Maintaining the growth trajectory displayed in 2020 with a phenomenal 279% annual profit rise in comparison to 2019, SDB bank went on to record an equally strong performance in the first quarter of 2021, particularly through steady growth across its diverse loan portfolio.
The bank continued to meet the challenges of the current economic climate successfully through relentless digital innovation and service delivery transformation, allowing them to register an almost threefold increase in profit for the three months ended March 31, 2021. Equalling LKR 302 Million, this represents a 190% increase in profit from the corresponding quarter last year. For the quarter under review, earnings per share on profit rose to Rs.3.3 from Rs1.9 per share in Q1 2020.
In the first quarter this year, the bank grew the volume of loans (net) amounting to LKR 5.5 Billion, up 5.2% from the end of 2020. This was reflected in the bank’s fee income as well, closely linked to its loans, up by a considerable 139%. The bank’s asset or loan quality also improved, with a gross non-performing advances ratio of 4.47% for the quarter, a small but significant reduction from 4.54% in 2020.
Parallelly, the bank maintained healthy Tier 1 and total capital adequacy ratios of 9.44 percent and 12.71 percent respectively by the end of March 2021, above the regulatory requirements. The bank stated LKR 9.3 Billion in core capital by end-March, having raised LKR 1.53 Billion in their rights issue in November 2020, with another LKR 4 Billion raised in fresh deposits in the period under review, supporting its liquidity further. SDB bank’s liquidity assets ratio stood above the statutory requirement, at 20.7%.
Perhaps most notably, the bank registered net interest income of LKR 1.63 Billion in Q1 2021, a significant 11% rise from the same period in the previous year. Equally, the bank only had to provide LKR 156.1 Million in possible bad loans during this period, representing a drastic drop from LKR 413.8 Million in the same period in 2020.
SDB bank’s sustained high-performance in Q1 2021 and its loan portfolio growth plus loan quality for the period can be attributed to the bank’s initiatives involving SME development, a nationally critical sector amounting to 52% of national GDP. Similarly, the bank’s continuous growth trajectory draws from its efforts at women’s empowerment and the extensive support leant to female entrepreneurs.
The bank’s continuous digital inclusion efforts island wide have also allowed for increased digital and financial literacy across both urban and rural parts of the country.
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