Higher provisioning for debt, a slower growth in the advances portfolio and an increase in financial VAT slowed profit growth at the Commercial Bank Group in the latest results data, the company said.
This was despite solid performances in some indicators in the nine months ended September 30, 2008, according to Commercial Bank’s Chief Financial Officer Nandika Buddhipala.
According to the press release, the Bank Group reported a pre tax profit of Rs. 5,549.7 million for the first three quarters of the year, marginally up 4.31 % over the corresponding period in 2007.
Post-tax profit for the same period totalled Rs. 3,056.5 million, marginally up 0.16 % from the corresponding 2007 period.
Gross provisioning for bad and doubtful debts, including the statutory general provisions was increased to Rs 1.689 billion in the period reviewed as against Rs 1.191 billion. The general provision on performing and overdue loans and advances as mandated by the Central Bank included in the total gross provisions amounted to Rs. 431.2 million.
Gross advances of the Group recorded a slower growth of 3.05 % at Rs. 186.6 billion at the end of the nine months reviewed. “The prevailing inflationary situation and high interest rate regime have impacted on the growth trend of the advances of the Bank,” Mr. Buddhipala said.
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