Aug 12, 2011 (LBO) - Sri Lanka's Commercial Bank of Ceylon's net profits in the June 2011 quarter rose 63.8 percent to 1.97 billion rupees, amid strong credit growth and containment of interest expenses, interim accounts show.
The group reported earnings of 5.17 rupees per share for the quarter. For the six months it reported earnings of 10.57 rupees.
Profits were also helped by a lower rate of tax, the bank said. A so-called financial value added tax fell 41 percent to 373 million rupees and income tax fell 11 percent to 824 million rupees.
Group interest income rose 9.1 percent 9.1 billion rupees but interest expense grew at a slower 1.8 percent to 4.6 billion rupees allowing net interest income to grow 17.7 percent to 4.49 billion rupees.
The bank said in a statement that it took "timely action to re-price deposits."
Group performing loans grew 7 percent to 228 billion rupees from December.
Managing director Amitha Gooneratne said the loan growth reflects a resurgent business sector.
Fee income rose 11.4 percent to 1.49 billion rupees.
Loan loss provisions were 19.3 million rupees with a 346 million rupee provision off-set by recoveries. Non-performing loans grew 3.1 percent to 15.4 billion rupees. The banks said its NPL ratio was 5.05 percent and 2.75 percent after provisions.
Chief financial officer Nandika Buddhipala said Tier I regulatory capital was 11.63 percent and Tier II 12.82 percent by June and the ratios would improve after fresh capital was raised from a rights issue.
Group gross assets rose 20.9 percent to 397 billion rupees and net assets rose 9 percent to 36.5 billion rupees from December.
source - www.lbo.lk
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