ComBank's PBT exceeds Rs 10 b

The Commercial Bank of Ceylon PLC profit before corporate tax has exceeded Rs. 10 b reaching a new milestone by growing PBT by 17.9 per cent to Rs 10.987 b for the 12 months ending December 31,2011.

Profit After Tax grew by a robust 45.7 percent to reach Rs 8 b (Rs 8.047 billion) from Rs 5.523 b for the previous year.

Commercial Bank Chairman Dinesh Weerakkody and Managing Director, Amitha Gooneratne

The Bank’s Total Income for the year was up 9.54 percent to Rs 45.483 b, with Interest Income growing by Rs 2.9 b to Rs 37.639 b and Non-interest Income (foreign exchange and other income) growing by 16 percent to Rs 6.590 b. Net Interest Income increased by 9.66 percent to Rs 17.996 b. Net Income improved by 11.3 percent to Rs 24.586 b.

The total interest income growth was principally attributable to a healthy 21.59 percent growth in Interest Income from Loans and Advances, which amounted to Rs 28.697 b for the 12 months. Interest Income from Other Interest Earning Assets such as Treasury Bills and Bonds totalled Rs 8.942 b reflecting a decline of Rs 2.195 bor 19.7 per cent, due to the reduction in Bills and Bonds volume and the lower interest regime that prevailed in the review period.

Gross Loans and Advances grew by Rs 59.590 b over the 12 months to Rs 287.96 b at December 31, 2011, an increase that averaged Rs 5 b per month.

The total Performing Loans and Advances portfolio of the Bank expanded by a noteworthy 27.50 percent to Rs 272.135 b. Total Deposits of the Bank as at December 31, 2011 stood at Rs 318.461 b, an increase of Rs 58.682 b or 22.59 percent over 12 months. The average growth in deposits was also close to Rs 5 b per month.

The Board of Directors of the bank has proposed a final dividend of Rs 3.50 per share, made up of Rs 1.50 in cash and Rs 2.00 in the form of a scrip dividend, taking total dividend per share for the year to Rs 6.00. The Bank paid an interim dividend of Rs 2.50 earlier in the year.

These dividends are on the higher capital after a Rights Issue in August and a 1 for 1 Share Split in September 2011.

Commercial Bank Managing Director, Amitha Gooneratne described the Bank’s performance as the result of solid all-round contributions from all core areas of banking.

“Our focus has always been on optimising the operational returns whilst maintaining a healthy balance in the deposit mix and prudent lending,” Gooneratne said.

He said the Bank had as a result, maintained or improved key performance ratios. Gooneratne said that the Bank had been able to transfer Rs 1.194 billion to an Investment Fund Account from the tax savings resulting from a reduction in the tax rate from 35 percent to 28 per cent, and the reduction in the financial VAT rate from 20 percent to 12 per cent.