Business Times

NDB says core banking profits up 34% in 2010

Sri Lankan business group NDB, which has a presence in the banking, capital markets and insurance sectors, announced this week that it had achieved a "sustainable core banking profits increase by 34% during the year 2010." Also, indicated by the entity was that its "Group Profit Attributable to Shareholders (PAS)" was Rs. 2 billion, an increase of 28%, while "Group [Return on Equity]" was 13.67.%. Both of which were said to exclude exceptions, which were identified as being "gains from government securities and equity income.."

NDB Chairman P. M. Nagahawatte and CEO Russell de Mel

Also noted by the group was that there was a "portfolio growth of 27%, with loan delinquencies maintained at an all time low of 1.9%," which it said was one of the lowest rates in the banking industry. It also indicated that its loans to total assets ratio increased by 10% to 68% in 2010, which it suggests will facilitate higher returns due to the new loans being "created with liquid funds."

These indicators were said to result from taking "advantage of emerging opportunities in lending as well as capital markets and insurance that witnessed a most welcome ‘bounce back’ during the year 2010." According to NDB Chief Executive Russell de Mel, who was quoted in the organisation's announcement; “The performance of the bank as well as the group during the previous year (2009) was highlighted by significant capital gains made from trading in Treasury Bills and Bonds which was influenced by falling interest rates and also by one off equity gains. Our philosophy is that whilst we seize these opportunities, thus maximising gains and returns, what is important is to sustain the core banking profits. Therefore, in 2010 the bank attempted to create a strong business model by improving its core banking income that is sustainable in the long run."

Also revealed was a "significant improvement in the core banking profits throughout the quarters as well, which has had a direct impact on the improvement in the full year returns." And that the NDB's banking arm's deposit base was privy to a "healthy growth of 19% from Rs. 49 billion to Rs. 59 billion during the year against an industry growth of 15.6%." At the same time, and on a quarterly basis, "both the lending portfolio as well as the deposit portfolio has shown significant growth potential during the fourth quarter."
Also suggested by NDB; "Prudent underwriting policies and well defined risk acceptance criteria helped the bank to maintain a high quality loan portfolio, improving its Non Performing Loans (NPL) ratio to 1.9% as at December 2010 from 2.5% an year ago, which compares well against the current Industry ratio of 5.3%. The provision cover on NPLs is at 76% with an Open Loan Position of 2.86%, signifying the minimum amount of stress on the Bank’s equity, on account of un-provided delinquencies. The overall provision cover is at 96%."

In addition; "With limited footprint and outreach, the SME sector recorded a significant portfolio growth of 63% during the year 2010. In addition to the traditional lending forms to SMEs the Bank also intermediated in facilitating industry verticals lining the small time producers with the large scale distributors and vice versa.

NDB has also taken the far sighted initiative of moving more towards customer centric cashflow based lending approach as opposed to the traditional collateral based lending creating greater inclusiveness at the bottom of the pyramid."

Top to the page  |  E-mail  |  views[1]
SocialTwist Tell-a-Friend
 
Other Business Times Articles
No strikes, unrest at Sri Lanka’s model university in Badulla
SEC mulls regulating bank guarantees to stop casino culture
Seylan to shed 250 jobs in April
Ashok Leyland Colombo bourse trades to be probed
Lankan firm builds Uganda’s largest hydro power plant
Army grounds clears for Shangri-La
Lanka’s ‘Achcharu’ education system
Today’s complicated education system creates misfits in society
Increase fuel prices, pleads LIOC
Lankan tea veteran Bryan Baptist trains Turks in tea-tasting
Letter
SLT Group records Rs. 50 bln revenue, Rs. 5.96 bln pre-tax profit
Now an effective non-toxic wood preservative from Sri Lanka’s premier scientific research agency
Raigam looks for its salt’s worth with confectionary firm
Social networks; Large Asian corporations increase exposure but engagement remains low: New study
Lankan ambassador Jayatilleka on Global Advisory Council on Climate Change
Clutch-free motorcycle now in Sri Lanka
Nokia outlines new strategy, broad strategic partnership with Microsoft
FITIS, IISEIE launch Sri Lanka ‘High-Tech Economy Survey’
Beating the high cost of living at a ‘Food Mart’
Eight banks to disburse World Bank $57.4 mln facility for small enterprises
Prof. Uditha Liyanage on the ‘New Mod-tradi Consumer’
Commercial Bank breaks Rs 5 bln PAT barrier in 2010
UN Global Compact picking up across the world
HSBC joins IUCN to restore the Warawewa Tank
Free Lanka launches Rs 1.5 bln IPO
Sri Lankan exporters again advised of the US GSP lapsing
Dubai's pearl heritage makes a comeback with trade
Call for political support to build green buildings in Sri Lanka
The Finance Company makes structural changes
Commercial Bank helps families displaced by conflict
Citrus' two hotels to go public
IFC, Sanasa Development Bank to help micro entrepreneurs
United Motors unit sells stake to Janashakthi group firm
World Cup: Many Sri Lankan stakeholders set to benefit
SEC to announce rules on cross border listings in March
IPOs galore with another - Union Bank IPO oversubscribed
Sri Lanka promotes renewable energy to face the depletion of fossil fuel
76% YoY consolidated revenue growth for Carson’s-owned Bukit Darah
Bartleet TransCapital reports sharp hike in growth and profits
Fitch upholds SLT's 'AAA(lka)' / Stable
NDB says core banking profits up 34% in 2010

 

 
Reproduction of articles permitted when used without any alterations to contents and a link to the source page.
© Copyright 1996 - 2011 | Wijeya Newspapers Ltd.Colombo. Sri Lanka. All Rights Reserved | Site best viewed in IE ver 8.0 @ 1024 x 768 resolution