Seylan Bank recorded a profit after tax of Rs. 4,010 million for the year ended December 31, 2016, the bank said.
Net interest income recorded a moderate growth of 12.03% as a result of the strong balance sheet growth. Net interest margin contracted from 4.42% in 2015 to 4.19% in 2016 due to cost of deposits increased at a faster rate.
Net fee and commission income witnessed a 15.04% growth from Rs. 2,697 million to Rs. 3,103 million during 2016, mainly attributed to core banking related business.
Other operating income comprising of net gains from trading, gains on financial instruments, gains on foreign exchange and other income decreased by 13.05% from Rs. 1,624 million reported in 2015 to Rs.1,412 million during 2016 mainly as a result of mark- to-market losses on Government Securities, due to the upward movement in interest rates.
Total expenses recorded an increase of 12.76% from Rs. 8,625 million to Rs. 9,725 million. Expenses growth was witnessed by a higher proportion of investments being made towards branch upgrading and refurbishments, continuous development in human resources and technology which resulted in the underlying expenses increasing rapidly over the previous period. Bank continues to focus on Cost Management through strategic cost management initiatives and through the implementation of lean concepts.
The Bank reported a significant net credit growth of 22.22%, with net advances growing from Rs. 193,104 million to Rs. 236,020 million during 2016. The Gross NPA ratio has also improved to 4.47% in 2016 compared to 4.68% in 2015.
The Bank’s CASA ratio (current and savings accounts) stood at 32.5% and total Time Deposits increased from 63.71% by end of year 2015 to 67.5% as at December 31, 2016 of the total deposit base. The overall deposit base recorded a growth of 21.79%. The Bank’s Earnings per Share (EPS) grew from Rs 11.11 to Rs. 11.63. The Bank recorded a Return (profit before tax) on Asset (ROA) of 1.76% and Return on Equity (ROE) of 15.18%. The Bank’s Net Asset Value per share as at December 31, 2016 was Rs. 80.51 (Group Rs 84.13).