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Friday June 14th, 2024

Sri Lanka’s Commercial Bank profits inch up in Dec on lower income tax charge

ECONOMYNEXT- Commercial Bank of Ceylon Plc, Sri Lanka’s largest listed lender in assets, said profits for the December quarter grew 1.11 percent to 5.87 billion rupees from a year earlier on the back of lower income tax charges, largely due to a tax reversal on Sri Lanka Development Bonds (SLDBs).

The group in its interim financials reported 5.71 rupees in earnings per share. For the 12 months ended December, Commercial Bank earned 16.80 rupees a share on profits of 17.26 billion rupees, down 2.66 percent.

The firm’s share opened at 90 rupees on the Colombo Stock Exchange on Monday.

The Commercial Bank group posted 38.38 billion rupees in gross income for the December quarter, down 0.29 percent from a year earlier.

Interest income grew 2.24 percent to 31.93 billion rupees while interest expenses increased at a faster 2.78 percent to 20 billion rupees, leading to net interest income rising at a slower 1.35 percent to 11.93 billion rupees.

The group loan book grew 3.03 percent to 893.92 billion rupees at end-December from a year earlier.

Bad loans grew to 4.95 percent from 3.24 percent at the bank-level, but Commercial Bank said the rate fell from a peak 5.09 percent in September.

Group provisioning for bad loans in December grew 56.22 percent to 2.78 billion rupees from a year earlier. Commercial Bank said provisioning grew due to adverse economic conditions in 2019.

Net fee and commission income grew 0.82 percent to 3.07 billion rupees.

The group earned 1.66 billion rupees in gains from trading, up from a 1.74 billion rupee loss a year earlier, while net gains from derecognition of financial assets grew to 690.96 million rupees from 47 million rupees.

Commercial Bank said gains were made on trading in 2019 compared to 2018 as some loss-making foreign exchange swap transactions matured a year earlier.

Net other operating income fell 92.08 percent to 428.69 million rupees. Commercial Bank said earnings from foreign exchange transactions fell due to the rupee appreciating against the dollar in 2019.

The Commercial Bank operating profits before financial and income tax fell 23.10 percent to 8.02 billion rupees.

Income tax for the quarter fell 85.8 percent to 336.8 million rupees, partially helped by the tax reversal on interest income from Sri Lanka Development Bonds (SLDBs) with effect from April 1.

The dollar denominated SLDBs were made tax-free February, resulting in a one-off gain for income taxed for the past seven quarters, and lower taxes on earnings from the securities going forward.

The group net assets grew 12.59 percent to 134.42 billion rupees.

The Tier 1 capital ratio grew to 12.399 percent at end-2019 from 11.43 percent a year earlier against a minimum requirement of 10 percent.

Total capital ratio grew to 16.182 percent from 15.623 percent against a required 14 percent.

The bank’s return on assets fell to 1.66 percent from 2.09 percent, while return on equity fell to 13.54 percent from 15.56 percent. (Colombo/Feb24/2020)

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Sri Lanka opposition leader proposes Grama Rajya system in addition to 13A

Opposition leader Sajith Premadasa (r) – File photo

ECONOMYNEXT — Sri Lanka opposition leader Sajith Premadasa has proposed devolving power to the village level through a Grama Rajya system in addition to implementing the 13th amendment to the constitution.

Speaking at an event in Jaffna on on Wednesday June 12, Premadasa said all provinces will benefit from the 13th amendment.

“Whatever one’s ethnicity, religion, status or region, this country has citizens of equal level. They’re all Sri Lankan citizens.

“There is no division or grouping.  As we give you and every other province what you should be given through the 13th amendment, we must implement a Grama Rajya system,” Premadasa said, addressing a crowd of school children and other attendees.

Premadasa’s assurance of implementing the 13th amendment has already drawn some protest in the south.

A collective of civil society organisations held a protest outside the office of the leader of the opposition in Colombo on Thursday June 12.

Calling itself the ‘Coalition Against Partition of Sri Lanka’, the group carrying national flags marched up to the opposition leader’s office Thursday June 13 morning and demonstrated against the full implementation of the 13th amendment.

“We arrived here today to hand over a missive against devolving police powers, land powers and judicial powers. If Mr Premadasa is inside, come outside,” Jamuni Kamantha Thushara, Chairman of the Citizen’s Movement Against Fraud, Corruption, and Waste, was seen declaring at the site.

“First of all, tell us what we stand to achieve by dividing and giving away the north and east,” said another protestor, warning against bringing the 13th amendment “anywhere here (paththa palaathe)”.

A police officer at the scene the protestors that a secretary to the opposition leader was ready to accept their letter.

“In Kilonochchi, he says the 13th amendment will be implemented. The votes in the north are going to be decisive this election. To win those votes, President Ranil Wickremesinghe, Sajith and Anura Kumara Dissanayake all say they will implement the 13th. We will not allow this country to be divided into nine pieces,” said Thushara.

Ven Balangoda Kassapa Thero, who was arrested on June 06 during a protest against the new Electricity Act, was also seen at Thursday’s protest. The Buddhist monk requested for a debate with Premadasa on the matter of the 13th amendment. (Colombo/Jun12/2024)

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Sri Lanka rupee closes flat at 303.85/95 to US dollar

ECONOMYNEXT – Sri Lanka’s rupee closed broadly flat at 303.85/95 to the US dollar on Thursday, from 303.80/304.00 to the dollar the previous day, dealers said. Bond yields were down.

A bond maturing on 15.12.2026 closed at 10.00/30 percent, down from 10.20/40 percent.

A bond maturing on 15.10.2027 closed at 10.60/75 percent.

A bond maturing on 01.07.2028 closed at 11.00/15 percent, down from 11.15/40 percent.

A bond maturing on 15.09.2029 closed at 11.80/85 percent.

A bond maturing on 15.05.2030 closed at 11.85/12.05 percent, down from 11.90/12.05 percent.

A bond maturing on 01.10.2032 closed stable at 11.95/12.15 percent. (Colombo/Jun13/2024)

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Sri Lanka sells Rs295bn in 2027 to 2031 bonds

ECONOMYNEXT – Sri Lanka has sold 295 billion rupees in 2027, 2029 and 2031 bonds, data from the state debt office showed.

The debt office sold an offered 60 billion rupees of 15 October 2027 at an average yield of 10.30 percent.

All offered 125 billion rupees of 15 September 2029 bonds were sold at 11.00 percent.

All 110 billion rupees offered of 01 December 2031 bonds were sold at 12.00 percent. (Colombo/May13/2024)

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