National Development Bank PLC (NDB) concluded anothersuccessful year, achieving a record PAT of LKR.7.7 Bn, with an impressive growth of 164% over the previous year. The sound performance of the Bank during the year amidst stiff competition, affirms the resilience and prudence of the Bank's strategy in driving its business efficiently.
The Bank recorded a Profit Before Tax (PBT) of LKR 9.7 Bn for 2013, a healthy growth of 110% compared to the previous year. The Bank's PAT was LKR 7.7 Bn, an increase of 164% over the previous year's LKR 2.9 Bn.However, PAT for the Group was LKR 2.7 Bn as at the end of the year, a 70% decrease from the previous year. This drop in the Group PAT was due to the exceptional equity gain of LKR 5.3 Bn earned by the Group's subsidiary NDB Capital Holdings PLC (NCAP) through the strategic divestment of AVIVA NDB Insurance PLC to American International Assurance (AIA) Company Limited of Hong Kong in December 2012. This gain was transferred to the Bank from the Group in March 2013 via a share buyback agreement with NCAP, thereby bringing down the Group PAT by the same amount compared to the previous year. The timing difference of realizing this income within the Group and the Bank, also explains how the Bank's PAT has steeply risen compared to the previous year's comparative figure.
On an overall note, the Group companies performed well during the year, providing much impetus to the enhanced performance of the Group as a whole.
The Total Operating Income of the Bank for 2013, comprising of Net Interest Income (NII), Fee and Commission Income and Net Trading Income achieved an impressive growth of 80% up to LKR 15.9 Bn, compared to 2012. The growth in Net Operating Income was restricted to 68%, due to impairment losses totaling up to LKR 1.2 Bn during the year.This was a result of the increased stress levels within the industry for loan recoveries and the Bank's prudent adoption of fair valuing the impaired loans based on sound judgment and objective evidence on future recoveries.
With policy rates being reduced in two tranches as a part of the country's monetary policy, interest rates were on a continuous downward trend during the year. Withstanding such industry norms, the Bank was able to achieve an NII ofLKR 6.8 Bn, a 22% increase compared to 2012. Interest Income grew by 21% with a corresponding growth in the Interest Expenses also by the same percentage. The Bank was able to maintain its Net Interest Margin at 3.74% for both 2013 and 2012, resulting from efficient balance sheet management.
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The Bank recorded a Profit Before Tax (PBT) of LKR 9.7 Bn for 2013, a healthy growth of 110% compared to the previous year. The Bank's PAT was LKR 7.7 Bn, an increase of 164% over the previous year's LKR 2.9 Bn.However, PAT for the Group was LKR 2.7 Bn as at the end of the year, a 70% decrease from the previous year. This drop in the Group PAT was due to the exceptional equity gain of LKR 5.3 Bn earned by the Group's subsidiary NDB Capital Holdings PLC (NCAP) through the strategic divestment of AVIVA NDB Insurance PLC to American International Assurance (AIA) Company Limited of Hong Kong in December 2012. This gain was transferred to the Bank from the Group in March 2013 via a share buyback agreement with NCAP, thereby bringing down the Group PAT by the same amount compared to the previous year. The timing difference of realizing this income within the Group and the Bank, also explains how the Bank's PAT has steeply risen compared to the previous year's comparative figure.
On an overall note, the Group companies performed well during the year, providing much impetus to the enhanced performance of the Group as a whole.
The Total Operating Income of the Bank for 2013, comprising of Net Interest Income (NII), Fee and Commission Income and Net Trading Income achieved an impressive growth of 80% up to LKR 15.9 Bn, compared to 2012. The growth in Net Operating Income was restricted to 68%, due to impairment losses totaling up to LKR 1.2 Bn during the year.This was a result of the increased stress levels within the industry for loan recoveries and the Bank's prudent adoption of fair valuing the impaired loans based on sound judgment and objective evidence on future recoveries.
With policy rates being reduced in two tranches as a part of the country's monetary policy, interest rates were on a continuous downward trend during the year. Withstanding such industry norms, the Bank was able to achieve an NII ofLKR 6.8 Bn, a 22% increase compared to 2012. Interest Income grew by 21% with a corresponding growth in the Interest Expenses also by the same percentage. The Bank was able to maintain its Net Interest Margin at 3.74% for both 2013 and 2012, resulting from efficient balance sheet management.
www.island.lk
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