National Development Bank PLC posted enhanced income and profitability during the nine months ended September 30, 2023.
NDB’s Director/ CEO Dimantha Seneviratne stated that the Sri Lankan economy is emerging well from the crisis and the Bank is recording similar performance. With critical economic factors such as interest rate, exchange rate and inflation stabilized, there is greater certainty and confidence in doing business.
“The timely finalization of the Domestic Debt Optimization is noteworthy and we expect expedited finalization of the international debt structuring too, which will further enhance internal conditions and also the external profile of Sri Lanka.”
NDB Group comprising the NDB Bank as the parent and its subsidiary companies posted an impressive Rs. 10.0 Bn profit before all taxes for the nine months ended 30 September 2023 which compared with Rs. 1.2 Bn of the same period in 2022. Profit after tax at the Group level was Rs. 5.4 Bn whilst the same at the Bank level was Rs. 5.2 Bn which compared with Rs. 691 Mn and Rs. 561 Mn respectively of the nine months of 2022 (YoY). At the Bank level Gross income for the period was Rs. 102.9 Bn, up by 38% YoY. Net interest income (NII) was Rs. 24.4Bn, an increase of 10%. Interest income of Rs. 93.7 Bn which increased by 44% and interest expense of Rs. 69.3 Bn which increased by 61% drove NII.
The deposits book was also re-priced simultaneously, with the Bank achieving a NIM of 4.00%. Net fee and commission income also drove profitability with a marked improvement of 24% to Rs. 5.4 Bn. Impairment charges for the nine months ended 30 September 2023 were Rs. 13.9 Bn, a YoY reduction of 37%, primarily due to higher impairment provisions made for FCY Investments in the same period of 2022. Total operating costs for the period was Rs. 10.1 Bn, up by 20%. General increase in price levels, particularly energy and foreign currency denominated expenses drove costs up. The resultant cost to income ratio was 30.2% and compared well within the industry. Taxes netted Rs.4.3 Bn, comprising taxes on financial services of Rs. 2.4Bn and income tax of Rs. 1.9Bn.
NDB posted a total assets figure of Rs. 789Bn as of end September 2023. The same figure at the Group level was Rs. 796 Bn. This was a 5% reduction over the total assets position in 2022, predominantly attributable to the appreciation of the Sri Lankan Rupee over 2023 compared to the severe depreciation seen in 2022 and the loan book contraction. Gross loans at the end of the period closed at Rs. 514 Bn – down by 11% over 2022.
With economic activity slowly improving it is anticipated that the industry-wide decline in gross loans will enter positive territories in the near future.
Customer deposits closed in at Rs. 627.7 Bn, a 7% reduction over 2022, with the reduction partly attributable to the appreciation of the Sri Lankan Rupee. The Balance Sheet remained dynamic and resilient and the Bank maintained sound liquidity and capital adequacy.
The post NDB records strong core banking performance, Group PTP of Rs.10.0B a eight-fold YoY increase appeared first on DailyNews.