Bad loan provisions prune Sri Lanka HNB’s December quarter profit
ECONOMYNEXT- Sri Lanka’s Hatton National Bank Plc said its net profits for the December 2018 quarter fell 19 percent from a year earlier to 3.8 billion rupees due to provisioning for bad loans.
Interim financial statements of the bank said its earnings per share for the quarter was 9.47 rupees.
For the 2018 year, HNB’s net profits grew 11 percent to 17.6 billion rupees, while earnings per share was 35.80 rupees.
HNB shares closed trading 1 rupee lower at 197 rupees on Tuesday.
Interest income for the December quarter grew 19 percent from a year earlier to 31.8 billion rupees, while interest expenses were up 11 percent to 16.8 billion rupees, resulting in net interest income growing 29 percent to 15 billion rupees.
Fee and commission income was up 22 percent to 2.9 billion rupees, while a net gain of 863.4 million rupees was made on trading, compared to a net loss of 949.3 million rupees in 2017.
Provisioning for bad loans grew 405 percent to 4.5 billion rupees.
HNB group’s loan book grew 17 percent from a year earlier to 770.3 billion rupees at end-December.
Deposits at the bank grew 14 percent to 818 billion rupees.
The total asset base of the bank grew 14 percent to 1.1 trillion rupees, while net assets per share were up 6 percent to 269.28 rupees.
Core capital ratio was 13.16 percent, down from 13.68 percent a year earlier, against a minimum requirement of 8.875 percent.
Total capital adequancy was at 15.41 percent, down from 16.72 percent against a minimum of 12.875 percent.
At the bank level, HNB’s bad loans grew to 2.78 percent from 2.28 percent a year earlier.