Corporate

ComBank's total assets top Rs. 300 bn in 1 H '09

The Commercial Bank of Ceylon Group has posted a turnover of Rs 22.051 billion in the six months ended June 30, 2009, recording a growth of 4.40 per cent.

In results released to the Colombo Stock Exchange this week, Commercial Bank of Ceylon PLC, its subsidiaries and associates reported a profit before tax and financial VAT of Rs 4.520 billion, and profit before tax of Rs 3.440 billion. Group Net profit after tax for the first half of 2009 surpassed the Rs. 2 billion mark to reach Rs 2.015 billion.

The Group's non-interest income grew by 23.88 per cent to Rs.3.620 billion mainly as a result of the contribution from exchange profit, the Bank said. This coupled with a growth in total assets which reached the Rs. 300 billion mark enabled the Commercial Bank of Ceylon PLC to post moderate results in the first six months of 2009. The Group reported a foreign exchange profit of Rs.1.915 billion, an increase of 77.91 per cent over the Rs. 1.076 billion reported in the corresponding period in 2008.

In contrast, other income at Rs. 1.705 billion recorded a drop of 7.63 per cent compared with the Rs.1.846 billion reported in the corresponding period of the last year due to the inclusion of the profit on the sale of Commercial Bank's stake in the shares of Commercial Leasing Company PLC, one of the associate companies of the Group, under Other income recorded for the first half of last year.

Non-interest expenses grew by 19.62 per cent to Rs.4.156 billion largely due to personnel costs increasing by 25.18 per cent to Rs.2.229 billion. This was due to enhanced employment benefits paid under the Collective Agreement signed, effective January 1, 2009, with the Ceylon Bank Employees Union for non-executive staff, salary increments granted to executive officers and an increase in number of staff during the period under review, the Bank said.

Net provisions on account of Bad and Doubtful Debts decreased by Rs. 64.0 million or 8.04 per cent, with the reversal of a part of the statutory general provision made as stipulated by the provisioning requirements of the Central Bank of Sri Lanka, consequent to a drop in the total performing and overdue advances portfolio of the Bank during the half year under review.

However, the specific provisions on non-performing loans and advances increased by Rs. 396.7 million or 59.42 per cent.

One of the main reasons for the drop in pre and post tax profits of the Group was the decrease in net interest income by Rs. 282.2 million or 4.65 per cent. This was mainly due to an increase in the cost of funds due to a shift in the deposits mix from low cost deposits to high cost deposits.

The interest income on loans and advances compared to the corresponding period in 2008 increased marginally by 0.02 per cent, notwithstanding a decrease in performing loans and advances and an increase in non-performing loans and advances.

The interest margins narrowed to 4 per cent in 2009 compared to 4.47 per cent recorded for the corresponding period in 2008.

Total assets of the Group grew by 6.83 per cent since December 31, 2008 to reach Rs. 300.8 billion as at June 30, 2009 and this helped the Bank to maintain its position as the largest indigenous private bank in Sri Lanka.

Total deposits of the Group, which stood at Rs 199.9 billion., as at December 31, 2008, rose to Rs 215.7 billion, as at June 30, 2009. However, the total gross loans and advances of the Group, which stood at Rs 189.7 billion as at December 31, 2008, dropped to Rs. 176.9 billion as at June 30, 2009 in the backdrop of the adverse macroeconomic conditions that prevailed in the country.

 Appointments

Director, Delmege Teas (Pvt) Limited

The Chairman of Lewis Brown & Co. (Pvt) Limited, the holding company of the Delmege Forsyth Group, since 2001 Mahen Dayananda has been appointed to the Board of Delmege Teas (Pvt) Limited with effect from July 27, 2009.

He was Chairman of the Colombo Tea Traders Association (CTTA), for a period of 3 years and also Chairman of the Ceylon Chamber of Commerce from 2006 - 2008. He was the Founder Managing Director and subsequently the Chairman of Tea Tang Limited. The members of the Board of Delmege Teas (Pvt) Limited are: Chairman, F. G. N. Mendis, Managing Director, C. N. S. Mendis, Director, Mahen Dayananda, Director, L. D. E. A. De Silva, Director, G. A. Kumarage and Director D. A. Wijesekera.

NTB appoints CEO

Nations Trust Bank announced the appointment of their new Chief Executive Officer Saliya Rajakaruna who will commence duties from 15 September. Rajakaruna will succeed the present CEO Zulfiqar Zavahir, who has retired from this role as well as resigning from the Board of Directors this month. The Bank also announced the resignation of their Deputy CEO Iftikar Ahamed.

Sarath Piyaratna, Executive Director of the Bank will act as Chief Executive Officer until the new CEO assumes duties in office. These appointments are being made subject to the approval of the Central Bank of Sri Lanka.

Commenting on the appointment of the new CEO, the Chairman of Nations Trust Bank PLC Mr Ajit Gunewardene said, We are delighted to welcome Rajakaruna as our new Chief Executive Officer.

The Bank has continued to perform well and is positioned to take advantage of the tremendous growth opportunities in the country, with expansion plans in the north and east scheduled to take place in the next quarter.

He further added, Saliya Rajakaruna's expertise in the industry, plethora of knowledge and sharp business acumen will certainly be an asset to Nations Trust Bank. Mr Saliya Rajakaruna has had a wealth of experience of more than 35 years in the financial services industry, having served at the London offices of Citibank, N.A taking on various roles relating to corporate banking risk management, finance and marketing with customers in Scandinavia, the UK and Europe.

He has also undertaken various assignments covering audit, product management and treasury activities relating to Citbank portfolios in the USA, South Africa and Asia. Mr Rajakaruna was attached to the Bank of Ceylon over the past 3 years, initially as its Chief Financial Officer and thereafter it's Chief Risk Officer with a mandate to manage all financial aspects and strategic issues impacting the Bank of Ceylon.

New MD at Oriflame Sri Lanka

Pierre Martensson takes over at the helm of Oriflame Sri Lanka. He comes with an extensive work history in the area of direct sales. His last assignment was in Thailand.

"I am glad to be here and from my first visit to the island, I was sold on the destination and that was the beginning of my work with the company and of course Sri Lanka" said Martensson.

Cosmetics are an ever evolving industry with constant changes in areas such as innovation and marketing strategies.