Friday, 28 August 2015

BoC leads first half growth with Rs. 6.7 b profit

The Bank of Ceylon (BoC) continued to lead its growth course in first half of 2015 with Rs. 9.1 billion Profit Before Tax (PBT) achieving 6% growth over the previous year.

Profit After Tax (PAT) stood at Rs. 6.7 billion resulting in 8% growth. \The Group reported Rs. 9 billion PBT resulting in 5% growth over the corresponding period of the previous year and the Bank dominates the results of the Group accounting for 96% of total earnings and 97% of the Group’s assets.

Total operating income for the period stood at Rs. 31 billion and shows a 24% increase which has been accelerated through 52% growth in net interest income and 53% growth in other operating income.

Net interest income has increased due to higher interest income complemented by a 12% reduction in interest expenses depicting a greater efficiency in deposit mix management by the Bank which has contributed to improve the Net Interest Margin (NIM) by 36% to 3.4% on YoY basis.

Despite the increase in personnel expenses, the Bank has been able to maintain other expenses 17 % lower than those of the corresponding period in 2014, allowing only a marginal increase of 2% in total operating expenses.

BoC has grown its total assets by a further 6% to Rs.1.4 trillion as of end June 2015.

Loans and advances accounted for 56% of the Bank’s total assets base and gross loans stood at Rs. 837 billion.

Recovering from the slow credit growth in 2014, the loan book has grown by 8% during the first half of 2015. The investment portfolio also showed an upward movement due to increased investment and treasury activities.

Deposits accounted for 71% of the Bank’s liabilities as at end June 2015 and showed a marginal increase of 1% compared to the end 2014 position which is an 8% increase compared to end June 2014.

Deposit mix has improved favorably achieving a higher CASA mix (current and savings account to total deposits) of 45% resulting in 437 bp increase on YoY basis.

The Bank’s domestic liquid asset ratio was 30.8% as of end June 2015 while the off-shore liquid asset ratio was 28.9% standing well above the Central Bank’s required benchmark of 20%.

The Bank managed to maintain better trade-off between liquidity and interest earning assets.

The Bank also continued to sustain CAR by maintaining Tier I at 8.4% and Tier II at 11.9% levels against the Central Bank’s minimum requirements of 5% and 10% respectively.

Further, the Bank has created history once again by being ranked among the top five banks in the Asia – Pacific region (excluding China and Japan) in terms of return on capital by “The Banker” magazine, becoming the first Sri Lankan bank to achieve such a performance ranking.
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