DFCC Bank PLC, the largest entity within the Group, reported a profit before tax (PBT) of LKR 4,105 Mn and a profit after tax (PAT) of LKR 3,070 Mn for the period ended 30 September 2021. This compares with a PBT of LKR 2,636 Mn and a PAT of LKR 1,751 Mn in the comparative period.
The Group recorded a PBT of LKR 4,508 Mn and a PAT of LKR 3,413 Mn for the period ended 30 September 2021 as compared to LKR 3,062 Mn and LKR 2,110 Mn respectively in the comparative period of year 2020. All the member entities of the Group made positive contributions to this performance.
The basic earnings per ordinary share (EPS) of the Bank improved to LKR 9.74 for the period ended 30 September 2021 from LKR 5.74 for the comparative period in year 2020 recording an increase of 70%.
The Bank’s Return on Equity (ROE) improved to 7.14% during the period ended 30 September 2021 from 4.93% recorded for the year ended 31 December 2020. The Bank’s Return on Assets (ROA) before tax for the period ended 30 September 2021 is 1% compared to 0.78% for the year ended 31 December 2020.
The Bank recorded LKR 8,700 Mn in net interest income (NII) which is a 2% increase year on year. However, the drop in AWPLR by 116 bps over the past 12 months and the time lag to reprice the existing deposits to match market trends, contributed to the drop in interest margin from 2.53% in December 2020 to 2.41% in September 2021. Since a large component of the portfolio which are to be repriced based on variable rates and with the expected upward revision to Average Weighted Prime Lending Rates the bank would record a positive impact to Net Interest Margins in the coming months.
Due to travel restrictions imposed to curb the spread of the pandemic, the business momentum was impacted during the third quarter of 2021.
The staff at the Head office and the branch network working continuously over the period has assisted the bank to increase non-funded business and helped the priority sectors of the country to continue with their business activities uninterruptedly. This effort was fruitful as it resulted in an increase in net fee and commission income to LKR 1,929 Mn for the period ended 30 September 2021 from LKR 1,436 Mn in the comparative period. Other operating income has increased mainly due to increase in dividend income and gain on the sale of fixed income securities during the period ended 30 September 2021.
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