COMBank's post tax profits soar 44% to Rs. 2.2b in 1H, 2007

The continued momentum of its fund-based operations have generated strong growth for the Commercial Bank Group enabling Sri Lanka's benchmark private bank, its associates and subsidiaries to post exceptional pre and post tax profits for the first half of 2007.

In results released to the Colombo Stock Exchange, the Commercial Bank Group reported a pre-tax profit of Rs. 3,422 million for the six months ending June 30, 2007, a growth of Rs. 804 million or 30.72 per cent over the corresponding period in 2006.

The post-tax profit of the Group at Rs 2,173 million reflects a growth of 44.41 per cent over the first half of last year. The post-tax profit for the second quarter of the current year too surpassed the Rs. 1 billion mark, the second successive time that the Group has notched up a billion rupees in post-tax profit for a three-month period.

Commercial Bank's Senior Deputy General Manager - Finance and Planning, Ranjith Samaranayake said the rate of post-tax profit growth was higher than the growth achieved in pre-tax profit primarily due to the Group's tax liability increasing by Rs. 136 million (12.20 per cent over the first half of 2006) due to a reversal of Rs.246 million on account of the deferred tax provision in the first half of 2007.

He said the growth in pre-tax profit was facilitated by the Group's net interest income increasing by Rs. 2.0 billion or 58.00 per cent in the period under review, to total Rs. 5.4 billion.

"These results indicate a very successful half year," Samaranayake said, adding that the growth momentum maintained in the fund-based operations of the Bank was one of the biggest contributory factors to the growth of net interest income in the first half of 2007.

Total interest-earning assets of the Group rose to Rs. 226.2 billion as at June 30, 2007, an increase of Rs. 26.4 billion or 13.22 per cent over Rs. 199.8 billion at the end of December 2006.

Interest-bearing liabilities grew by Rs. 20.1 billion or 11.26 per cent to Rs. 198.8 billion at the end of the half year.

This increase in interest-bearing liabilities was made possible by an increase of Rs. 11.8 billion (8.51 per cent) in deposits in the first six months of the current year. Total deposits stood at Rs 169.3 billion as at. June 30, 2007.