HDFC Bank posts impressive 1Q results
Housing Development Finance Corporation Bank of Sri Lanka (HDFC Bank)
has registered an after Tax Profit of Rs. 38.4 million for the 1Q ending
March 31, 2013 as against Rs. 4.9 million during the corresponding
period in 2012.
The operating profit before tax was Rs. 84.9 million as against Rs.
27.3 million compared with the corresponding period of the previous
year.
The bank's deposit base has increased from Rs. 11.9 billion to Rs.
14.5 billion during the 1Q of 2013 registering year-on-year (YOY) growth
of 22%.
The advances increased from Rs. 14.6 billion to Rs. 16.8 billion
showing the YOY growth of 15%.
Interest income improved by 26% in the period under review while
interest expenses increased by 30% during this period due to rising
interest rates and the increase of deposit base.
However, the Net Interest Income has shown 19% growth during the
corresponding period. Fee based income of the bank has also shown an
improvement registering a growth of 52% when compared with 1Q during the
past year.
The bank also reduced operating expenses by 19% during 1Q 2013 as
against the previous year.
The bank's Tier I Capital Adequacy Ratio stood at 18.4% while the
Total Capital Adequacy Ratio stood at 19.4% well above the regulatory
requirement of the 5% and 10% as at March 31, 2013.
With the amendment of the HDFC Act in 2011, HDFC diversified business
operations. The bank plans to enter the country's leasing, micro
finance, SME and agriculture markets.
For this purpose, the bank has already initiated a funding scheme
with the Central Bank and the bank hopes to negotiate more such funding
arrangements with specialised agencies. Through the Central Bank's
refinance scheme, HDFC is now ready to gain a foothold in Micro Finance,
SME lending and agricultural financing.
The bank will continue to promote the successful gold loans scheme in
2013.
Expansion of the bank's savings base will continue to remain a
priority for the bank, to mobilise an ongoing stream or low cost
funding. The bank will continue to consolidate the operations in 2013 by
improving the systems, processes and skills base to deal with future
growth opportunities and compete successfully in an increasingly
competitive market.
As part of this process, the bank has already strengthened the
regional management structure by giving greater decision making autonomy
to Regional Managers.
HDFC Bank was one of the first banks that published quarterly
statements in line with IFRS Standards and the bank's final accounts for
2012 have been prepared in compliance with IFRS Standards.
The NPL Ratio saw an improvement at 20.52% as against 22.21% in 2011,
due to the implementation of more stringent credit evaluation processes
coupled with a strong emphasis on recoveries.
This includes NPL Loans backed by EPF Balances which are guaranteed
by the Central Bank of Sri Lanka (CBSL).
The ratio excluding EPF category stands at 7.8% as at 31.12.2012 as
against 11.37% in 2011. Improving technology remains a priority during
the year to capitalise on efficiency and productivity gains that can be
facilitated through the creative use of IT and other technologies. The
bank is introducing new core banking solutions to meet future
requirements. HDFC Bank's transparency in communications is gaining
recognition. HDFC Bank won the ACCA Sustainability Reporting Award for
the third consecutive year in the small scale category for the Bank's
2011 Annual Report.
This was HDFC's first integrated report in line with international
integrated reporting standards and was also a first for the local
banking industry. |