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Records Rs 543 m profit for 2009:
Seylan Bank bounces back
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Chairman
Eastman Narangoda |
Seylan Bank recorded a Rs 543.30 million profit after tax for 2009
representing an increase of 250 percent over the previous financial
year.
The Bank’s profit before tax increased from Rs 155.24 million in 2008
to Rs 892.57 million in 2009 thus recording an unprecedented increase of
475 percent.
This is as a result of operating expenses and provisions for loan
losses decreasing by 21.05 percent (Rs 1.729 billion) and 11.51 percent
(Rs 284 million) respectively as against a drop in net operating income
of 11.77 percent (Rs 1.275 billion) a media release said.
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Seylan
gets stable rating
Fitch Ratings has affirmed
Seylan Bank PLC’s (Seylan) National Long-term rating at ‘BBB+(lka)’.
The outlook is stable. At
the same time, the agency affirmed the ‘BBB(lka)’ rating on
Seylan’s outstanding subordinated debentures.
The ratings continue to
reflect State support, given the bank’s size and systemic
importance.
The state owns 28 percent of
Seylan’s voting equity at present, consequent to an equity
infusion of over Rs 1.1 bn in October 2009 (37 percent of a
total new-share issue of Rs 3 bn). |
Seylan Bank Chairman Eastman Narangoda said this was by far the
year’s most significant achievement with the restoration of stability
and liquidity of the Bank.
Taking advantage of the buoyant stock market we made a public issue
of 54,290,000 ordinary shares at Rs 35 per share in September last year.
The desirability of the issue was bolstered by the aggregate 25 percent
stake taken in Seylan Bank by the two state institutions Bank of Ceylon
and the Sri Lanka Insurance Corporation.
The success of the issue clearly demonstrated the recovery of
investor confidence in the Bank, being fully subscribed before the
closing date.
During the same period, the Bank’s cost-to-income ratio showed a
marked improvement decreasing from 75.79 percent to 67.82 percent, while
the total capital adequacy ratio under severe pressure during the end
2008 crisis rose from 8.06 percent to 11.74 percent.
Seylan Bank now meets the liquidity targets stipulated by the CBSL.
These positive indicators have brought a corresponding rise in
confidence both in the shareholder and depositors.
Market capitalization of Seylan Bank grew 288 percent in the course
of the year from Rs 1.2 billion at the end of 2008 to a notable Rs 4.8
billion at the end of 2009.
The Bank now enjoys adequate capital to support the current business
volumes as well as its growth plans in the months that lie ahead.
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