HNB Group post tax profits up 33% to Rs. 1.80 Billion in nine months

Hatton National Bank (HNB), Sri Lanka's premier private sector commercial Bank, continues its robust performance by recording a 39% rise in pre-tax profits to Rs. 2,676 million in the nine months to September 2007.

Commenting on the performance, HNB's Managing Director Rajendra Theagarajah said, "We are extremely pleased with such consistent performance which has been sustained during the past eleven successive quarters. Relentless focus on balancing business growth with profitability, improving productivity, managing costs and enhanced asset quality has contributed towards this performance despite a increasingly inflationary domestic environment which also was faced with extreme volatility in interest rates".

Net interest generated from interest bearing assets has increased by 41% while Non interest income showed a growth of 23%. The nine months have also seen the entire operating expense bill of Rs. 6.3 bn being comfortably met by Net interest income from core banking activity.

Net Income including foreign exchange, commission income and investment income grew by 27% during the nine-month-period led by a surge in Foreign Exchange trading which grew by 51%.

HNB has maintained reasonable control on expenses with operating costs increasing by 21%. While recognising the impact of domestic inflation on expenses, Theagarajah stressed the need for increased focus on managing cost through better internal efficiencies.

In its quest to improve asset quality, the bank's loan quality has shown steady improvement with two key performance indicators namely NPA % and NPA cover having improved to 6.3% and 75.6% in September 2007.

The Group too has delivered exceptional results with the After-Tax profits (Minority Interest) recording a 33% increase to Rs. 1,787 mn.