Bank of Ceylon, having completed many fruitful years, now has closed 2016 with another   trailblazing record of Rs.31.2 billion profit before tax (PBT) with 23 percent growth. 
With this, BoC continues to break its own records by marking the highest ever profit made by a single entity. Profit after tax (PAT) stood at Rs.24.8 billion, resulting in a 43 percent growth.
Net operating income for the period reflected an improvement of 16 percent mainly backed by the increase of 17 percent in net interest income and 59 percent increase in other operating income.  
Reduction of 26 percent in total impairment charges through a reversal in provision following improved Non Performing Loans (NPLs) has also complemented the increase in net operating income. 
In 2016, many policy rates were changed affecting the market interest rate to move upward. In January 2016 Statutory Reserve Ratio (SRR) was increased by 150 bps to 7.5 percent and Standing Lending Facility Ratio (SLFR) and Standing Deposit Facility Ratio (SDFR) also increased during the year up to 8.5 percent and 7.0 percent.  
Whilst, the increasing trend in market interest rates has resulted in an increase in both interest income and expenses, the Bank has managed to maintain its interest margin at the previous year level of 3.3 percent through its effective management of cost of funding. Interest income earned through investment activities particularly in Sri Lanka development bonds and treasury bonds also contributed towards the growth in the net interest income. 
Despite the decline in net fee and commission income by 8 percent compared to the previous year in the light of subdued performance experienced across the export industry, 59 percent impressive growth in other operating income showcased the Bank’s ability of making its targets a reality through various avenues among challenges. This operating income includes Rs.3.1 billion capital gain from disposal of investment too.   
The reversal of impairment charges against Non Performing Advances (NPA) as a result of persistent efforts in recoveries, sturdy follow ups, strengthened by the continuous improvement in credit quality in the branch network has made significant improvements in Gross NPA ratio at the end of 2016 to 2.9 percent compared to 4.3 percent recorded in December 2015 year end.
Total operating expenses increased by 7 percent in line with the business expansion , however depicting the Bank’s effective cost benefit management, cost to income ratio came down to 43 percent from  45 percent compared to previous year.  
BOC, with an unparalleled benchmark of highest assets base owned by single entity added strength to the Balance Sheet by achieving Rs.1.0 trillion loans and advances base, with these total assets reached to Rs.1.7 trillion as of end 2016, further 6 percent growth compared to 2015 position. Loans and advances accounted for 60 percent of the bank’s total assets base and gross loans recorded 20 percent growth YoY even with the downward pressure on lending with increased rates and taxes. Personal loans, terms loans and overdraft contributed mostly to the growth momentum in the loan portfolio.
Deposit base accounted for 80 percent of the Bank’s liabilities as at end 2016 and grew by 16 percent from end December 2015 to Rs.1.3 trillion. Besides  23 percent increase in time deposits resulted in industry wide move towards higher yielding deposits, the bank continued to maintain its CASA mix (current and savings account to total deposits) at a higher level of 43 percent contributing favorably towards maintaining cost of funds at a moderate level when viewed against prevailing market conditions.  
The Bank’s return on average assets (ROAA) ratio stood at 1.9 percent and Return on Average Equity (ROAE) ratio stood at 28.4 percent portraying the Bank’s ability to generate healthy returns for the owners despite the increased assets base over the period.
Consequent to the increase in SRR and policy rates, the market experienced a shrink in overall liquidity position and the Bank’s domestic liquid asset ratio was at a moderate level of 21.6 percent as of end 2016 compared to the previous year, yet standing above the Central Bank’s required benchmark of 20 percent.The off-shore liquid asset ratio was at a superior level of 28.1 percent against the required benchmark indicating stability in foreign currency liquid assets of the Bank. 
The bank managed to maintain better trade-off between liquidity and interest earning assets. The Bank also continued to sustain Capital Adequacy Ratio (CAR) by maintaining Tier I at 8.7 percent and Tier II at 12.3 percent level against the Central Bank’s minimum requirements of 5 percent and 10 percent respectively. During the year the Bank received Rs.5.0 billion capital infusion from the treasury strengthening the bank’s capital base to Rs. 15.0 billion.