Sunday Observer Online


Sunday, 24 May 2009





Marriage Proposals
Government Gazette

HNB records over 9 b income for 1st quarter

First quarter results recently published on Hatton National Bank shows an impressive performance by the Bank recording an income of Rs 9.68 billion., a growth of 14 percent compared to the corresponding period last year, ample testimony for the Bank's resilience on the face of adversity.

Despite unfavourable global as well as local economic conditions the Bank continued to perform well in the first quarter of 2009.

HNB's operating profit from ordinary activities before tax and financial VAT surpassed Rs 1.7 billion mark, recording a growth of 10 percent over 2008. Operating Profit after tax for the period is Rs. 763.1 Million, Which is a 2 percent growth from Rs. 751.3 million in 2008.

The Banks' provision for the Financial VAT and Income tax for the first quarter was Rs. 937 million. High taxation on financial services continues to be a major obstacle for the growth in the industry.

Net interest income grew from Rs. 3.0 billion. in first quarter 2008 to Rs. 3.4 billion. in the first quarter 2009 recording a growth of 15 percent.

This was primarily facilitated by the growth in the Banks' interest earning assets and the effective management of the net interest margins.

Operating exprenses

The operating expenses of the Bank for the 1st quarter recorded an increase of 15 percent the Bank will continue to focus on expenditure management during rest of the year.

Due to contraction in the loan book during the first quarter of 2009 there was a reversal of Rs. 47.6 million. in the general provision after meeting the statutory general provision requirement of 1 percent stipulated by the Central Bank of Sri Lanka. However the specific provision saw an increase of Rs. 49.0 million. or 34 percent during the same period.

This includes certain prudential provisions made on exposures over and above the provisional guidelines of the Central Bank of Sri Lanka.

In the wake of slow down in the local banking industry and stringent credit policy being adopted due to unfavourable market conditions with focus on asset quality and risk management, Banks' loans and advances contracted by 5 percent from Rs. 170.8 billion. to Rs. 162.2 billion. in first quarter of 2009.

The net NPA ratio recorded a marginal increase from 2.3 percent as at December 2008 to 3.5 percent as at end March 2009.

However, the increase in the NPL ratio is relatively lower than the industry averages and the Bank boast of a very healthy NPA cover of 57.4.

During the first quarter the Bank's deposit base grew by an impressive Rs. 5.0 billion, demonstrating the confidence the public has placed on HNB during times of uncertainty in the financial sector.

The asset base which stands at Rs. 261.0 billion. too recorded an increase of Rs. 5.7 billion. during the same period.


HNB Group income too has increased by 13 percent to Rs. 10.1 billion. with post tax profits marginally decreasing by 4 percent to Rs. 711.8 million due to the adverse market conditions affecting the performances of Bank's subsidiaries which are into stock brokering and investment banking activities.

However the Banks insurance subsidiary HNB Assurance PLC recorded a impressive post tax profit growth of 12 percent to reach Rs. 15.9 million. Investments made in the two exchange houses namely Majan Exchange LLC in Oman and the Delma Exchange based in Abu Dhabi are still in the infancy stage and yet to contribute to the group profit.

The units have shown promise and further plans have been laid out to move in to other countries with higher expatriate concentration.

Bank has also planned to expand the network by 10 - 12 branches during the year, which includes 4 branches in the Northern and Eastern provinces.

With the proposed expansions and the existing branch network in the North and the East the Bank is well positioned to actively participate in the post conflict development activities.

During the period the Bank increased the ATM network by installing 13 new ATMs taking the total to 273 and has planned to increase the number to 300 by end of the year.

The Bank was also recognised as the best retail bank in Sri Lanka for the second consecutive year by the prestigious Asian Banker Magazine in March 2009.


St. Michaels Laxury Apartments
Donate Now |
LANKAPUVATH - National News Agency of Sri Lanka

| News | Editorial | Business | Features | Political | Security | Spectrum | Impact | Sports | World | Panorama | Junior | Letters | Obituaries |


Produced by Lake House Copyright 2009 The Associated Newspapers of Ceylon Ltd.

Comments and suggestions to : Web Editor