July 28, 2009 (LBO) – Sri Lanka’s Seylan Bank said net profit for the June 2009 quarter fell 39 percent to 188 million rupees from a year ago with both interest income and fee income falling and bad loans rising. The bank, part of the Ceylinco group, said in a stock exchange filing that interest income fell 2.51 percent to 5.3 billion rupees with interest costs up 3.42 percent to 3.8 billion, resulting in net interest income falling 15 percent to 1.5 billion rupees.
First half net profit was down 58 percent to 188 million rupees compared with the same 2008 period.
At bank level interest income grew less than one percent to 5.2 billion rupees in the June quarter while interest costs grew almost six percent to 3.6 billion resulting in net interest income falling by almost 11 percent to 1.5 billion.
The bank’s non-interest income fell 33 percent to 1.9 billion owing to sharp falls in forex and fee income.
The interest margin contracted to 3.85 percent from 4.78 percent as at December 31, 2008.
Total provisioning for bad loans rose 24 percent to 200 million rupees. Specific provision doubled to 377 million.
The bank’s non-performing loans ratio, net of interest in suspense and provision