Business

Cargills Bank in ‘steady performance’ over nine months ended September 30, 2023 – PAT Rs. 432 Million

Published

2 years ago

2023/11/29

Chairman of the Board Richard Ebell (L) / Managing DIrector/CEO Senarath Bandara (R)

Economic conditions and challenges prevailing last year have moderated somewhat, given the steadfast approach by policy makers and regulatory authorities towards economic recovery. We appreciate their efforts, and our results bear testimony to the progress made. Nevertheless, the road ahead remains challenging. A meaningful government budget, continued success of the IMF program, general price stability and regained momentum in tourism, remittances and exports will be key in shaping the country’s short- to medium- term economic revival, a Cargills Bank press release said.

The release adds: ‘Cargills Bank’s results for the nine months ended 30 September 2023 reflected continuing QoQ improvement in profitability. Profit after tax at Rs. 432 Mn was higher by Rs. 324 Mn than in the corresponding period of 2022. We are pleased the Bank has been able to maintain this momentum of profitability growth, and are confident the results of 2023 will reflect the strong commitment of the Bank’s team, successful execution of its strategy, a continued rigorous focus on market trends and its adaptability to a volatile environment.

‘Net interest income grew 15% or Rs. 353 Mn in the nine months compared with the corresponding period of 2022. The Bank directed its resources towards higher yielding assets, hedging interest rate risk and prudently managing deposits. In addition, close monitoring of the Bank’s lending portfolio and timely solutions offered to financially stressed customers helped maintain a healthy NIM to date.

‘Net fee and commission income of Rs. 590 Mn for the nine months was lower than the Rs. 641 Mn in the previous year. The decrease of 6% related largely to lower trade volumes and reduced net income from card related services. Additionally, capital gains realized on derecognition of financial assets, and higher foreign exchange income boosted other income streams by Rs. 265 Mn, to Rs. 391 Mn in the nine months.

‘Total operating expenses increased 25% from Rs. 1.7 Bn last year to Rs. 2.1 Bn. Personnel expenses increased 15% largely due to adjustments to salary and welfare benefits considering increased costs of living and market conditions. Other operating expenses grew 44% mainly from the impact of the Social Security Contribution Levy which was effective from October 2022, the increased cost of utilities and the cost of repair and maintenance of IT assets, particularly where denominated in foreign currencies.

‘Impairment charges totaling Rs. 607 Mn reflected a reduction of 50% in the first nine months of 2023 evidencing a focused and proactive management of delinquencies and commendable overall team efforts in this direction. The Bank’s Stage 3 Loans (net of Stage 3 Impairment) to Total Loans Ratio stood at 6.64% while Stage 3 Provision Cover was 52.74% at 30th September 2023. Additional impairment overlays considered necessary have been incorporated after a careful scrutiny of the status of borrowers.

‘VAT on Financial Services and income tax expenses increased substantially mainly due to growth in profits and the increased corporate income tax rate effective 1 October 2022.

‘The Bank maintains Capital Adequacy and Liquid Assets Ratios well above the minimum requirements prescribed by the Central Bank. The total Capital Adequacy Ratio was 20.43% while the Statutory Liquid Assets Ratio stood at 37.72%.

‘Total assets of the Bank at 30 September stood at Rs. 64.7 Bn, an increase of 20% or Rs. 11 Bn in the first nine months of the year. Financial Assets measured at fair value through other comprehensive income grew by 92% to reach Rs. 19.6 Bn. Positive gains were reflected in Other Comprehensive Income. The loan book registered moderate growth, from Rs. 36.0 Bn to Rs. 36.8 Bn, given conditions prevailing. In this regard, the Bank exercised care in maintaining the quality of its lending in a high interest rate environment, where interest payments threatened borrowers’ viability. A shift in strategy commenced in the latter part of the period, to rebuild momentum in lending.

‘Deposits to customers grew 20% from Rs. 37.8 Bn at the end of 2022 to Rs. 44.9 Bn at the reporting date amidst continued reductions in market interest rates. The Bank will judiciously balance interest expenditure and income, as substantial reductions in interest rates and the time lag in repricing loans have a direct impact on NIMs.

‘In October 2023, Fitch Ratings affirmed Cargills Bank’s National Long-Term Rating at ‘A(lka)’; Negative Outlook.

‘Ms Ruvini Fernando, who has served as a Director since 1 August 2018, resigned from the Bank’s Board on 27 October 2023 due to personal circumstances. Mr Arjuna Herath has been appointed to the Bank’s Board effective 1 November 2023.

‘The Colombo Stock Exchange (CSE) has approved the listing of the Bank’s shares on the CSE. Steps are being taken to duly offer to the public 62.5 Mn shares of the Bank at Rs. 8.oo per share through an Initial Public Offering.’

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Business

New policy framework for stock market deposits seen as a boon for companies

Published

23 hours ago

2026/01/14

Sahan Weerasooriya

Eardly Kern: ‘CSE experiencing strong revival

The government’s new policy framework to allocate a maximum interest rate for stock market deposits would pave the way for companies and investors to plan their future business activities, a senior stockbroker said.

‘Accordingly, the Colombo Stock Exchange (CSE) has entered a period of strong revival, supported by economic stabilization and rising investor confidence while significant market reforms would support the new policy framework on interest, Assistant Vice President Softlogic Stockbrokers, Eardly Kern, told The Island Financial Review.

He said that the imposition of maximum interest rates for stock market deposits would prevent the interest rates from moving upwards, thus paving the way for investors to invest in stocks with a lot of confidence.

Kern added: ‘The CSE outlook would provide expanding opportunities for investors as Sri Lanka positions itself for market-led investor platforms.

‘Improving macro fundamentals, such as lower interest rates, rising corporate earnings and historically attractive valuations, have been key catalysts in driving investment into the equities market.

‘These tailwinds, together with ongoing economic reforms, have helped re-establish confidence among both local and foreign investors.

‘Over the past two years, the number of CDS accounts has surpassed 949,000, with digital on-boarding through the CSE mobile app driving the latest surge.

‘Further, foreign inflows for 2024 amounted to USD 66.5 million, while Rs 175 billion was raised through capital market activity, including 16 new listings. With a target of 20 IPOs on the horizon, the CSE anticipates several new companies entering the market by early 2026.

‘The All Share Price Index (ASPI) delivered an impressive 49.7 percent return in 2024, ranking the CSE as the second-best performing market in Asia for the year. By November 2025, the index had risen a further 45.65 percent amounting to an extraordinary two-year return of approximately 95 percent.

‘The S&P SL20 Index recorded a parallel recovery, gaining 58.5 percent in 2024 and 31.84 percent so far in 2025.

‘ Despite the rally, the CSE continues to trade below its 10-year average PER and valuations remain significantly more attractive than in regional markets, such as, India, Malaysia, Vietnam, and China.

‘ Turnover has surged to Rs 1.06 trillion in 2025 (as of mid-November), nearly doubling the figure recorded in 2024. Market capitalization grew 34 percent n 2024, despite only around 40,000 active investors capturing most of the gains—highlighting the potential for broader participation.

‘ Corporate earnings have also strengthened markedly. After generating Rs 686 billion in earnings during 2024—a 50% year-on-year increase—listed entities are projected to deliver between Rs 775–800 billion in 2025. Earnings for the first half of 2025 have already grown 57 percent year-on-year.’

By Hiran H Senewiratne

Business

Dialog reinforces commitment to heritage through Kelaniya Duruthu Festival

Published

23 hours ago

2026/01/14

Sahan Weerasooriya

Dialog Axiata PLC, Sri Lanka’s #1 connectivity provider, has reinforced its enduring commitment to preserving national culture by sponsoring the Kelaniya Duruthu Festival, aligning long standing patronage with purposeful community engagement to honour religious heritage, support cultural continuity, and strengthen shared values.

The annual Kelaniya Duruthu Festival, one of Sri Lanka’s most significant religious and cultural observances, was held on 8th, 9th and 11th January 2026, marking a congregation of thousands of devotees and visitors at the historic Kelaniya Raja Maha Vihara. As a long-term patron, Dialog continues to provide sponsorship support, enabling the seamless organisation of the festival while uplifting traditions deeply rooted in the nation’s cultural identity.

Through its continued support of the Kelaniya Duruthu Festival, Dialog underscores its role as a responsible corporate citizen dedicated to safeguarding Sri Lanka’s cultural and religious heritage for future generations. This commitment is further reflected in Dialog’s long-term patronage of national events such as the Kandy Esala Perahara, Nawam Maha Perahara at Gangaramaya, Katharagama Esala Perahara and Gatabaru Esala Perahara. Complementing these efforts, Dialog has also undertaken heritage preservation initiatives including the construction of the vestibule at Dimbulagala Aranya Senasanaya, the launch of a website and directory of Amarapura Maha Nikaya Temples, and the restoration of the Anuradhapura Maha Vihara Sannipatha Shalawa.

Business

Sri Lanka launches its first-ever Smart Bus Ticketing System

Published

23 hours ago

2026/01/14

Sahan Weerasooriya

Advancing public transport with digital bus ticketing — CBA, in partnership with SLTB and Nimbus Venture.

A National Breakthrough in Public Transport Digitalization Powered by Ceylon Business Appliances with Nimbus Ventures.

Sri Lanka has taken a historic step forward with the launch of its first Smart Bus Ticketing System, enabling passengers to pay fares using contactless cards, digital wallets, and QR payments. This advancement places the country among global leaders in smart mobility.

The initiative was made possible through collaboration with the Government of Sri Lanka, leading banking partners, and the technology leadership of Ceylon Business Appliances (CBA) and Nimbus Ventures, who serve as the Technology, Software, Hardware, and Operational Partners behind the nation’s first Open Loop Transit Payment System.

For decades, CBA has been at the forefront of Sri Lanka’s digital transformation efforts—bringing modern, global-standard technologies that have strengthened the nation’s digital infrastructure.

Speaking to the media at the launch, Sardha Fernando, Managing Director of CBA, stated:

“This is not just a ticketing upgrade—it is a complete digital evolution of public transport in Sri Lanka. For years, CBA has been committed to introducing advanced technologies to the country, and today, we are proud to bring a globally recognized, secure, and seamless smart transit solution to our people. With every tap, we are enabling convenience, transparency, and a more connected future for all Sri Lankans.”

He added:

“This milestone reflects our ongoing mission: to help build a digitally empowered Sri Lanka that is ready to embrace the technologies shaping the world.”

‘Ruwath Fernando, CEO/Director of CBA, highlighted:

“This project demonstrates that Sri Lanka is ready to adopt and operate on par with global smart mobility technologies. Our commitment has always been to bring the world’s best software systems and innovations into Sri Lanka—solutions that are secure, scalable, and built to international standards.”

He continued:

“By introducing a state-of-the-art open-loop transit payment platform, we are proving that Sri Lanka can not only embrace but also successfully operate advanced digital ecosystems. This is a defining moment in positioning the country as a technology-proof nation prepared to trial and adopt global digital advancements.”

CBA extends heartfelt congratulations to the banking partners who trusted this vision—

Sampath Bank, Commercial Bank, Bank of Ceylon, People’s Bank, and DFCC Bank— on the successful launch of their new ticketing application.

This application integrates seamlessly with the PAX A910S ticketing device, powered by a robust CBA– Nimbus ventures software solution, engineered for scale, reliability, and national deployment..