People’s Bank’s gross income increased 31.4% to reach Rs 190.2 billion for the year ended December 31, 2017 whilst total operating income increased by by 15.2% to reach an industry high of Rs 78.8 billion.
Operating expenses increased by a controlled 4.9% to reach Rs 37.2 billion
The Bank’s impairment charges increased by 221% to Rs 4.4 billion. Relative to peers, the Bank’s and Group’s provisioning policy continues to be conservative with provision coverage at 97.5% and 92.7%, respectively at the end of 2017. Profit before tax increased by 17.4% to reach a group all time high of Rs 29.9 billion. On a Bank standalone basis, this was LKR 25.9 billion representing a 24.5% growth.
Group profit for the year increased by 14.2% to reach Rs 20.5 billion and its return on equity was 21.4%. On a Bank standalone basis, this was yet another industry benchmark at 26.6%. The Group’s contribution to the government in the form of taxes, special levy and dividends amounted to Rs 23.3 billion (2016: Rs 22.9 billion)
Customer deposits grew by 16.6% to reach Rs1,306 billion whilst customer advances grew by 12.8% to reach Rs 1,144 billion. Reflecting the challenging market conditions, gross non-performing loan ratio edged up slightly to 2.0% from 1.9% at end-2016. At the Bank only level, this was maintained at 1.9%. Basel III Tier I and Total Capital Adequacy Levels were 11.5% and 13.7%, respectively at end-2017 (end 2016 under Basel II: 11.1% and 13%).
Chairman Hemasiri Fernando said, “There are currently several technology driven initiatives in process which, once complete, will further augment our capabilities at both at a customer front and an operational back end.”