Caption: L to R: Deepal Akuretiyagama – Chief Operating Officer, Niran Mahawatte - Vice President, Treasury, Buwanaka Perera - Vice President, Corporate Banking, Dimantha Seneviratne - Director/ Chief Executive Officer, Suvendrini Muthukumarana – Acting GCFO and Assistant Vice President, Finance and Planning, Sanjaya Perera - Vice President, Personal Banking and Branch Network Management, Indika Ranaweera - Vice President, SME, Middle Markets and Business Banking, Chandana Guniyangoda - Assistant Vice President, Finance, Strategic Planning and Business Support
National Development Bank PLC released its financial results for the financial year 2018, to the Colombo Stock Exchange on 11 February 2019. The results showed exceptional profitability of LKR 5.7 Bn in post-tax profit, which was a growth of 30% over the prior year. Business recorded impressive growth with 23% in total assets, taking the assets base to LKR 473 Bn. Within the Balance Sheet, loans and receivables as well as customer deposits grew by 27%, to LKR 353 Bn and LKR 348 Bn respectively.
These growth rates were well ahead of the industry growth rates. Enhanced performance was demonstrated across a number of KPIs such as net interest margin, cost to income ratio, return on equity, return on assets and loans to deposits ratio.
The Director/ Group Chief Executive Officer of NDB Bank, Mr. Dimantha Seneviratne, hosted the Bank’s quarterly on-line investor webinar to discuss the Bank’s financial results for the full year 2018, on 13 February 2019 from the Bank’s Head Office premises in Colombo. This is a quarterly endeavor carried out subsequent to releasing quarterly financial statements to the Colombo Stock Exchange, where the Bank’s Investor Relations Team facilitates an on-line forum using webex technology to which, local and overseas investors, research analysts, stock brokers, fund managers, etc. can connect with the GCEO for a presentation of the financial results and pose any questions and seek clarifications.
At Wednesday’s Webinar, Mr. Seneviratne explained that a clear strategy and precise execution led to enhanced results in 2018. NDB embarked on a mid-term strategy titled as Transformation 2020 in 2017, along with the professional input of the International Finance Corporation. The strategy’s core objective is to convert NDB to a domestic systemically important bank [D-SIB] by 2020. Close to 150 strategic initiatives were implemented over 2017 and 2018, involving business transformation, business process re-engineering, digital transformation and marketing & customer experience amongst other strategic verticals.
It is evident from the financial results of 2018, that the Bank will achieve the status of a D-SIB well before the end of 2020. In light of this, the Bank devised a fresh strategy to guide it beyond 2020, with a five year strategy spanning up to 2023. This new strategy will set NDB on an accelerated growth mode. The expanding business, coupled with industry developments such as BASEL III guidelines, impact of the adoption of SLFRS 9, capital conservation buffer, Debt Repayment Levy, etc., will require additional capital for the Bank.
The Bank concluded a Rights Issue during the last quarter of 2018, resulting in LKR 3.4 bn being raised as Tier I capital. Furthermore, in December 2018 the Bank also announced its plans to raise Tier II capital via a five year listed debenture issue, to support the business growth.
Fitch Ratings Lanka Ltd published the Bank’s National Rating, affirming the rating at A+(lka) with a revised Negative Outlook, the key driver being the continued pressure on NDB’s capitalization, which has been well accounted for, in the Bank’s strategic priorities.
Commenting at the Investor Webinar, Mr. Seneviratne further reiterated that more initiatives will be taken during 2019 to ensure that the Bank is soundly capitalized to support the business growth and be fully compliant with the applicable regulatory guidelines on capital adequacy. He also elaborated that the Bank’s focus in 2019 would be on streamlining the internal processes via digital strategies with investments expected in this area. Furthermore, initiatives will be implemented to optimize on the synergies offered by the unique financial services group proposition enjoyed by NDB, with the amalgam of commercial banking and capital market services offered under the NDB brand name. Various novel products, combining banking product features and capital market solutions are being considered he mentioned, with NDB One account being the prevalent example, which brings the convenience of a savings account and enhanced benefits of wealth management to the customers.
NDB remains to be governed by a competent Board of Directors and led by an equally competent management. With solid plans in place to strengthen the Bank’s capital base, NDB is geared for another successful year in 2019, where it will deliver enhanced results to its valued clientele and the country at large.
NDB Bank which is the first and to date the only corporate in Sri Lanka to officially be certified with EDGE Certification, the leading and only global certification for gender equality at work place, is the parent company of the NDB Group, one of the fastest growing financial services conglomerates in Sri Lanka, with the strategic mission to be the dominant leader in the financial services and banking sector. From its inception, the group which includes NDB Bank, NDB Capital, NDB Investment Banking, NDB Wealth, and NDB Securities has been a catalyst in the development of the nation, strengthening and empowering entrepreneurs, corporates and individuals from all strata of the economy. Customers across all group companies have benefited from the product and service offerings of the NDB group.