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21 November, 2013 09:34 AM Source: Financial Times - Sri Lanka

The best testimony for a turnaround in the financial sector, or for that matter in any industry, can be identified when a company wipes out losses and makes profits, which is no exception in the resilient story of Nation Lanka Finance PLC (NLF).

With the infusion of new corporate energy in the form of investment from high net worth individuals and blue-chip organisations, NLF has made a cumulative net profit of Rs. 5 million between 1 April to 30 September 2013 in the first half of the financial year 2013/14.

What is more noteworthy is the fact that the company has achieved this profit after a lapse of five years while completely offsetting the Rs. 110 million losses during the same period in the previous financial  year.

Main factors
This success is attributable to few main factors such as growth in lending portfolio, growth in its total asset base of both NLF and the group, introduction of innovative products and services and prudent management of operational costs.

The lending portfolio stood at Rs. 1.7 billion on 1 April 2013 and grew 41% within six months to reach Rs. 2.4 billion as at 30 September 2013. The growth hinges on the expansion in the rapid microfinance lending which is responsible for 60% of the total growth.

Better credit evaluation and expeditious disbursement of funds with efficient service offer are the main pillars of lending growth while efficient collection and recovery have contributed to manage Non Performing Loans (NPL) ratio at a much satisfactory level of 2.1 %, which is one of the best in the current industry standards.

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