Pan Asia Banking Corporation PLC reported a solid bottom-line growth while recording a double digit growth in the loan book as the bank ploughed ahead amid the economic headwinds and the first time impact from the SLFRS 09, new accounting standard on Financial Instruments which factor Expected Credit Loss principles for loan loss provisioning.
Pan Asia Bank reported a strong 34% growth in total operating income during the financial year ended in December 31, 2018 to record Rs.8.93 billion.
This was supported by an equally strong fund based income and non-fund based income for the period.
The net interest income for the year rose by a robust 39% to Rs. 6.52 billion on the back of a Rs. 19.16 billion interest income and Rs.12.64 billion interest expense which rose by 23% and 16% respectively.
Meanwhile, the bank’s net interest income for the quarter increased by an even stronger 74% to Rs. 1.8 billion over the same quarter in 2017.
The net interest income which is the difference between the revenue generated from assets and expenses tied to liabilities was driven by both loan growth and improving margins. The latter grew up to 4.37% from 3.61% in 2017 and the industry’s 3.60% for 2018.
Fund based income consist of 73% of the bank’s total operating income.
Meanwhile the non-funded income of the bank rose by 22.1% to Rs.2.41 billion of which net fee and commission income had Rs.1.52 billion share which itself grew by 16% during the year.
The bank’s other operating income was boosted by a Rs.377.4 million gains made on the revaluation of foreign exchange, which is up from Rs.262.9 million recorded in the previous year.
Meanwhile, higher net forward foreign exchange gains helped the bank to increase its net trading income by 22% in 2018 to Rs.476.4 million.
Pan Asia Bank’s Director/Chief Executive Officer, Nimal Tillekeratne said these numbers reflect the bank’s resilience and its ability to perform amid challenging circumstances.
The Bank reported earnings of Rs. 3.48 a share or Rs. 1.54 billion for the financial year ended in December compared to Rs.3.31 a share or Rs. 1.39 billion in 2017.
Meanwhile the bank reported earnings of Rs. 4.14 a share or Rs.461.4 million in total profits for the most recent quarter ended in December (4Q’18) compared to Rs.472.4 million. The impairment charges on individually impaired customers increased the most to Rs.1.3 billion from Rs.337.3 as a result of the general weaknesses in the economy.
Meanwhile the collective impairment charges rose to Rs.719.8 million.
The Bank’s loans grew by 12.4% or Rs. 12.6 billion during the year. The Bank ended the year with a total loans and advances book of Rs.113.5 billion.
The gross non-performing loans ratio rose to 5.44% by the year end from 4.36% in December 2017.
Meanwhile the bank grew its deposit base by 10.7% or Rs.11.4 billion during the year to Rs.118.6 billion.
Meanwhile the total asset base of the bank grew from Rs.138.5 billion to Rs. 154.0 billion by the year end.
Total operating expenses rose by 15.5% during 2018 to Rs. 4.31 billion.
The bank’s Cost-to-income ratio fell to 48.9% from 56.51% from 2017.
The Bank’s Total Common Equity Tier I Capital stood at Rs.11.34 billion while the total capital stood at Rs.12.77 billion by December.