Commercial Bank PAT tops Rs 7 b

Improved business volumes in the third quarter of 2013 enabled the Commercial Bank of Ceylon to narrow the gap on its profit performance compared to the corresponding period of last year, during which translation gains on foreign exchange earnings was a major contributory factor to the bottom line.

Despite many challenges faced by the banking industry, the bank posted a pre-tax profit of Rs 10.404 billion for the nine months ended September 30, 2013, only marginally lower than the Rs 10.660 billion recorded in the corresponding period of 2012.

Post tax profit at the end of the third quarter stood at Rs 7.233 billion as against Rs 7.456 billion in the first nine months of last year, the Bank reported in its interim financial statements.

“What these figures clearly indicate is that operationally, the Bank has achieved noteworthy growth in terms of business volumes when the industry faced many challenges,” Commercial Bank Chairman, Dinesh Weerakkody said.

“Due to last year’s foreign exchange gains, the gap in net profit was 20% at the end of the first quarter of the current year, and 13.5% at the end of the first half.

The Bank has now narrowed this gap to under 3% despite the tough conditions that prevailed,” he said.

The Bank improved gross income by Rs 18.8 billion or 21.72% in the third quarter, accelerating the pace of growth. Gross income for first nine month period increased by 15.30% to Rs 53.498 billion.

“The Bank focussed on banking fundamentals to attract business and be competitive,” Commercial Bank, Managing Director and CEO Ravi Dias said.

According to the Bank’s Interim Financial Statements for the nine months ended September 30, 2013, interest income grew 20.54% to Rs 46.146 billion, mainly due to an increase in interest earning assets.

The growth in deposits which averaged Rs. 5 billion a month resulted in interest expenses growing by 29.78% to Rs 27.5 billion for the nine months.