Commecial Bank posted profit before VAT and NBT to the tune of Rs 16.398 billion at the end of the third quarter of 2016, reflecting growth of 15.19% during a period of rising interest rates and shrinking margins.
In a filing with the Colombo Stock Exchange, the Bank said gross income grew by 17.94% over the corresponding nine months of last year to Rs 66.868 billion at the end of the period reviewed. Profit before tax improved from 13.92% to Rs 13.887 billion while profit after tax at Rs 10.151 billion reflected robust growth of 20.48%, the bank said.
Continuing strong growth in the bank’s loan book resulted in total interest income growing by Rs 9.587 billion or 19.72% to Rs 58.191 billion. Interest expenses however increased at a higher rate of 29.49% to Rs 33.936 billion due to re-pricing of liabilities following the rise in interest rates, resulting in net interest income growing by 8.29% to Rs 24.255 billion.
“The bank has done well in the first nine months of the year, considering the high interest rate scenario that prevailed,” Commercial Bank Chairman Dharma Dheerasinghe said. “We recorded the highest three-month growth in the third quarter of the year and expect to end 2016 on a characteristically strong note.”
Commercial Bank Managing Director/CEO Jegan Durairatnam said the bank had achieved noteworthy growth in its loan book while continuing to improve the quality of its loan portfolio and significantly reducing impairment charges in the review period. “We continue to focus on key operational indicators as we grow and expand overseas, ensuring that the bank adapts well to the changing conditions,” he said.
Total assets of the bank increased by a noteworthy Rs 73.493 billion or 8.35% since December 2015 to Rs 953.299 billion as at September 30, 2016 reflecting an average assets growth of Rs 8.166 billion per month.