Sri Lanka's Sampath Bank flags competition from telcos

ECONOMYNEXT - Sri Lanka's Sampath Bank Plc has drawn attention to the threat banking faces from competition from mobile phone companies which are offering payment and other transaction services.

“The year ahead is likely to present an uncertain operating environment,” Sampath Bank Managing Director Nanda Fernando told shareholders in the firm’s annual report.

“We are also likely to experience strong competitive pressures, not only from peers in the banking industry, but also from telcos that appear to be intruding into our territory.”

Nonetheless, Fernando said, Sampath Bank stands firm in its determination to maintain its growth momentum, both in terms of the top line as well as the bottom line.

Fernando said Sampath Bank was focusing in improving its digital online banking facilities to cater to changing technology and consumer trends.

“Additionally, cost management and the promotion of electronic delivery channels will continue to be absolute priorities in our medium term growth agenda,” he said.

Norway's Norges Bank fund invests US$65mn in Sri Lanka stocks

ECONOMYNEXT - Norges Bank Investment Management (NBIM), a sovereign wealth fund in Norway has invested 65 million US dollars in Sri Lanka stocks over the past two years, the Royal Norwegian Embassy said.

NBIM, which comes under the Norges Bank, the country's central bank, has started by investing 31 million dollars in 2016 and doubled it to 65 million dollars in 2016.

"It must also be noted that the Norwegian Central Bank is completely independent from the Norwegian Government, therefore, this fund is not used as an instrument of the Norwegian government’s foreign policy, or as a tool in foreign aid," the statement said.

"The only mandate for the Norwegian Central Bank is to safeguard and ensure further growth of the fund.

"Therefore, the investments in Sri Lanka from the Norwegian sovereign wealth fund is an indication of the investor confidence and the potential investment opportunities that are available in the market."

The Norwegian Government Pension Fund Global is a sovereign wealth fund, which manages oil and gas profits of the government, where real returns are used for budgetary spending.

It has 890 billion dollars in assets, (about 1.3 percent of world stocks) of which 16 percent is in Asia. Japan has 9 percent, China 2.7 percent and India 1 percent. About 0.6 percent is in Africa.

Europe and North America has 78 percent.

"However, this is likely to change as the Norwegian Central Bank has indicated that they will shift more of their investments toward emerging economies in the future," the statement said.

Sri Lanka Telecom December quarter loss turns to profit

(LBO) – Sri Lanka Telecom group, the island’s largest fixed line operator, said profits rose to 124 million rupees in the December quarter from 383 million rupee loss reported a year earlier.

The group’s interim accounts reported earnings of 0.07 rupees per share for the quarter against a loss of 0.21 rupees per share recorded a year ago.

In the 12 months to December, the group reported earnings of 2.65 rupees per share on total profits of 4.7 billion rupees.

The company’s stock was last traded at 33.60 rupees on Wednesday.

Sri Lanka Telecom revenues in the quarter were 18.1 billion rupees, up six percent from 2015, and operating costs rose three percent to 13.9 billion rupees.

During the year ended December 2016, the group has acquired assets at a cost of 31,069 million rupees excluding capitalized borrowing costs — as at 31 December 2015 it was 12,390 million rupees.

No dividend was declared by the company for the quarter ended 31 December 2016 though a dividend of 1,606 million rupees was paid 24 May 2016 for the financial year ended 31 December 2015.

Percentage of public holding as at 31 December 2016 is 5.52 percent and number of shareholders representing the public holding is 12,213.

Mobitel (Pvt) limited acquired 87.59 percent of shares of E-channeling through a voluntary offer for a total consideration of 641.85 million rupees.

The transaction of the acquisition was completed on 14 September 2016. E-channeling has been consolidated as a subsidiary for the financial year ended 31 December 2016.

The group is primarily involved in providing broad portfolio of telecommunication services across Sri Lanka.

The services provided by the group also include internet services, data services, domestic and international leased circuits, broadband, satellite uplink, maritime transmission, IPTV service and directory publishing service.