Feb 25, 2012 (LBO) – Profits of Sri Lanka’s Nations Trust Bank rose 54 percent in the December 2011 quarter to 363 million rupees from a year earlier, helped by non-interest income and a lower tax bill, despite narrower interest margins. The bank reported earnings of 1.60 rupee per share for the quarter. In the year to December 2012 the bank reported earnings of 6.73 rupees per share on profits of 1.53 billion rupees, which grew 41 percent from a year earlier.
The bank’s net interest income grew 8.0 percent in the quarter to 2.66 billion rupees and interest expenses grew at a faster 16 percent to 1.54 billion rupees forcing net interest income down by a marginal one percent to 1.16 billion rupees.
“Whilst lending rates were driven down by lower market interest rates and revival of loan growth, funding costs trended upwards as competition increased and liquidity diminished alongside credit growth,” NTB said in a statement.
NTB said its countered falling net interest margins by shifting assets to more high yielding areas.
An interest rate cap on credit card lending had also reduced interest income, but the card business model had been reconfigured to improve yields on the second half of the year, the bank said.