Pan Asia crosses Rs.1 b profit in 4thQ’21; impairment cost rises
View(s):Pan Asia Banking Corporation PLC has reported a strong performance for 2021, revealing a Pre-Tax Profit of Rs. 4,034 million and a Post-Tax Profit of Rs. 3,075 million with growth rates of 42 per cent and 50 per cent respectively.
Against the backdrop of the COVID-19 impact on the Sri Lankan economy, the bank’s Operating Profit before VAT on Financial Services reached Rs. 4,911million, up by 39 per cent, reflecting the excellence in core banking performance and the success of cost containment measures evidenced by improvement in all key profitability matrices which now rank among industry bests, it said in a statement to the media.
This feat was achieved even after setting aside sizable provision buffers for the probable deterioration in credit quality due to COVID-19 pandemic. “The bank increased its provision buffers for loan losses during the year, sensibly taking into consideration increased risks and uncertainties due to the COVID-19 pandemic through management overlays,” it said.
The bank also increased the impairment provisions made on foreign currency exposures to the Government significantly by Rs. 719 million, “taking into consideration elevation of default risk associated with the Sri Lankan sovereign as a result of downgrading the sovereign credit rating of Sri Lanka by international credit rating agencies. As a result of above factors, total impairment charge for the year 2021 witnessed an increase of 49 per cent”.
Interest income accounted for 89.08 per cent of the bank’s gross revenue in 2021 despite interest income declining to Rs. 18.80 billion in 2021 from Rs. 18.82 billion recorded in 2020.
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