Subdued 1stQ performance from NTB
View(s):Nations Trust Bank’s (NTB) performance during the quarter ending 31st March 2019 reflected a continuation of the issues witnessed in the previous few quarters with increasing non-performing loans and moderation of credit growth.
The increased credit cost arising from both higher NPLs and policy changes relating to SLFRS 9 impairment provisioning added further pressure to the results of the quarter when compared with the corresponding period, NTB said in a media release.
“Despite these unfavourable conditions, group pre-tax profits remained relatively constant at previous year levels, recording Rs. 1,938 million whilst post-tax profits were affected largely due to the Rs. 209 million impact arising from the Debt Repayment Levy.
Therefore, group post-tax profits for the quarter recorded Rs. 773 million, down by 18 per cent over the corresponding period. Notably, its post-tax profits recorded a larger drop due to the inter-company dividend income of Rs. 291 million received last year resulting in a higher operating income for the comparative quarter,” it said.
Net interest income growth was weak at 8 per cent owing to the pressure of narrowing NIMs (Net Interest Margin) to 4.89 per cent from 5.46 per cent reported in the corresponding quarter. Interest income growth moderated at 18 per cent mainly due to a cautious lending approach adopted for selective portfolios coupled with some impact stemming from changes in impairment policy rules.
Commenting on the results and achievements, Renuka Fernando, CEO/Executive Director, stated: “Despite top-line numbers showing restrained growth largely due to multiple changes in accounting rules impacting the current quarter coupled with a slow recovery of the economy, the core foundations put in place in our business pillars remains strong.”