Seylan Bank’s success is a tribute to the resilience of the country’s financial system stability as the bank recorded a net profit of Rs. 1.2 billion for 2010 which is a 126 percent increase compared to Rs. 543 million the previous year. Pre-tax profits grew at 124 percent to Rs. 1.9 billion to be the highest ever profit figure earned by the bank since its inception.
"The Bank recorded a net profit of Rs 1.2 billion for the 2010 which is a 126 percent increase compared to Rs 543 million for the previous financial year. This is a clear indication that all our stakeholders have kept confidence in the bank after going through a turbulent period two years ago," its Executive Chairman Eastman Narangoda told journalists recently.
"The director board set goals for the 2010 financial year which were comparatively modest yet still ambitious, given the continuing impact of the global economic downturn," he said.
He said that by mid-year Seylan had exceeded expectations posting net profits of Rs. 510 million for the six months ending 30th June, a gain of 270 percent over same period in the previous years
The financial results for the year ending 31 December 2010 are a testament to the continued progress of the bank in returning to sustain profitability growth, Narangoda said.
Narangoda said among the major factors fuelling the progress of Seylan Bank was the bank’s success in growing its deposit base to Rs 109.9 billion as well as other strategic measures to improve the efficiency of the bank.
At the same time, renewed focus on recovering non performing loans and advances brought a welcome reduction in the Non Performing Loan (NPL) ration, which dropped by approximately 8 percent as against the previous year, he said.
Narangoda said these performance manage to improve key indicators including Return on Average (increased to 0.87 percent in 2010 from 0.38 percent in 2009), Return on Equity (improved to 10.88 percent from 6.20 percent compared to previous year) and interest rates spread (increased to 6.00 percent compared to 5.18 than the corresponding year).
The Chairman said the Bank’s cost-to-income ration increased slightly from 67.82 percent to 68.69 percent, while the Capital Adequacy Ratio has remained above 12 percent in both 2009 and 2010, which is well above the required rate as stipulated by the Central Bank.
General Manager/Chief Executive Officer of Seylan Kapila Ariyaratne said that having identified optimum performance standards, the bank was now geared to further develop its future business strategies in a bid to deliver even greater results to all stakeholders.
Ariyaratne said a Voluntary Retirement Scheme (VRS) open to 250 of its 3622 employees, which is the first time that it has made available via a on line basis.
The bank’s cost-to-income ratio increased slightly from 67.82% to 68.69%, while the Capital Adequacy Ratio has remained above 12% in both 2009 and 2010 which is well above the required rate as stipulated by the Central Bank.
The positive results posted each quarter throughout 2010 brought a corresponding upswing in investor confidence, both locally and overseas. The bank’s share price which was stabilized after the appointment of a new Board headed by veteran banker Eastman Narangoda in early 2009, continued gaining strength over the past year as the management implemented the wide-ranging initiatives set out in the bank’s aggressive strategic plan. The share price increased from Rs. 37 to Rs. 97.80 during the course of the year.
With the VRS, Seylan will also roll out a series of strategic measures. Among them are organizational restructuring, investment in advanced technology, and employee job enrichment and engagement processes by benchmarking international best practices from within and outside the country.
Added to this will also be further investment on continuous staff training and development. The Bank will also take strategic measures to improve the Brand Equity of the Seylan brand as well as its sub-brands to further strengthen the relationship the bank has with its key stakeholders. The bank is currently rolling out a new product development process as well as investing on more research to ensure the success of its current portfolio of brands as well as intended new products and services.
The bank is currently finalizing an internal marketing program which is intended towards further revitalising the bank’s staff to deliver an even greater standard of customer service and flexibility. The bank is further strengthening its international network to deliver greater results on some of the growth segments identified by the bank’s recent strategic plan. The network of branches will also be aggressively expanded to cater to the needs of the island-wide customer base.
source - www.island.lk
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