Business

BoC concludes 2021 with unprecedented value creation for all stakeholders

Published

4 years ago

2022/03/1

The, year 2021 was another tumultuous year for the entire world due to wider and much longer impacts turned out by the Covid-19 pandemic. Fight back demanded quick response strategies with new thinking. However, ably supported by BoC by facilitating the priority imports of vaccines, the Nation was able to bring out much optimism during the mid and latter parts of the year.

Financial Performance

Speaking on the Bank’s performance for the year 2021, the General Manager/CEO of the Bank of Ceylon, K E D Sumanasiri stated, the Bank was able to reiterate its position as the undisputed market leader in Sri Lanka’s banking sector, demonstrating its unparalleled ability to truly support its customers and the overall economy in trying times. Demonstrating its strength, agility and strategic approach in succeeding in the midst of challenges, the Bank was able to show a notable increase in both its fund-based and fee-based income during the year and recorded Rs. 43.2 billion Profit Before Tax, regardless of headwinds created by market interest rates fluctuations and stressed portfolio quality emanating from Covid-19 related economic impacts. This is a remarkable achievement for the Bank as it denotes the Bank’s strength of converting challenges into opportunities. “Further, the Bank’s asset book surpassed Rs. 3.0 trillion during the year surpassing another milestone in our journey” he mentioned.

Fund Based Income

Mostly, owing to loan growth and continuous credit monitoring efforts put in place during 2021, the Bank reported Rs. 260.5 billion interest income which is a 15% increase over the year 2020. The benefits of the remarkable loan growth achieved in the previous year materialized during this year, generating an interest income of Rs. 193.1 billion through loans and advances which is 74% of the total interest income. The main contributive portfolios were overdraft, term loans and personal loans. The Debt instruments which mainly comprises of Government Treasury Bills, Bonds and other Foreign Currency Sovereign Bonds brought the major portion of interest income earned from the investment portfolio which stood at Rs. 65.7 billion.

In the meantime, interest expenses declined by 2% to Rs. 149.3 billion in line with the improvement in the CASA ratio to 36% from 35% (2020) and repricing the deposits at lower rates. The inverse movement in interest income and interest expense positively contributed to Net Interest Income (NII) of the Bank and NII increased by 49% to Rs. 111.3 billion YoY.

Non- Fund Based Income

Non-fund-based income of the Bank grew by 42% YoY basis and the main contributors were fee and commission income and exchange income. Fee and Commission income has shown a sizable growth owing to a flourishing trend reported towards digital banking channels. Suitably, transactional banking related fee and commission income has formed a major portion of fee and commission income reporting 69% of the fee and commission income. During the period under review, an exchange gain of Rs. 9.2 billion was also reported.

Impairment Charges for Loans and Advances and Other Financial Instruments

Impairment charges for loans and advances for the period amounted to Rs. 35.4 billion bringing the loan to impairment provision reserve ratio to 6%. NPA ratio stood at 4.5% against 4.8% reported by end 2020. Nevertheless, in calculating the impairment charge, the Bank always follows a prudential approach; given the high degree of uncertainty and extraordinary circumstances in the short-term economic conditions mainly caused by the continuous disruptions to businesses. The Bank made an additional expected loss provision using management overlays on identified risk elevated industries.

Individually Significant Customers were thoroughly assessed for their repayment capacity irrespective of the moratorium or concessions they enjoyed due to the Covid-19 situation and necessary provisions were made along with the independent review. Consequently, the provision made for stage III customers escalated by Rs.19.7 billion (19%) and provision for Stage II customers increased by Rs.3.7 billion (32%).

The Bank has considerable exposure to investments in foreign currency denominated sovereign instruments by way of Sri Lanka Development Bonds and International Sovereign Bonds. As per the regulatory and Accounting Standards requirements a significant amount of provision amounting to Rs. 8.3 billion was made for investments in aforesaid instruments accounting the impact of sovereign downgrade.

Operating Expenses

The operating expenses of Rs. 41.7 billion consists of personnel costs, assets maintenance, deposit insurance and other overhead expenses. The increment of 26% by Rs. 8.6 billion reported in operating expenses in line with the increase in personnel expenses due to the revision of salary scales according to the collective agreement, absorption of Trainee Staff Assistants to the permanent cadre and provision made for post-retirement benefit plans. Other expenses settled at Rs. 12.6 billion for the year with a 18% upward, backed by an increase in deposit insurance premium due to growth in deposit base, upturn in office administration and establishment expenses which includes special transport arrangements for staff and expenses made in relation to Covid-19 related special safety measures at the Bank’s premises. However, the Bank’s cost to income ratio of 32% shows prudent and effective cost management mechanisms adopted by the management to maintain the cost escalation in line with revenue growth.

Tax Expenses

VAT on financial services which is charged based on the value addition made by the financial services has a direct relationship to the growth in PBT. That’s being the case, the growth of 80% reported in operating profits, the VAT on financial services also increased to Rs.9.0 billion with the 65% YoY growth.

Although the income tax expenses reported in the Income statement is Rs. 5.6 billion after the adjustments made for deferred tax, the total income tax payment which will be paid for the year of assessment accounts to Rs. 10.3 billion.

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Business

HNB Assurance Recognized with Merit Award at the Great HR Awards 2025

Published

12 hours ago

2025/12/14

Thilina Walpola

Team HNBA at the Great HR Awards

HNB Assurance PLC was recognized at the Great HR Awards 2025, receiving the Merit Award in the Finance, Insurance, Real Estate, and Investment sector. This recognition reflects the company’s continued commitment to strengthening its people strategy, nurturing a progressive culture, leveraging technology and maintaining strong industrial relations.

Sharing his thoughts on this accomplishment, Lasitha Wimalarathne, Executive Director / Chief Executive Officer of HNB Assurance PLC, stated, “This recognition reiterates our belief that people are the true drivers of our success. Over the years, we have invested significantly in building an environment where our teams feel inspired and supported to deliver their best. As we continue to grow as one of Sri Lanka’s best insurance companies, this award reflects our ongoing efforts to build a workplace where both our people and our business can thrive. My sincere thanks go out to our HR team for continuously driving these initiatives.”

Commenting on the award, Navin Rupasinghe, Head of HR / DGM at HNB Assurance PLC, said, “Our people-first philosophy shapes every HR initiative we design, from strengthening learning pathways and leadership development to enhancing employee well-being and engagement. This recognition validates our ongoing efforts to build a workplace culture grounded in trust, inclusivity and performance. As we look ahead, we remain committed to evolving our HR practices to meet the expectations of our people and the future of work. My sincere thanks to the CIPM for this recignition.”

Business

MullenLowe Sri Lanka named Creative Agency of the Year in South Asia

Published

12 hours ago

2025/12/14

Thilina Walpola

MullenLowe Sri Lanka has been awarded Gold as the Rest of South Asia’s Creative Agency of the Year at the Campaign Agency of the Year Awards 2025, held recently at Mumbai’s ITC Maratha Hotel. The accolade marks a landmark year for the agency, driven by breakthrough ideas, ambitious brands, and a surge in economic activity.

Campaign Agency of the Year – South Asia 2025 (Rest of South Asia – Creative Agency) awarded to MullenLowe Sri Lanka

Guided by a clear creative vision and extensive category expertise across 111 brands in 33 sectors, MullenLowe strengthened its position through strategic leadership appointments, talent acquisition, and the integration of AI-enabled tools. These initiatives created an environment where creativity, learning, and commercial impact worked in tandem, supporting long-standing client relationships and consistent new business momentum.

Thayalan Bartlett, Executive Chairman, said, “Our growth is rooted in a people-first, creative-centred culture. By attracting top talent and focusing on continuous upskilling, we have enriched both our creative and strategic capabilities.”

The agency’s innovation was further enhanced by Fever, its AI-enabled production studio, and LoweGo, a subscription-based design unit, enabling faster and more scalable solutions for modern marketers. Training programs, including an international AI workshop in Baku for top creative minds, helped unify teams around technology-driven creativity, leading to MullenLowe’s highest Effie points haul in a decade.

Harendra Uyanage, Senior Vice President and Executive Creative Director, added, “This recognition celebrates a team that constantly stretches its creative boundaries, transforming every brief into opportunity.”

The win adds to a series of recent accolades, including Most Effective Agency of the Year at the 2024 Effie Awards, and multiple awards at Dragons of Sri Lanka and SLIM Digis 2025, cementing MullenLowe’s vision to become Sri Lanka’s most commercially impactful creative company by 2030.

Business

ComBank named Sri Lanka’s Best Trade Finance Bank at Euromoney Awards 2025

Published

12 hours ago

2025/12/14

Thilina Walpola

Com Bank honoured for outstanding support to Sri Lanka’s trade sector

The Commercial Bank of Ceylon PLC was named Sri Lanka’s Best Trade Finance Bank at the prestigious Euromoney Transaction Banking Awards 2025, in recognition of the Bank’s strong performance and continued contribution to supporting Sri Lanka’s export and import sectors.

This global recognition from Euromoney, a leading authority in financial markets, celebrates institutions that demonstrate innovation, leadership, and measurable impact in transaction banking across cash management, payments, trade finance, and technology. Commercial Bank is Sri Lanka’s clear market leader in trade finance, commanding a 21% share in exports and a 14.26% share in imports, demonstrating its strong presence across both segments.

In 2024, the Bank supported over US$ 5 billion in trade transactions, underscoring its unmatched role in enabling the flow of goods, services, and foreign exchange. Its leadership has also been recognised regionally by the Asian Development Bank (ADB), which named Commercial Bank its Leading Partner Bank in Sri Lanka for the fourth consecutive year under the Trade and Supply Chain Finance Programme.

At the forefront of Commercial Bank’s recent innovations is ComBank TradeLink, Sri Lanka’s first fully integrated, end-to-end digital trade finance platform. The system brings all trade finance operations – from Letters of Credit to export collections and shipping guarantees – into one secure online interface, providing customers real-time visibility, faster processing, and paperless convenience. This digitalisation drive has redefined the client experience, reduced manual processes and improved turnaround times across thousands of transactions.

The Bank’s commitment to advancing Sri Lanka’s trade sector extends beyond technology. Through initiatives such as the ComBank Trade Club, which facilitates connections between buyers and suppliers both locally and internationally, and ComBank LEAP | GlobalLinker, a digital business networking platform for SMEs, the Bank is actively building bridges between Sri Lankan entrepreneurs and global markets. Its Diribala Exporter Development Programme further empowers micro, small, and medium enterprises to become export-ready, providing access to expert guidance, training, and financial support.

Reflecting on the award, Commercial Bank said the recognition from Euromoney was a tribute to the trust placed in the Bank by Sri Lanka’s exporters and importers, and to the dedication of its trade finance teams who continue to innovate and deliver excellence in a rapidly evolving global landscape.

As Sri Lanka’s largest private sector bank and the first to surpass US$ 1 billion in market capitalisation, Commercial Bank continues to lead in supporting national trade, driving digital transformation, and shaping a more inclusive and resilient export economy, the Bank said.

Commercial Bank was the first bank in the country to be listed among the Top 1000 Banks of the World, and has the highest Tier I capital base among all Sri Lankan banks. The Bank is the largest private sector lender in Sri Lanka and the largest lender to the country’s SME sector. Commercial Bank is also a leader in digital innovation and is Sri Lanka’s first 100% carbon-neutral bank.

Commercial Bank operates a network of strategically located branches and automated machines island-wide, and has the widest international footprint among Sri Lankan banks, with 20 branches in Bangladesh, a fully-fledged Tier I Bank with a majority stake in the Maldives, a microfinance company in Myanmar, and a representative office in the Dubai International Financial Centre (DIFC). The Bank’s fully owned subsidiaries, CBC Finance Ltd. and Commercial Insurance Brokers (Pvt) Limited, also deliver a range of financial services via their own branch networks.