‘Resilient financial performance while caring for all stakeholders’

With the COVID – 19 pandemic coming in waves throughout 2020, certain industries have come to a complete standstill causing considerably slower growth in advanced and emerging economies. The first nine months of this year has therefore been one of the most challenging periods in recent times.

Inevitably, the Bank’s financial results too suffered in the first nine months of 2020. Low interest rates, restrictions on fee-based income, subdued economic activities both locally and globally coupled with the two-month island-wide lockdown due to COVID-19 were the main reasons that impacted Sampath Bank’s performance during this period. Moreover, in the light of depressed market conditions, the Bank adopted a more conservative approach to making a significant amount of additional impairment provisions on foreign currency denominated government bonds as well as on loans and advances, which together have been responsible for a sizable profit erosion. However, the Bank reported a reduced profit for the period under review which can be considered as a promising result in the wake of these economic headwinds.

Despite the negative headwinds affecting its financial performance, Sampath Bank continued to prioritize the needs of all stakeholders. The Bank reiterated its commitment to support its customers by providing them with sustainable solutions to overcome this difficult time. The Bank took swift action to implement the COVID – 19 relief schemes for the benefit of customers. Accordingly, approximately 50% of the Bank’s customers enjoyed the moratorium relief. Further, Sampath Bank also actively participated in the government-led refinance scheme and granted approximately Rs 8 Bn worth of working capital loans. Going beyond the government’s relief measures, the Bank took independent action to evaluate the customer requirements on a case by case basis and provided customized and more affordable solutions.

Although the spread of COVID-19 was well controlled in the third quarter of this year, the reimposition of movement restrictions in response to the second wave will no doubt push back Sri Lanka’s anticipated economic recovery. For its part, Sampath Bank has made all necessary arrangements to ensure its smooth operation in the event of a nation-wide lockdown.