Banking
Abans Finance improves operational performance in the first half of FY 12/13
View(s):Abans Finance PLC, a listed company with the Colombo Stock Exchange has completed yet another satisfactory operational performance during the first six months of the FY 2012/2013.
Abans Finance is a member of the Abans Group of Companies headed by Ms. Aban Pestonjee. Abans (Pvt) Ltd., holds 84% of the Equity of the company. Mr. Rusi Pestonjee, a Director of the Abans Group functions as the Chairman. Abans Finance operates with a strong Governance Structure in compliance with Codes of Best Practices issued by the Central Bank of Sri Lanka, Securities Exchange Commission and Chartered Institute of Sri Lanka, in addition to the Continuing Listing Requirements of the Colombo Stock Exchange.
The Directors of the company are Rusi Pestonjee, (Chairman), Kithsiri Wanigasekara, (Managing Director / CEO) , Ms. Saroshi. Dubash, (Non-Executive= Director), Channa Pathirana, (Non-Executive Director), V.K. Choksy, (Independent Non- Executive Director – Senior Director) and T. Someswaran, (Non-Executive Director).
An effective Board Committee structure that strengthens Internal Controls and Integrated Risk Management with the constructive involvement of the Non- executive Independent Directors has ensured a vast improvement in Corporate Governance, particularly in the ongoing financial year.
“Achievement in Lending for the first six month period ended 30th September 2012 has been 73% of the budget in a business environment that has been a challenging one” said Kithsiri Wanigasekara, Managing Director of the company. The controlled growth strategy of the company implemented in an era with high interest rates on Lending with the intention of mitigating credit related risks has produced encouraging results, according him . The composition of Lending during the period included 77% approx. in respect of Finance Leasing and Hire Purchase on Motor vehicles, its core businesses. Mortgage related loans was approx. 17% of Lending with Personal Loans and Consumer Durables accounting for the rest.
Wanigasekara stated that a unique feature of the operations had been the achievement in controlling Non- performing Loans with improved recoveries on lending portfolios.
The company’s Gross NPL ratio has registered a vast improvement by 30th September 2012 to reach a level that was slightly above the Industry Average. Improved financial performance during the recent financial years coupled with the first half of FY 2012/2013, made a favourable impact on the Net NPL ratio as at end of September which was a healthy one below the industry Average. The strengthening of the Asset Quality is a priority on the company’s business agenda.
“The success behind these achievements had been the effective Risk management process in place” said Wanigasekara.
Funding of the businesses had been mainly through depositsfrom the public. Abans Finance, which is licensed by the Central Bank of Sri Lanka in terms of the Finance Companies Act No. 42 of 2011 is authorized to accept deposits. The company mobilizes deposits from its Head Office at No. 400, Galle Road, Colombo 3 and through branches located in Kandy, Badulla, Gampaha, Anuradhapura, Ratnapura, Dambulla, Kurunegala, Galle and Chunnakham.
The company has achieved 94% of its budgeted volumes in Deposits in the first half of FY 2012/2013 and is expected to mobilize improved volumes in new deposits during the second half of FY 2012/2013. The interim financial results for the first half of 2012/ 2013 are expected to be released within the next few weeks and the management is confident that financial results should be an improved performance over that of the first half of 2011/2012. Further, the company is to strengthen lending operations, considerably during the second half of 2012/2013.
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