Bank of Ceylon posts record Rs 17.8 bn PAT in 2020 | Daily News

Bank of Ceylon posts record Rs 17.8 bn PAT in 2020

Chairman BOC and other senior management addressing the media Picture by Wimal Karunatillke
Chairman BOC and other senior management addressing the media Picture by Wimal Karunatillke

Bank of Ceylon once again stamped its resilient leadership position despite unexpected challenges by posting a record Profit After Tax (PAT) of Rs. 17.8 billion for the year 2020. TheBank’s operating profit stood at Rs. 29 billion and reported a Rs. 23.6 billion Profit Before Tax (PBT) for the year 2020, moving forward with stable performance, while managing headwinds caused by low interest rates cashflow deferments and operational restrictions.

The Bank’s assets base grew by 24% to Rs 2.9 trillion, primarily backed by anincrease of 28% in the loan book.Chairman of Bank of Ceylon Kanchana Ratwatte said that with the tourism picking up and economic fundamentals falling into place they expect to post better results next year.Reaching another milestone, the Bank’s loanbook crossed the Rs 2 trillion mark during the year and closed with Rs 2.1trillion gross loans and advances to customers. Both Government and Privatesector lending contributed to growth during the year, while working capital and personal lending showed a boost in all segments, including retail and corporate financing. The Bank’s deposit base (more than 23% ofthe industry) increased during the year despite low interest rates. The Bank’sdeposit base of Rs 2.5 trillion represents 35% of the Current and Saving deposit (CASA) base, which generates funds at low cost. During 2020 the Bank successfully executedissuance of its first Additional Tier 1 (AT1) bond, generating Rs 15.0 billionATI capital.

The Bank’s Tier I Capital and Total Capital ratio stood at 11.2%and 14.9% respectively by end 2020, which were above regulatory norms. While the Bank recorded the highestindustry profit in 2020, its continued focus during the year was to ensure the integrity of the country’s banking sector, including payment and settlements,continued without interruption, while aiding the country in its economic revival, through SME and local entrepreneurship development.The Bank extended support by implementingthe CBSL announced moratorium to over 258,000 customers in facilities worth Rs589.4 billion under five schemes. Bank of Ceylon topped the industry ingranting loans under the “Saubagya” Working Capital Loan scheme, disbursing Rs 39.1 billion to over 18,000 borrowers. Bank of Ceylon introduced a special loan scheme for businesses affected by the COVID-19 pandemic, with facilities worth Rs 20.5 billion granted.

The Bank also played an indispensable role in supporting CSBL’s efforts to stabilise the Sri Lankan Rupee and strengthen the external position under difficult economic conditions by way of active participation in the exchange market, facilitating around USD 2.8 billion inward remittances. It was disclosed that the remittance increased mainly due to the fact that they are now coming through legal channels which did not operate due to the pandemic.

While focusing on economic revival, the Bank delivered on its duty in developing a strong national economy by boosting the SME and Microfinance sector with disbursement of Rs 128.9 billion to the sector in 2020.

The Bank also ensured all its digital and virtual channels were up and running for people to serve their banking requirements as social distancing limited visiting branches. A customer base of over 13 million conducted digital transactions worth Rs. 5.2 billion per day during this period.

Year 2020 was also the year that the Bank reaped the harvest of heavy investments made on digital infrastructure development many years ago. Registration to the Bank’s Online and Mobile Banking portals has increased nearly three-fold during the year. The Bank also operates a fully owned subsidiary in London, UK. During the year under review extra effort invested to manage the Bank’s overseas branches, namely Maldives, the Seychelles, India, and the UK, due to lockdowns, economic downturns and other social distancing measures experienced in those countries.

As the COVID-19 pandemic raged across India, the Bank adopted contingency and business continuity plans, together with safety measures, to ensure uninterrupted services. As one of South Asia’s hardest hit economies, given that 70% of the country’s GDP stems from tourism, the Bank gave its utmost support by way of moratorium relief packages for needy customers. With the majority of staff in quarantine and the senior management were working remotely, the Management of BOC took steps to operate services without interruption in customer service.

Moratorium relief packages were also provided for needy customers in the Seychelles during the partial lockdown, while uninterrupted customer services were provided, including salary payments of customers and social benefits granted by the Seychelles Government. Capitalising on more than 650 corresponding relationships and the Bank’s extensive experience in trade services, the Bank facilitated all essential and medical emergency-related imports without disruption. Bank of Ceylon continues to be recognised as the highest ranked local bank and listing among the Top 1000 Banks by the Banker Magazine UK and several other accolades.

The bank was also the recipient of three Gold Awards for Green Building by the Green Building Council for its Panadura City, Malsiripura and Walasmulla branches.

Venture Capital Fund soon

Bank of Ceylon will formulate a Venture Capital fund soon after obtaining approvals disclosed Chairman BOC, Kanchana Ratwatte.He said that they were looking at an allocation of around Rs. 10 billion for this. “We have not yet decided on the ticket size for lending but it would be for micro to mega businesses.”