DFCC records Rs.2.8Bn PAT in 2019

dfcc

DFCC Bank, the largest entity within the group recorded a profit after tax (PAT) of Rs 2,828 million for the year ended December 31, 2019 excluding the fair value loss on Commercial Bank of Ceylon PLC (CBC) in comparison to profit after tax of Rs 3,646 million recorded in the comparative year.

The Bank’s profit after tax with the fair value loss on CBC shares amounted to Rs 2,074 million for the current year against Rs 2,768 million in the comparative year.

The Group recorded a profit after tax of Rs 2,300 million for the year ended December 31, 2019 compared to Rs 3,070 million in the comparative year. Decline in PAT is mainly due to the increase in impairment and taxes on financial services. Taxes on financial services increased to Rs 1,548 million due to Debt Repayment Levy introduced during last quarter of 2018. Notwithstanding the turbulent environment in the country, the Bank recorded a Rs 12,662 million in net interest income (NII) which is a 2% growth YoY. This NII Growth was possible even after Bank meeting the conditions stipulated by Central Bank of Sri Lanka to reduce the lending rates by 250 basis points by December 2019 compared with the rates applicable in April 2019.

As a part of its growth strategy, DFCC continuously invests in its organization and infrastructure. The bank increased its island wide footprint by commencing 20 full service branches in 30 Days. The overall impairment provision increased due to adverse business environment faced by most industries. As a result, the impairment provision during the year under review increased to Rs 1,669 million,compared to Rs 1,056 million recorded in the comparable year.

Investments in equity securities and treasury bills and bonds (fixed income securities)are classified as financial assets and the change in fair value is recorded through other comprehensive income.

Reflecting its growth Strategy,DFCC Bank’s total assets increased by Rs 29,989 million recording a growth of 8% since December 2018.

The Bank’s deposit base as at December 31, 2019 increased to Rs 247,787 million from Rs 242,238 million as at December 31, 2018, which is a growth of 2%.