Sampath Bank gears up for the future amidst economic challenges

Sampath Bank registered profit before tax (PBT) of Rs 22.0 Bn and profit after tax (PAT) of Rs 12.3 Bn for the nine months ended 30th September 2023, recording a growth of 136.4% and 71.5% respectively against the subdued financial figures reported during the corresponding period in 2022.

Key highlights for the period ended 30th September 2023

Bank PAT improved by 71.5% to Rs 12.3 Bn.

10.0% year on year growth in net fee and commission income.

YoY exchange income declined by Rs 15.8 Bn due to the appreciation of LKR against USD by Rs 42.00.

70.4% decline in impairment charge on loans and investments.

Increase in government taxes by 197.7% compared to the previous period.

Total LKR deposits increased by Rs 112 Bn during the period to reach Rs 996 Bn as at 30th September 2023.

Tier 1 and Total Capital ratios improved from 11.92% and 14.27% as at 31st December 2022 to 14.37% and 17.73% respectively as at 30th September 2023.

Fund based income

Sampath Bank reported gross interest income of Rs 153.4 Bn for the period under review, up 44.6% from the Rs 106.1 Bn recorded in the corresponding period of the previous year. While the Average Weighted Prime Lending Rate (AWPLR) registered as at 30th September 2023 was 1,128 bps lower than the AWPLR reported as at 30th September 2022, the average AWPLR remained considerably higher throughout the current reporting period compared to the corresponding period in the previous year.

Interest expense for the period under review grew at a faster pace than the interest income as a consequence of the numerous interest rate hikes, resulting in a marginal 0.3% reduction in Net Interest Income.

Net Interest Margin also recorded a decline of 47 basis points from 5.66% as at 31st December 2022 to 5.19% as at the reporting date which is attributed primarily to the downward trend in the AWPLR from 1Q 2023.

Non-Fund based income

Sampath Bank’s Net fee and commission income (NFCI) increased by 10.0% during the period under review compared to the corresponding period in the previous year. Growth experienced in the period was mainly on account of the increase in fee and commission income derived from card, trade, electronic channels as well as remittance related activities.