NDB shareholders’ profit grows by 30 per cent
View(s):At NDB’s group level, Profits Attributable to Shareholders (PAS) grew by 30 per cent to Rs. 3.5 billion, as a result of new legislation.
The PAS was affected by the cumulative deferred tax provision on the revaluation gains from investment property in line with the new Inland Revenue Act which came into effect from April 1 2018, officials at the recently held NDB ‘Investor Forum’ said. It was held in Colombo to discuss the full year financial results for the financial year 2017.
The Investor Forum marked the release of the bank’s 2017 NDB Annual Report “Take a Closer Look”, to the Colombo Stock Exchange March 5 and also marks the bank’s endeavours in facilitating discussions and access to management for the stock broking and investment fraternity.
The PAS, excluding this tax impact would have been Rs. 3.7 billion, an increase of 38 per cent. Net Interest Income (NII), the vital contributor within total operating income grew by 27 per cent. Profit after Tax (PAT) exceeded Rs. 4 billion to Rs. 4.4 billion which was an impressive growth of 37 per cent compared to 2016.
The bank’s Net Interest Margin of Rs. 10.8 billion drew strength from a combination of factors, such as the enhanced Net Interest Margin up to 3 per cent (from 2.6 per cent in 2016), substantial volume growth in the loan book and the exponential growth in the deposits base, thereby reducing the reliance on high cost funding sources, NDB Director / CEO, Dimantha Seneviratne said.
Total impairment charges for loans and other losses was Rs. 1.3 billion, a reduction of 8 per cent compared to 2016. “Prudent risk management and credit underwriting standards, proactive credit follow ups and robust recovery efforts resulted in one of the best NPL ratios in the industry for the bank in 2017, at 1.83 per cent,” Mr. Seneviratne said. This NPL ratio compares very well with the industry average of 2.5 per cent for 2017 and NDB’s own NPL of 2.63 per cent 2016.
The event was also attended by NDB Chairman, Ananda Atukorala; NDB Vice President Corporate Banking, Buwaneka Perera; Lalith Fernando, Group Chief Financial Officer; Sanjaya Perera – Vice President – Personal Banking and Branch Network Management and CEO of NDB Holdings Ltd, Vajira Kulatilaka.
The bank PAT was at Rs. 4.35 billion, an increase of 37 per cent over 2016, while the group profit attributable to shareholders was Rs. 3.49 billion, an increase of Rs. 30 per cent over 2016.
The bank saw a total assets growth of 15 per cent up to Rs. 383 billion, including loans and receivables growth of 20 per cent to 274 billion and a quantum growth of Rs. 46 billion which resulted in a growth rate ahead of industry loan growth. The customer deposits growth of 34 per cent to Rs. 273 billion was seen, a quantum increase of Rs. 70 billion.
The forum was well attended by a gathering of stock brokers, investment and research analysts fund managers, institutional investors and financial press as well as the senior management of the bank and the NDB capital markets cluster companies.