NTB posts Rs. 1.5 b PAT
Nations Trust Bank Group recorded a profit after tax of Rs. 1,596
million for the nine months ended September 30, 2013 compared to Rs.
1,510 million in the corresponding period of the previous year, a
company media release said.

Ms Renuka Fernando |
Group revenue grew 18%, which however, did not translate to an equal
bottom line growth due to increases in operating costs attributable to
the costs incurred on the execution of the strategic initiatives and
higher impairment charges.
Core earnings were well balanced across the business pillars despite
industry challenges impacting particular portfolios unfavourably.
The Central Bank enforced an easing monetary stance from the
beginning of the year which led to a decline in policy rates resulting
in a gradual decline in interest rates as the year progressed. Such
measures taken to fuel credit growth did not materialise to anticipated
levels as private sector credit growth remained sluggish throughout the
period under review. Slower loan book growth led to excess funds being
invested in low-yielding liquid assets with Banks witnessing a decline
in NIMs. NPLs across the industry shot up with the slowdown in economic
activity also leading to a substantial rise in impairment charges.
Group net interest income increased by 33% over the corresponding
period with NIMs improving modestly. Yields on loans and advances came
under stress due to low credit demand which was further challenged by
regulatory caps on interest rates.
The gradual decline in cost of deposits coupled with improved spreads
on the FIS portfolio with the maturing of lower yielding assets
positively impacted NIM movement. Net fees and other operating income
recorded a 22% growth, with an outstanding contribution from credit card
related fees and commissions.
With the slowdown witnessed in external trade, trade finance income
fell below previous year's level. Net trading results amounted to a loss
of Rs. 310 million for the year mainly due to losses in FX income which
was partly off set by gains attributed to the FIS portfolio.
The adverse movement in forward premiums resulting in negative
market-to-market impact on funding SWAPS resulted in FX losses for the
period. However, this adverse trend reversed towards the end of the
third quarter wiping out most of the losses recorded in the first six
months. |