CDB records steady growth for financial year 2012/13

Citizens Development Business Finance PLC (CDB) has recorded steady growth in all aspects of business for the year 2012/13 according to the unaudited results released to the Colombo Stock Exchange (CSE). As indicated in the explanatory notes to the results published, the current year figures have been stated in compliance with the LKAS/SLFRS whilst the comparative figures are based on SLAS in accordance with the ruling issued by the Institute of Chartered Accountants of Sri Lanka.

The balance sheet has recorded a growth of 48%, documenting a figure of Rs. 24.49 billion. Revenue reflected a growth of 50%, recording a figure of Rs. 4.31 billion. Net interest income has recorded a growth of 36% at Rs. 1.70 billion. Interest income reflected an increase of 60% whilst interest expenses increased by 83%, indicating the adverse impact on margins due to increases in market interest rates during most part of the period under review.

Profit before tax stood at Rs. 669.99 million in comparison to last year figure of Rs. 644.27 million. Profit after tax of Rs. 534.87 million in comparison to Rs. 630.43 million in the corresponding previous period has been in the backdrop of an over nine-fold increase in income tax expenses. Total comprehensive income for the year stood at Rs. 761.32 million.

Balance sheet growth has been strongly supported by a loan book growth of 47% and a deposit base growth of 56%, recording figures of Rs. 19.45 billion and Rs. 17.8 billion respectively. The net and gross non performing loan ratios (NPL) stood at 1.27% and 2.32% respectively. Strong liquidity position reflecting 90% of the balance sheet assets in regular income and cash flow generating assets coupled with statutory liquidity ratio of 14.65% at the yearend well above the regulatory requirement of 10%.

CDB also enjoyed a strong capital position with capital adequacy ratio of 14.43% well above the regulatory requirement of 10% and shareholders’ fund standing at Rs. 3 billion, reflecting a growth of 30%. Earnings per share recorded a figure of Rs. 9.98 whilst net assets value per share stood at Rs. 55.32. The impact of the drop in gold prices has had minimum impact on CDB as exposure to gold-backed assets stood at 4.3% of balance sheet assets. The Board of Directors has proposed a first and final dividend of Rs. 2.75 per share for the approval of the shareholders.

Many prior initiatives were brought online during the year under review out of which key areas were the full live operation of the core banking solution, the first and only core banking solution implemented by a non bank financial institution (NBFI) in Sri Lanka; the launch of the CDB VISA international debit card; the provision of ATM accessibility to clients via the largest ATM network in the country; and the installation of the first CDB branded ATM at the head office.

CDB was also the first NBFI in Sri Lanka to be on the Sri Lanka Interbank Payment System (SLIPS). All these new initiatives have tremendously enhanced client service standards and client convenience. CDB also opened eight new outlets during the year, expanding its online connected distribution network to 44 by the year end. During the period under review, CDB further consolidated its positions as a net lender to the rural economy and provider of access to finance for base of the pyramid markets whilst further strengthening the deposit mobilising brand franchise.