DFCC maintains steady course despite turbulence | Sunday Observer

DFCC maintains steady course despite turbulence

DFCC released its interim non-audited financial statements for the six months ended June 30, 2019 last week.

It has been presented in accordance with Sri Lanka Accounting Standard 34 (LKAS 34) on ‘Interim Financial Statements’.

The DFCC Group is a diversified financial organisation involved in commercial banking, development banking, investment banking, wealth management, information technology, industrial park management and consultancy businesses.

Core business of DFCC Bank posted a profit before tax of Rs. 2,056 million and profit after tax of Rs. 1,588 million for the period ended June 30, 2019 compared to profit before tax of Rs. 2,373 million and profit after tax of Rs. 1,837 million in the comparative period.

After accounting for the one-off fair value loss on Commercial Bank of Ceylon PLC shares transferred to the trading portfolio, the Bank reported a profit before tax of Rs. 1,205 million and profit after tax of Rs. 737 million in comparison to profit before tax of Rs. 1,843 million and a profit after tax of Rs. 1,308 million in the comparative period.

The Bank recorded total operating income from core business amounting to Rs. 7,037 million for the period ended June 30, 2019 compared to Rs. 6,867 in the comparative period in 2018, an increase of 2%.

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 5%. A growth of 4% was recorded in fees and commission income to Rs. 945 million in period of six months in 2019 from Rs. 906 million in the comparative period of six months in 2018. This is the outcome of a focus on non-funded business.

The Bank’s impairment provision during the period ending June 30, 2019 was Rs. 476 million, a reduction compared to a sum of Rs. 649 million provided in the comparable period.

DFCC’s NPL ratio moved up to 4.63% as at June 30, 2019 from 3.28% in December 2018.DFCC’s total assets grew by Rs. 25,081 million to Rs. 399,988 million on 30 June 2019, which is a 7% growth on December 31, 2018. Within this, the Bank’s loan portfolio grew by Rs. 7,876 million to Rs. 257,610 million compared to Rs. 249,734 million as at December 31, 2018, which is a growth of 3%.

The Bank lent prudently and did not pursue aggressive growth particularly to sectors that exhibited stress.

DFCC’s deposit base experienced a growth of 5%.

CEO Lakshman Silva thanked former Chairman Royle Jansz, who relinquished his duties on July 27, for his inspirational leadership that contributed to the success and growth of DFCC Bank and welcomed the appointment of J. Durairatnam as the new Chairman of DFCC Bank on July 28.

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