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28 October, 2015 08:45 AM Source: Financial Times - Sri Lanka
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Pan Asia Banking Corporation PLC has increased its Profit After Tax (PAT) by a staggering 197% to Rs. 300.2 million for the quarter ended 30 September 2015 (3Q’15) from a year ago, supported by improved performance from all segments. The earnings per share (EPS) rose to Rs. 4.04 from Rs. 1.36 a year ago.
As a result, the bank’s PAT for the nine months ended September 30, 2015 has risen by 171% year-on-year (yoy) to Rs.751 million (EPS of Rs.3.40). This is the third consecutive quarter the bank has increased its after tax profits by over 100% yoy demonstrating the consistency in its performance.
This has been possible due to above average growth in the bank’s loans and receivables while maintaining healthy margins and asset quality, continuous improvements in its cost structure and enhanced service quality.

The growth in the bank’s gross loans and receivables to customers has continued to bypass the industry average and during the nine months to September 2015 the portfolio grew by as much as 29% or Rs. 18.4 billion.
In effect, the bank’s growth in loans and advances book accounts for closer to 5% of the total private credit in the economy granted during this period.  
“This demonstrates that Pan Asia Bank plays a significant role in the overall economy and we will continue to play the role of a catalyst in meeting the financial needs of the aspirational Sri Lankans and enterprises whilst contributing to the overall economic development of the country,” said Pan Asia Bank’s Director and CEO, Dimantha Seneviratne.
At a time when the banking sector Return on Equity (RoE) comes under pressure due to narrowing margins, Pan Asia Bank has continuously driven its return to its stock holders up to 19.77% by the end of 3Q 2015, virtually doubling the RoE from 9.81% in December 2014.
The bank has made tremendous progress in its core-banking performance even under challenging conditions as the Net Interest Income (NII) rose 72% and 55% respectively to Rs.1.10 billion and 2.9 billion during 3Q 2015 and nine months.
Amidst pressure on banking sector margins, Pan Asia Bank has widened its net interest margin to 4.48% from 3.82% in December 2014 due to prudent re-pricing and active assets and liability management.
In order to support its lending drive, the bank raised Rs.4 billion in debentures at very competitive rates which was oversubscribed on the opening day itself, demonstrating the strong confidence placed on the bank’s current and future strategies.
The non-fund based income of the bank showed continuous growth as a result of the concerted effort towards diversifying the income sources. In addition to generating new relationships, there was increased contribution from trade finance and fee and commission income.
As a result, the net fee and commission income rose 26% and 33% respectively to Rs. 189.6 million and Rs.572.4 million during 3Q 2015 and the nine months to end September. Other operating income and exchange income made a significant contribution, rising by 161% and 132% respectively to Rs.217.7 million and Rs.484 million.

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