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| Sunday, 7 March 2004 |
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| News Business Features Editorial
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Nations Trust Bank posts record profit of Rs 252 million Nations Trust Bank in keeping with its impressive track record has posted a record profit after tax of Rs 252 million for the year 2003 compared with that of Rs. 45 million in 2002, an increase of over 450%. The bank's core banking profits more than doubled in 2003 with profits having been further boosted by taking advantage of the decreasing interest rate scenario which resulted in significant gains being made from fixed income securities. The bank's balance sheet has shown significant growth with loans and advances at Rs 8.4 billion, showing an increase of 22% since last year while deposits have increased to Rs 6.6 billion, an increase of 30%. Fourth-quarter profits have been lower than expected due to a prudent approach to provisioning. The Chief Executive's report states "interest rate volatility during the last two months of the year 2003 impacted on our fixed income portfolio. The bulk of our medium term bond portfolio was liquidated and the relatively small remainder, marked to market. This has resulted in most of the profits earned by the bank for the fourth-quarter being negated. However it will ensure that the bank will not be burdened in 2004". The bank's conservative approach to risk management is also reflected in its healthy Non-Performing Loans ratio which has reduced from 5.7% in 2002 to 5.5% in 2003," one of the lowest among Sri Lankan banks." The Bank has been rated SL A-for Long Term Debt by Fitch Ratings Lanka Limited. A - denoting high credit quality. Market capitalization, which stood at Rs 2,401 million as at December 2003, has nearly doubled since last year and reflects investors' confidence in the bank. The bank concluded a rights issue during the year which increased the bank's issued share capital from Rs 500 million to Rs 850 million, thus enabling future expansion of the business. The IFC, one of the bank's sponsors, offered their rights to the employees resulting in NTB being in the unique position of being the only bank in Sri Lanka where almost all employees have a direct equity stake in their company. In keeping with its retail focus, the bank opened three branches and eight ATM's in high visibility locations. An agreement was signed with the Lanka Indian Oil Company to install ATM's at their multi-service stations. The two ATMs installed at these stations have proved to be quite popular. All service points are linked by state-of-the-art technology to the bank's network and the Cirrus/Maestro network of ATMs worldwide. The bank provides a wide range of customised products including phone banking and internet banking services and holds the exclusive franchise for both the prestigious American Express Credit Cards and American Express Foreign Exchange Services. Chairman, Vivendra Lintotawela, states "the personalised service and tailored options we offer our customers has shown that we respond quickly and effectively to our customers' demands and needs. It is with this in mind that we strive to be different from our competitors". Nationas Trust Bank, which owes its success to the selective but aggressive and proactive strategies it has pursued since inception, retained the services of a leading international consultancy company, Boston Consultancy Group, to review its strategic positioning. |
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