DFCC Group PAT Up 37%

DFCC Banking Group in the financial year ended March 31, 2012 saw profit after tax (PAT) increase by 37% year on year (YoY) to Rs. 2.9 billion on its core banking business, ie excluding the one off gain made by selling down its holdings in Commercial Bank the previous year, with Rs. 500 million to its bottomline contributed by its subsidiary DFCC Vardhana Bank (DVB).
DFCC Banking Group CEO Nihal Fonseka speaking to reporters on Wednesday said that the Bank benefited from the reduced tax regime that came into effect last year. The Bank was also aggressive in its customer acquisitions, growing its loan book by 47% to Rs. 89 billion as opposed to an industry average of 36%, while the deposit base of its subsidiary DVB grew by 75%, as opposed to a 22% industry growth, with DVB’s customer base doubling.
However a cause for concern is the slowing down in growth in China and India and problems in part of Europe, he said. But Fonseka said that with the end of Sri Lanka’s terrorist war, prospects for the country looked bright. He further said that coupled with physical expansion, the Group is also leveraging on technology to take it forward.
He said that technology is compensation for the lack of a knowledge of English among the majority of the people of this country living outside of Colombo and of the Western Province (WP).
It was also said at this event that the DFCC Banking Group’s 2011/2012 Annual Report is compatible to “GRI” reporting standards. Fonseka further said that profits weren’t accumulated by the Group through foreign exchange (forex) holdings by leveraging on a depreciating rupee, but by the trading business, as DVB is a young bank, with room for its forex portfolio to grow, compared to some of the older banks which have forex portfolios as large as between US$ 70-80 million.
DVB CEO Lakshman Silva said that DVB’s operations have had gone beyond Colombo and the WP with the bank being equipped with 126 service points islandwide. He further said that in the last two years DVB has begun leveraging on mobile technology to take banking to the masses. Meanwhile the Banking Group also unveiled a common website encompassing both DFCC Bank and its subsidiary DVB to enable its customers to indulge in internet banking at this occasion. The unveiling of this new website was done by its Group Chairman Rajan Brito. Fonseka said that this website would soon be available in the vernaculars as well.