Hatton posts 9-month $42M pre-tax profit

HNB recorded a pre-tax profit of US$42 million and a post tax profit of US$25.9 million for the nine months ended September.

The figures are up by 10 per cent compared to first nine months of 2009 with the Sri Lankan bank recording a pre-tax profit of US$39.4 million and a post tax profit of US$24 million during the period under review amidst pressures on margins and acceleration in demand for credit mainly during 3rd quarter of 2010.

Hatton National Bank’s Interest income dropped by 15 per cent during the nine months ended September 2010 to US$157.6 million despite loan growth due to re-pricing of assets during the year and prevailing low interest rates. Nevertheless, due to prudent asset and liability management the Bank was successful in recording a 5 per cent growth in net interest income during the period.

The non interest income increased by 22 per cent year on year mainly on account of capital gains and marked to market gains on the trading portfolio while the foreign exchange income witnessed a marginal growth.

Commenting on the growth the Senior DGM - Strategy Mr. Nihal Kekulawala stated that with the economic resurgence, the industry witnessed a growth in demand for credit while the Bank recorded an increase of US$127 million in gross loans and advances to US$ 1.7 billion during the nine months. The performing loans increased to US$1.59 billion by 8 per cent compared to end 2009 while the gross and net NPA ratios improved to 5.9 per cent and 3.1 per cent respectively as at end of September 2010 due to prudent lending policies and concerted recovery effort by the Bank. Further the bank maintained a provision cover of 48 per cent as at end of 3rd quarter of 2010.