Merchant Bank reports Q3 NPBT growth of 78%

Tuesday, 28 October 2014 01:22 - - {{hitsCtrl.values.hits}}

Chairman Shah and CEO Mutugala confident of further post-merger growth

Merchant Bank of Sri Lanka (MBSL), the pioneer subsidiary of State Banking giant, the Bank of Ceylon, reported positive NPBT growth of 78% with NPAT growth of 67% for the period ending Q3 2014. Group NPBT grew by 376%, while NPAT reported 130% growth for the same period. The company’s asset base grew by Rs. 1,339 million compared to the first nine months of 2013.

Commenting on the achievement, Merchant Bank of Sri Lanka PLC Chairman M.R. Shah said: “The clear business vision of the Board of Directors and the dedication of the staff who were effectively driven by the CEO, who was appointed in the latter part of 2013, have resulted in this remarkable achievement.” He added: “These strengths will be utilised to develop the branches of MCSL Financial Services Ltd. (MCSL) and MBSL Savings Bank, which will be merged with Merchant Bank of Sri Lanka PLC in due course. This will eventually enhance stakeholder value, with a greater portion of it adding to the shareholders.” Merchant Bank of Sri Lanka PLC posted revenue growth of 8% for the period ending 30 September 2014, compared to the first nine months of 2013. Net interest income, which was at Rs. 672 million in the first nine months of 2013, also reported growth of 19% in the corresponding nine-month period ending 30 September 2014. It peaked at Rs. 800 million mainly due to the branch expansion drive in 2012 and business growth in personal loans, term loans, microfinance and auto loans. On the other hand, Merchant Bank of Sri Lanka PLC has been able to reduce the interest expense by 10% in the third quarter of 2014 as against its corresponding period the year before. Accordingly interest expense, which was at Rs. 1,026 million in 3Q of 2013, dipped to Rs. 929 million for the same period of 2014. Net fee and commission income remained a negative growth for MBSL with a 6% decrease during the period under review. The company recorded Profit Before Tax (PBT) of Rs. 206.2 million, which is a growth of 78% compared to the corresponding period of 2013 and NPAT was also recorded at Rs. 142.4 million. This reflects a growth of 67% compared with the nine months of 2013. The comprehensive income recorded as Rs. 203 million, a growth of 114% as against the Rs. 95 million in the previous year. Speaking at the occasion, Chief Executive Officer of Merchant Bank of Sri Lanka PLC, T. Mutugala said: “We are now fully focused on our merger plans with MCSL and MBSL Savings Bank. Our aim is to continue the same growth momentum even after the merger is completed. We are confident of developing the MCSLFS and MBSL Savings Bank branches too and getting their contribution to the final results of MBSL. He is also very confident that with the current guidance of the Board of Directors and with the commitment of his staff, the goals could be reached within the set timelines.”