BOC ends first half 2020 with satisfactory results in the midst of crises
View(s):Bank of Ceylon has concluded the first half of the year once again earning industry leadership in terms of assets, deposits, advances and revenue. This year the bank has delivered results despite facing unprecedented challenges. “Although, the bank has ended the first half with satisfactory results, the Year-on-Year decrease in numbers that has been reported is not a surprise given the headwinds across all global economies due to the effects of COVID-19,” it said in a media release.
Despite the challenging economic conditions, the bank has reported the highest industry growth rates in revenue, deposits and advances for the first half of the year. The revenue of the bank for the period was Rs. 118.3 billion with a YoY increase of 2.4 per cent while it reported a Profit Before Tax (PBT) of Rs. 6.9 billion and Profit After Tax (PAT) of Rs. 5.8 billion for 1H-2020 notwithstanding the consequences of the COVID-19 pandemic.
However, the bank’s net interest income showed a 18 per cent decrease YoY mainly due to loss on COVID -19 moratorium and increase in interest expense in line with growth of the deposit base. Due to the stability and trust earned from the public, the bank experienced more deposits coming to the bank given the instability created in the market due to pandemic-related economic disruptions, causing interest expense to rise. “The impact of the moratorium was accounted against the interest income based on the modification method given in the Sri Lanka Financial Reporting Standard (SLFRS) 09 and the resultant day one loss of Rs. 6 billion has been adjusted to interest income,” it said.
Despite all these challenges the bank’s asset base grew by 11 per cent to Rs. 2.7 trillion, backed by a 14 per cent surge in the loan book. The bank’s loan book stood at Rs. 1.8 trillion and both Government and private sector lending have contributed to this growth.
“The bank’s role in passing out the benefits of the moratorium and the special low interest working capital loan announced by the Central Bank in order to facilitate the revival of the COVID-19 hit businesses and individuals is also unparalleled and commendable considering that it is the bank with the largest customer base with over 13.7 million accounts,” the release said.