Nations Trust Bank PAT up 25 percent to Rs. 180m in three months
Nations Trust Bank PLC reported that the Group has achieved an
Operating Profit before Income Tax and Value Added Tax of Rs. 404.579 Mn.
for the three months ended March 31, 2009 against Rs. 288.405 Mn. in the
corresponding last year, reflecting a 40 percent growth. Profit after
tax grew by 25 percent to Rs. 180.137 Mn. compared to Rs. 144.208 Mn. in
the corresponding period.
Corresponding to the growth in total assets of 9 percent and a
significant increase in non-fund based income, gross income of the Bank
grew by 22 percent.
Increased forex volumes and active market participation contributed
to a 65 percent growth in foreign exchange income while trading gains on
Government Securities by capitalizing on declining interest rates,
credit cards and commissions boosted the other operating income by 55
"In the wake of a significant slowdown in the local banking industry,
according to the Central Bank of Sri Lanka, deposits growth has
stabilized at 3.8 percent while loans and advances have decreased by 0.4
percent during the first three months of the year.
In comparison, we have been able to grow our deposits by 6 percent
and loans and advances have also shown a marginal growth in the backdrop
of a stringent credit policy being adopted due to unfavourable market
conditions," said Director/Chief Executive Officer of Nations Trust Bank
Zulfiqar Zavahir. Our investment in the customer service centres and
related delivery channels in the latter part of 2008 in line with our
business strategy have contributed to an increase in operating expenses
by 32 percent compared to the first quarter of 2008.
However, during the first quarter of 2009, the Bank kept the growth
in operating expenses at a lower rate than the growth in net income
which was 44 percent, thereby improving the operating efficiency and
bringing the Cost: Income ratio down from 61 percent to 56 percent
compared to the 2008 first quarter.
Specific provisions however increased to Rs. 258.587 Mn. for the
period from Rs. 96.116 Mn. which includes certain prudential provisions
made on exposures over and above the provisioning policy of the Bank,
which is more stringent than the guidelines of the Central Bank.