State Bank

Apr 01, 2010 (LBO) – Sri Lanka’s state-run People’s Bank group’s net profit rose 21.8 percent to 4.1 billion rupees in 2009 from a year earlier, helped by stronger margins despite higher provisions, annual accounts showed. Group gross loans and advances rose to 334 billion rupees from 294 billion rupees a year earlier. Non performing loans (NPL) rose to 21.1 billion rupees from 19.0 billion.

Soza said at standalone bank level the NPL ratio fell by one percent to 6.7 percent from 6.8 percent a year earlier.

The bank had raised 2.5 billion rupees through a debenture to boost its capital adequacy, he said. With retained profits capital adequacy had improved to 13.4 percent from 10.5 percent a year earlier.

Group assets rose 20.3 billion rupees to 501 billion rupees and net assets grew 14.2 percent to 22.2 billion rupees.

About 23 percent of loans were to state-owned enterprises. Soza said 45-50 percent of the asset were from lending to the state inclusive of Treasuries. The group includes People’s Leasing Company, the island’s largest leasing firm.

Group interest income rose 17.1 percent to 68.6 billion rupees while interest expense increased at a slower 11.4 percent to 41.4 billion rupees, allowing