Pan Asia Bank pre-tax profit sharply up by 53% in 1Q2020

Pa n A s i a Banking Corporation PLC has concluded 2020 Q1 with the best ever financial results in a first quarter of any year in its 25 year history,

“It has reported a profit before tax of Rs.652 million and profit after tax of Rs. 416 million, recording an impressive growth of 53 per cent in both, demonstrating resilience amidst challenging conditions,” the bank said in a media release.

The bank’s operating profit before taxes on financial services for the quarter increased by 22 per cent reflecting solid overall core banking performance, effective assets and liabilities management and excellence in NPL management, although prudential impairment provisioning undermined the bank’s operating profits to an extent.

The bank consciously increased impairment provision buffers during Q1 to deal with probable general deterioration in asset quality due to the impact of the COVID-19 pandemic. As a result, the total impairment charge for the quarter increased by 46 per cent to Rs. 529 million compared with Rs. 361 million during the same period a year ago.

The bank’s net interest margins improved from 4.36 per cent to 4.78 per cent during the past three months which is a ‘commendable feat’ given the industry-wide deterioration in credit quality and steps taken by the government to bring down market interest rates despite the increased credit risk of borrowers, it said.

The bank’s total asset base stood at Rs. 168 billion at the end of the quarter after posting a growth of 10 per cent supported by the expansion in gross loans and advances and other financial instruments. Customer deposits recorded a growth of 6 per cent or Rs. 7 billion during the quarter to touch Rs.130 billion.

Commenting on the results, the bank’s Director/CEO, Nimal Tillekeratne said this performance had been possible due to the bank’s well balanced, sustainable overall growth across all business segments coupled with improved efficiency and commitment from all staff. “This impressive performance reflects the bank’s resiliency, foresight, agility and the growing capability to generate strong financial performance even amidst challenging market conditions,” he said.