Booking Profits

Chairman Lal Nanayakkara says the turnaround has come from higher recoveries in its bad loan portfolio and profits from its investment portfolio.rn

rnIn 2001, the bank recorded an impressive Rs. 345.29 bn profit reversing a loss of Rs. 1.77 bn in 2000 after providing Rs. 821.75 mn for loan losses and Rs. 25.68 mn for the fall in value of dealing securities.rn

rnThe state-owned giant has negative net assets to the tune of Rs. 6 bn and is operating on a Letter of Comfort from the government. rn

rnldblquote The profitability has reduced our negative networth by Rs. 3 bn,
dblquote Nanayakkara said.rn

rnThe bank, which had its capital wiped out due to bad lending practices in the past, has been looking for up to Rs. 13.5 bn in fresh capital. rn

rnNanayakkara says two local investor groups are talking to Peoples Bank to give it a badly needed equity injection.rn

rnThe government is also tapping donor assistance to further reform the bank.rn

rnProfits aside, Nanayakkara says fresh capital is essen