Treasury to release Rs 544 m to pay GK depositors

The Treasury will release Rs.544.3 million needed for the first tranche towards the repayment of the defunct Golden Key Credit Card Company (GK) depositors.

This in response to a pledge made by the Finance Ministry that the government will mediate to settle this much anticipated and long over due issue.

The Cabinet on a proposal made by Finance Minister Ravi Karunanayake approved this payment and the money is now being dispersed.

Accordingly, the depositors who have had their account balance up to Rs two million will be paid within one month from today.

The balance will be repaid before the end of one year.
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CSE nets US$ 58.2 m upto May 2015

Foreign investments in the Colombo Stock Exchange (CSE) recorded a net inflow of US dollars 58.2 million during the first five months of 2015.

This includes net inflows to the secondary market amounting to US dollars 33.5 million and inflows to the primary market amounting to US dollars 24.7 million. Meanwhile, net cumulative inflows to the CSE by 21July 2015 amounted to US dollars 33.1million.

According to Government Data, foreign investments in the government securities market recorded a net outflow of US dollars 237.3 million during the first six months of 2015 compared to a net inflow of US dollars 196.5 million during the corresponding period of 2014. During the first five months of 2015, long term loans obtained by the Government amounted to US dollars 372.0 million compared to US dollars 848.1 million received in the corresponding period of 2014. Meanwhile during the year, up to 21July 2015, the rupee has depreciated by 2.1per cent against the US dollar. However, based on cross currency exchange rate movements, the Sri Lankan rupee appreciated against the euro by 10.0 per cent, the Australian dollar by 9.2 per cent and the Japanese yen by 2.0 per cent, while depreciating against the pound sterling by 2.0 per cent and the Indian rupee by 1.6per cent during this period.

In May 2015, workers' remittances declined marginally by 3.5 per cent, year- on-year, to US dollars 537.7 million from US dollars 557.5 million in May 2014.

Meanwhile, on a cumulative basis, inflows from workers' remittances increased marginally by 1.0 per cent to US dollars 2,803.1 million during the first five months of 2015 in comparison to the corresponding period of 2014. However, workers' remittances are expected to gather momentum during the second half of the year.
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Sri Lanka shares end at near 8-week high on stability hopes, earnings

Sri Lankan shares closed at their highest level in about eight weeks on Thursday on strong foreign inflows for a second session as hopes of political stability after Aug. 17 parliamentary polls and better earnings lifted sentiment, brokers said.

The main stock index ended 0.18 percent, or 12.99 points up at 7,212.62, its highest since May 29.

Turnover was at 2.21 billion rupees ($16.5 million), boosted by foreign buying. This was the highest turnover since July 3 and more than double of this year's daily average of 1.06 billion rupees.

Foreign investors were net buyers of 930.7 million rupees on Thursday, but they have been net sellers of 478.4 million rupees worth of shares so far this year.

"Investors are buying because they are confident of getting a stable government after the elections," Danushka Samarasinghe, research head at Softlogic Stockbrokers said.

Samarasinghe expects Sri Lankan companies to post strong results this quarter.

Analysts also said hopes over political stability after Aug. 17 parliament election also helped sentiment. They expect next month's election to help strengthen President Maithripala Sirisena's political position.

Conglomerate John Keells Holdings Plc rose 0.64 percent, while Hemas Holdings Plc rose 4.12 percent, pushing the overall index up.

($1 = 133.6000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Anand Basu)

Union Bank posts Rs 60 m PAT in Q2

Union Bank has posted a net profit of Rs 60 million in the second quarter of 2015.

Union Bank Director and CEO Indrajit Wickramasinghe said the first half of 2015 was a crucial period with the Bank restructuring itself.

“I am pleased to see the results of the many strategic development initiatives and investments gathering a strong growth momentum and its results evident with the performance the bank as highlighted as at June 2015”,he said. Second quarter results have highlighted an impressive growth reflecting on the rapid development initiatives the Bank embarked. From page iv

“The growth trajectory that is envisioned will deliver continuous value propositions and benefits to our customers for greater banking convenience. We have ensured greater process efficiencies and aligned our teams to deliver the best value and service.”

The Bank recorded a significant increase in revenue for 1H15, in comparison to the corresponding period in 2014. Total operating income for 1H15 grew by 37% YoY to Rs 1,350 Mn. Net Interest Income of the Bank grew by 43%YoY, to Rs.1,039 Mn for 1H15. Fees and Other operating income grew by 21% in comparison to the corresponding reporting period.

The Group recorded a significant increase in revenue for 1H15 in comparison to the corresponding period. Total operating income for 1H15 grew by 28% YoY to Rs 1,617Mn. This is mainly due to the strong Net Interest Income growth of 51%.

The Bank reported a profit before tax and financial services VAT of Rs.135Mn for the period.

This is a 291% increase in comparison to the previous period. Furthermore the Bank reported a Net profit after tax of Rs.60Mn for the 6 months period.

This is despite the significant investments that have been made, which are in line with the new strategic initiatives.
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Fitch rates ComBank the strongest Bank

The National Long-Term Rating of Commercial Bank of Ceylon PLC has been affirmed at ‘AA(lka); Stable Outlook’ by Fitch Ratings Lanka (FRL).

Commercial Bank’s Basel II compliant outstanding subordinated debentures have been affirmed by Fitch at ‘AA-(lka)’.

In a recent report, the agency said: “Fitch considers Commercial Bank as the strongest bank in this peer group. Its rating captures its more measured risk appetite, solid franchise, sound track record, and strong funding profile. The bank’s provision coverage has been improving and asset quality has remained satisfactory. The ratings reflect our expectation that its operations in Bangladesh will remain small.” “Sustained improvements in Commercial Bank’s asset quality and enhanced resilience against a volatile operating environment could be positive for the rating,” Fitch said.
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Sri Lanka Treasury Bill auction held on 22 July 2015

Sri Lanka stocks at more than 7-week high on hope for politics, earnings

Sri Lankan stocks hit a more than seven week high on Wednesday in high turnover led by blue chips as expectations of political stability after Aug. 17 parliamentary polls lifted sentiment, brokers said.

Brokers said investors were also awaiting cues from June-quarter corporate earnings.

The main stock index ended 0.76 percent, or 54.04 points up at 7,199.63, its highest since June 1.

Turnover was worth 1.62 billion rupees ($2.50 million), the highest since July 17 and well over this year's daily average of 1.05 billion rupees.

Foreign investors were net sellers of 442.3 million rupees on Wednesday extending year-to-date net foreign selling to 1.41 billion rupees worth of shares.

"There was huge buying interest today specially the stocks we're looking at for strong earnings," said Dimantha Mathew, a research manager at First Capital Equities (Pvt) Ltd.

"Buying interest emerged predominantly on earning expectations."

Conglomerate John Keells Holdings Plc rose 2.05 percent while Distillers Sri Lanka Plc rose 3.51 percent.

Analysts expect next month's election can help strengthen President Maithripala Sirisena's political position. 

($1 = 133.7000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez)