An Echelon Media Company
Thursday December 1st, 2022

Sri Lanka’s Commercial Bank profits up 73-pct in March 2022 quarter

ECONOMYNEXT – Sri Lanka’s Commercial Bank of Ceylon reported profits of 11.6 billion rupees in the March 2022 quarter, up 73 percent from a year earlier as foreign exchange gains outpaced provisions and net interest income also grew.

Commercial Bank group reported earnings of 9.42 rupees per share in interim accounts for the March 22 quarter.

Net fee and commission income grew 35 percent to 4.0 billion rupees.

Net interest income grew 19 percent to 37.8 billion rupees, interest expense grew 17 percent to 19.0 billion rupees and net interest income grew 21 percent to 18.8 billion rupees.

Loans and advances grew 12.5 percent in rupee terms, partly due to the inflation of dollar-denominated loans as a soft peg with the US dollar collapsed.

Loan loss provisions were down 16 percent to 5.9 billion rupees.

Net other operating income was loss of 12.2 billion rupees, down from a 3.6 billion rupee gain last year.

“The exchange impact on impairment charges on loans and advances and Government Securities denominated in foreign currency was recognised in Net Other Operating Income where the corresponding exchange gains are recognized,” the bank told shareholders.

Tier I capital adequacy stood at 9.835 percent in March, above the required minimum of 9 percent.

Owners of Sri Lanka government sovereign bonds which are now rated near default are expected to take a haircut.

However, banks with net dollar assets however stand to make gains in rupee terms.Sharply higher rates are also triggering mark to market losses in rupee bond portfolios.

Commercial Bank’s total assets grew 15 percent to 2.2 billion rupees. Net assets grew 3.7 percent to 175 billion rupees at the group level and 2.5 per cent to 169 billion rupees at the bank level. (Colombo/May16/2022)

Leave a Comment

Your email address will not be published. Required fields are marked *

Leave a Comment

Leave a Comment

Cancel reply

Your email address will not be published. Required fields are marked *

Sri Lanka China-backed port to welcome second cruise ship

ECONOMYNEXT – Sri Lanka’s China-backed Hambantota Port said it was getting ready to welcome MV Azamara Quest, a cruise ship, as another passenger vessel departed.

Mein Schiff 5, operated by TUI had departed Hambantota International Port for Pulau Penang Island, Malaysia on November.

“As well as being her maiden call at the port, Mein Schiff 5 is the first passenger cruise ship to call at the port since the pandemic began,” said Johnson Liu, CEO of Hambantota International Port Group (HIPG) said in a statement.

“It was undoubtedly a great boost for the tourist economy in the south when the vessel called at the Hambantota International Port.”

Mein Schiff 5’s passengers had also visited the Bundala National Park, Hambantota Botanical Gardens, Galle and Kataragama.

Passengers had explored Hambantota by tuk-tuk, while others had enjoyed the beaches in the Shangri La Hotel, the port said.

MV Azamara Quest will arrive in Hambanota on on December 05. (Colombo/Dec01/2022)

Continue Reading

Sri Lanka’s shares gain in mid market trade

EXONOMYNEXT- Sri Lanka’s shares gained in mid market trade on Thursday (1), pushed up by strong positive sentiments on interest rates easing in line with inflation and speculation on government to hold talks with multilateral creditors ADB and World Bank for a possible loan facility.

Market has continued to gain for the past four sessions.

“Shares were moving on positive strong sentiments flowing in from yesterday (30), we are seeing a rally in the hotels, while the retail favorites such as LIOC and Expolanka,” analysts said.

Positive investor sentiments have been established, from positive comments from the Governor of the Central Bank over market rates eventually seeing an ease despite the fears of a domestic debt restructuring as inflation falls, increased liquidity in dollar markets, and the inter-bank liquidity improves.

Analysts further stated that, Treasury related stocks are also activated due to downward movements in yield.

All Share Price Index (ASPI) gained by 1.4 percent or 123.41 points to 8,774.64, while the most liquid share gained by 1.31% or 35.68 points to 2,765.

The market generated a turnover of 1.6 billion rupees at 1130 hours. (Colombo/Dec1/2022)

Continue Reading

Sri Lanka electricity losses from overpriced fuel, no tariff hike considered: regulator

ECONOMYNEXT – Sri Lanka’s state-run Ceylon Electricity Board’s high operating costs are partly due to excessive prices paid for fuel and no tariff hike is being considered, Chairman of the Public Utilities Commission of Sri Lanka, Janaka Ratnayake said.

The CEB itself does not buy fuel but depends on state-run Ceylon Petroleum Corporation and Lanka Coal, another state firm to buy fuel. Both firms are periodically caught in procurement scandals.

“They are paying about 385 plus rupees per litre for furnace oil,” Ratnayaka told EconomyNext.

“That is too much. From the global market we can buy it to much lower price. It can be imported below 200 rupees,”

“I ask the government to take the necessary steps to create a system to import furnace oil, like they did for fuel, to be imported at the lower price levels. If that happens, we can go without going for a price hike.”

Sri Lanka’s CEB generally gets furnace oil and residual oil from the domestic refinery and usually do not import furnace oil.

The refinery however is not regularly operating due to inability to get crude amidst the worst currency crisis in the history of the island’s intermediate regime central bank.

Ratnayake had earlier brought to light import costs of the CPC.

Pushing for operations efficiency of the CEB is a role of the regulator. Regulating costs based on global benchmark prices to push for procurement efficiencies is a standard practice. However the PUCSL is not the official regulator of the petroleum sector.

Related

Sri Lanka power tariff revisions sought in Jan and July: Minister

Power and Energy Minister Kanchana Wijesekera told parliament that cabinet approval was sought to twice yearly tariff hikes in January and July of each year.

No Electricity tariff hikes are being considered yet, Ratnayake said.

Wijesekera blamed the regulator as well as successive administrations for not regularly revising power prices and pushing the sector into crisis.

In Sri Lanka activists had also blocked cheap coal power. (Colombo/Dec01/2022)

Continue Reading