COLOMBO – Bank of Ceylon (BOC) has showcased resilience in the third quarter of 2023, recording a profit before tax (PBT) of LKR22.6 billion, an outcome buoyed by a significant 20% surge in interest income despite the broader economic challenges faced during the period. Under the leadership of Chairman Ronald C. Perera and CEO Russel Fonseka, BOC has navigated through these challenges while continuing to support its customer base and the Sri Lankan economy at large.
The bank’s decision to absorb a portion of the interest rate hikes rather than passing them on in full to customers is reflected in a 53% drop in net interest income, illustrating BOC’s commitment to aiding the business revival of its clientele. This customer-focused approach has not hindered the growth in other areas, as evidenced by a 10% increase in net fee and commission income, spurred by higher card-related transactions and demand for retail banking services.
Amidst currency fluctuations, with the Sri Lankan Rupee (LKR) appreciating, BOC experienced exchange losses that affected trading and other operating income. However, this was mitigated by proactive credit risk management strategies that led to a net reversal of impairment provisions. This reversal was attributed to stringent credit monitoring, identification of high-risk borrowers, and positive impacts from business revival activities and currency appreciation.
BOC’s Revival and Rehabilitation Unit played a pivotal role in managing non-performing loans effectively, supporting troubled businesses through challenging times. Despite inflationary pressures that led to a 13% increase in operating expenses, the bank maintained strong Tier I and Total Capital Adequacy Ratios, well above regulatory requirements.
Customer confidence remained high, as demonstrated by an 11% growth in deposits totaling LKR3.7 trillion. The bank’s asset base expanded to LKR4.3 trillion, with loans and advances standing at LKR2.3 trillion and investments at LKR1.8 trillion.
Further emphasizing its dedication to economic growth and development, BOC launched the “SME Energizer” loan scheme to reinforce its support for small and medium-sized enterprises (SMEs) as well as large infrastructure projects.
The bank’s efforts have not gone unnoticed on the global stage; BOC has been ranked among the world’s top 1000 banks for the twelfth consecutive year and has been named Sri Lanka’s No.1 Banking Brand for the fifteenth consecutive year by Brand Finance Lanka. With a brand value exceeding LKR50 billion—the highest in the sector—BOC stands out as a beacon of stability and potential growth amidst economic recovery efforts in Sri Lanka.
The bank’s unwavering commitment to its customers, SMEs, and infrastructure development continues to be a cornerstone of its operational philosophy, setting it apart as a key player supporting Sri Lanka’s path to economic recovery.
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