NDB Bank’s post-tax profit up 32% in 9-mth period

The NDB Group’s profit attributable to shareholders for the nine months ended 30 September 2011 was Rs 1.7 billion against Rs 1.5 billion with the rise attributed to strong growth in core banking profits of 14% and improved performance of the group companies.

“This is a commendable performance despite the marked to market equity losses of the group amounting to Rs 100 million during the current period, compared to the gain of Rs 532 million made in the comparative period of 2010,” the Sri Lankan banking group said in a statement.

NDB Bank’s core banking profit (Net Interest and Fee Income less provisions and overheads) increased by 15% over the corresponding period last year. On a YOY basis, core banking profit growth for the first half of the year was a 7% increase, which signified the accelerated growth of core banking profits particularly during the third quarter of 2011, the statement added. Despite the pressure on interest margins, & the re-pricing effect on investments in the Government Securities portfolio (as a result of the decline in the market), bank’s Net Interest Income grew by 9% as compared with the corresponding period last year, largely contributed by the significant increase in loans & advances and deposits by 44% and 40% respectively. NDB Bank’s post-tax profit increased by 32%.

NDB Bank’s pre-tax profit increased by only 1% over the corresponding period last year owing to the bank incurring a loss of Rs 46 million against an income of Rs 301 million on its quoted equity portfolio for the corresponding period last year.

Despite the significant growth in the loan portfolio in all the sectors, NDB Bank has been able to contain its Non Performing Loans (NPL) ratio to an all time low of 1.41% which is one of the lowest in the industry, due to its prudent underwriting policies and well-defined risk acceptance criteria, it said.
“The bank has been able to achieve this low level of delinquencies by the use of strong credit analysis techniques and with the use of proactive risk management practices,” it noted.