Seylan Bank records PBT of LKR 1.7 Bn for Q1
Seylan Bank began the new fiscal year on a strong note, with Q1 2023 recording a Profit Before Tax (PBT) of LKR 1.7 billion compared to LKR 1.5 billion in 1Q 2022 demonstrating a robust growth of 17.26%. Supporting the bottom line, Profit After Tax (PAT) was LKR 1.135 billion in 1Q 2023, a 7.69% increase over the corresponding 2022 period.
Contributing significantly to the Bank’s profit momentum was a surge in Net Interest Income (NII) by 67.98% for the period under review. Growth in the Bank’s topline for Q1 2023 was propelled by notable increases in operating income of LKR 13.3 billion, a 47.26% growth during the period under review compared to LKR 9.1 billion in the corresponding period of 2022, driven mainly by growth in Net Interest Income, Net Fee Income etc. The bank recorded a substantial increase in interest income, amounting to Rs 28.9 billion, reflecting a 116.87% growth.
The Bank’s total assets as at March 31, 2023 was LKR 671 billionn. While loans and advances was LKR 424 billion, a contraction mainly due to the impact from local currency appreciation, deposits reflected a marginal growth to LKR 550 Bn. The contraction of assets and liabilities was partly due to local currency appreciation, which led to a decrease in the value of foreign currency assets and liabilities.
Total Operating Expenses recorded an increase of 23.39% from LKR 3.6 billion in the 1Q of the previous year to LKR 4.4 billion during the period under review, mainly due to the impact of price increases due to higher inflation and local currency depreciation. The Bank’s personnel expenses increased by 13.08 % to LKR 2.2 billion in 1Q 2023 compared to LKR 1.98 Bn in 1Q 2022 as a result of the salary revision based on the collective agreement and other adjustments provided to compensate rising cost of living expenses.
The Bank recorded an impairment charge of LKR 6.4 billion in 1 Q 2023 against LKR 3.4 billion reported in 1 Q 2022 with a growth of 88.14%. Income tax expenses stood at LKR 585.5 million which is a 41.68% increase from the comparative period, which increased to LKR 413.2 million due to higher tax rates.
Seylan Bank remained soundly capitalized as of 31 March 2023, with the key capital adequacy ratios above the regulatory minimum requirements and recorded 11.17% as Common Equity Tier 1 Capital Ratio & Total Tier 1 Capital Ratio and 13.92% as the Total Capital Ratio. The Return on Equity (ROE) stood at 8.24% and Return on Average Assets (profit before tax) stood at 1.02%.