NDB posts strong first quarter performance
View(s):National Development Bank PLC posted satisfactory results for the first quarter of 2023, as it continued strong strategic realignment in response to the external challenges that continue to affect the banking sector.
In a media release issued by the bank, Director/ CEO Dimantha Seneviratne stated that prudent balance sheet management, diversified revenue focus and cost optimisation ensured that the bank generated sound returns to its shareholders.
“We are cautiously optimistic of the economy’s recovery, particularly as the banking sector remains vulnerable with cascading effects of the economic crisis exerting pressure on sector capital adequacy. In such a scenario we are striving to strike a delicate balance between ensuring the quality of our balance sheet and supporting our customers as they gradually converge on a path of recovery,” he further commented.
NDB recorded a post-tax profit of Rs. 805 million for the first quarter ended March 31, 2023, a growth of 33 per cent over the same period in 2022.
As demonstrated over the years, NDB’s core banking operations posted resilient performance with gross income growing by 75 per cent to Rs.33.5 billion in the period under review.
Net interest income grew by 38 per cent to Rs.8.5 billion, driven by interest income of Rs.32.8 billion and interest expenses of Rs.24.2 billion, which were higher by 113 per cent and 165 per cent respectively over the comparative period.
Other operating income had a Rs.2.2 billion revaluation loss on account of the rupee appreciation on the bank’s foreign currency reserves.
Impairment charges continued to weigh down profits with a charge of Rs.4.8 billion reported for the quarter. Impairment provisions for loans reflected macroeconomic impact on loan book quality, predominantly stemming from reduced debt serviceability of customers across all segments, exacerbated by high inflation and negative GDP growth.
The statement said NDB continued to maintain provisions on investments in foreign currency bonds, for the expected International Sovereign Bond (ISB) restructuring to be announced by the Government of Sri Lanka during the year.
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