Alliance Finance reaches Rs.6 b milestone in deposits and 406% growth in profits

A pioneering Sri Lankan finance company, Alliance Finance has increased its profit after tax by a phenomenal 406% during the six months ended September 2011 compared with September 2010.

Alliance Finance AGM – Deposits Champa Nakandala said that the company has witnessed a significant growth last year on all fronts with its deposit base reaching Rs. 6 billion which reflects a 24% growth compared to 8.7% in the previous year. The diversified client base has grown to over 10,000 customers during this period.

She said that the company will continue to expand this year by converting more Collection Centers to Branches. Currently the company operates in every province in the country with 61 service points comprising of branches, collection centres, gold loan centres and window offices.

In keeping with the requirements of its expansion strategy, the company is expected to grow its deposit base further this year. The continuous and prompt payment of due interest to deposit holders over the years has built confidence amongst its clients, she said.

“Our first priority is the payment of interest and even the staff salaries are paid after that” as per the guidelines set by the three successive generations of the Board.

Asked how it was possible to sustain a high renewal ratio during the financial crisis in the industry, she said, although the Company was compelled to pay lower interest rates to depositors during that period, Alliance Finance was able to maintain a 90% renewal ratio with hardly any premature withdrawals.

As a testament to the company’s excellent performance in its core business of hire purchase and leasing, the non-performing loans (NPL) ratios which stood at 4.24% in March 2011 has reduced to 3.86% in September 2011.

In recognition of its superior performance in the industry, the Company recently won a Prestigious Silver Award in the Specialized Banking and Financial Services Sector category, at the National Business Excellence Awards 2011, organised by the National Chamber of Commerce of Sri Lanka.

The company has also been featured in the 61st position within the top 100 Most Valuable Brands of Sri Lanka compiled by an independent survey carried out by LMD and Brand Finance.