Cargills Bank registers Rs. 1,150 m PBT in 2024, posts 58% growth

• PAT for 2024 at Rs. 651m, up 48% YoY
• Net gains from financial assets at fair value through profit or loss grow by Rs. 11 m
• Net gains from derecognition of financial assets at fair value through other comprehensive income grow by Rs. 493 m
• Bank remains well capitalised and liquid
• Total Capital Ratio (CAR) at 22.44% 
• Liquidity Coverage Ratio (LCR), All Currency at 313.34%
• Net Stable Funding Ratio (NSFR) at 136.28%
• Total assets grow by Rs. 10 b

Cargills Bank’s results for the year ended 31 December 2024 reflected a year-on-year (YoY) increase of 48% in profitability. 

Profit After Tax (PAT) at Rs. 651 million for the year 2024 was higher by Rs. 211 million compared to 2023. Net interest income of Rs. 3.589 billion was a marginal increase of Rs. 208 million in the year 2024 compared with 2023. The bank continued to focus on repricing of deposits and advances to reflect market conditions and to manage the Net Interest Margin (NIM) in an optimal manner. The marginal increase in NIM is attributable to this proactive approach in the decreasing interest rate regime.

Net fee and commission income of Rs. 894 million for the year ended 31 December 2024 recorded a Rs. 96 million growth in comparison with the previous year. Concerted efforts to improve trade volumes, card-related fee income, and improved remittance income were among the main contributory factors for this growth of 12% recorded.

Additionally, net gains from financial assets at fair value through profit or loss grew by Rs. 11 million to reach Rs. 276 million in the year of 2024. Capital gains realised on derecognition of financial assets boosted other income streams by Rs. 493 million in the period under review to reach Rs. 670 million. Net other operating income dropped by 76% to Rs. 61 million largely due to reduction in foreign exchange gains recognised during the year under review. Total operating expenses increased by 11% from Rs. 2.892 billion last year to Rs. 3.198 billion. Personnel expenses increased by 24% largely due to adjustments to salary and welfare benefits considering increased costs of living over the last few years and market conditions. Other operating expenses grew by 4% largely due to increased utility-related operating expenses and marketing costs.

Impairment charges totalling Rs. 607 million reflected a decrease of 28% from Rs. 849 million in the year 2024 partially due to the need for management overlay provisions being lower subsequent to a careful scrutiny of the status of borrowers and considering the improved macroeconomic environment. The bank’s Stage 3 Loans (net of Stage 3 Impairment) to Total Loans Ratio stood at 8.74%, while Stage 3 Provision Cover was 46.79% as at 31 December 2024.

The Bank maintains Capital Adequacy and Liquid Assets Ratios well within the minimum requirements prescribed by the Central Bank. The Total Capital Ratio was at 22.44% while all liquidity related ratios were well above the regulatory minimum.

Total assets of the bank as at 31 December 2024 at Rs. 80.3 billion records an increase of 15% or Rs. 10.3 billion during the year. The loan book posted a moderate growth of 14%, from Rs. 40.6 billion to Rs. 46.1 billion, given the prevailing conditions. Financial assets measured at fair value through other comprehensive income grew by 26% to reach Rs. 22.4 billion. A net loss of Rs. 411 million was reflected in Other Comprehensive Income. Customer deposits grew by 17% to Rs. 59.4 billion at the reporting date from Rs. 50.7 billion at end-2023 amidst continued reductions in market interest rates.

Richard Ebell, who served on the bank’s Board as Chairman, retired on 2 July 2024 in compliance with the Banking Act on Corporate Governance for licenced commercial banks issued by the Monetary Board of the Central Bank. Ebell completed nine years in the bank Board, having been appointed in 2015. Asoka Pieris, who served as Deputy Chairman, was appointed as the Chairman of the bank with effect from 3 July 2024.