NDB Bank's pre tax profit up 95% to Rs. 2,086 m in 2006

NDB Bank's full year profit for 2006 and the overall results show strong progress in terms of implementing the new business strategy after the merger between the National Development Bank Ltd and NDB Bank Ltd on August 1, 2005.

A balanced business is being developed, with the Corporate, SME, Consumer, Investment Banking and Insurance sectors, all making good progress. There was a significant increase in the Bank's distribution channels, with 31 branches now supporting the various business areas.

NDB Bank with a strong financial profile, sound asset quality and strong capital position has been given a Fitch Credit Rating of "AA" with a positive outlook.

The Bank's profit before tax grew by 95% from Rs. 1,071 million in 2005 to Rs 2,086 million in 2006. The Group's profit before tax also grew by 105% from Rs. 1,866 million in 2005 to Rs. 3,827 million in 2006, including an exceptional capital gain generated in the first quarter of 2006.

Excluding the exceptional capital gain, the Group's profit before tax grew by 29% from Rs. 1,866 million in 2005 to Rs. 2,412 million in 2006.

The Group's profit attributable to shareholders, including the exceptional capital gain, increased significantly from Rs. 1,036 million in 2005 to Rs. 2,030 million in 2006.

The profit attributable to shareholders, excluding the exceptional capital gain, was Rs. 1,014 million compared with Rs. 1,036 million in 2005, due to the impact of higher rates of Income tax and Financial VAT. Shareholders' Funds as at December 31, 2006 amounted to Rs. 8.55 billion and Rs. 10.57 billion for the Bank and the Group, which are well in excess of the regulatory minimum standards.

The Tier 1 and Tier 2 capital for the Bank and the Group amounted to 15.57% and 21.95% compared with the regulatory minimum of 10%.

The core banking business grew significantly during the year.

However, the results of the Bank in 2005 include the performance of National Development Bank Limited up to July 31, 2005 and thereafter the performance of the merged entity.