* Total assets grow to Rs. 390,560 million
* Core business posts 9% PAT increase
Core business of DFCC Bank posted a profit before tax of Rs. 1,585 million and profit after tax of Rs. 1,124 million for the quarter ended March 31, 2019.
After accounting for fair value loss on Commercial Bank of Ceylon PLC shares transferred to the trading portfolio, the Bank reported a profit before tax of Rs.1,001 million and profit after tax of Rs. 541 million in comparison to profit before tax of Rs. 1,277 million and a profit after tax of Rs. 1,068 million in the comparative period.
The Bank recorded total operating income from core business amounting to Rs. 3,981 million for the quarter ended March 31, 2019. After accounting for the impact of high fair value loss in the investment of Commercial Bank of Ceylon PLC, the operating income reflects a decline of 14%. A growth of 8% was recorded in fees and commission income to Rs. 467 million in Q1 2019 from Rs. 434 million in Q1 2018. This is the outcome of a focus on non-funded business.
Operating expenses increased to Rs. 1,750 million (11%).
The Bank’s Super Grade Branch at Lake House premises has taken customer convenience a step further by offering a totally new experience with DFCC MySpace, and a Self-Banking area.
Impairment provision during the year decreased to Rs. 11 million for Q1 2019 from Rs. 542 million in the comparable period. The Bank has identified Small and Medium Enterprises (SMEs) as a separate segment in adopting the Circular No 6 of 2019 issued by Central Bank of Sri Lanka in the financial statements for the period ended March 31, 2019.
DFCC’s NPL ratio moved up to 3.91% as at March 31, 2019 from 3.28% in December 2018. The ratio has been managed at a level below the industry average of 4.2% as at March 2019.
Investments in equity securities and treasury bills and bonds are classified as financial assets whose variations in fair value are recorded through other Comprehensive Income. Fair value losses of Rs. 1,407 million and net fair value gain of Rs. 603 million were recorded on account of equity securities and fixed income securities.
DFCC’s total assets grew by Rs. 15,652 million to Rs. 390,560 million on March 31,2019. Within this, the Bank’s loan portfolio grew to Rs. 262,521 million. The Bank lent prudently and did not pursue aggressive growth particularly to sectors that exhibited stress.
DFCC’s deposit base experienced a growth of 3%.
The Bank’s CASA ratio, which represents the proportion of low cost deposits in the total deposits of the Bank, was 24.4% as at March 31, 2019.
The Group’s Tier 1 capital adequacy ratio stood at 10.51% while the total capital adequacy ratio was 15.62%.
CEO Lakshman Silva’s statement: Despite difficult conditions, DFCC Group maintained its momentum in the first quarter when compared to the previous year while continuing its dynamic progress in digital channels. The Bank continued to concentrate on adding value to shareholders, customers and other stakeholders through the introduction of innovative products and by providing an exceptional and personalised customer service.