Consolidated People’s Bank financial support extended in 2020 and 2021 exceeds LKR 1 trillion – The Island
People’s Bank today announced the results for the financial year ended 31 December 2021 – with total consolidated operating income reaching LKR 110.7 billion and total operating expenses amounting to LKR 50.5 billion of LKR, an increase of 21.9% and 14.9% respectively compared to 2020. tax and after-tax profits amounted to LKR 37.2 billion and LKR 28.1 billion; representing growth of 51.1% and 74.6%. On an individual bank basis, the figures were LKR 30.4 billion and LKR 23.7 billion respectively, up 43.2% and 67.3% from 2020.
Revenue growth came primarily from net interest income, which accounted for nearly 90.0% of total operating income and increased 30.2%, alongside the Bank’s growth in its credit portfolio and investment, while its commission income increased by 23.4% to LKR 9.0. billion; reflecting the Bank’s efforts to improve its sources of unfunded revenue. Expenditure growth is mainly related to direct business growth. Compared to 2019, the Bank’s cost/income ratio improved significantly to 51.1% in 2021 from 54.3% in 2020 and 61.8% in 2019. the Bank increased, reflecting the macroeconomic tensions seen across the sector.
During the year, the Bank invested in rural development, supported small and medium-sized enterprises (SMEs), and encouraged women’s entrepreneurship. By the end of 2021, it had granted over LKR 63.0 billion to SMEs through various lending initiatives; which included nearly LKR 1.9 billion through its own program to help revive businesses in agriculture, IT, logistics, manufacturing, tea and tourism. Together with the Small Holder Agri-Business Partnership (SAP), introduced a low interest credit scheme for 5,000 farmers with an initial provision of LKR 1.0 billion. To support local fertilizer production, the Bank introduced the Sarabhoomi loan scheme while to promote female entrepreneurship, it granted LKR 533.5 million. The Bank has also introduced additional loan programs to support self-employment in agricultural and artisanal spaces. To support the country’s investment in IT, the Bank has committed LKR 6.0 billion, of which LKR 750.0 million has already been drawn down. From a personal lending perspective, in its effort to uplift the housing and construction sector, the Bank has extended over 10,000 home loan facilities amounting to over LKR 185.8 billion by the end of 2021. In addition, by the end of 2021, it had disbursed over LKR 5.5 billion to retired armed forces disabled officers and over LKR 68.5 billion to government pensioners. To help artists and related professionals, the Bank disbursed over LKR 550.0 million, while to help university students and teachers, the Bank designed laptop loan schemes through which a total of LKR 350.5 million was granted throughout the year. Medical students at state universities have also been offered personal loan facilities.
All told, the Bank’s consolidated loan portfolio grew by 12.1% to LKR 1.99 trillion at the end of 2021. The Bank’s Phase 3 loans, however, were 4.3% (2020 : 4.5%). In addition, the Bank effected conversions of approximately LKR 453.0 billion of Treasury bonds during the said two-year period. Growth in its consolidated deposits was 12.1% to LKR 2,168.7 billion.
Total consolidated taxes and dividends paid to the Government of Sri Lanka amounted to LKR 20.4 billion in 2021, a growth of 25.1% from LKR 16.3 billion in 2020. Its consolidated level Tier I and its Total Capital Adequacy were 13.4% and 17.9%, respectively at the end of 2021 (end 2020: 10.7% and 15.6%). On an individual Bank basis, they were 12.6% and 17.8% respectively (2020: 9.5% and 15.5%); either being not all-time institutional highs, but also among the highest in the industry. All other regulatory ratios were all maintained well above the minimum requirement.
Commenting on the results, the President of Banque Populaire, Mr. Sujeewa Rajapakse, said: “We are very satisfied with the Bank’s results, especially since they were achieved in unprecedented circumstances. As a service provider, the past two years have put our promise and ability to deliver to the ultimate test. As a national institution, we do not measure our success by typical turnover or net income, but by our national added value – our results from a quantitative and qualitative point of view attesting to our resilience in these times. challenges and our overall performance. including, more specifically, our productivity and efficiency. All that said, our work is far from done. Not content with any of our successes, we remain focused and fully committed to the government’s economic recovery plan. Aware of the challenges awaiting us, we look to the future with great optimism. Together we can!”