Commercial Bank secures Chinese loan
The Commercial Bank of Ceylon PLC (Commercial) recently secured a commercial loan from a Chinese bank, the result of a visit by a high-level delegation of bankers to China in mid-February led by Central Bank Governor Arjuna Mahendran. Five other banks – Bank of Ceylon, People’s Bank, HNB, Sampath and Seylan were part of the delegation. Commercial CEO, Jegan Durairatnam, told the Business Times that what has been secured is a ‘single bank loan’. Meanwhile Commercial, which has reported profit before VAT and NBT of Rs 5.377 billion for the three months ending 31st March 2016, commencing the year with a robust 27.89 per cent growth, will be opening its Maldives branch in two months, he said.
In September 2015, the bank received regulatory approval for the establishment of a fully-fledged Tier I Bank in Male. Commercial’s profit before tax for the quarter was up 27.95 per cent to Rs 4.579 billion, and profit after tax grew by 28.92 per cent to Rs 3.234 billion. The Net interest income for the three months was Rs 8.113 billion, a growth of 12.17 per cent, the lower growth rate due to an 18.27 per cent increase in interest expenses (Rs. 9.937 billion) consequent to a rise in rates. Total operating profit for the period reviewed at Rs 10.979 billion reflected an improvement of 13.39 per cent , with the Bank achieving a noteworthy reduction of 25.17 per cent in total impairment charges through a reversal in the provision for individual impairment due to an improvement in NPLs.
Net operating income grew by 19.53 per cent to Rs 9.983 billion. Gross loans and advances increased by Rs. 29.317 billion over three months from Rs 526.167 billion at the end of 2015. Deposit growth over the same period averaged Rs. 9.65 billion per month, taking the bank’s total deposits to Rs. 653.040 billion as at 31st March 2016. Commercial’s attempt at branching out to Myanmar, where it currently has a Representative Office in Yangon, is on hold with the change of the regime there, Mr. Durairatnam added. The bank also received a licence to operate a fully owned Money Transfer Operation in Italy recently.