People’s Bank’s consolidated financial support extended during 2020 & 2021 crosses LKR 1.0 trillion

People’s Bank today announced the results for the year ended December 31, 2021 – with consolidated total operating income reaching LKR 110.7 billion and total operating expenses amounting to LKR 50.5 billion, either of which up 21.9% and 14.9% respectively over 2020. Consolidated pre-tax and post-tax profits amounted to LKR 37.2 billion and LKR 28.1 billion; representing a 51.1% and 74.6% growth. On a Bank standalone basis, figures were LKR 30.4 billion and LKR 23.7 billion, respectively – up 43.2% and 67.3% over 2020.

Income growth primarily stemmed from net interest income, which accounted for close to 90.0% of total operating income and grew by 30.2% in line with the Bank’s growth in its credit and investment portfolio, whilst its fee income grew by 23.4% to reach LKR 9.0 billion; reflecting the Bank efforts to improve its non-funded income sources. Expense growth mostly related to direct business growth. Relative to 2019, the Bank’s cost to income ratio has shown a marked improvement at 51.1% in 2021 as compared with 54.3% in 2020 and 61.8% in 2019. Bank-wide impairment charges rose reflecting macro-economic stresses as seen throughout the industry.

During the year, the Bank invested in rural development, supported small and medium-sized enterprises (SMEs) and encouraged women entrepreneurship. At end 2021, it extended over LKR 63.0 billion to SMEs through various loan initiatives ; which included close to LKR 1.9 billion through its own scheme to help revive businesses across agriculture, information technology, logistics, manufacturing, tea and tourism. In conjunction with the Small Holder Agri-Business Partnership (SAP), introduced a low-interest credit scheme for 5,000 farmers with an initial provision of LKR 1.0 billion. To support the production of local fertilizer, the Bank introduced the Sarabhoomi loan scheme whilst to promote women entrepreneurship, it extended LKR 533.5 million. The Bank also introduced additional loan schemes to assist self-employment in the agricultural and handicrafts spaces. To support the country’s investment in information technology, the Bank committed LKR 6.0 billion of which LKR 750.0 million was already drawn down. From a Personal Loan perspective, in its effort to uplift the housing and construction sector, the Bank granted over 10,000 home loan facilities amounting to over LKR 185.8 billion at end 2021. In addition, by end 2021, it had disbursed over LKR 5.5 billion to retired disabled officers of armed forces and over LKR 68.5 billion to government pensioners. To assist artists and related professionals, the Bank disbursed over LKR 550.0 million, whilst to assist University Students and Teachers, the Bank designed laptop loan schemes through which a total of LKR 350.5 million was extended throughout the year. Medical students at state universities were similarly offered personal loan facilities.

All the above considered, the Bank’s consolidated loan book expanded by 12.1% to reach LKR 1,990 billion at end 2021. The Bank’s stage 3 loans were, however, at 4.3% (2020: 4.5%). In addition, the Bank undertook approximately LKR 453.0 billion treasury bond conversions during the said two-year period. Growth in its consolidated deposits was 12.1% to LKR 2,168.7 billion.

Total consolidated taxes and dividends to the Government of Sri Lanka totaled LKR 20.4 billion during 2021, representing a 25.1% growth over LKR 16.3 billion in 2020. Its Consolidated Tier I and Total Capital Adequacy was 13.4% and 17.9%, respectively at end 2021 (end 2020: 10.7% and 15.6%). On a Bank standalone basis, these were 12.6% and 17.8%, respectively (2020: 9.5% and 15.5%); either of which not institutional all times highs but also amongst the highest in the industry. All other regulatory ratios were all maintained well above the minimum requirement.

Commenting on the results, the Chairman of People’s Bank, Mr. Sujeewa Rajapakse, stated that: “We are very pleased with the results of the Bank more so as attained during unseen like before circumstances. As a service provider, the last two years have put our promise and our ability to deliver to the ultimate test. As a national institution, we don’t measure our success by a typical top line or bottom line but by our national value added – with our results both from a quantitative and qualitative perspective self-attesting to our resilience in these difficult times and overall performance including, most notably, our productivity & efficiency. All the above said, our job is far from over. Not complacent with any of our successes, we remain focused and fully committed to the Government economic revival plan. Mindful of the challenges which lie ahead, we look forward with a great degree of optimism. Together, we can!”