Citizens Development Business Finance PLC (CDB) crossed the Rs 1Bn milestone in After Tax Profit for the second consecutive year in the FY 2016/17, despite an increasingly competitive and volatile operating environment.
Demonstrating strong and resilient results across the board, the Balance Sheet for yearend reflected a growth of 7%, recording Rs. 53.9 Bn. CDB’s revenue detailed at Rs. 8.6 Bn reflects a growth of 15%, while interest income grew by 14% to Rs 7,587 Mn. Interest expenses increased by 31% to Rs 4,699 Mn. This resulted in a decline of 6% in net interest income amidst a rising interest rate scenario, which saw a posting of Rs 2,888 Mn. Net Operating income moved upwards to Rs 3.7 Bn, a growth of 5% mainly attributed to a reduction of Rs 173 Mn in impairment charges and other credit losses.
The Loan Book grew by 12% to stand at Rs 43.2 Bn, while the deposit portfolio reflects a growth of 6%, reaching to Rs 32.6 Bn. Growth in lending was supported by growth in the share of non-auto lending, which represented 7% of total lending compared to 5% last year. During the period under review, the gross NPL ratio further improved to 3.08%, compared to last year’s 3.62%. Similarly Net NPL improved to 1.05% from 1.56%.
Capital Funds increased by 24% notching Rs 6.2 Bn, while ROE is detailed at 17.83%, ROA 1.93%, EPS at Rs. 18.53 and Net Asset Value per Share at Rs. 115.
Capital adequacy ratios for Tier I and Tier II stands at 12.32% and 14.12% respectively, compared to the regulatory required level of 5% and 10%. The liquidity ratio too echoed similar trends of being above regulatory requirements, displayed at 13.03%.
CDB’s subsidiary too proved its mettle this year. Unisons Capital Leasing Ltd (UCL), CDB’s 90.38% owned specialized leasing subsidiary acquired in October 2014, performed impressively in the 2016/17 financial year. UCL reported Rs 20 Mn in Profit After Tax and expanded its balance sheet to an impressive Rs 693 Mn, from Rs 370 Mn last year.
In its bid to give stakeholders more accessibility, CDB expanded its distribution network by adding seven new branches completing 69 branches.
CDB has embarked on an ambitious technology drive to maximize market opportunities with the planned launch of CDBiNet in the 1Q of 2017/18. An online omni channel transactional platform with a 360 degree application for customer portfolios, CDBiNet facilitates management and maintenance of personal portfolios including online account opening facilities, online fund transfers to any bank via the Common Electronic Fund Transfer System (CEFTS) and online utility bill settlements.
As a responsible corporate citizen, CDB which was certified as the first Carbon Verified Financial Institution in South Asia by the Sri Lanka Carbon Fund, has always been conscious of its sustainability ethos, while enhancing its economic returns. While environmental initiatives do have significant focus, CDB added its prowess to child health by collaborating with the Sri Lanka Association for Child Development to launch a national autism awareness programme. Other ongoing CSR initiatives include CDB Pariganaka Piyasa, CDB Sisudiri Scholarship Scheme and CDB Hithawathkam, all constructed on a platform of sustainable knowledge gain.
CDB will continue its emphasis on inclusive economic development. Being a net lender to the rural economy and providing access to finance to the base of the pyramid markets, it is astutely growing the urban funding and rural lending approach. CDB has also set two tangible goals – to double its balance sheet by 2020 and have the lowest possible Green House Gas Emissions (GHGs) within the financial services sector.
CDB has continued to reach formidable heights emphasizing on constructing and nurturing a sustainable business, believing strongly on the ethos of compliance, transparency and ethics. This has been well evidenced in CDB wearing the laurels as Runner Up at the Ceylon Chamber’s Sustainability Awards, gaining a Sector Gold for National Business Excellence, a Silver for CSR and a Silver in service excellence in the Service Brand of the Year from SLIM Brand Excellence 2016 and Silver for National HR Excellence in 2016/17.