Amana Bank continued its upward performance trend by recording a 2023 Mid-Year Profit Before Tax (PBT) of LKR 802.8 million, reflecting a substantial growth of 44% in comparison to LKR 556.9 million booked a year back. Owing to its resilient performance despite the challenging economic environment, the Bank in Q2 alone achieved a YoY PBT growth of 122% to reach LKR 379.4 million from LKR 171.2 million. Despite accounting for higher taxes, the Bank went on to achieve a half yearly Profit After Tax (PAT) of LKR 419.6 million corresponding to a healthy growth of 16%, whereas in Q2 the Bank’s PAT grew by 79% from LKR 111.3 million to LKR 198.9 million.
The Bank maintained its robust top-line performance thorough the first half of 2023, posting an 80% growth in Financing Income from LKR 4.85 billion to reach LKR 8.75 billion, which was well supported by effective deployment of funds and timely re-pricing of advances and liabilities. As a result the Bank’s Financing Margin improved to 4.8% from 3.6% to end the first half with a Net Financing Income of LKR 3.36 billion, reflecting a 68% YoY increase.
The Bank’s Total Operating Income grew by a significant 66% to reach LKR 4.47 billion, with Net Fee and Commission Income and Net Trading Income contributing LKR 474.4 million (66% YoY growth) and LKR 622.9 million (47% YoY growth) respectively. Despite accounting for a higher level of impairment to mitigate risks of those businesses vulnerable to economic shocks, which resulted in impairment charges increasing by 191%, the Bank fared to grow its Net Operating Income by 38% to reach LKR 3.04 billion from LKR 2.19 billion posted in H1 2022.
The Bank posted a commendable growth of 57% in Operating Profit Before VAT on Financial Services and Social Security Contribution Levy for H1 to reach LKR 1.23 billion compared to LKR 0.78 billion achieved a year back. Total Comprehensive Income for the period stood at LKR 387.2 million reflecting a healthy YoY growth of 38%.
Amidst tight liquidity conditions and competition for funds in the market, the Bank continued to witness an increase in acceptance for its people friendly banking model, resulting in Customer Deposits growing by a commendable 9% to close H1 2023 with a portfolio of LKR 122.9 billion, maintaining a healthy CASA ratio of 42%, while Customers Advances closed at LKR 80.0 billion.
Owing to timely customer engagement and effective portfolio management, the Bank improved its Stage 3 Impaired financing ratio to 2.2%, well below the market average. The Bank’s Total Assets as at end of 30 June 2023 stood at LKR 142.0 billion while the Bank’s Total Capital Ratio stood at 15.4%, well above the minimum regulatory requirement of 12.5%. This performance reflects Amana Bank climbing up 14 positions in the latest LMD Brand Finance Top 100 Most Valuable Brands in Sri Lanka.
The Bank recently announced its intention to raise LKR 6.7 billion in equity capital by way of a Rights Issue which will facilitate in meeting the minimum capital requirement of LKR 20 billion for licensed commercial banks. Once approved by CSE and shareholders, the Bank will issue 2,902,267,365 ordinary voting shares in the proportion of 1 new share for every 1 share held at a consideration of Rs 2.30 per share. Demonstrating its commitment to deliver long-term value to shareholders owing to its positive performance trend, the Bank recently also declared an interim scrip dividend of LKR 0.12 per share, which is the Bank’s 6th consecutive dividend.
Commenting on the Bank’s mid-year performance, Chairman Asgi Akbarally said “Amana Bank's exceptional performance in the first half of 2023 stands as a testament to our unwavering resilience in the face of a challenging environment. With our people-friendly banking model at the forefront, we have not only weathered the storm but thrived, achieving one of our best-ever quarters and setting new standards of achievement. As economic conditions progressively show signs of improvement, our optimism continues to grow. We extend our deepest gratitude to our esteemed stakeholders who have been pivotal to our journey, and we eagerly anticipate the opportunities that lie ahead.”
Also sharing his views on the Bank’s performance Managing Director/CEO Mohamed Azmeer said “Our strong mid-year performance in the backdrop of the current macroeconomic environment, echoes the Bank’s stability, resilience and continued acceptance. This achievement reinforces Amana Bank’s commitment in stimulating economic growth through our people friendly banking model, fostering financial well-being to our customers. I am thankful to my fellow Directors, management, staff, shareholders and customers for their continued support, trust and confidence in Your Bank. With optimism, we look forward to a promising journey ahead during the rest of the year and beyond with a strong growth outlook.”
Amãna Bank PLC is a stand-alone institution licensed by the Central Bank of Sri Lanka and listed on the Colombo Stock Exchange with Jeddah-based IsDB Group being the principal shareholder having a 29.97% shareholding in the Bank. The IsDB Group is a USD ‘AAA’ rated multilateral development financial institution with a membership of 57 countries. Testifying its position as a leading practitioner of the non-interest based banking model, Amãna Banks continued to be recognized amongst the Top 100 Strongest Islamic Bank’s in the World by The Asian Banker.
Amãna Bank does not have any subsidiaries, associates, or affiliated institutions apart from its engagement with OrphanCare as its Founding Sponsor.
