Nations Trust reports commendable performance in first quarter of ’07

CORPORATE RESULT: Nations Trust Group comprising the Nations Trust Bank and its fully owned subsidiaries reported commendable performance for the three months ended March 31, 2007, continuing to maintain the excellent growth momentum recorded in 2006 in results released to the Colombo Stock Exchange.

The Group profit before tax and after tax were Rs. 174.079 mn. and Rs. 102.031 mn. for the first quarter of 2007 as against Rs. 99.759 mn. and Rs. 58.124 mn. respectively for the corresponding period of 2006, recording 74% and 76% increase.

The improvement in the profit of the Group for the quarter compared to the corresponding period in 2006 was facilitated by an all round improvement in performance compared to the corresponding period in 2006.

Net interest income increased from Rs. 377 mn. to Rs. 475 mn., an increase of 26% mainly as a result of healthy growth recorded in deposits and advances during the period under review.

Deposits grew from Rs. 20.937 bn. as at December 31, 2006 to Rs. 23.986 bn. as at March 31, 2007 while net loans and advances grew from Rs. 26.993 bn. to Rs. 29.414 bn. Foreign Exchange income showed a tremendous increase while Other Operating Income too recorded encouraging improvements during the period.

Given the highly volatile conditions that were experienced towards the latter part of the quarter in relation to the short term interest rates in the market, the performance is really commendable, Director/Chief Executive Officer Zulfiqar Zavahir said.

Reflecting on the improvements in the asset quality as evident from the lower Non-performing Advances Ratio, the net charge to profits on provisions for bad and doubtful debts decreased to Rs. 57.895 mn. in 2007 from Rs. 79.841 mn. in the first quarter of 2006.

The increase in the VAT on Financial Services and the income tax liability corresponds to the increase in profits liable for the taxes, Zavahir said.

The Bank’s market positioning of “One Bank Many Solutions” is now being supported by all the financial services products and services that are required by individual, corporate or institutional clients.