LB Finance PLC, Sri Lanka’s leading non-banking financial service provider, showcased a resounding growth for the first six months of the year as at end-September 2018, with Operating Profit Before Tax on financial services recording a 31.7% increase to 4.5 billion, from Rs 3.4 billion for the same period last year. Profit before taxes increased to 3.7 billion from 2.8 billion, with a recorded increase of 32%. The total comprehensive income for the period, net of tax is Rs 2.4 billion, up 24.5% from Rs. 1.9 billion in 2017. The growth demonstrates stability, customer trust, and strength of the company.
The recorded growth in gross earnings was driven by an outstanding 22.6% increase in interest income, to 13.2 billion in 2018 from Rs. 10.8 billion in 2017. The Net Interest Income in the first six months of 2018 increased 31.3% to Rs. 7.0 billion from Rs. 5.3 billion in the first six months of 2017. Demonstrating customer loyalty, deposits with LB Finance showed an above-average 13.7% growth, up from Rs. 68.5 billion in 2017 to an impressive Rs. 78.0 billion in 2018.
LB Finance’s Tier 1 core capital has increased 20.8% to Rs. 14.6 billion, from Rs. 12 billion in the previous corresponding period. Gross Non Performing Accommodations ratio has marginally increased to 2.78% in the period under review compared to 2.14% in 2017, but well within the norm for non-bank financial institutes.
The changing landscape of the country with the volatility in the foreign exchange, changes in duties and taxes, and the lowered investor confidence makes this performance estimable. The results once again prove that LB Finance retains the top position in non-banking solution providers in the country.
The annualised return on average shareholders’ funds after tax has increased to 29.15%, from 28.72% in 2017. The available amount of liquid assets is Rs. 15.0 billion, a 79% phenomenal surplus over the requirement of Rs. 8.4 billion.
LB Finance has an A- (lka) rating from Fitch Ratings Lanka Ltd. with a stable outlook, pointing to low default risk and strong capacity for repayment of commitments. LB Finance Managing Director Sumith Adhihetty declared, “Once again we have been able to make significant strides in achieving our strategic goals and milestones as we have been continuously doing so in the past few years. I am extremely pleased to note that our financial performance for the first six months of year as at September 2018, we have overcome market challenges and have accomplished considerable progress in continuing to create wealth and value for all our stakeholders.”
With a rich history over four decades, LB Finance PLC is licensed by the Central Bank of Sri Lanka under the Finance Business Act No. 42 of 2011 and listed on the Main Board of the Colombo Stock Exchange. The company offers a variety of financial services including leasing, factoring, hire purchasing, micro finance, mortgage loans, housing loans, education loans, gold loans, currency exchange and Western Union Money Transfer services through an island-wide branch network and Gold Loan Centres, offering unparalleled convenience to all customers.