Vallibel Finance December profit up 32%; loans & leases moderate

Vallibel Finance PLC, a Dhammika Perera-controlled licensed finance company, reported earnings of Rs.4.39 per share for the October-December quarter against Rs.3.34 a share reported during the same period last year, the interim report showed.  
The net profit was Rs.182.8 million, an increase of 31.7 percent from a year ago, as the loans grew albeit at a modest pace. The net interest income rose by 18.4 percent to Rs.510 million on year. 
The net fee and commission incomes grew by 36.3 percent on year to Rs.22.7 million. 
Vallibel mainly thrives on high margin loans and leases granted largely to two-wheelers and three-wheelers and personal loans. 
But the pace of growth of such loans slowed down lately due to higher interest rates and loan-to-value ratios imposed on vehicles. 
In January 2017, the Central Bank further tightened the credit flows into two-wheelers, three-wheelers and motor cars for personal use, a move that could somewhat limit the future performance of the company.  
During the nine months ended December 31, 2016, Vallibel gave around Rs.5.3 billion loans and leases, an expansion of 29 percent. The total loans and advances reached Rs.23.8 billion.  The deposits grew by Rs.2.6 billion or 17.5 percent during the nine months to Rs.17.4 billion.   
Meanwhile, for the nine-month period, the company reported earnings of Rs.12.18 against Rs.8.40 a share a year ago. The net profit for the period was Rs.506.3 million, an increase of 45 percent from a year ago. 
The annualized return on equity of the company was as high as 31.31 percent.  
The company said its gross non-performing loans declined to 3.15 percent. 
As of December 31, 2016, Vallibel had an asset base of Rs.29.6 billion, up 30.1 percent during the nine months. 
As of December 31, 2016, the billionaire businessman, Dhammika Perera along with his investment company collectively held a 76.141 percent stake in Vallibel Finance.