tax of Rs 5.321 billion, an increase of 31.91 %, emphatically
reiterating its status as one of the country’s best performing corporate
entities.
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Dinesh Weerakkody, Chairman of
Commercial Bank and Ravi Dias, Managing Director/CEO of the
bank. |
“Clearly, public trust and confidence in the bank continue to grow by
leaps and bounds,” Commercial Bank Chairman Dinesh Weerakkody commented.
“We have achieved solid growth in deposits and a healthy increase in
lending in the six months under review, building further on our strong
performance of 2011.”
Ravi Dias, Managing Director and CEO of Commercial Bank said the
bank’s performance reflects its resilience even in challenging
conditions. “The solid foundation we have built and our continued
commitment to best practice and sound fundamentals has proven its value
in no uncertain terms,” he said.
The bank’s net income for the six months was up 40.29 % to Rs 16.550
billion, with interest income growing by 32.55 % due to the increase in
its loan portfolio. Non-interest income (foreign exchange & other
income) improved by 105.63 % to Rs 6.091 billion, mainly due to a growth
of Rs 2.930 billion or 329.35% in exchange income.
The increase in foreign exchange income was largely due to the
relatively higher volume of foreign currency operations of the bank and
the translation gains recognised consequent to the depreciation of the
Sri Lanka Rupee against the US Dollar during the six months period under
review. In addition, the other income of the bank, which mainly
comprises of commission income and investment income recorded an
increase of Rs. 198.6 million or 9.58%.
Net Interest income of the bank grew by 18.38 % over the
corresponding six months of last year to Rs 10.459 billion.
The main contributory factor for this increase in net interest income
was the increase in interest income on the loans and advances portfolio
of the Bank by Rs. 5.866 billion, or 44.25% during the six month period
under review. This was mainly due to the increase in the performing
loans and advances portfolio of the Bank by Rs. 29.094 billion, or
10.69%. At the same time, the total interest expenses of the Bank too
increased by Rs. 4.232 billion or 46.21% during the six months under
review primarily due to the growth in the volume of deposits of the Bank
by Rs. 41.826 billion or 13.13% to Rs.360.287 billion, and also due the
continued increase in the market interest rates.
Commercial Bank’s Total income for the six months was up 41.49% to Rs
30.393 billion. Total assets increased by 10.99% or Rs 48.489 billion,
from Rs 441.099 billion at 31st December 2011 to Rs 489.588 billion at
the end of the review period.
Net provisions for bad and doubtful debts increased to Rs 1.008
billion as against a net reversal of Rs 300.6 million for the first half
of 2011, made possible by the reduction of the general provision rate
from .9% to .7% between 1st January and 30th June 2011. The increase in
net provisions for bad and doubtful debts for the first half of 2012 was
mainly as a result of a more stringent provision policy adopted by the
Bank.
Non-interest expenses increased by 21.79% to Rs 6.783 billion,
largely on account of increased personnel costs and expenses linked to
the expansion of the Bank’s delivery channels in Sri Lanka. The Bank
opened five new service points and added 22 new terminals to its ATM
network during the period under review.
The Bank’s total capital adequacy ratio stood at 12.22% as at 30th
June 2012, as against the prescribed minimum of 10%. The gross
non-performing advances ratio increased from 3.43% as at 31st December
2011 to 3.66%, while the net non-performing advances ratio moved from
2.08% to 2.14% during the same period.
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