Nations Trust Bank (NTB) has closed the first quarter ending 31March 2017 with a post-tax profit of Rs. 725 m, up by 22% over the corresponding period in the previous year with pre-tax profits increasing by an impressive 33%.
Profitability growth was underpinned by a 9% growth in loans and advances during the period under review despite the narrowing of net interest margins.
Net interest income increased by 18% as the volume growth outperformed the impact arising from the narrowing of NIMs.
The NIM compression is reflective of the rising cost of funds and a conscious rebalancing of the loan portfolio towards Corporate and SME from consumer lending.
Non fund based income including fees, commission and operating income increased by 39% for the period under review with trade and other related fees contributing to a larger portion of the increase. Initiatives put in place to harness fee generating business across various customer and market segments is progressing rapidly as reflected by the increases shown in fee based income.
Net trading losses for the year amounted to Rs.56 m which is reflective of the swap cost arising from an increased funding forex SWAP book and unfavourable movements in forward premiums. However, the bank benefited from the relatively lower funding costs of the forex swaps compared to high cost rupee deposits.
Impairment charges recorded an 11% decrease which reflects the emphasis placed on credit quality and the collection effort that has been put in. Overall asset quality was maintained across the portfolios with the Group NPL ratio improving from 2.41% in December 2016 to 2.30% by quarter end 2017.
Expenses recorded a growth of 15% with personnel and other operating expenses contributing towards the increase. Growth in expenses are somewhat impacted by the higher taxes applicable for the current period on account of the increase in the VAT rate and the impact of regulatory allowances. The bank continued to focus on widening the roll-out of lean initiatives, workflow methods and automation across the enterprise in its pursuit towards rationalizing expenditure on key controllable cost lines.
SME and Corporate loan portfolios recorded good growth during the quarter, thereby cementing a strong base for further growth in the ensuing months. CASA growth was significant for the quarter recording a 10% growth and contributing to 25% of the total deposit growth. The launch of the new max-bonus product boosted growth in SA and has been well received by the market.
Commenting on the results and achievements, CEO/Executive Director Renuka Fernandostated: “I am extremely pleased with the performance of the first quarter; well-balanced across the business pillars with support functions collaborating and equally contributing towards the growth and achievements in the businesses. The foundation has now been put in place to have a successful financial year.”
Nations Trust Bank PLC is amongst the top 25 business establishments in Sri Lanka, ranked by Business Today Magazine and is the benchmark for customer convenience, ably providing a host of financial products and services to a wide range of customers.
Nations Trust Bank operates 93 branches across the country, boasting an ATM network covering 137 locations plus more than 3,500 ATMs on the Lanka Pay Network and is the issuer and sole acquirer for American Express cards in Sri Lanka.
Profitability growth was underpinned by a 9% growth in loans and advances during the period under review despite the narrowing of net interest margins.
Net interest income increased by 18% as the volume growth outperformed the impact arising from the narrowing of NIMs.
The NIM compression is reflective of the rising cost of funds and a conscious rebalancing of the loan portfolio towards Corporate and SME from consumer lending.
Non fund based income including fees, commission and operating income increased by 39% for the period under review with trade and other related fees contributing to a larger portion of the increase. Initiatives put in place to harness fee generating business across various customer and market segments is progressing rapidly as reflected by the increases shown in fee based income.
Net trading losses for the year amounted to Rs.56 m which is reflective of the swap cost arising from an increased funding forex SWAP book and unfavourable movements in forward premiums. However, the bank benefited from the relatively lower funding costs of the forex swaps compared to high cost rupee deposits.
Impairment charges recorded an 11% decrease which reflects the emphasis placed on credit quality and the collection effort that has been put in. Overall asset quality was maintained across the portfolios with the Group NPL ratio improving from 2.41% in December 2016 to 2.30% by quarter end 2017.
Expenses recorded a growth of 15% with personnel and other operating expenses contributing towards the increase. Growth in expenses are somewhat impacted by the higher taxes applicable for the current period on account of the increase in the VAT rate and the impact of regulatory allowances. The bank continued to focus on widening the roll-out of lean initiatives, workflow methods and automation across the enterprise in its pursuit towards rationalizing expenditure on key controllable cost lines.
SME and Corporate loan portfolios recorded good growth during the quarter, thereby cementing a strong base for further growth in the ensuing months. CASA growth was significant for the quarter recording a 10% growth and contributing to 25% of the total deposit growth. The launch of the new max-bonus product boosted growth in SA and has been well received by the market.
Commenting on the results and achievements, CEO/Executive Director Renuka Fernandostated: “I am extremely pleased with the performance of the first quarter; well-balanced across the business pillars with support functions collaborating and equally contributing towards the growth and achievements in the businesses. The foundation has now been put in place to have a successful financial year.”
Nations Trust Bank PLC is amongst the top 25 business establishments in Sri Lanka, ranked by Business Today Magazine and is the benchmark for customer convenience, ably providing a host of financial products and services to a wide range of customers.
Nations Trust Bank operates 93 branches across the country, boasting an ATM network covering 137 locations plus more than 3,500 ATMs on the Lanka Pay Network and is the issuer and sole acquirer for American Express cards in Sri Lanka.
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