Cargills Bank’s results for the quarter ended March 31, 2025 reflected an increase of Rs. 116 mn in profitability compared to the corresponding quarter in 2024 posting a profit after tax of Rs. 162 mn for Q1 2025.
Net interest income of Rs. 865 mn was an increase of Rs. 51 mn in Q1 2025 compared with Q1 2024. Market interest rates have witnessed a gradual reduction in line with the CBSL policy directions and the Bank’s portfolio was repriced to reflect these changes.
While the Bank continues to focus on maintaining the NIM, a reduction from 4.86% to 4.31% was witnessed reflecting the market interest environment.
Net fee and commission income of Rs. 254 mn for the quarter ended March 31, 2025 recorded Rs. 55 mn growth in comparison with the corresponding period in 2024. Concerted efforts to improve trade volumes, loan related fee income, card-related fee income and improved remittance income were among the main contributory factors for this growth of 28% recorded.
Capital gains realised on derecognition of financial assets boosted other income streams by Rs. 246 mn in the quarter under review to reach Rs. 338 mn. Net gains from financial assets at fair value through profit or loss decreased by Rs. 38 mn to reach Rs. 46 mn in Q1 2025. Net other operating income grew by 63% to reach Rs. 27 mn largely due to improvement in foreign exchange gains recognised during the quarter under review.
Total operating expenses increased by 19% from Rs. 770 mn Q1 2024 to Rs. 915 mn in Q1 2025 and additional one time expenses incurred on investigations and recommendations subsequent to the cyber security incident. The Bank’s Cost-to-Income Ratio of 59.72% reflected a marginal increase from 58.23% in 2024.
Impairment charges totaling Rs. 126 mn reflected a decrease of 44% from Rs. 226 mn in the Q1 2025 subsequent to a careful scrutiny of the status of borrowers and considering the improved macro-economic environment and results of recovery actions.
Total assets of the Bank as at March 31, 2025 at Rs. 82.3 bn reflected an increase of 3% or Rs. 2 bn during the quarter.
The loan book posted a moderate growth of 6%, from Rs. 46.1 bn to Rs. 48.8 bn, given conditions prevailing. Financial Assets measured at fair value through other comprehensive income decreased by 2% to reach Rs. 21.8 bn. Net loss of Rs. 307 mn was reflected in Other Comprehensive Income. Customer Deposits decreased by 5% to Rs. 56.7 bn at the reporting date from Rs. 59.4 bn at the end 2024.
