The Commercial Bank of Ceylon this week reported a pre tax profit of Rs. 2.494 billion for the third quarter of the 2010 financial year, indicating "growth was particularly strong in this quarter" where it experienced a 54.8% increase over the same quarter in 2009. Additionally, pre tax profits for the nine months ending September 30, 2010, were stated to be Rs. 6.519 billion, up 30.5% from the same period in 2009.
According to the bank's Chief Financial Officer, Nandika Buddhipala, one of the "principal contributors" to this growth was its loan book: "Gross Loans and Advances increased by Rs 18.135 billion in the three months, from Rs 186.635 billion at 30th June to Rs 204.770 billion at 30th September, a growth of 9.72 %. Within these three months alone, non-performing loans reduced by Rs 2.602 billion or 13.65 %." Additionally, he also added "Gross Loans and Advances for the full nine months reflected a growth of 11.91 % over the figure of Rs 182.9 billion at 31st December 2009."
Further, it also emerged that the bank's "Total Deposits grew by 7.6 % to Rs 252.617 billion at 30th September 2010, an increase of Rs 17.873 billion over the nine months reviewed." Also that "Net Interest Income had increased by 32.5 % for the nine months to Rs 11.705 billion. The interest expenses of the Bank recorded a drop of 23.78 % responding to the low interest rate regime that prevailed during the period under review compared to the corresponding period of last year." Meanwhile, it was also indicated that "increased lending had generated Net Interest Income of Rs 4.312 billion in the three months ending 30th September 2010, a growth of 41.5 % compared to the corresponding period of last year."
At the same time, while "[interest] income on loans and advances also recorded a drop of 16.70 %. However, interest income on other interest earning assets which mainly consist of treasury bills and bonds, increased by 29.87 %, restricting the drop in toal interest income to 5.38 %." This resulted in an overall net interest margin improvement of 4.57%.
Also noted was that growth in "non-interest expenses was limited to 4.5 % despite additional expenses incurred on expansion of the branch network" and that "[net] provisions on account of Bad and Doubtful Debts decreased by Rs 218 million or 44.5 %." |
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