NDB Group profits up 35% to Rs. 2.9 b

The NDB Group's Profit After Tax for the year was Rs. 2.94 b, an impressive growth of 35 percent over the previous year. The Profit Attributable to Shareholders for the year was 2.70 b and compares with Rs. 2.1 b for 2010, a growth of 29 percent.

NDB Chairman, Hemaka Amarasuriya and CEO, Russell de Mel

This significant increase in group profits was attributable to the growth in the core banking income of NDB by 13 percent over the previous year and the improved performance of the fee based group companies.

NDB positions itself as the only Financial Services Group in the country, with subsidiaries and associates in Investment Banking, Stock Broking, and Wealth Management, which make up the Capital Markets cluster, and Insurance.

The performance of the capital markets cluster improved significantly due to the increased level of activity, in particular managing complex IPOs, apart from a host of other Investment banking services it offers.

Additionally, the investment banking arm in Bangladesh, NDB Capital, has performed well despite the difficult market conditions. The Bank's Net Interest Income grew by 18% over 2010, supported by a significant growth in loans and advances by 43percent and customer deposits by 35percent.

The growth is commendable, and in relative terms NDB's performance during the year was higher than its peers. The Bank's Profit After Tax, grew by 32 percent despite the relatively lower equity income during the year compared with 2010.

NDB has contained its Non Performing Loans (NPL) ratio to an all-time low of 1.35 percent which is one of the lowest in the industry. The Bank has been able to achieve this low level of delinquencies by the use of strong credit analysis techniques and proactive risk management practices.

The provision cover on NPLs was at 74 percent as at December 31, 2011 with an Open Loan Position of 2.73 percent, which signify minimum amount of stress on the Bank's equity, on account of un-provided delinquencies. NDB is actively engaged in SME banking and has funded agriculture, handicrafts, manufacturing, trading and distribution, fisheries, and dairy sectors to develop the entrepreneurs in the country.

In keeping abreast with the growth momentum created as a result of restoration of peace, the Project Finance Division diversified its portfolio into growth sectors such as Tourism, Healthcare, Rubber Products, Non-conventional Renewable Energy, Construction related sectors and Animal Husbandry.

The economic revival of the North and the East created unprecedented opportunities for project financing and NDB funded several projects. This also included hotel projects in Pasikudah in the East, including a five-star hotel in 2011.

NDB has also made strong inroads into rural and urban parts of the country.

The expansion plan with 13 branches in 2011 increased its foot print covering key geographies in the country. NDB continued to push its national savings drive, taking the core concept of 'savings' beyond monetary measures.

This savings drive was extended to all parts of the country earlier in the year.

NDB launched some of the most innovative products in 2011. NDB introduced the breakthrough Rattharan Savings product.

The pioneering product offers a unique feature in which customers can reserve gold at today's price and obtain gold for the future by paying in instalments.

The Bank revolutionised the leasing industry by introducing new benefits to its leasing product, where long traditional requirements of customers, to have guarantors or make a down payment, to obtain a lease facility are no longer required.

For the first time in Sri Lanka's banking history NDB introduced a loan approval within three hours for its Dream Maker Personal Loans.

NDB also became the first bank in Sri Lanka to introduce secure, online shopping for debit cardholders with the introduction of the 'Verified by Visa' facility.

The NDB Group has signed an MoU with Singapore's DBS Bank, to form a strategic alliance in Investment Banking.

Through this MoU, NDB Group and DBS Bank would work on Equity and Fixed Income Issuances, Syndications, Project Financing and Mergers and Acquisitions. DBS Bank is the largest bank in Singapore and a leading financial services group in Asia.