Net interest income went up almost six percent to 3.3 billion rupees with interest income up 16 percent to 9.5 billion rupees while interest expenses rose 22 percent to 6.2 billion rupees.

At bank level, the results showed that interest margin fell to 4.53 percent as at September 30, 2008 from 4.70 percent at December 31, 2007.

Group net profit for the nine months ending September 30, 2008 was stagnant at just over three billion rupees compared with the same period a year ago.

Commercial Bank’s Chief Financial Officer Nandika Buddhipala said higher provisioning for debt, slower loan growth and an increase in financial value-added tax had slowed profit growth in the nine months ended September 30, 2008.

Total deposits of the group rose almost seven percent to 195.8 billion rupees as at September 30, 2008, from 183.1 billion rupees as at December 31, 2007.

Buddhipala in a statement said it was "a reasonable growth given the size of the base and the prevailing conditions."

However, he said, gross advances of the group recorded a slower growth of 3.05 percent to 186.6 billion at the end of the nine months reviewed from 181.1 billion as at December 31, 2007

"The prevailing inflationary situation and high interest rate regime have impacted on the growth trend of the advances of the bank," Buddhipala said.

Gross provisioning for bad and doubtful debts, including the statutory general provisions was increased to 1.689 billion rupees in the nine month period as against 1.191 billion year ago.

The gross non-performing loans and advances ratio of the bank had risen to 5.14 percent as at September 30, 2008 from 3.02 per cent as at December 31, 2007.

"This was mainly due to the classification of loans and advances as per requirements of the recent direction of the Central Bank and also due to the prevailing macro economic environment in the country," Buddhipala said.

The group’s foreign exchange income rose by 366 million rupees or 27.26 percent during the nine-month period mainly due to higher gains realised from forward foreign exchange transactions, the statement said.

Total assets of the group rose five percent to 282.2 billion rupees as at September 30, 2008, from 268.4 billion as at December 31, 2007.