Pan Asia Bank posts PAT of over Rs. 2.1Bn for 1H2025; Increase of 110-pct – Lanka Business Online – Sri Lanka business and economy news as it breaks

Operating Profit before Taxes on Financial Services – Rs. 3.83 billion, up by 40%
Profit before Tax – Rs. 2.91 billion, up by 46%
Profit after Tax – Rs. 2.15 billion, up by 110%
Total Assets grow by Rs. 18 billion, up by 7%
Net Interest Income – Rs. 6.27 billion, up by 7%
Net Fee and Commission Income – Rs. 1.14 billion, up by 34%
Gross Loan Book expands by Rs. 22 billion, up by 14%
Customer Deposit Base increases by Rs. 13 billion, up by 7%
Cost-to-Income Ratio improves remarkably to 47.92% from 52.68%
Net Interest Margin – 4.68%, Return on Assets (Pre-tax) – 2.17%, Return on Equity – 15.79%
Earnings per Share more than doubled to reach Rs. 4.86 from Rs. 2.32
The Bank remains well capitalised and liquid:

– Common Equity Tier 1 Capital Ratio – 16.65% (Regulatory Minimum – 7.00%)

– Tier 1 Capital Ratio – 16.65% (Regulatory Minimum – 8.50%)

– Total Capital Ratio – 18.32% (Regulatory Minimum – 12.50%)

– Leverage Ratio – 7.89% (Regulatory Minimum – 3%)

– All Currency LCR – 188.56%, Rupee LCR 212.94% (Regulatory Minimum – 100%)

– Net Stable Funding Ratio – 139.71% (Regulatory Minimum – 100%)

Pan Asia Banking Corporation PLC reported an impressive financial performance for 1H 2025 amidst diverse challenges emerging from the gradually reviving but challenging macro-economic environment. In financial terms, the Bank witnessed yet another period of growth and profitability, with an increase in Profit After Tax (PAT) of 110%. This growth is reflective of the robust portfolio management, effective cost management and commitment to generating sustainable profits. As a result, the Bank ended 1H 2025 with a PAT of Rs. 2.15 billion to more than double Earnings Per Share (EPS) from the previous year to reach Rs. 4.86.

The Bank’s robust performance was complemented by the ability to navigate external challenges adeptly and an unwavering commitment to asset quality, which was reflected in maintaining one of the lowest Stage 3 Loan Ratios in the industry of 2.39% as of 30th June 2025, a testament to rigorous credit risk management and underwriting standards. While the government-imposed restrictions on recoveries posed headwinds, the Bank proactively refined its recovery strategies to minimise the impact.

Market interest rates for both lending and deposits gradually came down in line with the policy decisions taken by the Monetary Board of the Central Bank of Sri Lanka (CBSL) to reduce the policy rates several times over. As a consequence, the Bank’s interest income for 1H 2025 decreased by 5% compared to the corresponding period last year, due to its response to the market conditions, in a situation of increased average loan portfolio. Furthermore, interest expenses for 1H 2025 decreased by 12% against the interest expense for 1H 2024 due to prevailing low interest rates despite the strong growth in average deposit book. Consequently, the net interest income increased by 7% during 1H 2025 as the drop in interest expense outpaced the drop in interest income.

The Bank’s Cost-to-Income Ratio improved remarkably by over 475 bps to 47.92% in 1H

2025 from 52.68% for the year 2024. The increase in other operating expenses was contained at 15% due to the effective cost management strategies of the Bank and despite the cost increases primarily caused by the new branch opening and other technological enhancement projects conducted by the Bank and general price increase of goods and services.

The Bank’s total assets experienced an increase of 7% mainly driven by loans and advances. The loans and advances book expanded by 14% during the period under review mainly due to increased credit demand from all 3 segments of SME Banking, Corporate Banking and Retail Banking. In the meantime, the Bank’s total customer deposits base recorded a healthy growth of Rs. 13 billion or increased by 7% passing Rs. 204 billion mark to end the 1H 2025.

During 1H 2025, the Bank maintained a solid capital and liquidity position, reinforcing its financial strength in a dynamic environment. Capital buffers remained well above regulatory minimum requirements, reflecting prudent management. The Common Equity Tier 1 Capital Ratio and the Tier 1 Capital Ratio stood at 16.65%, staying well above the regulatory minimums of 7% and 8.50%, respectively. The Total Capital Ratio stood at 18.32% against the statutory minimum of 12.50%, ensuring resilience and growth capacity. Meanwhile, the Bank’s Leverage Ratio which rank well above the regulatory minimum of 3%, stood at 7.89% in 1H 2025.

Despite the significant expansion in loan book witnessed during 1H 2025, liquidity levels remained robust, with an All-Currency Liquidity Coverage Ratio (LCR) of 188.56% and Rupee LCR of 212.94%, both comfortably surpassing regulatory thresholds. The Net Stable Funding Ratio (NSFR) of 139.71% reflects the Bank’s ability to raise stable funding under gradually resurgent economic conditions. These strong metrics underline the Bank’s commitment to financial stability and sustainable expansion.

Commenting on the Bank’s performance, Naleen Edirisinghe, Director and CEO of Pan Asia Bank, said: “Pan Asia Bank’s strong performance in 1H 2025 is a clear reflection of our disciplined execution and unwavering focus on value creation. The success we have achieved in delivering steady growth and improved profitability validates the strength of our core banking strategy. Our consistent asset expansion and bottom-line growth speak to the trust our customers place in us. Looking ahead, we remain committed to driving digital innovation, enhancing customer experiences, and sustaining operational excellence to unlock further value and long-term growth.”

Recording consistent growth year after year, Pan Asia Bank is strongly positioned as the ‘Truly Sri Lankan Bank’, marking an illustrious journey that has promoted financial security and fulfilled the aspirations of its customers while supporting the prosperity of the nation.