Sri Lanka’s state-run Bank of Ceylon see high credit growth, deposits fall
COLOMBO (EconomyNext) – Sri Lanka’s state-run Bank of Ceylon group, the largest commercial bank in the country, reported a steep 8.4 percent credit growth in the March 2015 quarter while deposits fell 2.1 percent amid low interest rates in the country.
Bank of Ceylon is a key financier to the state and state enterprises.
Group posted profits of 2.87 billion rupees in the quarter, up 8.9 percent from a year earlier.
Interest income fell 0.4 percent despite strong loan growth amid low interest rates, and interest expenses fell at a faster 15.1 billion rupees to 16.2 billion rupees, helping the bank grow net interest income 31 percent to 11.5 billion rupees.
Fee and commission income rose 31 percent to 2.5 billion rupees. Net gains from trading fell 49 percent to 504 million rupees and gains from financial instruments were sharply down to 69 million rupees in the quarter from 1.8 billion rupees a year earlier.
The bank provided 4.1 billion rupees for loan losses up from 3.5 billion rupees a year earlier, with 3.6 billion rupees being general provisions.
Loans and advances to customers rose 8.6 percent to 827 billion rupees from 763 billion during the March quarter. Financial assets held for trading rose to 30 billion rupees from 18.4 billion.
Reverse repo deals fell to 5.6 billion rupees from 60 billion rupees.
Deposits fell 2.1 percent to 923 billion rupees, but other borrowings rose 31 percent to 331 billion rupees.
Group gross assets rose 4.6 percent to 1.42 billion rupees. Net assets rose 2.5 percent to 87.5 billion rupees.
At bank level net assets rose 3.2 percent to 74.8 billion rupees.
At stand alone bank level capital adequacy fell to 12.42 percent from 13.55 percent amid higher loan growth, but was above the regulatory minimum. Non-performing loans rose to 4.39 percent of risk weighted assets from 3.78 percent.