LB Finance tops K. Seeds Investments’ 2Q rankings

K. Seeds Investments has identified LB Finance PLC as the best performing finance company under the first category among the 29 listed finance companies in Sri Lanka through a ranking carried out based on their financial performance for the second quarter of 2021/22.

The report segregates the finance companies based on the size of their asset base and ranks them in their respective categories among their peers based on ten financial metrics, which are calculated from the published quarterly financial statements.

LB Finance PLC topped the overall spectrum by belonging to ‘Category 1’ (asset base > Rs 100 billion). The Categories 2, 3, and 4 represent the companies having an asset base between Rs. 50-100 billion, 20-50 billion, and less than 20 billion, respectively.

On the road to recovery, the NBFI sector has made a strong comeback with a 91 % year-on-year (YOY) growth and 138% quarter-on-quarter (QOQ) growth. The CSE recorded its highest-ever quarterly earnings, out of which the NBFI sector contributed 16.4% of the total earnings. 

In addition, Lanka Credit & Business Finance Ltd. and Sarvodaya Development Finance, two well established finance companies, were listed on the CSE, and will be included in next quarters’ ranking report.

LB Finance PLC delivered a PAT of Rs. 2.1 billion for 2QFY 2021/22 and secured the top spot among the listed finance companies in Sri Lanka. 

The report ranks the finance companies according to their financial results released through interim reports on the Colombo Stock Exchange across 10 key performance indicators (KPls) – cost-income ratio, return on equity, return on assets, net profit margin, net interest margin, impairment to loan book, credit to deposits, operating leverage, net profit growth and loan growth. These 10 KPls are weighted equally, and an overall ranking is arrived at based on the aggregate score for each category.

K. Seeds Investments is a boutique investment bank in Sri Lanka, specialising in mergers and acquisitions, balance sheet structuring, equity/debt placements, treasury management, corporate restructuring and talent management.