Sri Lankaâ€™s Seylan Bank September net down 6.1-pct
ECONOMYNEXT – Profits at Sri Lanka’s Seylan Bank fell 6.1 percent from a year ago to 1.1 billion rupees in the September 2018 quarter, on falling foreign exchange and investment income and higher bad loan provisioning, interim accounts showed.
The bank reported earnings of 3.13 rupees per share in the quarter. For the nine months ending September 2018, earnings were 8.54 rupees a share, on a profit of 3.1 billion rupees, down 11 percent from a year earlier.
Seylan Bank was trading 2.70 rupees higher on Monday at 70 rupees.
In the September quarter, net interest income grew 5.9 percent from a year ago to 4.4 billion rupees, as interest income grew 9.14 percent to 12.3 billion rupees and interest expenses increased a faster 11 percent to 8 billion rupees.
Net fee and commission income grew 1.32 percent to 991 million rupees.
Trading income was 502 million rupees, up from a trading loss of 202 million rupees a year ago.
Foreign exchange losses were 184.7 million in the quarter, down from a profit 401.9 million rupees a year earlier.
Bad loan provisioning had increased 121.2 percent to 581.9 million rupees, mostly due to the adoption of new accounting standards IFRS 9.
An assessment of the new accounting standard at end December 2017 had shown that bad-loan provisioning would increase by about 30-45 percent, the bank said.
Bad loan provisioning also increased as non-performing loans rose in the September quarter.
Non-performing loan ratio increased to 5.6 percent at end September 2018, up from 4.4 percent at end December 2017.
Seylan Bank’s loan book grew 11.7 percent from nine-months earlier to 313.7 billion rupees at end September 2018.
The bank’s deposits grew 8.8 percent to 334 billion rupees.
Total tier 1 capital ratio was 10.19 percent, above the minimum requirement of 7.88 percent, but lower than the 11.16 percent recorded in December 2017.
Seylan Bank’s total capital ratio was 13.54 percent, above the minimum requirement of 11.88 percent and slightly higher than the December 2017 number of 13.25 percent. (COLOMBO, 29 October 2018)