Commercial Bank of Ceylon beats all odds to deliver exceptional results for '07
Wednesday, 12 March 2008
Raihan M Chowdhury
Better management of interest margins and a significant contribution from its operations in Bangladesh have enabled the Commercial Bank of Ceylon PLC to overcome the adverse market conditions of 2007 and post noteworthy growth in all key performance indicators in the concluded financial year.
"Our success with our operations in Bangladesh has inspired us to continue looking at new markets and we are exploring all options both in South Asia and South East Asia," Country Manager of the Bank's Bangladesh Office, S Renganathan told the FE in an interview.
He disclosed that the bank's operations in Bangladesh, now comprising nine outlets, had contributed Rs 910 million or 13.5 per cent of its pre-tax profit.
Replying to a question, he said that the Colombo-based bank will float certain portion of its shares in the Bangladesh stock market, if the Bangladesh regulators provide the company with the rules and regulations on initial public offering (IPO).
"We are interested to float shares in Bangladesh stock market, but we are not properly informed on the rules and regulations on the IPO system of Bangladesh," the country manager said.
He said the results released at the Colombo Stock Exchange recently reveal that Sri Lanka's benchmark private bank has enhanced top and bottom line growth and improved capital adequacy ratios in the year to reiterate its consistency in the face of high inflation, volatile interest rates and escalating internal strife in its home market.
Declaring that "2007 was a difficult year and 2008 may turn out to be even more challenging," he pointed out that "Yet, we have seen that with prudent management and the creative use of all opportunities, we can still deliver value to all our stakeholders. Our challenge in 2008 will be to maintain consistency amidst high volatility."
The Commercial Bank Group comprising the bank, its subsidiaries and associate companies has reported a profit before tax and after special financial VAT of Rs 6.791 billion for the 12 months ending December 31, 2007, an increase of Rs 1.716 billion or 33.8 per cent over the normalised pre-tax profit for the previous year.
The Group's profit after tax and financial VAT at Rs 4.152 billion reflected an even higher growth of 46.9 per cent on a normalised basis or Rs 1.327 billion, on a turnover of Rs 35.207 billion, which was up 43.9 per cent in the year under review.
A statement of the bank said the Commercial Bank, the largest entity in the Group, turned in a still stronger performance, with normalised pre-tax profit (after financial VAT) up 34.9 per cent to Rs 6.705 billion, and normalised profit after tax growing 48.35 per cent to Rs 4.103 billion.
The statement said that the Group had delivered three interim dividends of Rs 1.50 each in the year, and proposed a fourth and final dividend of Rs 2.50, taking the total dividend payout to Rs 7.0 per share for 2007.
The profit growth of the Group was facilitated by an increase of Rs 3.994 billion or 52.6 per cent in net interest income, which reached Rs 11.587 billion at the end of 2007.
Elaborating on other key indicators, Commercial Bank Managing Director, Amitha Gooneratne said total deposits grew by more than Rs 25.694 billion or 16.3 per cent to Rs 183 billion in the 12 months, despite the dampening effect of rising inflation on deposit mobilisation. Gross loans and advances at Rs 178.727 billion as at December 31, 2007 also reflected a growth of 16.0 per cent or Rs 24.6 billion, Gooneratne disclosed.
Established in 1969, Commercial Bank was adjudged Sri Lanka's 'Bank of the Year' by The Banker, a top notch global banking magazine, in December 2007. This was the Bank's sixth such award. In July 2007, the Bank was named the 'Best Bank' in Sri Lanka by another prestigious international financial magazine 'Euromoney'. Commercial Bank has also been rated the 'Best Bank in Sri Lanka' for nine consecutive years by the US based 'Global Finance' magazine.
The Bangladesh operation of the Bank bagged the third position among the foreign banks and won the Best Corporate Award by the Institute of Cost and Management Accountants of Bangladesh in 2007.
S Renganathan joined the Bangladesh office in November of 2003.
He is the fellow of the IFS School of Finance of United Kingdom.
Better management of interest margins and a significant contribution from its operations in Bangladesh have enabled the Commercial Bank of Ceylon PLC to overcome the adverse market conditions of 2007 and post noteworthy growth in all key performance indicators in the concluded financial year.
"Our success with our operations in Bangladesh has inspired us to continue looking at new markets and we are exploring all options both in South Asia and South East Asia," Country Manager of the Bank's Bangladesh Office, S Renganathan told the FE in an interview.
He disclosed that the bank's operations in Bangladesh, now comprising nine outlets, had contributed Rs 910 million or 13.5 per cent of its pre-tax profit.
Replying to a question, he said that the Colombo-based bank will float certain portion of its shares in the Bangladesh stock market, if the Bangladesh regulators provide the company with the rules and regulations on initial public offering (IPO).
"We are interested to float shares in Bangladesh stock market, but we are not properly informed on the rules and regulations on the IPO system of Bangladesh," the country manager said.
He said the results released at the Colombo Stock Exchange recently reveal that Sri Lanka's benchmark private bank has enhanced top and bottom line growth and improved capital adequacy ratios in the year to reiterate its consistency in the face of high inflation, volatile interest rates and escalating internal strife in its home market.
Declaring that "2007 was a difficult year and 2008 may turn out to be even more challenging," he pointed out that "Yet, we have seen that with prudent management and the creative use of all opportunities, we can still deliver value to all our stakeholders. Our challenge in 2008 will be to maintain consistency amidst high volatility."
The Commercial Bank Group comprising the bank, its subsidiaries and associate companies has reported a profit before tax and after special financial VAT of Rs 6.791 billion for the 12 months ending December 31, 2007, an increase of Rs 1.716 billion or 33.8 per cent over the normalised pre-tax profit for the previous year.
The Group's profit after tax and financial VAT at Rs 4.152 billion reflected an even higher growth of 46.9 per cent on a normalised basis or Rs 1.327 billion, on a turnover of Rs 35.207 billion, which was up 43.9 per cent in the year under review.
A statement of the bank said the Commercial Bank, the largest entity in the Group, turned in a still stronger performance, with normalised pre-tax profit (after financial VAT) up 34.9 per cent to Rs 6.705 billion, and normalised profit after tax growing 48.35 per cent to Rs 4.103 billion.
The statement said that the Group had delivered three interim dividends of Rs 1.50 each in the year, and proposed a fourth and final dividend of Rs 2.50, taking the total dividend payout to Rs 7.0 per share for 2007.
The profit growth of the Group was facilitated by an increase of Rs 3.994 billion or 52.6 per cent in net interest income, which reached Rs 11.587 billion at the end of 2007.
Elaborating on other key indicators, Commercial Bank Managing Director, Amitha Gooneratne said total deposits grew by more than Rs 25.694 billion or 16.3 per cent to Rs 183 billion in the 12 months, despite the dampening effect of rising inflation on deposit mobilisation. Gross loans and advances at Rs 178.727 billion as at December 31, 2007 also reflected a growth of 16.0 per cent or Rs 24.6 billion, Gooneratne disclosed.
Established in 1969, Commercial Bank was adjudged Sri Lanka's 'Bank of the Year' by The Banker, a top notch global banking magazine, in December 2007. This was the Bank's sixth such award. In July 2007, the Bank was named the 'Best Bank' in Sri Lanka by another prestigious international financial magazine 'Euromoney'. Commercial Bank has also been rated the 'Best Bank in Sri Lanka' for nine consecutive years by the US based 'Global Finance' magazine.
The Bangladesh operation of the Bank bagged the third position among the foreign banks and won the Best Corporate Award by the Institute of Cost and Management Accountants of Bangladesh in 2007.
S Renganathan joined the Bangladesh office in November of 2003.
He is the fellow of the IFS School of Finance of United Kingdom.