Sampath says ready to help rebuild nation using solid foundation as launching pad

• Secondary market yields continue to trade within narrow range

Sampath Bank said yesterday it stands ready to help rebuild the nation post-COVID-19 using its solid foundation as a launching pad. 

In a statement, the bank said it continued to demonstrate its commitment to offer the best possible service to its customers across the country by maintaining all essential banking services without

Chairman Malik Ranasinghe

Managing Director Nanda Fernando

interruption amidst curfew restrictions imposed during the COVID-19 lockdown. Sampath Bank’s 429 ATMs, 448 Deposit Kiosk Machines (DKMs) and all 229 branches when permitted remained fully operational during the entire period of lockdown, enabling customers to perform routine transactions with the bank. Our ongoing investments in digital technology continued to benefit customers during this hour of need, shown by the extensive use of Sampath Vishwa – the bank’s digital platform. Sampath Vishwa proved to be a convenient and efficient alternative mode of payment right throughout this period. 

The spread of COVID-19 comes just as the country’s economy seemed to be slowly recovering from the spillover effects of the Easter Sunday terror attacks in April 2019. However, as it stands now, the impact of the economic downturn cannot be estimated. It is noteworthy that while Sri Lanka appears to have managed the COVID-19 outbreak reasonably well, the obvious economic fallout from the local and global lockdown will be unprecedented. It has affected supply chains significantly and the cascading effect will severely impact almost all businesses in the country. 

Amidst this backdrop, Sampath Bank remains committed to support all stakeholders to overcome this unfortunate situation. The bank has already put in place all necessary systems and processes to facilitate relief under various schemes announced by the Government. The bank is now equipped to accommodate the debt moratorium, grant working capital loans at concessionary rates and support new investments through loans for eligible individuals and ventures.

Impact of COVID-19 on the banking industry

Due to the unsettled economic environment, the prospects for Sri Lanka’s banking sector in 2020 remains bleak. While government mandated credit concessions are expected to decrease the impact on individuals and businesses, it would certainly impact liquidity, revenue growth, credit growth and credit quality of all Banks in the country. Further, profitability will be severely compromised. 

On a positive note, the Central Bank of Sri Lanka (CBSL) has relaxed certain rules and regulations to provide space for banks to assist COVID – 19 affected businesses. These include lower capital conservation buffers, relaxed non-performing classification rules, decreased SRR, changes in restructuring loan classifications and extension to address supervisory concerns. In addition, the Institute of Chartered Accountants of Sri Lanka (CASL) has issued a guidance note suggesting measures that can be adopted to soften the immediate impact on financial reporting due to this global disaster. 

Future of the bank 

Sampath Bank will adopt a broad-based approach that includes sound strategic planning coupled with effective management decisions to overcome the prevailing challenges. The management team of the bank will remain vigilant in managing assets and liabilities and meeting all contractual obligations of the bank while ensuring delivery of all concessions to customers and other stakeholders. All ongoing projects and recent proposals will be re-evaluated with a view to redirecting expenditure only to essential core business requirements. At the same time, the bank will cautiously explore new business opportunities that may present itself from time to time. In this regard the bank will seek to upgrade the skills of employees and invest in technology where necessary in order to leverage on such opportunities successfully.

Furthermore, it is expected that Sampath Bank’s solid fundamentals including a strong capital base, expertise in IT and the capacity of Team Sampath will help strengthen resilience and support the bank to perform consistently in the medium to long-run despite the current economic distress.