The Commercial Bank of Ceylon PLC has made a steady start to 2015, with profit after tax of Rs 2.509 billion for the three months ended 31st March, an improvement of 10.1% YoY.

A robust YoYgrowth in loans and receivables coupled with customary strong deposit growth and lower cost of funds contributed to this growth by generating net interest income of Rs 7.233 billion, an increase of 10.06%, Sri Lanka’s largest private bank said in a filing with the Colombo Stock Exchange.

Profit before VAT and NBT for the three months reviewed was up 7.88% to Rs 4.204 billion, while profit before tax at Rs 3.579 billion reflected an improvement of 8.77%, the Bank reported.

Total operating income, comprised of net interest income, commissions, foreign exchange income, recoveries and other income, increased by 8.84% to Rs 9.682 billion.

Total loans & receivables amounted to Rs 498.552 billion as at 31st March 2015, a growth of 19.13 per cent over 12 months. Total deposits grew by an average of more than Rs 6 billion a month since 31st December 2014 to reach Rs 549.111 billion at the end of the quarter reviewed. Deposit growth over the preceding 12 months was 16.28%.

Commenting on these results, Commercial Bank Chairman Mr Dharma Dheerasinghe said: “Commercial Bank’s performance in the first quarter is consistent with projections and reflects the inherent strengths of the Bank. There are several challenges that are common to most players in the banking sector, and in that context, the Bank’s figures are impressive.”

Commercial Bank Managing Director Mr JeganDurairatnam said that the Bank was able to report a commendable growth in profits despite shrinking interest margins witnessed during the period under review.

Total assets of the Bank crossed the Rs 800 billion mark during the review period and stood at Rs 807.852 billion at the end of Q1.

Total expenses, including personnel costs, depreciation & amortisation and other expenses increased by 7.82% to Rs 4.148 billion.

In other key performance indicators, Commercial Bank improved its gross and net non-performing loans (NPL) ratios to 3.40% and 1.88% respectively from 4.40% and 2.54% a year previously. Interest margins continued to drop and stood at 3.66% as at 31st March 2015.The Bank’s Tier I capital adequacy ratio reduced from 12.93% to 12.14%, while total capital adequacy for the reviewed quarter reduced to 15.03% from 15.97%. These ratios however remain well above statutory requirements.

The Bank retained its position as the bank with the highest market capitalisation in Sri Lanka and the third largest listed entity overall in the period reviewed.