Healthy results from Sampath Bank in 2021

Sampath Bank has reported a profit before tax (PBT) of Rs.16.8 billion in FY 2021, up by 50.7 per cent against Rs.11.2 billion recorded in 2020.

Profit after tax (PAT) for the year under review also grew by 55.2 per cent to Rs.12.5 billion from Rs.8 billion recorded in the previous year, the bank said in a media release.

The bank recorded a sizable 35.7 per cent increase in net fee and commission income during the period, primarily driven by cards, electronic channels, and trade-related operations.  

Despite the improvement reported in NPL and Stage 3 loans, additional impairment provisions were made as allowance for overlay to reflect potential credit losses due to the COVID -19 related uncertainties.  

The Sampath Group too posted significant growth for the current financial year, with Group PBT and PAT of Rs.18.8 billion and Rs.13.9 billion respectively. All four subsidiaries recorded remarkable performance compared to the previous year, the statement said.

Interest income of the bank fell by 3 per cent to Rs. 85.9 billion in the year under review compared to the previous year. The lower interest rate environment which prevailed for most part of the year and the weak credit demand resulting from the pandemic-induced economic downturn, were the main reasons for this contraction. Notably however, the decline in interest income from loans and advances was partially offset by interest income from other financial instruments, the bank said.

Interest expenses for FY 2021 declined by 19.1 per cent compared to the previous year on the back of a strong improvement in CASA.

The bank recognised total impairment charge of Rs.17.1 billion for 2021 compared to Rs.11.8 billion in 2020, reflecting a 45 per cent increase, year-on-year. In the current year, the bank recognised Rs.12.7 billion against loans and advances and Rs.3.8 billion against other financial instruments.