|
HNB
reports impressive 1H results
 Half
year results released recently on Hatton National Bank
shows an impressive performance by the bank recording
an income of Rs 17.6 Bn., a growth of 30% compared to
the corresponding period last year. This impressive
growth is ample testimony for the resilience of the
Bank to the less than conducive economic conditions
prevailing in the country.
HNB’s net interest income grew steadily to Rs 6.0
Bn., a growth of 13% during the first half of 2008 compared
with 2007 and non interest income grew by 39% to Rs
2.3 Bn from Rs 1.7 Bn. This enabled the Bank to improve
the Net Income from Rs 6.9 Bn to Rs 8.3 Bn., a growth
of 20%. During the 1st half 2008 entire operating expenses
bill was comfortably met by the net interest income
from core banking activities.
Bank’s non interest expenses grew only by 6% to
Rs 4.5 Bn during the first half when compared to the
same period in 2007. Personnel costs have been well
managed with an increase of only 10% to Rs 1.7 Bn when
compared to the same period in 2007. The premises, equipment
& establishment expenses and other operating expenses
too have been managed with only an increase of around
10% despite high inflationary conditions prevailed during
the period.
Continued focus on cost management and improvement in
productivity norms saw an improvement in cost income
ratio from 61% to 54% during the first half of 2008.
Bank’s provision for bad and doubtful debts decreased
by 29% to Rs 424 Mn during the first half of 2008 compared
to the same period of 2007. As at the end of the 1st
half of 2008 the bank has built up the statutory general
provision stipulated by CBSL to 0.87% leaving the bank
adequate comfort in meeting the requirement of 1% by
end of March 2009.
HNB’s Operating Profit from Ordinary Activities
before taxes surpassed Rs 3 Bn mark, recording a growth
of 49% over 2007. Operating Profit after tax for the
period is Rs 1.6 Bn up from Rs 964 Mn., an improvement
of impressive 63% compared to the respective period
in 2007. Financial VAT and Corporate Taxes increased
by 41% and 33% respectively, compared to the first half
of 2007 to reach Rs 863 Mn and Rs 707 Mn. Taxation has
and will continue to pose a challenge to the Banking
industry to sustain growth in profitability.
HNB’s Total Assets currently stands at Rs 239 Bn
indicating a 3% growth during the first half of 2008.
Whilst Deposit and Loans & Advances portfolios grew
by mere 1%, investments in Government securities recorded
a growth of 18%.
Prudent management of balance sheet growth with improved
performance in the core banking activities and sound
management of expenditure, resulted in an appreciable
increase in post tax ROAA from 0.93% as at end June
2007 to 1.33% as at end June 2008.
HNB Group income too has increased by 26% to Rs 18.4
Bn with post tax profits increasing by 28% to Rs 1.3
Bn. Group profits records a reduction compared to the
bank, due to the inclusion of dividends of Rs 245 Mn
from Subsidiaries in the bank’s financials.
|
