Seylan Bank net profit up 24.4 percent for full year

Feb 29, 2016 (LBO) - Seylan Bank reported a reported a record profit after tax of 3,831 million rupees for the year ended 31st December 2015, up 24.4 percent compared with the previous year, the bank said. Profit before tax increased 24.25 percent to reach 5,777 million rupees for the year. Earnings per share was 11.11 rupees, on a share price of 84 rupees, down 3.9 percent on Monday. Net interest income increased from 11,165 million rupees to 11,825 million rupees, a 5.9 percent increase for the year, while net Fee and Commission income increased 19.5 percent from 2,257 million rupees to 2,697 million rupees showing "a consolidation of the solid growth achieved by Seylan Bank over the past few years," a statement said. Other operating income comprising net gains from trading, gains on financial instruments, foreign exchange and other income decreased by 42.2 percent to 1,624 million rupees in 2015. This was mainly due to lower contributions from capital gains on government securities due to the upward movement in interest rates. During the year under review the Bank focused considerably on cost containment, it said. "This was evident by the containment of growth in expenses of 6.36 percent from 8,109 million in 2014 to Rs.8,625 million in 2015." The slow credit growth in the first half of the year, was reversed in the latter half with growth momentum picking up in the third and fourth quarters of 2015 and the bank reported a net credit growth of 24.61 percent, with net advances growing from 154,963 million rupees in 2014 to 193,104 million rupees in 2015. During 2015, the Bank grew its deposit base by 20.76 percent to 224,525 million rupees. The Bank’s low cost deposit base comprising current & savings accounts (CASA) stood at 36 percent of the total deposit base as at end December 2015, it said. The Bank was able to improve its asset quality with a reduction in its Gross NPA (net of IIS) from 7.69 percent in December 2014 to 4.68 percent as at end December 2015. "The Bank has consistently been able to improve its asset quality since 2009 through focused, sustained and effective recovery efforts," it said. The Bank also continued its CSR initiatives focusing on education and accelerated its 100 libraries project for underprivileged schools. 29 more school libraries were opened by the Bank during 2015 taking the overall number of libraries opened under the project to 80. "The Branch refurbishment and relocation too continued in full stream during 2015, with a view to enhance the customer’s service experience. 85 percent of the branch network has been refurbishment over the last 4 years. The Bank opened 2 new branches in Pilimathalawa & Peradeniya during the year. As at 31st December 2015, the Bank network comprised of 159 Branches, 182 ATMs and 95 Student Saving Centres." The Bank’s total Capital Adequacy ratio stands at 12.87 percent, of which the Tier – 1 ratio stands at 12.24 percent at the end of 2015, both well above the regulatory requirements, it said. In July 2015, Fitch affirmed the Bank’s rating at ‘A-lka’ with a ‘stable’ outlook. As a result of performance, Return (profit before tax) on Assets and Return on Equity stood at to 2.16 percent and 15.62 percent respectively. The Bank’s Net Asset Value per share as at 31st December 2015 was 72.63 rupees (Group 76.21 rupees).