• Group assets cross Rs 2.5 Tn
• Advances growth in Q2 exceeds Rs 100 Bn
• Deposits grow by over Rs 140 Bn in Q2
• Asset quality continues to improve, with the net Stage 3 ratio at 1.59%
• Persistently strong capital buffers underpin financial stability
• Recognised once again by ‘The Banker’ among the ‘Top 1000 Banks in the world’

HNB sustained its upward momentum in the first half of 2025, delivering sound growth. Group Profit After Tax (PAT) recorded a growth of 42.5% to Rs 23.16 Bn, while the Bank PAT rose by 37.9%, reaching Rs 21.19 Bn.

With interest margins being under pressure, the Bank’s Net Interest Income remained broadly stable at Rs 45.6 Bn during the first half of 2025. The 11.3% YoY drop in interest income amid lower interest rates, despite the strong loan book growth was offset by the 18.7% YoY drop in interest expenses aided by strategic initiatives to strengthen CASA base.

Net Fee and Commission Income recorded a notable YoY growth of 19.7%, primarily driven by increased card usage and a significant surge in digital transactions. Additionally, exchange income surged to Rs 2.8 Bn, reversing a loss of Rs 1.3 Bn recorded in the corresponding period of 2024, largely attributable to the depreciation of the Sri Lankan rupee.

Asset quality continued to strengthen during the quarter, supported by the Bank’s resilient risk management framework, prudent underwriting and extensive recovery efforts. This progress was reflected in a favourable shift in the Stage 3 portfolio, and an impairment reversal of Rs 5.1 Bn, compared to the impairment charge of Rs 1.5 Bn recorded in the same period last year. Consequently, the Net Stage 3 ratio improved to 1.59% from 1.88% as at December 2024. Meanwhile, the Stage 3 coverage ratio remained strong at 74.88%.

As at end of June 2025, the asset base of the Group surpassed Rs 2.5 Tn, reflecting a 13.7% growth during the six-month period. This growth included a Rs 137.6 Bn increase in net loans and advances of the Group while the Group’s deposit base grew by approximately Rs 160 Bn during the first half of the year reaching Rs 1.9 Tn.

During the period, HNB continued to maintain strong capital buffers, with Tier I and Total Capital Adequacy Ratios at 18.42% and 22.46%, respectively, well above the regulatory minimum requirements of 9.5% and 13.5%. The Bank also sustained a strong liquidity position, evidenced by an all currency Liquidity Coverage Ratio of 271.54%, significantly exceeding the minimum regulatory threshold of 100%.