Nations Trust Bank (NTB) has reported a 25% year-on-year net profit increase to Rs.180 million in its interim financial statements for the three months ended March 31, 2009.
Net interest income was also up 37% year on year to Rs.905 million, according to interim accounts of the Bank. Brokers said the bond market capital gains and increased foreign exchange income, supported in 1Q2009 by steep declines in Treasury yields and accelerated currency depreciation respectively, have driven NTB's no interest income up 57% year on year to Rs.613 million.
NTB's non interest expenses are up 32% year on year to Rs.848 million, primarily due to increased personnel costs. Value Added Tax (VAT) on financial services were up 181% year on year to Rs.73 million. Furthermore, total deposits are up 6% quarter on quarter to Rs.36.5 billion.
NTB's Director and Chief Executive Officer Zulfiqar Zavahir said NTB has been able to grow its deposits by 6% 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. "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% compared to the first quarter of 2008," he said.
"However, during the first quarter of 2009, the Bank managed to keep the growth in operating expenses at a lower rate than the growth in net income which was 44%, thereby improving the operating efficiency and bringing the Cost : Income ratio down from 61% to 56% compared to the 2008 first quarter."
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