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Friday June 14th, 2024

Sri Lanka’s Hatton National Bank Dec profits grow on tax cut

ECONOMYNEXT- Hatton National Bank Plc, the second largest listed lender, posted net profits of 6.26 billion for the December quarter, up 28 percent from a year earlier due to reversal of taxes on Sri Lanka Development Bonds.

HNB, which also owns finance and insurance firms, reported 12.52 rupees in earnings per share for the December quarter in its interim financials.

The banking group earned 29.32 rupees a share for the 12 months ending December, on net profits of 14.67 billion, down 17 percent from a year earlier. The HNB share closed trading on Tuesday 80 cents down at 155 rupees.

Gross income for the December quarter fell 4 percent from a year earlier to 36.61 billion rupees.

Interest income fell 3 percent to 30.95 billion rupees amid price controls on loans, while interest expenses grew 4 percent to 17.46 billion rupees, squeezing the net interest margin 11 percent to 13.49 billion rupees.

Provisioning for bad loans fell 48 percent to 2.31 billion rupees amid bank-level bad loans more than doubling to 5.91 percent.

The group loan book was flat at 769.4 billion rupees, despite new rules on Domestic Systemically Important Banks lowering HNB’s risk-weighted capital adequacies by 50 basis points.

The deposit base grew 2 percent to 835.06 billion rupees.

Net fee and commission income fell 8 percent to 2.56 billion rupees while net insurance premium income grew 16 percent to 2.28 billion rupees.

Operating profits before taxes were down 4 percent to 7.88 billion rupees.

The bottom line grew on an income tax reversal of 488.50 million rupees, compared to a 321.31 million rupee corporate income tax a year earlier.

The government in February exempted income tax on Sri Lanka Development Bonds with effect from April 2018. Hatton National Bank holds the highest SLDBs among private banks in Sri Lanka.

The tier 1 capital ratio grew to 14.74 percent from 13.16 percent against a regulatory minimum of 9.5 percent, while the total capital ratio grew to 18.12 percent from 15.41 percent against a required 13.5 percent.

The bank return on assets fell to 11.57 percent from 14.10 percent.

The group net assets grew 10 percent to 145.51 billion rupees, while net assets value per share grew at a similar rate to 290.78 rupees. (Colombo/Feb25/2020)

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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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