MBSL Income Increases by 26%

(Created date: 04-Jun-2014)

Income growth of the Merchant Bank in of Sri Lanka (MBSL) rose 26% in the year ending December 31, 2013 from Rs.1.87 billion to Rs.2.36 billion. The significant growth during the year was attributed to an aggressive expansion drive initiated by MBSL over 2012/2013 and the dedication of its staff towards achieving predetermined goals, Chairman MBSL M.R. Shah said. The expansion plan yielded highly positive results with 16 new customer touch points becoming profitable immediately. "Our objective was to reach a larger segment of society and widen our presence across the country. Although 30 branches and customer touch points may seem small in number, this initiative has successfully enhanced MBSL brand recognition and raised brand awareness across the country.

In 2013, these 16 customer touch points generated an income of Rs. 334 million, which is 15% of the total income of the Company and made a net contribution of Rs. 12 million, giving plenty of hopes for a brighter future. Such a contribution by newly established customer touch points is a remarkable feat," he said.

The overall company profits decreased from Rs.201 million to Rs.117 million in the face of challenging times for the leasing industry. The policy rate reduction was encouraging to a company like MBSL that does not have access to customer deposits. However, the growth opportunity presented by the lower interest rates was largely negated, due to the persistent downturn of the leasing market.

Earnings per Share (EPS) dropped from Rs.1.49 to Rs.0.87.

The asset growth 12% of the MBSL from Rs.11.89 billion to Rs.13.27 billion was encouraging as was the 7% growth in the loan portfolio from Rs.9.3 billion to Rs.9.91 billion.

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