The Bank of Ceylon (BOC) closed its 75th year by recording the highest ever profit before tax (PBT) in the bank’s history as well as in the Sri Lankan banking industry of Rs.20.3 billion, up 29 per cent compared to the previous year, according to a BOC media release. Post tax profit stood at Rs. [...]

The Sunday Times Sri Lanka

BOC posts Rs. 20.3 billion profit before tax

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The Bank of Ceylon (BOC) closed its 75th year by recording the highest ever profit before tax (PBT) in the bank’s history as well as in the Sri Lankan banking industry of Rs.20.3 billion, up 29 per cent compared to the previous year, according to a BOC media release.

Post tax profit stood at Rs. 13.6 billion – a 12 per cent growth. “The group has reported Rs.21.4 billion PBT recording a 33 per cent growth over last year with the bank dominating the results of the group accounting for 95 per cent of earnings and 97 per cent of the group’s assets,” the release added.

Despite the dip in interest margin due to the low interest rate regime, PBT was boosted by fee income, trading income and gains from financial investments. Fee income increased by 42 per cent to Rs.9.2 billion due mainly to the increase in export and import transactions and guarantees fees, it said, adding that net gains from trading in treasury bills and dealing securities grew by 50 per cent to Rs.4.9 billion. “Increase in these income bases shows the bank’s ability to find alternative income generating channels at difficult times.”

Amidst the challenging operating environment which prevailed throughout most of the year, the bank’s assets grew by 11 per cent to Rs.1.3 trillion, the release said. The bank is the first domestic bank to achieve a trillion assets balance sheet and continues as the only bank to have done it so far. BOC is the largest provider of finance to both Government and private sectors.

Loans and advances account for 56 per cent of the bank’s one trillion asset base and gross loans stood at Rs.777.5 billion as at end 2014. The release said that the growth of the assets was also supported by the increase in financial investments and reverse repurchase agreements. “Even though the asset growth is at a moderate level, BOC continues to secure its market leadership in terms of assets, advances, deposits, profits, NRFC deposits and Inward Remittances.”

Deposits accounted for 74 per cent of the bank’s liabilities as at the end of 2014, according to the release which said that the total customer deposit base has grown from Rs.842.1billion in December 2013 to Rs.934 billion as of end 2014 amidst interest rate margin pressure.

“This is an 11 per cent growth and is in line with the industry growth rate which reflects the strong domestic franchise of the bank. The CASA ratio also has been improved to 43 per cent from 38 per cent resulting in a favourable deposit mix.”

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