Sampath Bank issued a statement noting that it had registered a profit before tax (PBT) of Rs. 15 billion and a profit after tax (PAT) of Rs 13.1 billion for the year that ended on 31 December 2022.

The Net Interest Income increased substantially in the year under review from Rs. 41.7 billion in 2021 to Rs. 73.5 billion in the financial year (FY) 2022, reflecting a solid 76.4% growth. While interest income attributed to loans and advances declined, owing to the bank’s decision to prudently manage the lending activities in light of severe macroeconomic stress, the adverse impact of this approach was offset by the continuous upward movement in market interest rates. 

With AWPLR increasing rapidly throughout the year, the bank benefited from the frequent repricing of the loans and advances portfolio during 2022. Similarly, interest income from Treasury Bills and Bonds increased due to the unprecedented rate hikes in 2022 while interest income on foreign currency (FCY) loans increased substantially owing to the depreciation of the Sri Lankan rupee. As a result, interest income for the year 2022 reached Rs. 158 billion, denoting an increase of 83.3% over the previous year.

However, interest expenses too saw an increase as banks were compelled to increase interest rates on deposits in line with treasury bill rates during the latter part of 2022. As a result, Sampath Bank’s LKR term deposit base increased by Rs. 158 billion while the bank’s LKR Current and Savings Account (CASA) base reduced by Rs. 111 billion during the year. Proactive and timely asset and liability management ensured that the escalation was well managed. 

Furthermore, with interest income outpacing the interest expense, the net interest margin (NIM) for the reporting period reached 5.66%, 205 bps higher than the NIM registered at the end of 2021.

With Card and Trade-related activities generating robust results compared to the previous year, the total Net Fee and Commission Income (NFCI) of the bank grew by 69.4% from Rs. 11.5 billion reported in 2021 to Rs 19.4 billion in the year under review.