Rs 8.8 billion profit to shareholders:
NDB Group records phenomenal results
Financial year 2012 proved to be an year of record performance for
NDB as it reported a 37 % and 45 % increase in profit before tax (PBT)
and profit after tax (PAT) respectively, with its asset base recording
an increase of 17 % over December 31, 2011. These growth levels resulted
in a PBT of Rs. 4.6 billion and PAT of Rs. 3 billion.
Hemaka Amarasuriya and Russell de Mel |
However, it is noteworthy to mention that the share of profits
available for shareholders at a group level increased significantly by
227 % to Rs 8.8 billion, due to the capital gains of Rs 6 billion
generated as a result of the divestment of the investment in AVIVA NDB
Insurance PLC to American International Assurance (AIA) Company Limited
of Hong Kong during the fourth quarter of 2012.
The Net Interest Income of the bank increased by 26 % over the last
year with other income from fees, commission and forex income increasing
by 22 % to Rs. 2.3 billion.
On the operating expenses side, gross administrative expenses
increased with a controlled growth of 16 % over last year.
Provisions for loan losses for the period were reported at Rs. 94
million for the year compared to the reversal of Rs 326 million in 2011,
due to provision recoveries/releases of Rs 426 mn in 2011.
The asset base of the bank grew to Rs. 162 billion as at December 31,
2012 from Rs. 138 billion as at year end 2011 indicating continued
acceleration of development financing activities by the bank.
Advances (gross) of the bank was Rs. 119.2 billion with an increase
of 18% over 2011, mainly on account of growth in the SMEs, agriculture
and the service sectors.
The deposit base of the bank increased by 31%, with a 10% and 60%
increase reported in current and saving deposits respectively, improving
the CASA percentage substantially.
The bank also achieved a 21% return on equity and reported improved
Earnings Per Share (EPS) from Rs 12.25 in 2011 to Rs 17.74. However, the
Group EPS for 2012 is significantly higher at Rs 53.82 due to the
capital gain of Rs 6 billion earned by the NDB Group from divesting NDB
Group’s holding in AVIVA NDB Insurance PLC to AIA.
The balance sheet growth of the NDB group of 21% from the previous
financial year points to a sound financial position and the
shareholders’ equity base increasing by Rs 8 billion to Rs 25 billion.
This significant surplus in shareholder funds within the NDB group will
result in the Bank having ample opportunities in moving forward to
benefit from development opportunities in the country and in the region.
During 2012 the Bank expanded its distribution network by opening
nine branches.NDB continued to remain focused on driving the SME
business segment and opened four more dedicated SME Centres in Kandy,
Anuradhapura Matara and Kalutara. NDB’s SME Centres aim to provide a
one-stop-shop for the diverse needs of entrepreneurs. They are equipped
to provide 360 degree solutions ranging from financial expertise on SME
Banking services, industry expertise for those who intend to start up
new business ventures to investment and capital management advice along
with a gamut of customized credit facilities. The bank also conducted
SME workshops in several regions. |