Siyapatha Finance profits up by 48% in 2015

Siyapatha Finance PLC has reported a Profit Before Tax (PBT) of Rs. 559.15 million for the year ended 31 December 2015. Profit After Tax (PAT) stood at Rs. 384.5 million, reflecting a Year on Year (YoY) growth of 48%. 

This impressive growth was mainly attributed to the increase in interest earning assets and credit quality that was reflected in a very low Non Performing Advances ratio (NPA ratio). The NPA ratios of three months and six month levels stood at 2.49% and 1.33% respectively, indicating high credit quality with a very low delinquency rate.

Net Interest Income of the company grew to Rs. 1,149.22 million which reflected a growth of 9% when compared with the last financial year. Interest income of the company increased to Rs. 1.97 billion (reflecting a growth of 7%) during the period under review while interest expense recorded an increase of 6% caused in the main by re-pricing of borrowings. Total operating income grew by 15% YoY which was due to an increase in fee and commission income.

Gross loan portfolio of the company grew by Rs. 3.94 billion showing a growth of 40.07% from the end of previous financial year, with finance leases being the main contributor. Prudent steps taken in providing for provision for impairment ensured that impaired loan percentage was 1.78% of gross loans outstanding. 

The company recently commenced deposit mobilisation in March 2015 and currently has a deposit base of Rs. 2 billion as at end February 2016. Total assets of the company stood at Rs. 14.64 billion showing a growth of 40.52% over the financial year end 2014.

The company’s Return on Average Assets stood at 2.87% whereas Return on Average Shareholders’ Funds was 25.91% for the period under review. These ratios have improved marginally over the corresponding period of the previous financial year. 

The company has also maintained its liquid assets ratios well above the regulatory minimum and a trade-off is always maintained between liquidity and profitability.

The Capital Adequacy Ratio (CAR) – Tier 1 of the company stood at 12.20% while total Capital Adequacy for the period under the review was 18.26%. The said ratios have been maintained well above the mandatory minimum ratios prescribed by the regulator.

The company has a National Long Term Rating A-(lka); outlook Stable from Fitch Ratings Lanka Ltd.

Speaking on the company’s recent growth trajectory, Siyapatha Finance Chairman Channa Palansuriya commented: “In the recent past the company has grown exponentially at a pace much faster than the industry average and has operated profitably. In terms of asset size it currently is at a pitch at or around a medium-sized finance company but the plans ahead would make us a larger institution on par with most of the top five Non-Banking Financial Institutes. The paradigm shift would result in a hybrid institute that offers a mix of traditional financial products associated with finance companies with more banking related product offerings.”

In the context of its product innovation and strategic focus, Chief Executive Officer Roshan Nanayakkara stated: “The company has introduced many innovative products targeting many market segments and has always set a strategy that is aggressive and innovative without in any way tampering on our way of doing business which has at all times being ethical. We have always valued sustainability as the core of our business strategy. We believe that this approach drives product/service innovation and business decisions.”

Siyapatha Finance PLC is a licensed finance company that is a fully-owned subsidiary of Sampath Bank PLC and has been in operation for the last 10 years. The product breadth of the company includes finance leasing, hire purchase advances, business and personal loans, factoring, and gold loans.