Apr 13, 2009 (LBO) – Profits at Sri Lanka’s Pan Asia Bank has grown 3.5 percent to 223 million rupees in the full-year 2008, through strong net interest margins were eroded by high taxes, the bank’s annual report shows. Interest income shot up 45.5 percent to 2.86 billion rupees, interest expenses increased 46.9 percent to 1.79 billion rupees and net interest income kept pace, growing 43.1 percent to 1.06 billion rupees.
“They have benefited on the wider spreads and high lending rates experienced last year for trade finance and overdraft facilities,” says Danushka Samarasinghe, research manager at Asia Securities.
The bank had gross overdrafts of 5.0 billion rupees on a net loan book of 11.16 billion. Loans and advances grew by 21.7 percent to 11.16 billion in 2008.
Its government securities portfolio also grew to 3.42 billion rupees from 1.4 billion from the previous year.
Non interest income had increased by 8.0 percent to 376 million rupees.
Fee based income had increased 13.9 percent to 284.65 billion rupees. However foreign exchange income has slipped 20.3 percent to 71.86 million rupees from the previous year.
But financial value added tax (financial VAT) a non-recoverable tax, ha