NDB records strong performance for 2021
View(s):National Development Bank PLC,
Sri Lanka’s fourth largest listed bank, has posted a sound all-round performance for 2021, notwithstanding the multiple challenges faced by the bank which were similarly faced by many entities last year.
Just as bank results began trickling this week on year-end 2021 results, NDB has also done well with operating profit before taxes totalling Rs. 10.3 billion, up by 12 per cent. Total taxes for the period were Rs. 3.9 billion with an effective tax rate of 38 per cent. Accordingly, post-tax profitability reached Rs. 6.4 billion at a YoY growth of 15 per cent whilst profits attributable to shareholders of the bank reached Rs. 6.9 billion, a YoY growth of 35 per cent, the bank said in a media release.
Commenting on the year’s performance, Dimantha Seneviratne, Director/ CEO of NDB said that the retrospect of 2021 had many reasons to be grateful for. “We managed one of the largest equity infusions in the history of the bank netting Rs. 9.5 billion and onboarded the Norwegian Investment Fund for developing countries (Norfund) as our top shareholder with a 9.99 per cent ownership. Our strategy remained well on track with strong delivery across all areas and we extended support to our pandemic-hit customers via a host of modes.”
He said the sustainable growth trend that the bank has maintained over the years continued, with the institution achieving triple Rs. 500 billion in total assets, gross loans and customer deposits.
The core income sources of the bank enhanced during the year compared to 2020, attributable to the timely delivery of the bank’s strategy milestones. Net interest income grew by 22 per cent to Rs. 21.6 billion, despite a marginal decline in interest income, which was off-set by a larger decline in interest expenses.
However impairment charges for the year rose sharply by 51 per cent to Rs. 10.3 billion compared to similar charges in 2020. “The bank consciously reviewed the stress levels of the customers on a prudent basis in light of the prevailing economic conditions and accounted for impairment charges on an individually significant basis as well as on a collective portfolio level basis, using objective evidence of customer credit quality,” the statement said.
With regards to impairment provisions on foreign currency denominated government instruments, the bank increased such provisions up to Rs. 2 billion factoring in the revisions of the sovereign rating of the country.
The statement said that NDB has reached a pivotal juncture in its growth journey. Its strong capital position has enabled it to pursue ambitious growth targets. The bank’s capital market subsidiaries are expected to further enhance synergies amidst the improvements seen in the Sri Lankan capital markets.
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