NDB Capital Holdings PLC (NCAP) posted strong third quarter results recording a net profitability of Rs. 206.9 million at the company level. This was almost a threefold jump in profitability compared to a net profit of Rs. 53.4 million recorded during the same quarter the previous year.
Net profit for the nine-month period ended 30 September 2012 resulted in a growth of 159% which amounted to Rs. 326 million compared to previous year’s figure of Rs. 125.5 million. At a group level, the net profit for the first nine months of 2012 was Rs. 353.1 million, a 68.5% growth over the same period, the prior year.
This significant growth in profitability was achieved due to a series of strategic initiatives undertaken earlier in the year. The company was re-launched in June 2012, positioning itself as the only listed full service investment bank in the country offering investment banking, wealth management, stock broking and private equity.
The increase in profitability at the company level was driven by a prudent asset allocation policy and efficient investment strategies. During the period ended 30 September 2012, the company made strategic investments to the value of approximately Rs. 890 million to acquire 100% stakes in NDB Investment Bank Limited (NDBIB), NDB Stockbrokers (Private) Limited and an additional 5% stake in Aviva NDB Insurance PLC.
Furthermore, NDBIB, the flagship company of the group, was recognised as the ‘Best Investment Bank’ in Sri Lanka by the prestigious Euromoney Magazine at its Awards of Excellence 2012.
The Chairman, Ashok Pathirage, commenting on the performance said, “NCAP’s performance was commendable despite the tough conditions which prevailed both in the money market and the capital market.” He further stated, “NCAP, now led by a team of capital market experts with the recent changes in the management structure, is well positioned to extract the synergies with the commercial banking operations of NDB Group and offer an unparalleled product range to its customers”.
CEO Vajira Kulatilaka said: “We have formulated a unique knowledge-based business model that will help us sustain our leadership position in the market. The successful strategies we have implemented in the recent past would further improve the business performance of the company. Backed by NDB Group’s strategic alliance with DBS Group of Singapore, we are planning to further contribute towards the development of the Sri Lankan capital markets by executing landmark transactions and other strategic initiatives.”
NCAP recently announced the signing of a share sale and purchase agreement with American International Assurance Company Limited (AIA) of Hong Kong, one of the largest insurance companies in the world, with an exclusive focus on the Asia-Pacific region to sell its shareholding in Aviva NDB Holdings Lanka (Private) Limited (Aviva NDB Holdings) together with Aviva Asia Holdings (Private) Limited. The net receipt of US$ 59 million from the intended sale is expected to be earned by end 2012, subject to the necessary regulatory and legal clearances.
NCAP is a 99.6% owned subsidiary of NDB Bank.