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Sri Lanka’s Union Bank net down amid higher provisions

ECONOMYNEXT – Profits at Sri Lanka’s Union Bank fell 75 percent to 48 million rupees as net interest income fell and higher loan loss provisions were made amid a Coronavirus pandemic, interim accounts show.

The bank reported earnings of 5 cents per share for the quarter. In the year ended to December it reported earnings of 58 cents per share on total profits of 622 million, down 23 percent from a year earlier.

The stock last closed 20 cents up at 11.40 rupees a share on Thursday.

Fee and commission income grew 1 percent to 259 million rupees from 257 million rupees in the December 2019 quarter.

Net interest income fell 14 percent to 1 billion rupees with interest income falling 21 percent to 2.7 billion rupees from 3.4 billion rupees a year earlier while interest expenses fell 25 percent or 1.7 billion rupees from 2.2 billion rupees.

Customer loans fell 73 percent to 73 billion rupees, down from 84 billion rupees a year earlier.

Loan loss provisions rose 174 percent or to 222 million rupees from 81 million rupees.

The non-performing loan ratio grew to 6.05 percent from 5.03 percent.

Debt securities grew 62 percent to 20 billion rupees, from 12.6 billion rupees the previous year.

Customer deposits grew 5 percent to 87 billion rupees, from 82.7 billion rupees.

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Gross assets remained unchanged at 129 billion rupees in December 2020 quarter.

Net assets grew 4 percent to 18 billion rupees, from 17.4 billion rupees.

Tier I capital adequacy ratio 16.34 percent, up from 16.12 percent.

Total capital adequacy ratio was 17 percent, up from 16.36 percent. (Colombo/Feb28/2021)

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