Siyapatha Finance records PBT of Rs. 833.79 m in the face of a challenging 2018

• PBT Rs. 833.79 m
• PAT Rs. 516.52 m
• Total asset base Rs. 36.16 b
• Cost to income ratio 40.46%

Leading financial entity, Siyapatha Finance PLC, a fully-owned subsidiary of Sampath Bank, recorded a pre-tax profit and a post-tax profit of Rs. 833.79 m and Rs. 516.52 m respectively by 31 December 2018, despite the macroeconomic challenges faced by the industry during the year.

Chairman Channa Palansuriya

Managing Director Saman Herath

 

As a result of the sound growth of the loan book by 20.9% and improved margins in 2018, the interest income grew by 39% YoY to reach Rs. 6.395 b. Nevertheless, interest expenses increased at a lower rate of 33% YoY, which contributed to the Net Interest Income of Rs. 2.715 b, an increase of 48% YoY, due to prudent ALCO management.

Efficient cost management initiatives taken by the company resulted in the improvement of the cost to income ratio to 40.46% in 2018 from the previous year’s (2017) recorded ratio of 45.56%.

Impairment charges were recorded at a higher level during the year under review as a result of asset quality deterioration, which was due to a higher Non-Performing (NPA) ratio across the industry and the adoption of a new accounting standard – SLFRS 9, effective from 1 January 2018.

The total tax expense, including taxes on financial services, showed an increase of 18% to reach Rs. 608.52 m in 2018. Taxes on financial services grew by 26% with the introduction of the Debt Repayment Levy (DRL) from 1 October. The total asset base grew by 21% to reach Rs. 36.16 b as of 31 December 2018. In terms of Capital Adequacy Ratios, the Core Capital ratio and Total Capital ratio were recorded at 9.40% and 12.21%, which were well above the prescribed minimum ratios set by the Central Bank of Sri Lanka.

During the year Siyapatha Finance has opened four new branches in Kiribathgoda, Wattala, Maharagama and Hatton, bringing the total number of branches to 30 at the end of 2018.