LB Finance (LFIN) reports profits of Rs1.1bn for the quarter, deposit base grows to Rs75bn

LB Finance headquarters in Colombo 3

August 2, 2018 (LBO) – Colombo Stock Exchange listed LB Finance (LFIN) reported earnings of Rs1.137bn for the quarter ended June 2018.

Profits were up a robust 20% year over year, however sequentially from the march quarter, revenue and profits seem to be flat.  Analysts say the lack of sequential profit growth may be deliberate,  in order slow down and consolidate the company’s position after years a industry leading growth.

The company continued to report an astounding return on equity of 28%, although this is down from even higher levels in previous quarters.

LB Finance, whose ultimate controlling shareholder is arguably Sri Lanka’s richest man, has grown at an astounding rate over the past decade.  Currently the company sits on a massive deposit base of over Rs75bn, indicating the trust that the company has established with its customers.

With deposit bases of finance companies now at such a significant level, some analysts are uncomfortable with the lack of reporting that finance companies have to do with regard to non-performing loans.  In the quarterly earnings statements of banks there is more information available.