LOLC posts 19.6 b PAT for Financial Year 2018/19 | Sunday Observer

LOLC posts 19.6 b PAT for Financial Year 2018/19

LOLC Group releasing its year end results for March 31, 2019 registered another strong year to its stellar performance over the last decade. With a robust profit before tax (PBT) of Rs. 26.81 billion, compared to Rs. 24.66 billion recorded in 2018, LOLC continues to surpass its own accomplishments. The Group’s profit after tax (PAT), as at 31st March 2019, stood at Rs. 19.62 billion in comparison with Rs. 19.19 billion that was recorded in 2018.

The Group, well served by its characteristic strength in the SME and microfinance sectors of the country, has been a catalyst in financial inclusion in Sri Lanka. LOLC has undertaken a timely expansion to the region and has now established itself as a market leader in microfinance in the countries which it operates, the company said in a financial statement.

Regional expansion has offered LOLC a diversified revenue stream with increased financial stability, has added resilience with a well spread risk profile. Therefore, it has made the Group susceptible for local externalities offering consistent growth. LOLC’s maiden overseas investment PRASAC is a good testament to this. Invested in 2007, with mere 18%, PRASAC grew leaps and bounds to become the largest microfinance institution in the dollarized Cambodian economy.

Today, LOLC owns 70% of PRASAC, a company that clams USD 2.6 billion in assets, USD2.2 billion in portfolio, USD 1.5 bn in deposits and USD103 million in PBT for the 12 months ending March 2019.

Today, with the financial sector representation in Cambodia, Myanmar, Pakistan, Indonesia and the Philippines, that accounts for a gross revenue of 41%, LOLC has fully establish itself as a strong regional financial conglomerate. With this standing, the Group is determined to reach its vision of becoming a global player with a multi-currency, multi geographic microfinance and SME platform in the future.

The Central Bank of Sri Lanka imposed a consolidation plan to strengthen the financial sector of the country. Consequently, LOLC Finance PLC (LOFC) merged with its sister company, LOLC Micro Credit Limited in March 2018.

The merger was successful in many facets; it created the largest NBFI in the country with an asset base of Rs. 211 billion, a portfolio of Rs. 151 billion in addition to the efficiencies and synergies generated through the merger.

The merged entity recorded a profit of Rs.7.1 billion at its first post merged financials amidst the challenging macroeconomic conditions prevailing in the country. During the year under review, LOFC brought about a conscious contraction in the portfolio along with other stringent NPL management strategies, that resulted in a 6.38% NPL.

Commercial Leasing and Finance PLC has been an exemplary performer since its acquisition by LOLC in 2008.

LOLC Development Finance PLC, formerly known as BRAC Lanka PLC, maintained strong compliance with statutory ratios with a CAR ratio of17.03%. However, the company was impacted the most compared to LOFC and CLC, with the ongoing economic implications that had direct repercussions to the microfinance sector resulting a loss of Rs. 140 million.

Seylan Bank, an Associate of LOLC Group also contributed Rs. 1 billion to the Group profits.