Citizens Development Business Finance Ltd. (CDB) reported a remarkable upturn in its performance for the half year ended 30 September 2010 as per the interim financial statements.
An elated CDB’s Director/CEO Mahesh Nanayakkara said that the Company’s pre-tax profit has gone up by over five times to record Rs. 112 m up from Rs. 19 m for the corresponding period of last year.
“This is a significant landmark in the history of CDB. Post-tax profit recorded was Rs. 100 m while revenue reached Rs. 882 m for the six months ending 30 September 2010 projecting a growth of 21% over the corresponding previous period,” he added.
CDB’s AGM Finance & Planning Damith Thennakoon said: “Our total deposit base increased to Rs. 6 b, a growth of 25% or Rs. 1.2 b from the last financial year end.
Our average monthly net deposits recorded a figure of Rs. 160 m during the period under review. Net interest income increased by 69% to Rs. 365 m or an increase of Rs. 149m over the corresponding previous six months.
The second quarter’s net profit after tax figure recorded a figure of Rs. 65 m compared to the first quarter figure of Rs. 35 m, reflecting a growth of 185%.”
“Downward trend in the market interest rates coupled with timely re-pricing of asset and liability portfolios and a strategic product composition helped to maintain healthy margins thus being the biggest contributor to the impressive growth in net interest income.
This also reflects our focused strategy to concentrate on the core business within a well defined business domain yielding exceptional and sustainable financial results.
“Our total asset base grew by 17% to reach Rs. 7.8 b projecting an increase of Rs. 1.1 b since 31 March 2010 while the overall NPL ratio stood at 5.44% as at 30 September 2010. Loan growth, as well as consistent reductions in the NPL quantum, contributed to declining trend in the NPL ratio.
The earnings per share recorded a figure of Rs. 2.52 for the six months ending 30 September 2010. Similar improvements were also seen in all of the company’s key business areas,” Thennakoon added.
CDB’s AGM Credit Sasindra Munasinghe said: “With the Government’s per capita income target of US$ 4,000 within the next five years, the Central Bank of Sri Lanka is expecting the finance industry to more than double its lending capacity to the Rs. 550 b level by 2015/16. Our average approvals per month during the six month period from April to September 2010 stood at Rs. 433 m while the disbursements for the same period accumulated towards Rs. 2.2 b.
“Our loan book increased by 21% (Rs. 1,037 m) from the last year recording a figure of Rs. 6.1 b. Our broad business approach is more weighted on rural lending and urban funding.
This approach proved to be a recession proof business strategy and is now helping us to accelerate our business volumes in both segments, while positioning CDB as a net lender to the rural economy.”
CDB’s current island wide reach stands at 32 outlets with two service centres in the Northern region and 16 outlets located outside the Western Province.
It is now in the process of opening two new outlets in Batticaloa and Trincomalee in the current quarter.