Pan Asia Bank post-tax profit up by 50% in 1H 2021
View(s):Pan Asia Banking Corporation PLC has reported impressive gains in the first half of 2021, posting a 50 percent growth in post-tax profit to Rs. 1,356 million compared to the same 2020 period. Its pre-tax profit rose by 27 percent to Rs. 1,822 million
“The bank’s performance was characterised by strength and resilience despite the heightened uncertainty due to the impact of the COVID-19 pandemic,” it said in a media release.
Against the backdrop of the COVID-19 impact on the Sri Lankan economy, the bank’s operating profits before VAT on Financial Services reached Rs. 2,245 million, an increase of 25 percent, adding that this was achieved even after setting aside a sizable provision buffers for the probable deterioration in credit quality due to COVID 19 pandemic.
The bank increased impairment provision buffers in 1H taking into consideration increased risks and uncertainties due to COVID 19 pandemic through experience adjustments, management overlays and downgrading of credit exposures of the borrowers in elevated risk industries.
The bank’s Net Interest Income for the period witnessed an increase of 17 percent due to significant reduction in financial cost of funds at a rate faster than the drop-in interest yields of interest earning assets.
“… the volatility in foreign exchange rates enabled the bank to increase its Foreign Exchange Income substantially as reflected in Other Operating Income. On the other hand, the aforementioned currency volatility had a negative impact on the bank’s net trading income due to mark-to-market losses on forward exchange contracts and currency swaps,” it said.
Commenting on the financial performance, the bank’s Managing MD/CEO, Nimal Tillekeratne said; “We are extremely proud and pleased to deliver such an excellent performance under the extreme conditions created by the pandemic. This performance has been hard-won on account of a proactive approach to business while leveraging on emerging opportunities in the market in a prudent manner.”
Jayantha S.B. Rangamuwa, Chairman of Pan Asia Bank, said, “For a banking institution to record profitability amidst a global pandemic and unfavourable macroeconomic conditions, points to the outstanding systems and governance with the institution. By demonstrating this industry-leading performance, Pan Asia Bank has shown that it is the truly Sri Lankan bank that is focused on building stakeholder wealth while supporting people impacted by COVID-19 in helping to support and uplift their livelihoods.”