Friday 1 August 2014
Sri Lankan stocks slips from near 3-yr high on profit-taking, foreign outflow
Aug 1 (Reuters) - Sri Lankan stocks ended a tad weaker on Friday, snapping a four-day winning streak as investors booked profits in large-cap shares as foreigners exited risky assets ahead of a key U.S. jobs report.
The main stock index ended 0.06 percent, or 3.77 points, weaker at 6,810.13, slipping from its highest close since Sept. 20, 2011 hit on Thursday. It rose 6.82 percent in July. The bourse is up 15.18 percent so far this year.
Expectation of strong corporate earnings, declining interest rates and continued foreign buying have helped boost buying risky assets in the island nation's $21.93 billion-worth stock market.
"Bit of profit-taking and the global worries dragged down the market," a stockbroker said on condition of anonymity.
Global shares fell on Friday and the euro eased against the dollar, hit by weak euro zone manufacturing data and nerves ahead of a key U.S. jobs report.
Analysts said the market will wait and see how foreign investors will react to the global situation and that earnings hopes could still drive the market with lower interest rates.
Foreign investors were net sellers for the first time in eight sessions. They have sold 77.9 million rupees ($598,300) worth of shares on Friday, but have been net buyers of 10.89 billion rupees so far this year.
Turnover was 775 million rupees, less than this year's daily average of about 1.09 billion rupees.
The index has been in the overbought region since July 3, as local investors moved funds from fixed income to riskier assets because of low interest rates and foreign buying.
Losses were led by large-cap share Ceylon Tobacco Company Plc which fell 1.54 percent to 1,130.60 rupees while Lion Brewery (Ceylon) Plc fell 2.33 percent to 625 rupees.
Lower interest rates have prompted local investors to buy shares and move away from unattractive fixed assets, analysts said. Yields on treasury bills edged down further by 7-10 basis points at a weekly auction on Wednesday.
The International Monetary Fund urged Sri Lanka on Wednesday to keep key interest rates on hold for the near term and said a cautious approach is warranted.
The main stock index ended 0.06 percent, or 3.77 points, weaker at 6,810.13, slipping from its highest close since Sept. 20, 2011 hit on Thursday. It rose 6.82 percent in July. The bourse is up 15.18 percent so far this year.
Expectation of strong corporate earnings, declining interest rates and continued foreign buying have helped boost buying risky assets in the island nation's $21.93 billion-worth stock market.
"Bit of profit-taking and the global worries dragged down the market," a stockbroker said on condition of anonymity.
Global shares fell on Friday and the euro eased against the dollar, hit by weak euro zone manufacturing data and nerves ahead of a key U.S. jobs report.
Analysts said the market will wait and see how foreign investors will react to the global situation and that earnings hopes could still drive the market with lower interest rates.
Foreign investors were net sellers for the first time in eight sessions. They have sold 77.9 million rupees ($598,300) worth of shares on Friday, but have been net buyers of 10.89 billion rupees so far this year.
Turnover was 775 million rupees, less than this year's daily average of about 1.09 billion rupees.
The index has been in the overbought region since July 3, as local investors moved funds from fixed income to riskier assets because of low interest rates and foreign buying.
Losses were led by large-cap share Ceylon Tobacco Company Plc which fell 1.54 percent to 1,130.60 rupees while Lion Brewery (Ceylon) Plc fell 2.33 percent to 625 rupees.
Lower interest rates have prompted local investors to buy shares and move away from unattractive fixed assets, analysts said. Yields on treasury bills edged down further by 7-10 basis points at a weekly auction on Wednesday.
The International Monetary Fund urged Sri Lanka on Wednesday to keep key interest rates on hold for the near term and said a cautious approach is warranted.
($1 = 130.2000 Sri Lankan Rupees)
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sunil Nair)
Sri Lanka stocks close lower
Aug 01, 2014 (LBO) - Sri Lanka's stocks closed 0.06 percent lower with Ceylon Tobacco Company losing ground amid net foreign selling, brokers said.
The Colombo benchmark All Share Price Index closed 3.77 points lower at 6,810.13, down 0.06 percent. The S&P SL20 closed 13.09 points lower at 3,759.42, down 0.35 percent.
Turnover was 775.04 million rupees, down from 1.05 billion rupees a day earlier with 110 stocks closed positive against 80 negative.
Laugfs Gas non-voting closed 50 cents higher at 30.70 rupees with an off-market transaction of 61.00 million rupees changing hands at 30.50 rupees per share contributing 8 percent of the daily turnover.
The aggregate value of all off-the-floor deals represented 18 percent of the turnover.
Central Investments and Finance closed 30 cents higher at 1.70 rupees, attracting most number of trades during the day.
Foreign investors bought 105.26 million rupees worth shares while selling 183.13 million rupees worth shares.
Ceylon Tobacco Company closed 17.70 rupees lower at 1,130.60 rupees, contributing most to the index drop.
Lion Brewery Ceylon closed 14.90 rupees lower at 625.00 rupees and John Keells Holdings closed 1.30 rupees lower at 235.50 rupees.
JKH’s W0022 warrants closed 10 cents higher at 64.10 rupees and its W0023 warrants closed 70 cents lower at 71.50 rupees.
Commercial Leasing and Finance closed 20 cents lower at 4.30 rupees and Commercial Bank closed 1.00 rupee lower at 144.00 rupees.
Sri Lanka Telecom closed 2.40 rupees higher at 56.50 rupees.
The Colombo benchmark All Share Price Index closed 3.77 points lower at 6,810.13, down 0.06 percent. The S&P SL20 closed 13.09 points lower at 3,759.42, down 0.35 percent.
Turnover was 775.04 million rupees, down from 1.05 billion rupees a day earlier with 110 stocks closed positive against 80 negative.
Laugfs Gas non-voting closed 50 cents higher at 30.70 rupees with an off-market transaction of 61.00 million rupees changing hands at 30.50 rupees per share contributing 8 percent of the daily turnover.
The aggregate value of all off-the-floor deals represented 18 percent of the turnover.
Central Investments and Finance closed 30 cents higher at 1.70 rupees, attracting most number of trades during the day.
Foreign investors bought 105.26 million rupees worth shares while selling 183.13 million rupees worth shares.
Ceylon Tobacco Company closed 17.70 rupees lower at 1,130.60 rupees, contributing most to the index drop.
Lion Brewery Ceylon closed 14.90 rupees lower at 625.00 rupees and John Keells Holdings closed 1.30 rupees lower at 235.50 rupees.
JKH’s W0022 warrants closed 10 cents higher at 64.10 rupees and its W0023 warrants closed 70 cents lower at 71.50 rupees.
Commercial Leasing and Finance closed 20 cents lower at 4.30 rupees and Commercial Bank closed 1.00 rupee lower at 144.00 rupees.
Sri Lanka Telecom closed 2.40 rupees higher at 56.50 rupees.
NDB reports solid Q2 2014 performance
NDB and its Group companies reported a strong performance with its profit attributable to shareholders crossing the Rs. 2 b mark for the six months ended 30 June 2014, affirming the strong strategic focus maintained by the Group in generating and delivering meaningful long-term value to its shareholders.
Chief Executive Officer of the Bank Rajendra Theagarajah, expressing his views on the half-year performance of the Group, stated that it is ably guided by a unique strategy which will ensure that the Group will thrive in its performance in a highly challenging and fast changing industry climate that prevails. He further stated that these results are a testimony to an exciting year of enhanced performance, which the Group promised to its shareholders, with the release of its Q1 results in May 2014.
The Group profit before income tax recorded a 42% year-on-year growth to reach Rs. 2.9 b for the first half of 2014, whilst the Group profit after tax recorded a commendable increase of 57% to reach Rs. 2.1 b. This strong growth was a result of enhanced performance across all products and services together with prudent and efficient cost management across the entire Group.
The Group’s total operating income of Rs. 6.3 b recorded a 17% growth on a year-on-year basis, with three constituents of operating income, namely, Net Interest Income (NII), net fee and commission income and net gains from trading recording a year-on-year increase of 16%, 15% and 38% respectively. The increase in NII amidst a reducing interest rate environment affirms the structural robustness of the Group’s balance sheet in sourcing and utilising funds effectively.
The bank’s impairment charges for loans and other losses of Rs. 222 m increased by 49% over the prior period, and were primarily due to the increase in impairment provision on an individual basis; resulting from the bank’s prudent adoption of fair valuing of its impaired loans, based on sound judgment and objective evidence of future recoveries.
The bank’s operating expenses recorded a modest 9% increase over the prior period, and the cost to income ratio recorded a record low of 42.6%, well below the budgeted levels, affirming the bank’s sustained focus on strategic cost management.
The asset base of the Group increased by 16% compared to end December 2013 and stood at Rs. 239 b, maintaining its growth momentum ahead of the industry growth levels. The balance sheet growth was fuelled by a marked increase in loans and receivables and investments.
Loans and receivables recorded a 26% increase (of Rs. 33 b) over the last 12 months, primarily due to increase in infrastructure and working capital financing.
Loans and receivables also recorded a 12% increase over December 2013, which is well above the industry loan growth rate. Asset quality was sustained with a non performing loans ratio of 2.69%, which is also well below the industry average.
Customer deposits of Rs. 140 b posted an increase of Rs. 22 b (a 19% growth) over the past 12 months. This was a 7% growth over 31 December 2013. NDB’s balance sheet indicates a strong liquidity position supported by customer deposits and institutional borrowings, which provide leeway for the bank to mobilise more funds to economically important sectors such as SMEs.
Capitalising on the strong relationships maintained with international funding agencies, NDB raised a further $ 75 m in June 2014 via a syndication facilitated by the International Finance Corporation, thereby completing a total syndication of $ 200 m. The bank raised $ 125 m of this syndication in March 2014.
The funds raised via this syndication facility will be infused to the SME sector of the country and other eligible sectors that contribute towards national development.
The syndication saw several leading international banks and more than five international development financial institutions lending to the bank (some of them lending to Sri Lanka for the first time), which reflects the growing confidence the international financial fraternity has placed in the Bank as well as Sri Lanka at large.
The second phase of the syndication facility will also help further strengthen the Group’s balance sheet.
The NDB Group has long benefited from a strong bedrock of capital, which has provided much stimulus in achieving solid business growth and resilience in absorbing potential business losses.
The regulatory capital adequacy ratios of the bank stood well above minimum requirements, the Tier I capital ratio at 11.18 % (minimum requirement – 5%) and the Tier I and II ratio at 16.49% (minimum requirement – 10%).
The Group Earnings per Share (EPS) stood at Rs. 25.40 for the first half of 2014, marking a 54% increase over the comparative period.
Return on shareholder funds (ROE) moved along the same upward trajectory and recorded 16.24%, well above the comparative period and the budgeted levels, denoting positive value generated to its shareholders.
The share price of the bank closed at Rs. 204.10 on 30 June with a market capitalisation of Rs. 33.7 b. Accordingly the Group’s Price Earning (PE) ratio was 8.04 (times).
The first half of 2014 saw NDB receiving many coveted local and international accolades.
The bank was recognised with a Bronze award for its sound investor relations at the CFA
Sri Lanka Capital Market Awards 2014, conducted by the CFA Society of Sri Lanka.
The bank clinched three titles at the Asian Banking and Finance – Retail Banking Awards 2014 as the Domestic Retail Bank of the Year (Sri Lanka), SME Bank of the Year (Sri Lanka) and the Core Banking System Initiative of the Year (Sri Lanka).
NDB Chairman Sunil Wijesinha sharing his thoughts on these achievements mentioned that all these awards speak volumes of the commitment, efficiency and transparency with which the bank strives to accomplish its purpose.
He added: “We are humbled by such recognitions and are further energised to serve all our stakeholders with best in class standards.” He reiterated that the Group was geared for robust growth and assured that they will deliver meaningful value to all their stakeholders.
www.ft.lk
Chief Executive Officer of the Bank Rajendra Theagarajah, expressing his views on the half-year performance of the Group, stated that it is ably guided by a unique strategy which will ensure that the Group will thrive in its performance in a highly challenging and fast changing industry climate that prevails. He further stated that these results are a testimony to an exciting year of enhanced performance, which the Group promised to its shareholders, with the release of its Q1 results in May 2014.
The Group profit before income tax recorded a 42% year-on-year growth to reach Rs. 2.9 b for the first half of 2014, whilst the Group profit after tax recorded a commendable increase of 57% to reach Rs. 2.1 b. This strong growth was a result of enhanced performance across all products and services together with prudent and efficient cost management across the entire Group.
The Group’s total operating income of Rs. 6.3 b recorded a 17% growth on a year-on-year basis, with three constituents of operating income, namely, Net Interest Income (NII), net fee and commission income and net gains from trading recording a year-on-year increase of 16%, 15% and 38% respectively. The increase in NII amidst a reducing interest rate environment affirms the structural robustness of the Group’s balance sheet in sourcing and utilising funds effectively.
The bank’s impairment charges for loans and other losses of Rs. 222 m increased by 49% over the prior period, and were primarily due to the increase in impairment provision on an individual basis; resulting from the bank’s prudent adoption of fair valuing of its impaired loans, based on sound judgment and objective evidence of future recoveries.
The bank’s operating expenses recorded a modest 9% increase over the prior period, and the cost to income ratio recorded a record low of 42.6%, well below the budgeted levels, affirming the bank’s sustained focus on strategic cost management.
The asset base of the Group increased by 16% compared to end December 2013 and stood at Rs. 239 b, maintaining its growth momentum ahead of the industry growth levels. The balance sheet growth was fuelled by a marked increase in loans and receivables and investments.
Loans and receivables recorded a 26% increase (of Rs. 33 b) over the last 12 months, primarily due to increase in infrastructure and working capital financing.
Loans and receivables also recorded a 12% increase over December 2013, which is well above the industry loan growth rate. Asset quality was sustained with a non performing loans ratio of 2.69%, which is also well below the industry average.
Customer deposits of Rs. 140 b posted an increase of Rs. 22 b (a 19% growth) over the past 12 months. This was a 7% growth over 31 December 2013. NDB’s balance sheet indicates a strong liquidity position supported by customer deposits and institutional borrowings, which provide leeway for the bank to mobilise more funds to economically important sectors such as SMEs.
Capitalising on the strong relationships maintained with international funding agencies, NDB raised a further $ 75 m in June 2014 via a syndication facilitated by the International Finance Corporation, thereby completing a total syndication of $ 200 m. The bank raised $ 125 m of this syndication in March 2014.
The funds raised via this syndication facility will be infused to the SME sector of the country and other eligible sectors that contribute towards national development.
The syndication saw several leading international banks and more than five international development financial institutions lending to the bank (some of them lending to Sri Lanka for the first time), which reflects the growing confidence the international financial fraternity has placed in the Bank as well as Sri Lanka at large.
The second phase of the syndication facility will also help further strengthen the Group’s balance sheet.
The NDB Group has long benefited from a strong bedrock of capital, which has provided much stimulus in achieving solid business growth and resilience in absorbing potential business losses.
The regulatory capital adequacy ratios of the bank stood well above minimum requirements, the Tier I capital ratio at 11.18 % (minimum requirement – 5%) and the Tier I and II ratio at 16.49% (minimum requirement – 10%).
The Group Earnings per Share (EPS) stood at Rs. 25.40 for the first half of 2014, marking a 54% increase over the comparative period.
Return on shareholder funds (ROE) moved along the same upward trajectory and recorded 16.24%, well above the comparative period and the budgeted levels, denoting positive value generated to its shareholders.
The share price of the bank closed at Rs. 204.10 on 30 June with a market capitalisation of Rs. 33.7 b. Accordingly the Group’s Price Earning (PE) ratio was 8.04 (times).
The first half of 2014 saw NDB receiving many coveted local and international accolades.
The bank was recognised with a Bronze award for its sound investor relations at the CFA
Sri Lanka Capital Market Awards 2014, conducted by the CFA Society of Sri Lanka.
The bank clinched three titles at the Asian Banking and Finance – Retail Banking Awards 2014 as the Domestic Retail Bank of the Year (Sri Lanka), SME Bank of the Year (Sri Lanka) and the Core Banking System Initiative of the Year (Sri Lanka).
NDB Chairman Sunil Wijesinha sharing his thoughts on these achievements mentioned that all these awards speak volumes of the commitment, efficiency and transparency with which the bank strives to accomplish its purpose.
He added: “We are humbled by such recognitions and are further energised to serve all our stakeholders with best in class standards.” He reiterated that the Group was geared for robust growth and assured that they will deliver meaningful value to all their stakeholders.
www.ft.lk
Seylan Bank PAT grows 21%; exceeds Rs. 1.2 b during 1H 2014
Seylan Bank recorded an impressive performance with profit before income tax reaching Rs. 1,863 million for the six months ended 30 June 2014. Profits after tax reached Rs. 1,213 million, a 21% increase compared to the Rs. 1,002 million reported in the corresponding six-month period in 2013.
The quarterly PAT figure of Rs. 698 million was an improvement of 41% compared with Rs. 497 million reported in the corresponding three months of last year.
Net interest income increased from Rs. 4.27 billion to Rs. 5.16 billion, a 21% increase for the six months ended 30 June 2014. Net fee and commission income increased by 8% from Rs. 973 million to Rs. 1,056 million with the bank showing a continuation of the solid growth trend recorded in the past few years.
During 1H 2014, the bank grew its deposit base from Rs. 167.4 billion to Rs. 172.7 billion.
The growth was predominately achieved through the mobilisation of current and savings deposits, which enabled the bank’s low cost deposit base to increase from 33% in December 2013 to over 35% as at end June 2014. However, the bank’s net advance portfolio reduced from Rs. 136.5 billion to Rs. 133.1 billion during the six months under review, due to slower than expected credit growth in the industry and the impact of lower gold prices.
Despite the decline in gold prices and its impact on the pawning base, the bank was also able to improve its asset quality through effective recovery and rehabilitating efforts.
This enabled the bank to maintain its Gross NPA (net of IIS) at 10.86% as at end June 2014.
The bank has also set itself a target of reducing this to a single digit by year-end.
The bank successfully concluded a review, update and extension of its Strategic Plan in the latter part of 2013, with an extension of the plan to 2016. The areas of focus in the strategic plan review included advance/deposit growth, branch expansion, customer service improvement, staff development, NPA reduction, cost control, new product development, IT infrastructure, shareholder value, etc.
The bank also continued its CSR initiatives focusing on education and accelerated its 100 libraries project for underprivileged schools; 18 such school libraries were opened by the bank so far during 2014.
The branch relocation and upgrading project too continued in full steam during 1H 2014, with a view to enhance the customers’ service experience. In July 2014, a further 19 Convenient Banking Centres with limited operations were upgraded to full branch status.
As at 30 June, the bank network comprised 151 branches, 162 ATMs and 92 Student Savings Centres.
The bank’s total capital adequacy ratio stands at 15.27% at the end of Q-2 2014, well above the regulatory requirements.
As a result of the impressive performance, Earnings per Share was at Rs. 3.51 for Q2 2014, while return (profit before tax) on assets and return on equity stood at 1.70% and 11.06% respectively. The bank’s net asset value per share as at 30 June was Rs. 64.90 (Group Rs 67.71).
www.ft.lk
The quarterly PAT figure of Rs. 698 million was an improvement of 41% compared with Rs. 497 million reported in the corresponding three months of last year.
Net interest income increased from Rs. 4.27 billion to Rs. 5.16 billion, a 21% increase for the six months ended 30 June 2014. Net fee and commission income increased by 8% from Rs. 973 million to Rs. 1,056 million with the bank showing a continuation of the solid growth trend recorded in the past few years.
During 1H 2014, the bank grew its deposit base from Rs. 167.4 billion to Rs. 172.7 billion.
The growth was predominately achieved through the mobilisation of current and savings deposits, which enabled the bank’s low cost deposit base to increase from 33% in December 2013 to over 35% as at end June 2014. However, the bank’s net advance portfolio reduced from Rs. 136.5 billion to Rs. 133.1 billion during the six months under review, due to slower than expected credit growth in the industry and the impact of lower gold prices.
Despite the decline in gold prices and its impact on the pawning base, the bank was also able to improve its asset quality through effective recovery and rehabilitating efforts.
This enabled the bank to maintain its Gross NPA (net of IIS) at 10.86% as at end June 2014.
The bank has also set itself a target of reducing this to a single digit by year-end.
The bank successfully concluded a review, update and extension of its Strategic Plan in the latter part of 2013, with an extension of the plan to 2016. The areas of focus in the strategic plan review included advance/deposit growth, branch expansion, customer service improvement, staff development, NPA reduction, cost control, new product development, IT infrastructure, shareholder value, etc.
The bank also continued its CSR initiatives focusing on education and accelerated its 100 libraries project for underprivileged schools; 18 such school libraries were opened by the bank so far during 2014.
The branch relocation and upgrading project too continued in full steam during 1H 2014, with a view to enhance the customers’ service experience. In July 2014, a further 19 Convenient Banking Centres with limited operations were upgraded to full branch status.
As at 30 June, the bank network comprised 151 branches, 162 ATMs and 92 Student Savings Centres.
The bank’s total capital adequacy ratio stands at 15.27% at the end of Q-2 2014, well above the regulatory requirements.
As a result of the impressive performance, Earnings per Share was at Rs. 3.51 for Q2 2014, while return (profit before tax) on assets and return on equity stood at 1.70% and 11.06% respectively. The bank’s net asset value per share as at 30 June was Rs. 64.90 (Group Rs 67.71).
www.ft.lk
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