Sampath Bank reports robust performance in 1H

Chairman Harsha Amarasekera

Managing Director Ayodhya Iddawela Perera

Sampath Bank has reported robust financial performance during the first half of 2023 with a profit before tax (PBT) of Rs. 13.2 billion and a profit after tax (PAT) of Rs. 7.7 billion representing growth of 46.6% and 8.1% respectively compared to 1H 2022.

Key financial highlights for 1H 2023 compared to the same period in 2022 include Growth in Net Interest Income (NII) supported by higher AWPLR; A 13.6% increase in net fee and commission income driven by trade-related operations; A decline of exchange income due to rupee appreciation against the dollar;  A significant 74.4% decline in impairment provision on loans and investments; Operating expenses increased by 19.1%; and a 104% increase in total tax expenses due to the upward revision in income tax rate and the introduction of SSCL.

The Group’s PBT and PAT for 1H 2023 were Rs. 13.4 billion and Rs 7.6 billion respectively, reflecting growth of 39.3% and 3.6% respectively.

Sampath Bank’s capital adequacy ratios continued to improve, with CET 1, Tier 1, and total capital ratios standing at 13.89%, 13.89%, and 17.36% respectively as of 30 June 2023. This improvement is attributed to several factors, including a Tier 2 capital infusion, profit generation in 2023, and a decline in risk-weighted assets due to rupee appreciation.

Sampath Bank’s total assets increased by Rs. 97 billion (an annualised growth of 14.6%) from Rs. 1.3 trillion as of 31 December 2022, to Rs. 1.4 trillion as of 30 June 2023. Despite the rupee’s appreciation against the dollar, the Bank’s total deposit book grew from Rs. 1.1 trillion to Rs. 1.14 trillion during the same period, demonstrating strong customer confidence.

Looking ahead, Sampath Bank said it remains committed to navigating challenges, contributing to the economy, supporting its customers, and positively impacting society through its sustainable initiatives. The Bank’s enduring resilience and commitment to excellence position it as a cornerstone of stability in the Sri Lankan financial landscape.

It said as a responsible corporate citizen and a premier private sector bank in Sri Lanka, Sampath Bank has once again showcased its unwavering commitment to supporting the Sri Lankan economy and its people throughout the past four to five years. Despite facing significant challenges, including the aftermath of the Easter attack, the COVID-19 pandemic, the foreign currency crisis, and social unrest, the Bank has remained steadfast in its dedication to customers, the community, and deposit holders.

In a show of solidarity during tough times, the Bank has extended various forms of moratoria and concessionary repayment plans, providing much-needed relief to its customers. This commitment to alleviating economic pressure has been a cornerstone of Sampath Bank’s approach in these turbulent times.

Furthermore, the Bank has continued its strong contribution to public financing, with an effective tax rate exceeding 56% for the period ending June 2023. These contributions, which include Income Tax, VAT on Financial Services, Social Security Contribution Levy, Crop Insurance Levy, and other indirect taxes, underscore the Bank’s role as a significant participant in Sri Lanka’s economic landscape.

In recognition of its exceptional performance, Sampath Bank was honoured with the esteemed title of “Best Bank in Sri Lanka for 2023” at the Euromoney Awards ceremony held in Hong Kong. This prestigious award, the fifth time the Bank has received it, underscores Sampath Bank’s enduring excellence and positive impact on society.

Sampath Bank’s dedication extends beyond financial matters, as demonstrated by its impactful Corporate Social Responsibility (CSR) initiatives. The Bank’s flagship project “Weweta Jeewayak,” a tank restoration endeavour, and the “A Breath to the Ocean” initiative aimed at restoring the oceanic ecosystem, reflect the Bank’s commitment to sustainability, environmental preservation, and community well-being.