National Development Bank's (NDB) net profit for FY2009 has increased by 30% YoY to LKR 2.1 bn, even though net profit 4Q2010 has dropped by 10.4% YoY.
Interest margins have increased to 3.99% from 3.62% resulting from deeper drop in borrowing costs. Interest yield for FY2009 is 14.12%, decreasing 0.74 percentage points from 14.86% FY2008. Interest cost for FY2009 was 10.13%, decreasing 1.11 percentage points from 11.24% in FY2008. Therefore net margin has improved by 0.37 percentage points.
Deposit base of NDB has increased by 61% over the FY2009 to LKR 50 bn from LKR 31 Bn.
Operating costs have increased by 11.8% YoY for FY2009 to 2.7 bn from LKR 2.4 Bn for FY2008. The key cost drivers that have increased during the financial year are personnel costs along with premises, equipment and establishment costs.
Cost /Income Ratio (CI ratio) remains at consistent levels for FY2008 and FY20009 hovering around approximately 63%.
NDB is well capitalized with CAR (Tier 1) is at 20.59% and CAR (Tier 1 & 2) stands at 23.79%.
NDB is currently trading at 8.5X PER and 1.2X PBV . NDB currently trades at 12.1X and 10.4X for FY2010E and FY2011E EPS forecasts. Maintain
Sri Lanka Equity Analytics
World Trade Centre
Colombo, Sri Lanka
Email: info@srilankaequity.com
Web: www.srilankaequity.com
Thursday, February 18, 2010
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