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| Sunday, 22 May 2005 |
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Business |  |
| News Business Features Editorial
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NSB profits drop 11.9% despite exceptional performance The National Savings Bank (NSB) performed exceptionally well last year but its profits declined by 11.9 per cent compared to the previous year. In 2003 NSB's post-profit tax was around Rs. 3,533 million and it had dropped to Rs. 3,114 million last year, its Chairman L. D. C. Herath said. He said that the drop in profits was due to the increase in Value Added Tax, Capital Gain Tax and increasing the Corporate Social Responsibility activities of the Bank. Herath said that NSB's deposits grew by 11.8 per cent last year and the cumulative deposits base was around Rs. 180 billion. Despite functioning in a highly competitive milieu, the Bank was able to mobilise Rs. 18,994 million in that year and set a target to mobilise Rs. 19,000 million this year since it believes that there is immense potential in this area of business, Herath said. He also said the Bank was rather dominant in investing in government papers with a low yield in the past and took a decision to reduce investment in government papers by three per cent.It also expects to reduce it another three per cent this year. The Bank continued to offer the most attractive and flexible housing loan portfolio of 29 per cent in the year under review to Rs. 9,270 million. The showdown in the share market due to political uncertainty and the resultant negative investor confidence slightly affected the Bank's revenue. NSB General Manager/CEO Eastman Narangoda said that the Bank being mindful of its social responsibility, contributed Rs. 25 million towards tsunami relief efforts made by the government and committed to contribute Rs. 50 million for 1,000 reservoir projects. He also said that in 2004, the Bank set aside 2 per cent on after tax profits, which amounted to Rs. 82 million for social obligations. In addition, the Bank paid additional interest over and above the stated rate for the accounts of senior citizens named Gaurawa, which cost approximately Rs. 200 million, he said. The Bank paid Rs. 1,500 million to the Treasury as special levy in 2004. The total contribution to the government by way of taxes and levies amounted to Rs. 3.2 billion last year. HS |
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