Nations Trust Bank records steady performance

Nations Trust Bank closed the first half of the year ending 30th June 2016 recording a post-tax profit of Rs. 1,278 mn, a relatively slower growth of 2% over the corresponding period.

Narrowing of Net Interest Margins (NIM) coupled with unfavourable impact arising from foreign exchange funding SWAPs slowed revenue growth. NIM impact was partly off-set by loan portfolio growth which saw accelerated traction in the 2Q thereby setting the pace for 2016.

Net interest income recorded marginal growth due to NIM compression as cost of deposits increased at a faster rate than re-pricing of loans. The resultant increase in interest expense of 39% over the previous period was only partly offset by the increase in interest income of 18%.

However, a more positive trend was seen during the second quarter which saw higher growth in NII underpinned by improved NIM and higher growth in loan volumes.