March 15, 2024
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4min

Sampath Bank PLC is proud to announce its strategic collaboration with Visa, the global leader in payments, to introduce a groundbreaking addition to its Corporate Cards portfolio — the Sampath Visa Purchasing Card. This innovative Card is designed to revolutionise the management of integrated operating expenses within organisations.

Mr. Shiran Kossinna, Assistant General Manager – Card Centre, Sampath Bank, remarked, “The introduction of the Sampath Visa Purchasing Card represents our continuous effort to further streamline the expense management of the bank’s valued corporate clients. We believe this innovative solution will significantly enhance the efficiency and control in managing corporate expenses, providing our clients with a competitive edge in today’s dynamic business environment.”

 


 

Ms. Avanthi Colombage, Country Manager, Sri Lanka & Maldives, Visa commented, “We are very excited about this partnership with Sampath Bank, that brings a bold, innovative product to the Sri Lankan business landscape. With the Sampath Visa Purchasing Card, organisations truly get better control and view of their expenses, enabling smarter finance planning and management. With today’s evolving client needs, we believe this comprehensive solution will unlock numerous payment efficiencies for corporates in the region.”

Classic Travel (Pvt) Ltd, a distinguished IATA accredited travel agent and member of the Expolanka Group of Companies, proudly stands as the first corporate partner to obtain the new Sampath Visa Purchasing Card, marking a milestone in this strategic partnership.

Mr. Shiham Imamudeen, CEO – Classic Travel / Expolanka Leisure Cluster, expressed, “Classic Travel is honoured to be the launch customer of the Sampath Visa Purchasing Card. We believe that this card will streamline the expense management of our company, providing us with greater control and efficiency in our financial processes. This collaboration reflects our commitment to embracing innovative solutions that enhance our business operations.”

This versatile Card is issued to designated employees or directors of corporate entities, and facilitates efficient payments to small-scale suppliers, vendors, security services, stationary, online subscriptions, and other administrative services of the corporates.

Corporates embracing the Sampath Visa Purchasing Card can benefit from a series of advantages. From reduced organisational costs to streamlined Procure to Pay processes, accurate cash-flow forecasting, and improved supplier management, the card empowers organisations with greater control and risk reduction.

Negotiation leverage through vendor negotiations, customised transaction limits, and enhanced management reporting further contribute to the appeal of the Sampath Visa Purchasing Card. This innovative solution not only enables corporations to monitor compliance with spending policies but also allows for category-specific restrictions on purchases.

For more information about the Sampath Visa Purchasing Card and its benefits, please visit www.sampath.lk or contact 1332.

 


 


February 28, 2024
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3min

Sampath Bank was adjudged as the Runner Up in the Banking Category at the prestigious ACCA Sri Lanka Sustainability Awards 2023. The awards ceremony, organised by the Association of Chartered Certified Accountants (ACCA), Sri Lanka, took place on 20th February 2024 at the Hilton Residencies in Colombo.

Since 2004, ACCA Sri Lanka has striven to reward and recognize those organizations, giving credence to their sustainability practices with recognition of the strong link between business strategy, corporate governance, and sustainability.

 



 

This recognition underscores Sampath Bank’s steadfast commitment to sustainability and corporate integrity. The award acknowledges the bank’s dedication to reporting and disclosing comprehensive environmental, social, and governance information within Sri Lanka. As a responsible corporate entity, Sampath Bank has played a pivotal role in promoting environmental, social, and governance reporting, contributing to heightened awareness of corporate transparency issues and increased accountability and responsiveness to stakeholders whilst adhering to world best reporting standards.

The evaluation process leading to Sampath Bank’s Runner Up position involved a thorough assessment by an expert panel of judges. The report submitted by the bank was meticulously reviewed based on three main criteria such as Completeness, Credibility, and Communication.

Ayodhya Iddawela Perera, Managing Director of Sampath Bank PLC, expressed her pride in the bank’s commitment to sustainability, stating, “Sustainability has always been among the core ethos of Sampath Bank which have certainly been integral to our success over the years. Accolades such as this push us to move even further in our strife to achieve excellence in our growth and performance, while maintaining the right balance between stakeholder expectations. We are also thankful for ACCA’s efforts to encourage sustainability reporting which have played a pivotal role in highlighting the need for socially and environmentally responsible business practices in the country.”

Sampath Bank remains dedicated to pioneering initiatives that align with its sustainability goals, and this recognition further motivates the bank to advance its efforts in contributing to a sustainable and responsible business environment while remaining true to its core banking values and adhering to the highest ethical standards, in order to manage its triple bottom line.

 



 


February 26, 2024
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4min

Siyapatha Finance PLC, a fully owned subsidiary of Sampath Bank PLC, recently opened its latest branch in Akkaraipattu, with the participation of  Managing Director of Siyapatha Finance PLC, Mr. Ananda Seneviratne,  Additional Government Agent-Ampara  , Mr. V. Jegatheesan, Civil Affairs Coordinating Officer,  Army Camp, Akkaraipattu ,  Major Janaka Subasinghe ,  senior officials of the management of Siyapatha Finance PLC  , officials of Akkaraipattu Police Office and other distinguished guests , further expanding its commitment to providing unparalleled financial solutions to the nation. The branch, located at No. 130, Sagama Road, Akkaraipattu.

With a strategic focus on catering specifically to small businesses and entrepreneurs in the region, the Akkaraipattu branch marks the 48th addition to Siyapatha Finance’s extensive branch network. This branch is a part of the company’s efforts in providing financial services to more Sri Lankans and expanding its reach to the country’s growing middle class. The product portfolio of the Akkaraipattu Branch is designed to meet the diverse financial needs of the community  offerings leasing facilities, fixed deposits, savings accounts, gold financing, loans, fast draft services, factoring, and bill payment facilities.

 



 

“ Siyapatha Finance remains consistent in its determination to empower the nation,” said Mr. Ananda Seneviratne, Managing Director of Siyapatha Finance PLC. “Akkaraipattu branch marks a significant step towards a future where financial solutions become the driving force for growth and prosperity in local communities. With a strategic focus on empowering agriculture, fishery, trading, and business sectors, this endeavor is aimed at unlocking the vast potential that Akkaraipattu holds. As we extend our financial expertise, we look ahead to a promising future ,  fostering economic empowerment and prosperity for the community we serve,” he elaborated.

In parallel to the opening of Akkaraipattu branch, Siyapatha Finance PLC,  to mark  the company’s  green project  “Siyapathen Mihikathata “ – planting over  10,000 trees across the island ,  initiated a project  in the region, demonstrating the company’s commitment to environmental sustainability. The endeavor involves the planting of 100 trees strategically placed around the area, with the inaugural batch planted at KM/TK/ Kolavil Vinayagar Maha Vidyalayam. Siyapatha Finance PLC is one of the prominent financial companies with a network of branches throughout the country, which has designed its financial services to ensure that its customers are provided with the best in service delivery standards. Over the past eighteen years, the company has contributed vastly to the development of small and medium entrepreneurial efforts and to fulfilling individual financial needs across the island. Their dedication to continuously expanding their financial services is fueled by the drive to help communities achieve their business objectives. Siyapatha Finance aims to empower local businesses in Akkaraipattu, as well as those in the agriculture and fisheries industries, through its product portfolio, which includes fixed deposits, savings accounts, leasing, hire purchase, gold financing, business loans, personal loans, revolving loans, bill payments and factoring.

For further information on Siyapatha Finance, call 0677 605 655 or log on to www.siyapatha.lk.

 



 


February 15, 2024
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18min

Backed by its strong capital base, Sampath Bank continues to navigate adeptly through challenging times. The Bank demonstrated resilience and a commitment to prioritizing stakeholder interests in the face of challenging economic headwinds, thanks to its well-executed business strategies, increased vigilance, and proactive risk management measures.

 



 

Despite the country showing signs of a broader economic upturn in 2023, Sampath Bank remained steadfast in supporting customers who continued to experience stress due to pressures accumulated over the past few years. Spearheaded by its Credit Nursing Unit, the Bank offered a variety of relief measures, including tailor-made repayment plans, restructures, and rescheduling solutions, to provide much-needed breathing space for distressed customers. This enabled them to focus on revitalizing their businesses. Additionally, the Bank provided financial counseling and business advisory services to empower customers to access fresh equity, seed capital, and other resources to transform their business models. This initiative was aimed at creating stronger and more resilient businesses capable of thriving in an increasingly uncertain world.

Notwithstanding challenges in the external operating environment, the Bank engaged in its CSR commitments with renewed vigour to initiate various projects under its flagship “Weweta Jeewayak” program contributing to rural economy growth. In addition, the Bank gave enhanced focus to contribute to the country’s climate action goals by increasing investments in the “A Breath to Ocean” initiative aimed at restoring the oceanic ecosystems, particularly in turtle conservation, coral restoration and mangrove rehabilitation.

Regardless of continuing uncertainties and challenging economic conditions throughout the year, profitability remained in line with expectations as the Bank’s Profit Before Taxes on financial services stood at Rs 38.4 Bn which is a 89.9% increase over the previous year’s achievement of Rs 20.2 Bn. However, considering the impact of higher tax expenses, the Profit After Tax (PAT) demonstrated a reduced improvement of 30.5%, rising from Rs 13.1 Bn in the previous year to Rs 17.1 Bn for the year ended 31st December 2023.

The Group remained resilient with a profit after tax of Rs 17.9 Bn for the year under review, reflecting a 27.5% growth over the previous year.

Net Interest Income (NII)
The Net Interest Income (NII) for the year amounted to Rs 72.3 Bn, indicating a marginal 1.6% decline year on year, primarily due to the increase in interest expenses for FY 2023 surpassing the increase in interest income. Interest income increased by Rs 45.8 Bn in the year under review, marking a 29.1% improvement compared to the previous financial year, while interest expenses surged by 55.9% year on year reaching Rs 131.2 Bn. Despite this significant disparity, timely re-pricing strategies, coupled with stringent management of both asset and liability portfolios amidst the backdrop of the declining AWPLR, helped contain the impact on the Bank’s NII, ensuring only a marginal drop. The Net Interest Margin (NIM) for the year was 5.16%, compared to 5.66% reported in the previous year.

Net Fee and Commission Income

Net fee and commission income decreased by 2.9% compared to the previous year due to lower income from credit and trade related activities. Fees earned from credit declined due to lower demand from the market, while the contraction in trade-related income is attributed to the combined impact of the downward revision of commission rates applied to import-related transactions as well as the appreciation of LKR against the USD. Meanwhile, fees generated through cards, electronic channels and remittance related activities recorded strong growth compared to the previous year. It should be noted, however, that despite recording a decline in 2023, fees from trade-related activities remained the largest contributor to net fee and commission income, followed by cards.

Net Trading and Other Income

The Bank registered capital gains of Rs 591.7 Mn in the year under review, reflecting a 9.2% increase over the previous year from the sale of Treasury bills and Treasury bonds. The Bank reported a Net Other Operating Loss of Rs 1.6 Bn in 2023, contrasting with a gain of Rs 19.7 Bn reported in 2022. This change was mainly attributed to the Rs 2.4 Bn exchange loss resulting from the appreciation of the LKR against the USD by 11% (2022: depreciated by 82%). This was, however, offset to some extent by the net trading gain of Rs 0.8 Bn for 2023.

 Impairment Charge

The Bank continued with its prudent provisioning policy and posted a total impairment charge of Rs 20.1 Bn for the current financial year. Impairment charges for the current year include Rs 18.1 Bn related to loans and advances (2022: Rs 54.3 Bn) and Rs 1.8 Bn attributed to other financial instruments (2022: Rs 7.8 Bn). Furthermore, there is an additional impairment charge of Rs 0.2 Bn related to commitments and contingencies, compared to Rs 0.6 Bn in 2022.

Impairment charge on loans and advances

Despite the decrease in the impairment charge on loans and advances by Rs 36.3 Bn compared to 2022, the total provision cover of the Bank increased by 200 basis points, rising from 11.8% as at the end of 2022 to 13.8% as at the end of 2023.

The overall reduction in impairment charges against loans and advances was attributed, on one hand, to the gradual revival in economic activities, and on the other hand, to Sampath Bank’s prudent provisioning approaches in 2022. These approaches led to the build-up of additional provision coverage for risk-elevated segments in the loans and advances portfolio.

Rs 16.3 Bn was charged on account of Individually Significant Customers (ISL) following an extensive evaluation covering more than 60% of the total advance portfolio. The proactive approach adopted by the Bank in the previous financial year to make appropriate provisions for customers with potential risks has resulted in the establishment of a substantial provision cover against Individually Significant Customers (ISL) in 2022. This has resulted in lower additional provisioning being required during the reporting period.

The collective impairment charge decreased by Rs 19.9 Bn to Rs 1.8 Bn in 2023 compared to previous year. In addition to the revival in the economy and the Bank’s prudent provisioning policy in the previous year, the 8% reduction in the quantum of exposure subjected to collective impairment also contributed to the lower collective impairment charge in 2023. The impairment models used for collective impairment in 2022 were continued in 2023 to ensure that adequate buffers were in place to absorb any potential credit risk that could arise in the future. The Bank continued its prudent policy of booking additional provisions against newly identified customer segments with elevated credit risk during the reporting period. The allowance for overlay applied in 2022 was continued and maintained for the current reporting period as well. Meanwhile, in testament to the Bank’s timely and effective provisioning strategy, the cost of risk decreased from 5.97% in FY 2022 to about 2.04% in FY 2023.

 Impairment charge on other financial instruments

The Bank recorded a net impairment charge of Rs 1.8 Bn against other financial instruments during the reporting year, compared to Rs 7.8 Bn reported in the previous year. The reduction in the impairment charge on financial instruments reflects the Bank’s decision to exchange its holdings in Sri Lanka Development Bonds (SLDBs) for local currency-denominated bonds offered as part of the Domestic Debt Optimization Program (DDO) in 2023. This allowed the Bank to reverse the impairment provision already recognised against the SLDBs by Rs 4.8 Bn. However, Rs 1.2 Bn was recognised as a day-one loss against the local currency bonds at the time of conversion of SLDBs under the DDO programme, equivalent to 5% of the bond value. At the same time, the Bank increased the impairment provision against its Sri Lanka International Sovereign Bonds (SLISB) investments by Rs 5.5 Bn to account for a possible haircut in 2024.

 Operating Expenses

Operating Expenses witnessed a year-on-year increase of 15.7%, primarily driven by elevated overhead costs stemming from inflation-induced price hikes, the effect of LKR depreciation in 2022, and additional price adjustments influenced by higher taxes and import restrictions. Personnel costs grew by 14.0% in 2023 owing to the annual salary increase. Due to elevated operating costs and a decline in operating income, primarily attributed to LKR appreciation, the Bank’s cost-to-income ratio, which stood at 25.3% in FY 2022, increased to 35.7% in FY 2023. Nevertheless, it remained well below the industry average of 40.5% for the year.

Taxation

Tax expenses on financial services saw an increase of Rs 3.4 Bn, rising from Rs 5.2 Bn in FY 2022 to Rs 8.6 Bn in FY 2023. This growth is attributed to the combined impact of the overall expansion in the tax base and the application of SSCL for the entire year. Income tax too witnessed a substantial increase of 567.7% from Rs 1.9 Bn in FY 2022 to Rs 12.6 Bn in FY 2023. This surge is attributed to the expanded tax base and the application of a higher tax rate of 30%, introduced in the second half of 2022, throughout the year 2023. Additionally, in 2022, the Bank recognized a deferred tax credit of Rs 1.8 Bn, stemming from the increase in deferred tax assets due to a one-off adjustment associated with the income tax rate hike from 24% to 30%.

Total Comprehensive Income

The total Comprehensive Income for the year amounted to Rs 25.6 Bn, indicating an increase of 69.2% compared to the previous year’s achievement of Rs 15.1 Bn.

Assets

The Bank’s asset base experienced a year-on-year increase of 16.4%, propelled by higher investments in Government debt securities. The composition of the asset book shifted in the current financial year due to the Bank’s strategic decision to adopt a cautious lending approach, coupled with subdued demand amid weaker economic conditions, both locally and globally. As a result, the gross loan portfolio as of the end of 2023 decreased by Rs 42.8 Bn to Rs 877.3 Bn. In the context of LKR appreciation against the USD, foreign currency-denominated loans declined by 18.2% compared to the previous year. The Stage 3 loan portfolio increased by Rs 42.8 Bn during the year, primarily due to customers enduring prolonged macro-economic pressure shifting to adverse stages. However, this trend moderated to some extent in the latter part of the year. Funds mobilized through deposits were directed towards short-term financial instruments, leading to an increase of Rs 195.9 Bn in T-bill investments. Moreover, investments in T-bonds also grew as the Bank exercised the conversion option under the DDO, converting SLDBs worth USD 113 Mn (face value) into LKR-denominated instruments during the year.

Boosted by elevated Nostro balances, cash and cash equivalents reached Rs 79.3 Bn in 2023, maintaining parity with the previous year-end. Meanwhile, placements with banks grew by Rs 22.8 Bn during the year. The Bank initiated the accumulation of Nostro and placement balances in the latter part of 2022 as a precautionary measure to mitigate potential deterioration in the Net Open Position (NOP) following the conversion of SLDBs into LKR bonds. Despite the rise in the total deposit base, balances with the Central Bank of Sri Lanka decreased by Rs 17.1 Bn following the downward revision in the SRR rate from 4% to 2%. During the year under review, Sampath Bank also ventured into its first-ever investment in US Treasury instruments by allocating USD 76 Mn.

Liabilities

Overall liabilities witnessed a year-on-year increase of 16.4%, primarily driven by the growth in the Bank’s deposit base, which expanded from Rs 1,103.2 Bn in FY 2022 to Rs 1,264.5 Bn as of end-2023. The Bank’s CASA ratio demonstrated an improvement, rising from 32.7% in FY 2022 to 33.4% in the year under review, affirming the success of initiatives to attract low-cost deposits.

The increase in total borrowings from Rs 40.9 Bn to Rs 68.8 Bn, also played a role in the overall increase in liabilities for the year under review. In February 2023, the Bank successfully issued Rs 10 Bn worth of BASEL III compliant listed rated unsecured subordinated redeemable debentures, further enhancing its Tier II capital. The debenture issue was oversubscribed on the very first day, underscoring the strong investor confidence in Sampath Bank. Rs 7.5 Bn worth of debentures were redeemed in March 2023.

Equity

Sampath Bank’s total equity strengthened, increasing by Rs 21.5 Bn during the year to reach Rs 147.9 Bn as at 31st December 2023, mainly due to improved profitability recorded in 2023.

Dividend

The Board of Directors of Sampath Bank PLC recommended a final cash dividend of Rs 5.85 per share for the financial year ended 31st December 2023 subject to the approval of the shareholders at the 38th Annual General Meeting to be held on 28th March 2024. The Dividend payout ratio for the year ended 31st December 2023 stood at 40.02% (2022: 40.08%).

 Capital and Liquidity

The Bank concluded the current financial year with all capital ratios showing improvements compared to the previous financial year. As at 31st December 2023, Sampath Bank’s CET 1, Tier 1 and total capital ratios stood at 16.35%, 16.35% and 19.56% respectively compared to 11.92%, 11.92% and 14.27% respectively at the end of 2022. These increases can be attributed to three main factors: enhanced profitability, the Tier II capital infusion of Rs 10 Bn in February 2023 and a reduction in risk-weighted assets stemming from the decrease in the loan book.

It is noteworthy to mention that all three Capital Adequacy Ratios consistently remained comfortably above the regulatory minimum requirements throughout the current financial year. Similarly, with a liquidity ratio at 47.76% as at 31st December 2023, the Bank exceeded the regulatory minimum requirement of 20%.

 Other Key Ratios

The Return on Average Shareholders’ Equity (after tax) improved to 12.65% as at 31st December 2023 compared to 10.95% reported at the end of the year 2022. Return on Average Assets (before tax) stood at 2.12% as at 31st December 2023 as against 1.16% reported for 2022.

External Rating

On 5th October 2023, Fitch Ratings Lanka Limited affirmed Sampath Bank’s National Long-Term Rating at A(lka), removed the Rating Watch Negative (RWN) outlook and assigned a Stable outlook. Fitch also affirmed the BBB+(lka) rating for the Bank’s Basel III compliant subordinated debentures.

 



 


February 13, 2024
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5min

In a landmark collaboration, the Chamber of Young Lankan Entrepreneurs (COYLE), the Harvard Club of Sri Lanka, and Sampath Bank PLC are poised to elevate corporate leadership in Sri Lanka with an exclusive 3-day Business Excellence Masterclass featuring Harvard Professor Boris Groysberg, a luminary in organizational leadership. This program will be conducted in the style of an authentic Harvard lecture, providing a unique opportunity for participants.




The event, scheduled for March 4th to 6th, 2024, at the prestigious Shangri La Hotel in Colombo, brings together COYLE’s commitment to empowering young entrepreneurs, the Harvard Club of Sri Lanka’s dedication to academic and career excellence, and Sampath Bank’s unwavering support for professional and personal development.

Professor Boris Groysberg, a distinguished member of the faculty at Harvard Business School, globally renowned for his expertise, will lead this exclusive masterclass. His insights, encompassing the latest in organizational leadership, promise to reshape the corporate landscape in Sri Lanka.

The significance of Professor Groysberg’s presence cannot be overstated. With a background in business and organizational leadership, he has received several notable accolades and has built an unparalleled understanding of organizational dynamics. Accordingly, his valuable and unique contributions are poised to uplift corporate leadership in Sri Lanka, especially in the context of the present economic climate.

Aiming to set a new standard for corporate leadership in the country, this masterclass will provide participants with a unique opportunity to gain practical skills and knowledge that will have a lasting positive impact on them both personally and professionally. This initiative thus underscores a shared commitment by COYLE and the Harvard Club of Sri Lanka, to fostering leadership excellence in the region. The Harvard Club of Sri Lanka’s instrumental role in bringing Professor Groysberg to Sri Lanka highlights its dedication to providing unique opportunities for professional growth.

Sampath Bank’s support of this exclusive event solidifies its commitment to supporting initiatives that contribute to the professional development and growth of the business community in Sri Lanka. Firmly expressing the bank’s support of such initiatives, Sampath Bank representative further mentioned, “The presence of such a respected academic as Professor Groysberg from the Harvard Business School in Sri Lanka is truly a unique opportunity. Furthermore, it will be an enlightening experience for all participants to be a part of a Harvard-style business masterclass. Thus, we are incredibly proud to support this initiative that aligns with our goal of nurturing leadership and innovation in the Sri Lankan business landscape.”

In this exclusive 3-day Business Excellence Masterclass with Professor Groysberg, participants will explore transformative case studies, including Domino’s Pizza and Amazon’s evolution. Interactive lectures will cover leadership in extreme situations, decision-making for leaders, and dynamics in recruiting star performers. The masterclass will spotlight Danaher Corporation’s corporate strategy and strategies for engaging, inspiring, and retaining employees. This diverse agenda ensures a rich learning experience, providing practical tools and knowledge to enhance participants’ leadership capabilities.

All participants who successfully complete the masterclass will receive a certificate signed by Professor Groysberg. Participants will also enjoy lunch, and morning and evening snacks at Shangri-La Colombo as part of the package.

For inquiries and to reserve your spots, please contact Sheruni Alles on +94 777 881 923 or email sheruni.alles@freight-links.com, or Indunil Ukwatte on +94 778 047 172 or email ceo@coyle.lk.

 



 


February 5, 2024
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7min

Sampath Bank stepped forward to provide much-needed support to the farmers of the Northern region who are battling intense heat and unforgiving soil by successfully restoring and gifting the Vavuniya Kidachchoori Tank to the people of the region under its award-winning  Corporate Sustainability Responsibility initiative, ‘Wewata Jeewayak’. Sampath Bank Managing Director Ayodhya Iddawela Perera, Senior Deputy General Manager – Marketing & Customer Care Tharaka Ranwala, Chief Human Resource Officer Dr. Lalith Weragoda, Development Commissioner General Agrarian Development A.H.M.L. Aberathna, government officials, Kannagi Farmers’ Association officers and members as well as a large number of local residents were present at the occasion.

 



 

Farmers of the North struggle to cultivate their lands due to minimum resources but make a significant contribution to the nation’s economy by providing essential food items such as chillies, onions, and potatoes, thereby helping to strengthen the agro economy of the nation. Amidst such a backdrop where they are faced with numerous hardships on multiple fronts, these Northern farmers also harvest hundreds of acres of paddy to supply a significant amount of rice to the nation. Having understood the vital role played by these Northern farmers, Sampath Bank took the necessary steps to commence the restoration of the Vavuniya Kidachchoori Tank as part of ‘Wewata Jeewayak’, making the initiative the first irrigation project of the Northern Province and the 20th overall across the island.

Although the farmers of the region made numerous futile attempts while being faced with an ever-increasing need for a steady supply of water to cultivate their lands during both the Yala and Maha seasons they were left with limited options to cultivate their large land area. Having eventually grown accustomed to surviving on a single harvest season, through their Farmers’ Association they approached several organisations in the hope of receiving support to restore the tank and subsequently connected with Sampath Bank’s ‘Wewata Jeewayak’ program to meet their objectives. Accordingly, Sampath Bank took on the project under the ‘Wewata Jeewayak’ program to restore the Vavuniya Echankulam Kidachchoori Tank with the aim of ensuring a better future for farmers and their families while also rejuvenating dying traditional irrigation systems.

While 290 farming families occupying 185 acres of land are direct beneficiaries of the Kidachchoori Tank, the dilapidated state of the tank in recent years has greatly hampered their farming activities. The tank’s two sluices were not functioning well and water was wasted due to significant leaks in both sluice gates. The daily water leak was similar to amount of water sufficient for cultivating 5 acres of paddy lands. Further, the tank was not sufficiently filled with water due to the damaged feeder canal which was previously connected to a cascaded irrigation system. Sampath Bank stepped forward to restore the tank and transform it into a complete irrigation system giving hope to the Vavuniya Echankulam farming community. Within a short period of time, the bank was able to successfully restore the entire irrigation system by overhauling the two sluice gates to stop any water leaks, restoring the feeder canal and attending to any other restoration work necessary. The bank was provided technical assistance during the project by the Vavuniya District Department of Agrarian Development.

Sharing her thoughts during the Thai Pongal celebration at Vavuniya Echankulam, Sampath Bank Managing Director Ayodhya Iddawela Perera stated, “I am happy to announce the 20th successful tank restoration in Sri Lanka under our ‘Wewata Jeewayak’ Corporate Sustainability Responsibility initiative carried out at the Vavuniya Kidachchoori Tank. The accelerated restoration effort has delivered a complete irrigation system to the hardworking farming community of the Northern Province. Now they can move forward and cultivate and harvest their paddy fields during both seasons. We believe that this is wonderful news not only for them but the entire nation as well. Sampath Bank will continue to make all possible efforts to contribute towards uplifting the economy of the farming communities of Sri Lanka. In closing, I would like to convey our gratitude to all those who have contributed in various ways to make this project a tremendous success including the Department of Agrarian Development and other government bodies, officials, Kannagi Farmers’ Association and residents of the area.”

Sampath Bank commenced the ‘Wewata Jeewayak’ CSR project about two decades ago with the aim of restoring the dying traditional irrigation systems and contributing to the upliftment of agriculture to strengthen the economy of the farmers in the dry region that supplies rice to the country. The restoration of the tank system to provide the water necessary for the cultivation of both the Yala and Maha seasons will increase the economy of the farmers and enhance the economic development of the rural areas. Through this program, the importance of an environmentally balanced water bodies is also emphasized. While it is in line with the United Nations Sustainable Development Goals, it also assures the upliftment of the agricultural industry, agribusiness, and various other livelihoods.

Sampath Bank is a 100% local bank that has deeply rooted itself in the lives of the people of Sri Lanka. Established in 1987, the bank has become a state-of-the-art financial institution that continues to be a market leader today thanks to its constant innovation and customer focused approach to business. It has introduced many firsts to the Sri Lankan banking sector including introducing ATMs to Sri Lanka, extended banking hours, slip-less banking and touch-less cash withdrawal to name a few. As part of its visionary approach, the bank is steadily transforming itself into a ‘tech company engaged in banking,’ from the traditional approach of a bank adopting technology.


December 8, 2023
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4min

 


 

 

Authorised Persons (AP) License & Certificate of Registration as an Off-shore Company were ceremonially handed over

Colombo, Sri Lanka – December ,7 2023: Sampath Bank PLC, the trailblazer in banking industry of Sri Lanka proudly announced their first step in getting qualified as an Authorised Person and to be permitted to engage in offshore banking business in and from the area of authority of the Colombo Port City by receiving the Authorised Persons (AP) License from Colombo Port City Economic Commission (CPCEC) and Certificate of Registration as an Off-shore Company from Registrar General of Companies. This is the first milestone after the receipt of Monetary Board concurrence in 2022 for the issuance of a banking license to engage in business under the Colombo Port City Economic Commission Act, No 11 of 2021.

The AP License, AP Agreement and Certificate of Registration as an Off-shore Company were ceremonially handed over by Chairman – CPCEC, Mr. Dinesh Weerakkody to Mr. Harsha Amarasekera PC. Chairman – Sampath Bank PLC in the presence of Bank’s Managing Director, Mrs. Ayodhya Iddawela Perera, on 07 December 2023 at the office of CPCEC, One Galle Face, Office Tower.

On the occasion of the handover, Mr. Amarasekera said that “Sampath Bank is geared to facilitate the financial ecosystem within the Colombo Port City by serving the investors and businesses from all economics and particularly from the regional economies. This milestone will pave the way forward in the Banks expansion drive for investment in strategic locations by serving international businesses and offering tailor made services backed by state-of-the-art technology, while contributing to the advancement of the national economy”.

We have designed a range of offshore banking products and services that can elevate Bank’s local presence to global as we focus on new business opportunities being created through Special Economic Zone at Colombo Port City. We started early by serving Investors and Authorised Persons in Colombo Port City foreign currency zone within regulated framework and look forward for facilitation of diversification and bolster a service economy” said Bank’s Managing Director.

Sampath Bank offers full gamut of modern banking products and services for Corporates, Small and Medium-sized Enterprises and Retail customers through the network of island-wide established 229 branches. The principal activities of the Bank already includes corporate and retail lending, offshore project financing, trade financing, treasury and investment services, resident and non-resident foreign currency operations including array of digital banking services, inward-outward remittance facilities, travel related services, issuance of local and international credit and debit cards and dealing in government securities.

 




 

 


December 4, 2023
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3min

 



 

 

Colombo, 01.12.2023 — Sampath Bank PLC, third largest private bank in Sri Lanka, announced the appointment of Mr. Prabhash Subasinghe to its Board of Directors, effective from December 1, 2023. This decision, ratified during the board meeting on November 30, 2023, was made under the recommendation of the Board Nominations and Governance Committee, following the necessary regulatory approvals, including the approval from the Director of Bank Supervision Department of the Central Bank of Sri Lanka.

Prabhash Subasinghe, a distinguished entrepreneur with a track record of rapid success in building global companies, brings with him a wealth of experience and leadership. Known for his visionary approach, Prabhash is a Cornell University alumnus with a background in Applied Economics and Business as well as an alumnus of the Harvard Business School. His commitment to transforming Sri Lanka into a hub for multinational companies aligns seamlessly with Sampath Bank’s strategic goals.

As the founder of Global Rubber Industries Pvt. Ltd. (GRI) and Global Sea Foods Pvt. Ltd. (GSF), Prabhash has demonstrated his prowess in steering companies to global prominence. GRI, a manufacturer of high-performance speciality tires, operates one of the largest and most advanced speciality tire production plants in Sri Lanka, while GSF, a processor and supplier of high-quality seafood, has made significant strides in the international market. Prabhash’s diverse business portfolio also includes investments in insurance, banking, luxury real estate, and a significant role as the principal shareholder of Ceylinco Insurance PLC, the largest listed insurer in Sri Lanka.

Ayenka Holdings, an investment company founded by Prabhash, boasts a large and diverse portfolio of investments in the Colombo Stock Exchange and a luxury real estate project in the Maldives. Furthermore, his influence extends to the banking sector, with investments in Sanasa Development Bank (SDB) one of the main shareholders in Sampath Bank, and a Non-Executive director at Hemas Holdings PLC. Prabhash was also a past Chairman of the Sri Lanka Export Development Board (EDB).

Prabhash, envisions being a catalyst for the next generation of corporate growth in Sri Lanka. The Global Group of companies under his leadership operates in ten offices worldwide, employing 1200 professionals with sixteen nationalities.

 



 

 


November 14, 2023
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13min

 



 

 

Financial Performance

, recording a growth of 136.4% and 71.5% respectively against the subdued financial figures reported during the corresponding period in 2022.

Key highlights for the period ended 30th SeptemberSampath Bank registered profit before tax (PBT) of Rs 22.0 Bn and profit after tax (PAT) of Rs 12.3 Bn for the nine months ended 30th September 2023 2023

  • Bank PAT improved by 71.5% to Rs 12.3 Bn.
  • 0% year on year growth in net fee and commission income.
  • YoY exchange income declined by Rs 15.8 Bn due to the appreciation of LKR against USD by Rs 42.00.
  • 4% decline in impairment charge on loans and investments.
  • Increase in government taxes by 197.7% compared to the previous period.
  • Total LKR deposits increased by Rs 112 Bn during the period to reach Rs 996 Bn as at 30th September 2023.
  • Tier 1 and Total Capital ratios improved from 11.92% and 14.27% as at 31st December 2022 to 14.37% and 17.73% respectively as at 30th September 2023.

Fund based income

Sampath Bank reported gross interest income of Rs 153.4 Bn for the period under review, up 44.6% from the Rs 106.1 Bn recorded in the corresponding period of the previous year. While the Average Weighted Prime Lending Rate (AWPLR) registered as at 30th September 2023 was 1,128 bps lower than the AWPLR reported as at 30th September 2022, the average AWPLR remained considerably higher throughout the current reporting period compared to the corresponding period in the previous year.

Interest expense for the period under review grew at a faster pace than the interest income as a consequence of the numerous interest rate hikes, resulting in a marginal 0.3% reduction in Net Interest Income.

Net Interest Margin also recorded a decline of 47 basis points from 5.66% as at 31st December 2022 to 5.19% as at the reporting date which is attributed primarily to the downward trend in the AWPLR from 1Q 2023.

Non-Fund based income

Sampath Bank’s Net fee and commission income (NFCI) increased by 10.0% during the period under review compared to the corresponding period in the previous year. Growth experienced in the period was mainly on account of the increase in fee and commission income derived from card, trade, electronic channels as well as remittance related activities.

Sampath Bank posted a Net Other Operating Loss of Rs 2.3 Bn in the first nine months of 2023 compared to a gain of Rs 18.0 Bn reported in corresponding period of 2022, largely due to the Rs 2.8 Bn exchange loss stemming from appreciation of the LKR against the USD by 11.5%. This was however counter balanced by the Bank recording a net trading gain of Rs 1.7 Bn for the first nine month period ending 30th September 2023, compared to a loss of Rs 3.0 Bn reported in the corresponding period of the previous year which was mainly due to revaluation gains derived from its forward exchange contracts.

Impairment charge

The Bank continued with its conservative and prudent provisioning policy and posted a total impairment charge of Rs 14.4 Bn for the period, though 70.4% less than the charge for the corresponding period in the previous year. The impairment charge for the current review period comprises Rs 12.5 Bn on account of loans and advances (corresponding period in 2022: Rs 37.7 Bn) and Rs 1.8 Bn on other financial instruments (corresponding period in 2022: Rs 10.3 Bn) as well as an additional impairment charge of Rs 0.2 Bn on commitments and contingencies (corresponding period in 2022: Rs 0.8 Bn).

Impairment charge on loans and advances

Even though the impairment charge for loans and advances for the first nine months of 2023 decreased by 66.9% compared to the same period in the previous year, the total provision cover of the Bank increased by 370 bps from 9.8% as at end September 2022 to 13.5% as at 30th September 2023.

Impairment on Individually Significant Loan (ISL) Customers

Rs 11.4 Bn was charged as an impairment provision against ISL customers during the first nine months of 2023. During the period under review the Bank re-evaluated a substantial portion of its loans and advances portfolio under the ISL category, considering both the financial resilience of customers as well as external macroeconomic pressures. Meanwhile, the proactive approach adopted by the Bank in the previous financial year to make appropriate provisioning to account for customers with potential risk has led to the build up of a sizeable provision cover against many ISL impaired customers, which resulted in lower additional provisioning being required during the reporting period. This was the main reason for the drop in the impairment charge as reported above.

Collective Impairment

Impairment models used in 2022 were continued in the first nine months of 2023 to ensure adequate buffers were in place to absorb any potential credit risk that could arise in the future. The probability weightage applied to the worst-case economic scenario remained unchanged during the reporting period. Despite the positive movements in major macro-economic variables, the Bank did not reflect these in the Economic Factor Adjustments in this quarter either, which is in keeping with the conservative stance adopted in the previous two quarters. The Bank continued to be prudent and built additional provisions against newly identified customer segments with increased credit risk during the reporting period. The allowance for overlay applied in 2022 continued to be maintained for the current reporting period as well.

The collective impairment charge for the reporting period dropped by 91.3% as the buffers built up in the previous reporting period helped to manage the risk elevated segments of the loan portfolio during the reporting period.

Impairment charge on other financial instruments

Sampath Bank recorded a net impairment charge of Rs 1.8 Bn against other financial instruments during the reporting period. The Bank opted to exchange its holdings in SLDBs to local currency denominated bonds offered by the Domestic Debt Optimisation Program (DDO). This allowed the Bank to reverse the impairment provision already recognised against the SLDBs. However, the Bank recognised a day one loss against the local currency bonds received in settlement of SLDBs under the DDO program. At the same time, the Bank increased the impairment provision against its SLISB investments on account of a possible haircut. The combined impact saw the Bank tabling a net impairment charge of Rs 1.7 Bn for the period under review against the debt instruments.

Operating Expenses

Operating expenses in the first nine months of 2023 showed 18.8% increase in comparison to the corresponding period in 2022. This was mainly due to a 25.6% increase in other expenses driven by inflation induced price increases, the substantial currency depreciation that took place in 2022 and other factors such as increased taxes and import restrictions. Personnel costs grew by 14.1% in 2023 owing to the annual salary increase.

Tax Expnses

Total effective tax rate of the Bank increased to 57.1% in first nine months of 2023 from 43.4% reported in the corresponding period in 2022 owing to the combined effect of the increase in tax rate and newly introduced Social Security Contribution Levy (SSCL).

Key Ratios

The Return on Average Shareholders’ Equity (after tax) increased to 12.49% as at 30th September 2023 from 10.95% reported at the end of the year 2022. Return on Average Assets (before tax) stood at 2.15% as at 30th September 2023 as against 1.16% reported as at 31st December 2022.

Capital Ratios

In addition to being well above the regulatory minimum requirements, Sampath Bank’s capital adequacy ratios improved further in the first nine months of 2023 from the figures reported in the previous year end. As at 30th September 2023, Sampath Bank’s CET 1, Tier 1 and total capital ratios were at 14.37%, 14.37% and 17.73% compared to 11.92%, 11.92% and 14.27% respectively at the end of 2022. These increases are attributed to three main reasons – the Tier 2 capital infusion of Rs 10 Bn in February 2023, profit generated in 1H 2023 along with the decline in risk weighted assets due to increased investment in government securities and LKR appreciation.

Assets and Liabilities

Total assets of the Bank increased by Rs 161 Bn (annualized growth of 16.3%) from Rs 1.32 Tn as at 31st December 2022 to Rs 1.49 Tn as at 30th September 2023 mainly due to investments in Government Securities.

Meanwhile, total loans declined by Rs 55 Bn from Rs 920 Bn as at 31st December 2022 to Rs 865 Bn at the end of the reporting period. Foreign currency loans declined by 19.6% mainly due to the LKR appreciation against the USD, while LKR denominated loans decreased by 3.0%.

 

Despite the LKR appreciation, Sampath Bank’s total deposit book increased from Rs 1.10 Tn reported as at 31st December 2022 to Rs 1.21 Tn at the end of September 2023, an increase of Rs 110.1 Bn. LKR deposits increased by Rs 112 Bn in the first nine months of 2023 to reach Rs 996 Bn as at 30th September 2023. The CASA ratio as at the same date was 33.8% compared to 32.7% reported at the end of 2022.

Awards

Sampath Bank was awarded with the esteemed title of “Best Bank in Sri Lanka for 2023”at the prestigious Euromoney Awards ceremony held in Hong Kong. The award recognises the Bank’s resilient performance and its conviction to supporting all stakeholders, while navigating through exceedingly challenging conditions in 2022. While staying true to its stated goals, this is the fifth time Sampath Bank has received this coveted award, a testament to the Bank’s commitment to excellence and its positive impact on society.

 



 

 


November 6, 2023
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6min

 


 

 

Sampath Bank PLC is delighted to announce the renewal of its partnership with the National Chamber of Exporters (NCE). This strategic partnership underscores Sampath Bank’s commitment to bolstering the growth of Sri Lankan exports on the global stage and builds upon the Memorandum of Understanding (MoU) signed between the NCE and Sampath Bank last year, signifying a shared commitment to fortify Sri Lanka’s export industry.

In recognition of w and outstanding contributions to international trade, Sampath Bank will also sponsor the coveted NCE Certificate of Ethical Trading.

Sampath Bank’s dedication to supporting its invaluable export clients goes beyond this partnership with the NCE. The bank has proactively engaged in various initiatives, aimed at facilitating their ventures on the global stage.

One notable action is the bank’s membership in USA, Canada, UK, Germany, China, Japan, Italy, and India’s Business Councils of the Ceylon Chamber of Commerce. These councils play a crucial role in facilitating and developing trade investment and business relations between key markets and Sri Lanka. These connections act as vital stepping stones for the bank’s clients, enabling them to explore new markets and establish meaningful international trade relationships.

Recognizing the paramount importance of access to information in international trade, Sampath Bank has set up its dedicated Advisory desks in the International Trade Department. This department comprises specialised personnel poised to assist clients in accessing a wealth of critical information, whether related to trade agreements or other indispensable resources, equipping clients with knowledge to make informed decisions.

In addition, Sampath Bank has made substantial investments in a cutting-edge digital compliance system. This system automates trade compliance procedures, offering an extra layer of protection for local exporters. Before any transaction is initiated, the bank’s system checks whether the receiving party has been flagged or blacklisted, thus ensuring the security of the local exporter and promoting ethical international trade practices.

In the wake of the COVID-19 pandemic, many of Sampath Bank’s clients have faced the challenge of rebuilding their pre-pandemic operational capacities. Prior to the pandemic, these clients were well on their way to achieving an impressive 20-25% year-on-year growth. Today, they find themselves operating at only half their previous capacity, grappling with survival in a challenging economic environment.

In response to these pressing circumstances, Sampath Bank has emerged as a strong pillar of support. The bank has extended additional financing to some clients, while others have seen their facilities restructured to better suit their current needs. Clients seeking to diversify or adapt to local markets have found steadfast support from the bank, ensuring their continued existence and growth in the market.

Furthermore, the recent Russia-Ukraine conflict presented unforeseen challenges. Several of Sampath Bank’s clients encountered difficulties in repatriating funds from Russia. Leveraging its extensive network of over 600 correspondent relationships, the bank has stepped in to ensure the seamless transfer of funds for its clients, demonstrating its commitment to their success.

Shashi Kandambi Jassim, Senior Deputy General Manager – International Banking, emphasised the bank’s dedication, stating, “Sampath Bank supports its local export customers in every possible way, even in the face of the challenging economic situation both in Sri Lanka and across the world, as long as they remain compliant with international trade regulations.”

Sampath Bank PLC’s partnership with the NCE and its ongoing commitment to empowering Sri Lankan exports are a testament to its vision of a prosperous and sustainable future for the nation’s exporters.

Sampath Bank is a 100% local bank that has deeply rooted itself in the lives of the people of Sri Lanka. Established in 1987, the bank has become a state-of-the-art financial institution that continues to be a market leader thanks to its constant innovation and customer focused approach to business. It has introduced many firsts to the Sri Lankan banking sector including introducing ATMs to Sri Lanka, extended banking hours, slip-less banking, and adaptation of block-chain technology to name a few. As part of its visionary approach, the Bank is steadily transforming itself into a ‘Tech company engaged in banking,’ from the traditional approach of a bank adopting technology.

 


 

 



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