HNB Grameen Finance Limited has ended the first half of 2015 with a profit before tax (PBT) of Rs.853 million, up from Rs.261 million in the first half of 2014, recording a staggering 227 percent growth in profits.

The profit-after-tax of the company has seen a sharp rise of 198 percent to Rs.524 million, from Rs.176 million in the corresponding period last year. These figures are noteworthy as they have been achieved in fiercely competitive environment.

HNB Grameen has maintained its non-performing loan (NPL) ratio below 1 percent, a remarkable achievement in an industry where the gross NPL average is above 6 percent. The company has recorded a ratio of 0.832 percent in the first half of 2015, while the figure for the corresponding period in the previous year was 0.67 percent. This is a direct result of the company’s excellent credit management practices, which have been strengthened by a well-defined credit evaluation process and a tenacious recovery mechanism. 

The capital reduction which was carried out during this quarter has been successful in wiping out the retained loss and has strengthened the balance sheet with a significant growth in the core capital.

The first half of 2015 was notable for the rebranding which took place within the company following the acquisition of Prime Grameen by banking giant Hatton National Bank (HNB) in late 2014. Under its new identity HNB Grameen has solidified its leadership position through enhanced synergies with HNB, which is the majority shareholder with a 51 percent stake in the company, while Prime Lands (Pvt.) Ltd retains a 47.5 percent stake. 

Commenting on the performance, HNB Grameen Chairman Jonathan Alles stated, “HNB Grameen, the most recent addition to the HNB group, has shown significant growth momentum both in its asset book and profitability whilst maintaining the quality of the loan portfolio. The exceptional performance of the company despite the challenging environment bears witness to the strong commitment of the team and the robust business model.”  

HNB Grameen is a company which has enjoyed strong public confidence over the years, and the latest figures indicate that this confidence has been further strengthened. Public deposits, which include fixed deposits and savings, have increased by 58 percent to Rs.8479 million from Rs.5369 million in 2014 and loans and advances have seen a remarkable growth of 97.35 percent to Rs.7,947 million from Rs.4,063 in the previous year. Another highlight of the first half was Fitch Ratings assigning HNB Grameen a national long-term rating of ‘A (lka)’ with a stable outlook, reaffirming that the company is in a strong position to build on the momentum of the first half. 

HNB Grameen Managing Director/CEO Chaminda Prabhath thanked the customers for the continuing faith and loyalty shown by them.
“I would like to thank our loyal customer base for making HNB Grameen their preferred financial partner on their journey of development. During the first half we strategically focused on the small scale enterprises (SSE) segment by introducing a loan scheme to provide them superior financial solutions and so far we have been successful in penetrating that market. Another area of focus for us was the expansion of our reach island wide and towards this end we have opened new service centres in several unbanked areas, demonstrating our commitment to serving all Sri Lankans. I thank each and every staff member for being our strength and working tirelessly to reach our targets through enhanced productivity. I would also like to thank the experienced board of directors of HNB Grameen for their support and guidance at all times.”

The first half of 2015 saw several exciting initiatives on the technological front within the company which are aimed at achieving increased efficiency in future. These include the setting up of a state-of-the-art, fully centralized core banking system, which demonstrates far-sighted continuity planning and signing up for the Microsoft Enterprise Agreement, the world’s leading volume licensing package by software giant Microsoft. 

HNB Grameen hopes to expand its product portfolio in the second half of 2015 with the addition of leasing and SSE products, in order to cater to the financial needs of all Sri Lankans. Furthermore, plans are in place to list the company on the Colombo Stock Exchange.