NDB sees post-tax profitability up by 34%

National Development Bank PLC (NDB) achieved sustained results for the first quarter ended 31 March 2021, amidst challenging conditions as the pandemic continued to bite the country’s economy.

In a media release, commenting on this performance, NDB Director/ Group CEO -. Dimantha Seneviratne noted that the period was marked by two fundamental changes, one - the prospect of prolonged low interest rates, and the other - greater inclination towards digital engagements from its customers.

The NDB Group's new strategic plan, which was launched in October 2020, has placed it on a steadfast growth trajectory amidst the turbulences. “We carry good momentum to the second half of the year, which seems steeper in terms of challenges, with the outbreak of the third wave of the pandemic in Sri Lanka and worsening situations across Asia, which will have a cascading impact on the local economy,” he said. Moving forward, the bank said the foreseeable future will be impacted by the effects of the COVID-19 pandemic. “NDB remains committed to support its customers through these challenges and make essential contribution towards national economic revival, whilst generating meaningful returns to its shareholders and other stakeholders,” the statement said adding that the bank is set to achieve a triple Rs. 500 billion, in total assets, gross loans and customer deposits, with total deposits to soon cross this milestone.

Operating profit before all taxes for the period was Rs.3.5 billion, an increase of 19 per cent. Total taxes for the period was Rs.1.1 billion comprising VAT on financial services and income tax, with income tax rate reducing to 24 per cent from 28 per cent. The resultant effective tax rate for Q1 2021 was 33 per cent.

Post-tax profitability enhanced to Rs.2.3 billion, up by 34 per cent whilst profit attributable to shareholders was Rs.2.4 billion, up by an impressive 90 per cent, complemented by improved performance of the NDB Group's capital market cluster, making up the unique financial service powerhouse in Sri Lanka, the statement said.

The bank's total operating income posted a growth of 23 per cent to Rs.8.2 billion supported by enhanced net interest income (NII), fee income and other nonfund income bases.