ECONOMYNEXT – Sri Lanka’s Commercial Bank profits of 12.5 billion rupees in the September 2024 quarter, up 100 percent from a year ago, as interest income fell and credit to customers picked up pace, interim accounts show.
While credit to customers increased, investments in debt securities were down from a year ago.
Commercial Bank group reported earnings of 9.11 rupees per share for the quarter, and 22.63 rupees for the nine months on total profits of 31.07 billion rupees, up 118 percent.
Net fee and commission income was up 5.6 percent to 5.9 billion rupees.
Interest income fell 8 percent 73.7 billion rupees as rates fell, interest expenses fell at a faster 25 percent to 37.4 billion rupees, expanding net interest income 29 percent to 30.5 billion rupees.
“The challenge for banks operating in periods of low interest rates is to grow their portfolios while managing margins with timely adjustments,” Commercial Bank Chairman Sharhan Muhseen said in a statement.
Other operating income was 2.1 billion rupees, down from 6.8 billion rupees.
Loan loss provision were only 1.0 billion rupees, down from 12 billion a year earlier.
Commercial Bank Managing Director Sanath Manatunge said vigilant supervision of the quality of the loans portfolio, equitable and forward-looking management of impairment provisioning and timely repricing of assets and liabilities have brought results.
Consistent performance in volatile conditions enables the bank to continue to accelerate lending he said.
Loans to customers grew 9.47 percent to 1,287 billion rupees in the nine months to September. The bank said out of 121 billion rupee of loan growth 44 percent came in the September quarter.
Total capital adequacy rose to 17.2 percent from 15.15 percent. Amid credit growth Stage 03 bad loans fell to 4.08 percent from 5.85 percent.
Investments in debt instruments was down 2 percent from a year ago to 636 billion rupees.
At standalone bank level Tier I capital rose to 12.55 percent by end September 2024 from 11.44 in December 2023.
The bank’s gross assets grew 4.2 percent to 2,688 billion rupees. Net assets rose 16.6 percent to 250 billion rupees. (Colombo/Nov14/2024 – Update III)