SAMPATH BANK PLC

Interim Financial Statements

for the period ended 30th June 2020

(In terms of rule 7.4 of the Colombo Stock Exchange)

Sampath Bank, backed by a One Trillion Rupee Balance Sheet, works hand in hand with all stakeholders to create a better future for the Nation.

The global economy took a steep downward trend with the outbreak of COVID - 19 pandemic epicentre shifting from China and East Asia to the United States and Europe. Most countries declared prolonged lockdowns and movement restrictions with a view to controlling the disease, which severely hampered worldwide economic activity and global trade from March 2020.

Domestically, the COVID - 19 outbreak weakened the Country outlook substantially as it brought further stress to an already challenged macroeconomic situation. Responding to these economic challenges, the Central Bank of Sri Lanka took steps to cut policy rates twice during the second quarter, resulting in the Standard Deposit Facility Rates and the Standard Lending Facility Rates dropping to 5.5% and 6.5%, respectively by 30th June 2020. At the same time, the Statutory Reserve Requirement (SRR) was reduced in two stages from 5% to 2% during the 1H 2020, in a bid to improve liquidity levels in the market.

While the economy and the banking sector as a whole continued to face unprecedented challenges due to the COVID-19 pandemic, Sampath Bank is pleased to announce that its total assets crossed the Rs One Trillion (1 Tn) mark for the first time in its history. Reaching this milestone in the span of just 33 years, probably makes Sampath Bank the youngest business organisation in Sri Lanka to achieve this significant milestone.

During this difficult period the Bank redoubled efforts to serve its valued customers, who were severely impacted by the prolonged lockdown, to overcome the challenges and hardships faced by them. By leveraging its IT supremacy and substantial investments made in technology platforms and the widespread branch network, Sampath Bank was able to operate seamlessly during this time of disruption. The Bank was quick to implement all the relief measures introduced by the government, with approximately 50% of the Bank's loan portfolio being granted relief under the government announced moratorium scheme. Further, the Bank actively engaged in providing working capital loans under "Saubhagya" scheme introduced by the government and took proactive steps to provide necessary assistance to customers across all segments who required special attention, including re-scheduling of loan repayments of those customers who were severely impacted.

Given the unprecedented challenges witnessed in the first half of 2020, it is important to note that comparing the Financial result of the first half of 2020 with 2019 may not be realistic.

Financial Result of Sampath Bank for the First Half of 2020

Sampath Bank registered a profit before tax (PBT) of Rs 5.32 Bn and a profit after tax (PAT) of Rs 3.97 Bn for the six months ended 30th June 2020. Despite the unique challenges that prevailed since mid- March 2020, the Bank was able to limit the decline in PBT and PAT to 8% and 3.2% respectively compared to the corresponding period in 2019. The Bank made solid progress towards its targets set for 2020, which together with diversified product portfolio embedded with technological advancements and strong cost control measures helped the Bank to control the impact on profits. PBT and PAT of the Group also declined by 7.7% and 4.2% respectively for the six months ended 30th June 2020 and stood at Rs 5.48 Bn and Rs 3.99 Bn respectively.

Meanwhile, the Bank remained well-capitalized with a Tier 1 capital ratio of 13.30% and a Total capital ratio of 16.77%.

Fund Based Income (FBI)

The Bank's Net Interest Income (NII) for the quarter ended 30th June 2020 was significantly affected by two factors - reduction in policy rates in order to provide relief to the economy and the moratorium granted to customers. Consequently, the day one loss on account of COVID - 19 moratorium was recorded against the interest income as per the modification method given in the Sri Lanka Accounting Standard - 9 (SLFRS - 9). As the entire day one loss that arose due to COVID - 19 moratorium has been recorded during the period under review, Sampath Bank does not have to incur any additional impact on interest income during the 2H of 2020.

Due to the reasons mentioned above, the Bank's Net Interest Income declined by 11.9% and stood at Rs

17.4 Bn for the 1st half of 2020 compared to the same period in 2019. While closely monitoring the factors affecting this reporting line, the Bank's ALCO continued to take necessary action to manage the net interest income to the best possible level. Overall, interest income for the period decreased by Rs 5.0 Bn to Rs 46.2 Bn compared to Rs 51.2 Bn recorded in the corresponding period in 2019, denoting a decline of 9.8%. The total interest expenses stood at Rs 28.8 Bn in 1H 2020 compared to Rs 31.4 Bn recorded in the corresponding period of 2019, a reduction of 8.5%.

Consequently, the Net Interest Margin for the 1H 2020 decreased to 3.57% compared to 4.46% reported in 2019.

Non-Fund Based Income (NFBI)

Net fee and commission income, which comprise of credit, trade, card, and electronic channel related fees, was limited to Rs 3.8 Bn during the period under review, a decline of 18.9% over the figure reported in 1H 2019. The decline was mainly due to the decrease in credit-related fee and commission income consequent to the restrictions imposed to assist customers during this difficult period. Meanwhile, the fee and commission income from electronic channels showed strong growth owing to the high usage of Sampath Vishwa and other popular electronic products.

Other operating income (net) recorded a significant YoY increase of 509% in the 1st half of 2020, led mainly by an increase in realized exchange income due to the 2.7% depreciation of the Sri Lankan Rupee against the US Dollar. Consequently, other operating income (net) for the first six months of 2020 increased to Rs 2.6 Bn, from the loss of Rs 642 Mn reported for the corresponding period in 2019. On the other hand, the Bank incurred a net trading loss of Rs 107 Mn as a result of mark to the market losses on forward exchange contracts owing to the aforementioned currency depreciation. Therefore, the Bank's net exchange income from foreign exchange transactions amounted to Rs 1.8 Bn for the period under review.

Operating Expenses

Operating expenses, which stood at Rs 10.1 Bn during 1H 2019, decreased to Rs 9.6 Bn during the period under review, reflecting a YoY decline of 5.2%. The cost optimization strategies implemented by the Bank to face the situation was instrumental for this achievement. Meanwhile, the Bank's Cost-to-Income ratio (excluding taxes on financial services) increased marginally to 40.2% in the first six months of

2020, from 38.8% reported for the corresponding period in 2019. The main reason for this marginal increase was the drop in the key income sources during the first half of 2020.

Impairment Charges on Loans and Receivables

The Bank has provided a substantial credit loss provision for customers whose credit risk has significantly increased due to the prevailing economic recession. As a result, the impairment charge against individually significant customers increased to Rs 4.3 Bn in 1H 2020 from Rs 2.5 Bn in the corresponding period in 2019.

After analyzing the economic downturn, Sampath Bank management decided to increase the credit loss provision at the portfolio level as well. However, the collective impairment charge for the first six months of 2020 is lower compared to the first half of the last year due to the explanation given below. The credit quality of the loan portfolio was severely affected in April 2019 due to the terrorist attack that took place in April 2019 which prompted the Bank to increase its collective impairment provision in Q2 2019.

Business Growth

Sampath Bank's total asset base grew by 4.5% (annualized 9.0%) during the period under review to reach Rs 1 Tn as at 30th June 2020. It stood at Rs 962 Bn as at 31st December 2019. Gross loans & advances grew by 3.9% (annualized 7.8%) to reach Rs 748 Bn as at 30th June 2020, recording a growth of Rs 28 Bn for the period under review. The total deposit base increased by Rs 72 Bn for the same period, to reach Rs 790 Bn as at the reporting date, a growth of 10% (annualized 20%). Meanwhile, the CASA ratio, which stood at 36.6% as at 30th June 2020 improved marginally from the 31st December 2019 position of 35.2%.

Performance Ratios

Return on Average Equity (ROE) (after tax) declined from 11.78% as at 31st December 2019 to 7.56% as at 30th June 2020, in direct correlation to the lower PAT. Return on Average Assets (ROA) (before tax) also declined to 1.09% from 1.66% as at 31st December 2019.

The Statutory Liquid Asset Ratio (SLAR) for the Domestic Banking Unit and the Off-Shore Banking Unit stood well above the mandatory requirement of 20% throughout the period and ended up at 28.12% and 33.88% respectively as at 30th June 2020.

Capital Adequacy

The Bank's Common Equity Tier I Capital, Tier I Capital and Total Capital Adequacy ratios as at 30th June 2020 stood at 13.30%, 13.30% and 16.77% respectively, all well above the minimum regulatory requirement of 6.5%, 8% and 12.0%, applicable as at the reporting date.

STATEMENT OF PROFIT OR LOSS

Bank

Group

For the six months ended 30th June

For the quarter ended 30th June

For the six months ended 30th June

For the quarter ended 30th June

2020

2019

Change

2020

2019

Change

2020

2019

Change

2020

2019

Change

(Audited)

Rs 000

Rs 000

%

Rs 000

Rs 000

%

Rs 000

Rs 000

%

Rs 000

Rs 000

%

Gross income

53,227,270

58,327,739

(8.7)

24,361,507

29,462,434

(17.3)

56,505,300

61,661,396

(8.4)

25,599,961

31,142,759

(17.8)

Interest income

46,200,358

51,216,303

(9.8)

21,674,493

25,590,862

(15.3)

49,243,043

54,269,401

(9.3)

22,885,240

27,129,239

(15.6)

Less : Interest expense

28,751,908

31,413,847

(8.5)

14,203,959

16,012,936

(11.3)

30,308,131

33,080,366

(8.4)

14,781,649

16,835,053

(12.2)

Net interest income

17,448,450

19,802,456

(11.9)

7,470,534

9,577,926

(22.0)

18,934,912

21,189,035

(10.6)

8,103,591

10,294,186

(21.3)

Fee & commission income

4,418,159

5,550,856

(20.4)

1,750,417

2,782,743

(37.1)

4,594,447

5,705,736

(19.5)

1,835,332

2,858,904

(35.8)

Less : Fee & commission expense

630,612

881,898

(28.5)

206,820

389,916

(47.0)

630,912

882,527

(28.5)

206,940

390,050

(46.9)

Net fee & commission income

3,787,547

4,668,958

(18.9)

1,543,597

2,392,827

(35.5)

3,963,535

4,823,209

(17.8)

1,628,392

2,468,854

(34.0)

Net (loss)/gain from trading

(106,541)

2,168,215

(104.9)

557,580

671,896

(17.0)

(106,541)

2,168,215

(104.9)

557,580

671,896

(17.0)

Net gain on derecognition of financial assets

- at fair value through profit or loss

66,030

31,765

107.9

32,266

22,533

43.2

66,030

31,765

107.9

32,266

22,533

43.2

- at fair value through other comprehensive income

21,790

-

100.0

15,958

-

100.0

21,790

-

100.0

15,958

-

100.0

- at amortised cost

-

2,698

(100.0)

-

-

-

-

2,698

(100.0)

-

-

-

Net other operating income

2,627,474

(642,098)

509.2

330,793

394,400

(16.1)

2,686,531

(516,419)

620.2

273,585

460,187

(40.5)

Total operating income

23,844,750

26,031,994

(8.4)

9,950,728

13,059,582

(23.8)

25,566,257

27,698,503

(7.7)

10,611,372

13,917,656

(23.8)

Less: Impairment charge

7,436,124

7,241,824

2.7

2,581,851

3,766,957

(31.5)

8,057,215

7,899,778

2.0

2,853,697

4,095,084

(30.3)

Net operating income

16,408,626

18,790,170

(12.7)

7,368,877

9,292,625

(20.7)

17,509,042

19,798,725

(11.6)

7,757,675

9,822,572

(21.0)

Less: Operating expenses

Personnel expenses

4,806,267

4,921,547

(2.3)

2,201,577

2,316,636

(5.0)

5,284,371

5,332,885

(0.9)

2,442,288

2,510,536

(2.7)

Depreciation and amortisation expenses

1,166,024

1,212,111

(3.8)

599,486

631,152

(5.0)

1,223,844

1,186,574

3.1

640,713

607,674

5.4

Other expenses

3,608,999

3,975,432

(9.2)

1,630,966

2,023,861

(19.4)

3,908,015

4,292,746

(9.0)

1,785,776

2,137,583

(16.5)

Total operating expenses

9,581,290

10,109,090

(5.2)

4,432,029

4,971,649

(10.9)

10,416,230

10,812,205

(3.7)

4,868,777

5,255,793

(7.4)

Operating profit before taxes on financial services

6,827,336

8,681,080

(21.4)

2,936,848

4,320,976

(32.0)

7,092,812

8,986,520

(21.1)

2,888,898

4,566,779

(36.7)

Less: Taxes on financial services

Value added tax

1,503,655

1,723,590

(12.8)

664,399

834,748

(20.4)

1,612,376

1,811,083

(11.0)

709,871

875,897

(19.0)

Nation building tax

-

229,812

(100.0)

-

111,300

(100.0)

-

242,804

(100.0)

-

117,479

(100.0)

Debt repayment levy

-

941,079

(100.0)

-

455,772

(100.0)

-

992,617

(100.0)

-

480,244

(100.0)

Profit before income tax

5,323,681

5,786,599

(8.0)

2,272,449

2,919,156

(22.2)

5,480,436

5,940,016

(7.7)

2,179,027

3,093,159

(29.6)

Less : Income tax expense

1,356,719

1,689,818

(19.7)

806,973

985,012

(18.1)

1,484,068

1,767,015

(16.0)

858,905

1,031,252

(16.7)

Profit for the period

3,966,962

4,096,781

(3.2)

1,465,476

1,934,144

(24.2)

3,996,368

4,173,001

(4.2)

1,320,122

2,061,907

(36.0)

Attributable to:

Equity holders of the Bank

3,966,962

4,096,781

(3.2)

1,465,476

1,934,144

(24.2)

3,996,368

4,173,001

(4.2)

1,320,122

2,061,907

(36.0)

Non controlling interest

-

-

-

-

-

-

3,966,962

4,096,781

(3.2)

1,465,476

1,934,144

(24.2)

3,996,368

4,173,001

(4.2)

1,320,122

2,061,907

(36.0)

Earnings per share - Basic/Diluted (Rs)

10.40

13.80

(24.6)

3.84

6.52

(41.0)

10.48

14.06

(25.5)

3.46

6.95

(50.2)

1

STATEMENT OF COMPREHENSIVE INCOME

Bank

Group

For the six months ended 30th June

For the quarter ended 30th June

For the six months ended 30th June

For the quarter ended 30th June

2020

2019

Change

2020

2019

Change

2020

2019

Change

2020

2019

Change

(Audited)

Rs 000

Rs 000

%

Rs 000

Rs 000

%

Rs 000

Rs 000

%

Rs 000

Rs 000

%

Profit for the period

3,966,962

4,096,781

(3.2)

1,465,476

1,934,144

(24.2)

3,996,368

4,173,001

(4.2)

1,320,122

2,061,907

(36.0)

Other comprehensive income

Items that will be reclassified to profit or loss:

Debt instruments at fair value through other comprehensive income:

Gain arising on re-measurement

228,308

78,796

189.7

233,652

38,825

501.8

228,308

78,796

189.7

233,652

38,825

501.8

Reclassification to profit or loss

(21,790)

-

(100.0)

(15,958)

-

(100.0)

(21,790)

-

(100.0)

(15,958)

-

(100.0)

Changes in allowance for expected credit losses

5,189

-

100.0

1,798

-

100.0

5,189

-

100.0

1,798

-

100.0

Deferred tax effect on the above

(59,278)

(22,063)

(168.7)

(61,458)

(10,871)

(465.3)

(59,278)

(22,063)

(168.7)

(61,458)

(10,871)

(465.3)

152,429

56,733

168.7

158,034

27,954

465.3

152,429

56,733

168.7

158,034

27,954

465.3

Net other comprehensive income to be reclassified to profit or loss

152,429

56,733

168.7

158,034

27,954

465.3

152,429

56,733

168.7

158,034

27,954

465.3

Items that will not to be reclassified to profit or loss:

Equity instruments at fair value through other comprehensive income:

Loss arising on re-measurement

(547,084)

(253,854)

(115.5)

(316,399)

(133,867)

(136.4)

(547,084)

(253,854)

(115.5)

(316,399)

(133,867)

(136.4)

Exchange difference in translation

50,577

(36,140)

239.9

6,313

5,603

12.7

50,577

(36,140)

239.9

6,313

5,603

12.7

Deferred tax effect on the above

139,022

81,198

71.2

86,824

35,914

141.8

139,022

81,198

71.2

86,824

35,914

141.8

(357,485)

(208,796)

(71.2)

(223,262)

(92,350)

(141.8)

(357,485)

(208,796)

(71.2)

(223,262)

(92,350)

(141.8)

Net other comprehensive income not to be reclassified to profit or loss

(357,485)

(208,796)

(71.2)

(223,262)

(92,350)

(141.8)

(357,485)

(208,796)

(71.2)

(223,262)

(92,350)

(141.8)

Other comprehensive income net of tax

(205,056)

(152,063)

(34.8)

(65,228)

(64,396)

(1.3)

(205,056)

(152,063)

(34.8)

(65,228)

(64,396)

(1.3)

Total comprehensive income for the period net of tax

3,761,906

3,944,718

(4.6)

1,400,248

1,869,748

(25.1)

3,791,312

4,020,938

(5.7)

1,254,894

1,997,511

(37.2)

Attributable to:

Equity holders of the Bank

3,761,906

3,944,718

(4.6)

1,400,248

1,869,748

(25.1)

3,791,312

4,020,938

(5.7)

1,254,894

1,997,511

(37.2)

Non controlling interest

-

-

-

-

-

-

3,761,906

3,944,718

(4.6)

1,400,248

1,869,748

(25.1)

3,791,312

4,020,938

(5.7)

1,254,894

1,997,511

(37.2)

2

STATEMENT OF FINANCIAL POSITION

Bank

Group

As at

30th June

31st December

Change

30th June

31st December

Change

2020

2019

2020

2019

(Audited)

(Audited)

Rs 000

Rs 000

%

Rs 000

Rs 000

%

ASSETS

Cash & cash equivalents

29,186,055

17,789,176

64.1

29,403,142

17,977,598

63.6

Balances with Central Bank of Sri Lanka

12,482,619

31,028,270

(59.8)

12,482,619

31,028,270

(59.8)

Placements with banks

1,064,050

7,251,305

(85.3)

1,064,050

7,251,305

(85.3)

Reverse repurchase agreements

17,512,806

-

100.0

19,212,555

2,304,392

733.7

Derivative financial instruments

1,310,794

862,754

51.9

1,310,794

862,754

51.9

Financial assets recognised through profit or loss - measured at fair value

14,550,670

11,130,230

30.7

14,550,670

11,130,230

30.7

Financial assets at amortised cost

- loans & advances

711,267,503

689,377,504

3.2

744,153,936

719,046,634

3.5

- debt & other instruments

166,807,633

156,293,495

6.7

166,853,252

156,308,796

6.7

Financial assets - fair value through other comprehensive income

19,950,699

17,331,724

15.1

19,950,755

17,331,780

15.1

Investment in subsidiaries

2,597,294

2,394,701

8.5

-

-

-

Property, plant & equipment

8,304,145

8,466,366

(1.9)

15,773,808

15,702,051

0.5

Intangible assets

881,069

995,137

(11.5)

931,267

1,055,341

(11.8)

Right-of-use assets

3,563,530

4,059,219

(12.2)

2,969,150

3,208,266

(7.5)

Current tax receivables

-

-

-

87,700

46,246

89.6

Deferred tax assets

3,499,655

3,737,512

(6.4)

3,500,370

3,738,064

(6.4)

Other assets

12,343,732

11,633,105

6.1

13,104,467

12,331,379

6.3

Total Assets

1,005,322,254

962,350,498

4.5

1,045,348,535

999,323,106

4.6

LIABILITIES

Due to banks

2,678,398

1,511,665

77.2

2,678,398

1,567,974

70.8

Derivative financial instruments

1,524,398

604,069

152.4

1,524,398

604,069

152.4

Securities sold under repurchase agreements

1,405,852

16,398,511

(91.4)

1,344,656

16,384,511

(91.8)

Financial liabilities at amortised cost

- due to depositors

787,860,659

717,250,492

9.8

800,740,281

730,189,642

9.7

- due to other borrowers

49,787,091

55,661,729

(10.6)

61,246,363

67,311,166

(9.0)

- due to debt securities holders

36,882,097

37,642,049

(2.0)

40,845,589

41,371,586

(1.3)

Retirement benefit obligation

3,622,625

3,651,642

(0.8)

3,727,688

3,741,781

(0.4)

Dividend payable

247,518

88,898

178.4

247,518

88,898

178.4

Current tax liabilities

3,499,333

7,427,315

(52.9)

3,928,087

7,835,445

(49.9)

Deferred tax liabilities

-

-

-

1,322,549

1,405,568

(5.9)

Other liabilities

13,528,899

17,108,344

(20.9)

16,977,375

17,365,839

(2.2)

Total Liabilities

901,036,870

857,344,714

5.1

934,582,902

887,866,479

5.3

3

STATEMENT OF FINANCIAL POSITION

Bank

Group

As at

30th June

31st December

Change

30th June

31st December

Change

2020

2019

2020

2019

(Audited)

(Audited)

Rs 000

Rs 000

%

Rs 000

Rs 000

%

EQUITY

Stated capital

47,622,493

47,622,493

-

47,622,493

47,622,493

-

Reserves

Statutory reserves

4,040,000

4,040,000

-

4,204,000

4,204,000

-

Other reserves

47,031,418

47,236,649

(0.4)

50,000,211

50,205,442

(0.4)

Retained earnings

5,591,473

6,106,642

(8.4)

8,938,929

9,424,692

(5.2)

Total equity attributable to equity holders of the Bank

104,285,384

105,005,784

(0.7)

110,765,633

111,456,627

(0.6)

Non controlling interest

-

-

-

Total Equity

104,285,384

105,005,784

(0.7)

110,765,633

111,456,627

(0.6)

Total Liabilities & Equity

1,005,322,254

962,350,498

4.5

1,045,348,535

999,323,106

4.6

Commitments & contingencies

407,254,013

391,416,500

4.0

402,670,416

388,639,429

3.6

Net asset value per share (Rs)

273.39

275.27

(0.7)

290.37

292.19

(0.6)

Memorandum information

Number of employees

4,095

4,134

Number of branches

229

229

CERTIFICATION:

I certify that the above Financial Statements are in compliance with the requirements of the Companies Act No. 7 of 2007 and give a true and fair view of the state of affairs of Sampath Bank PLC and the Group as at 30th June 2020 and the profits for the period then ended.

(Sgd)

Ajantha de Vas Gunasekara

Group Chief Financial Officer

We, the undersigned, being the Chairman and the Managing Director of Sampath Bank PLC, certify jointly that:

  1. the above statements have been prepared in compliance with the format and definitions prescribed by the Central Bank of Sri Lanka; and
  2. the information contained in these statements have been extracted from the unaudited Financial Statements of the Bank and its Subsidiary companies unless indicated as audited.

(Sgd)

(Sgd)

Prof Malik Ranasinghe

Nanda Fernando

Chairman

Managing Director

12th August 2020

4

STATEMENT OF CHANGES IN EQUITY

Bank

For the six months ended 30th June 2019 (Audited)

Stated

Statutory

Other Reserves

Retained

Total

Capital

Reserve Fund

Revaluation

FVOCI Reserve

General

Earnings

Equity

Reserve

Reserve

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Balance as at 1st January 2019

32,795,952

3,470,000

2,409,050

1,160,765

38,909,901

5,643,642

84,389,310

Total comprehensive income for the period

Profit for the period

-

-

-

-

-

4,096,781

4,096,781

Other comprehensive income

-

-

-

(152,063)

-

-

(152,063)

Total comprehensive income for the period

-

-

-

(152,063)

-

4,096,781

3,944,718

Transactions with equity holders, recognised directly in equity,

contributions by and distributions to equity holders

Right issue

12,104,933

-

-

-

-

-

12,104,933

Final dividend for 2018: scrip

2,721,608

-

-

-

-

(3,160,150)

(438,542)

Final dividend for 2018: cash

-

-

-

-

-

(1,404,511)

(1,404,511)

Unclaimed dividend adjustment

-

-

-

-

12,595

-

12,595

Total contributions by and distributions to equity holders

14,826,541

-

-

-

12,595

(4,564,661)

10,274,475

Balance as at 30th June 2019

47,622,493

3,470,000

2,409,050

1,008,702

38,922,496

5,175,762

98,608,503

For the six months ended 30th June 2020

Stated

Statutory

Other Reserves

Retained

Total

Capital

Reserve Fund

Revaluation

FVOCI Reserve

General

Earnings

Equity

Reserve

Reserve

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Balance as at 1st January 2020

47,622,493

4,040,000

2,993,599

807,879

43,435,171

6,106,642

105,005,784

Total comprehensive income for the period

Profit for the period

-

-

-

-

-

3,966,962

3,966,962

Other comprehensive income

-

-

-

(205,056)

-

-

(205,056)

Total comprehensive income for the period

-

-

-

(205,056)

-

3,966,962

3,761,906

Transactions with equity holders, recognised directly in equity,

contributions by and distributions to equity holders

Final dividend for 2019: cash

-

-

-

-

-

(4,482,131)

(4,482,131)

Unclaimed dividend adjustment

-

-

-

-

(175)

-

(175)

Total contributions by and distributions to equity holders

-

-

-

-

(175)

(4,482,131)

(4,482,306)

Balance as at 30th June 2020

47,622,493

4,040,000

2,993,599

602,823

43,434,996

5,591,473

104,285,384

5

STATEMENT OF CHANGES IN EQUITY

Group

For the six months ended 30th June 2019 (Audited)

Stated

Statutory

Other Reserves

Retained

Total Equity

Non Controlling

Total

Capital

Reserve Fund

Revaluation

FVOCI

General

Earnings

Attributable to

Interest

Equity

Reserve

Reserve

Reserve

Equity Holders

of the Bank

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Balance as at 1st January 2019

32,795,952

3,609,000

5,093,155

1,160,765

38,909,901

8,481,881

90,050,654

-

90,050,654

Total comprehensive income for the period

Profit for the period

-

-

-

-

-

4,173,001

4,173,001

-

4,173,001

Other comprehensive income

-

-

-

(152,063)

-

-

(152,063)

-

(152,063)

Total comprehensive income for the period

-

-

-

(152,063)

-

4,173,001

4,020,938

-

4,020,938

Transactions with equity holders, recognised directly in equity,

contributions by and distributions to equity holders

Rights issue

12,104,933

-

-

-

-

-

12,104,933

-

12,104,933

Final dividend for 2018: scrip

2,721,608

-

-

-

-

(3,160,150)

(438,542)

-

(438,542)

Final dividend for 2018: cash

-

-

-

-

-

(1,404,511)

(1,404,511)

-

(1,404,511)

Unclaimed dividend adjustment

-

-

-

-

12,595

-

12,595

-

12,595

Total contributions by and distributions to equity holders

14,826,541

-

-

-

12,595

(4,564,661)

10,274,475

-

10,274,475

Balance as at 30th June 2019

47,622,493

3,609,000

5,093,155

1,008,702

38,922,496

8,090,221

104,346,067

-

104,346,067

For the six months ended 30th June 2020

Stated

Statutory

Other Reserves

Retained

Total Equity

Non Controlling

Total

Capital

Reserve Fund

Revaluation

FVOCI

General

Earnings

Attributable to

Interest

Equity

Reserve

Reserve

Reserve

Equity Holders

of the Bank

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Balance as at 1st January 2020

47,622,493

4,204,000

5,962,392

807,879

43,435,171

9,424,692

111,456,627

-

111,456,627

Total comprehensive income for the period

Profit for the period

-

-

-

-

-

3,996,368

3,996,368

-

3,996,368

Other comprehensive income

-

-

-

(205,056)

-

-

(205,056)

-

(205,056)

Total comprehensive income for the period

-

-

-

(205,056)

-

3,996,368

3,791,312

-

3,791,312

Transactions with equity holders, recognised directly in equity,

contributions by and distributions to equity holders

Final dividend for 2019: cash

-

-

-

-

-

(4,482,131)

(4,482,131)

-

(4,482,131)

Unclaimed dividend adjustment

-

-

-

-

(175)

-

(175)

-

(175)

Total contributions by and distributions to equity holders

-

-

-

-

(175)

(4,482,131)

(4,482,306)

-

(4,482,306)

Balance as at 30th June 2020

47,622,493

4,204,000

5,962,392

602,823

43,434,996

8,938,929

110,765,633

-

110,765,633

6

STATEMENT OF CASH FLOWS

Bank

Group

For the six months ended 30th June

2020

2019

2020

2019

(Audited)

Rs 000

Rs 000

Rs 000

Rs 000

Cash flows from operating activities

Interest receipts

36,996,494

49,733,610

39,975,098

52,708,579

Interest payments

(30,570,097)

(31,010,110)

(31,897,498)

(32,285,203)

Net commission receipts

3,695,687

4,652,093

3,871,675

4,806,344

Cash payments to employees

(4,815,832)

(5,231,808)

(5,276,788)

(5,628,145)

Taxes on financial services

(2,451,071)

(3,161,832)

(2,559,792)

(3,313,855)

Receipts from other operating activities

2,425,606

(227,103)

2,686,259

(30,336)

Cash payments to other operating activities

(3,863,634)

(4,156,978)

(3,932,965)

(3,961,158)

Operating profit before changes in operating assets & liabilities

1,417,153

10,597,872

2,865,989

12,296,226

(Increase)/decrease in operating assets

Balances with Central Bank of Sri Lanka

18,545,651

5,240,578

18,545,651

5,240,578

Financial assets at amortised cost - loans & advances

(20,544,772)

(18,779,124)

(24,303,896)

(21,097,414)

Other assets

(549,564)

(830,567)

(628,844)

(865,568)

(2,548,685)

(14,369,113)

(6,387,089)

(16,722,404)

Increase/(decrease) in operating liabilities

Due to banks

1,562,157

(5,480,500)

1,562,157

(5,480,500)

Re-purchase agreements

(14,959,566)

(11,809,405)

(15,006,762)

(11,804,624)

Financial liabilities at amortised cost - due to depositors

71,488,769

7,971,077

71,415,747

11,071,061

Financial liabilities at amortised cost - due to other borrowers

(5,725,034)

619,203

(5,896,572)

(509,402)

Other liabilities

(1,591,814)

971,804

1,107,666

794,609

50,774,512

(7,727,821)

53,182,236

(5,928,856)

Net cash generated from/(used in) operating activities before income tax

49,642,980

(11,499,062)

49,661,136

(10,355,034)

Income tax paid

(4,967,100)

(2,585,676)

(5,171,390)

(2,626,780)

Net cash generated from/(used in) operating activities

44,675,880

(14,084,738)

44,489,746

(12,981,814)

Cash flows from investing activities

Purchase of property, plant & equipment

(233,347)

(333,447)

(692,148)

(902,760)

Proceeds from disposal of property plant & equipment

2,098

3,449

2,731

8,272

Net cash flow from reverse repurchase agreements

(17,506,692)

(2,499,999)

(16,902,049)

(3,102,790)

Net cash flow from financial assets - FVPL

(2,990,023)

14,977,970

(2,990,023)

14,977,970

Net cash flow from debt instruments at amortised cost.

(10,444,301)

(39,163,725)

(10,474,619)

(39,163,733)

Net cash flow from financial assets - FVOCI

(2,833,997)

15,323,951

(2,833,997)

15,323,951

Purchase of intangible assets

(100,828)

(89,830)

(103,519)

(90,530)

Dividend received from financial assets

1,360

124,123

1,360

124,123

Dividend received from subsidiaries

4,828

-

-

-

Net cash used in investing activities

(34,100,902)

(11,657,508)

(33,992,264)

(12,825,497)

Cash flows from financing activities

Proceeds from the issue of debentures

-

7,000,000

-

7,000,000

Rights issue

-

12,104,933

-

12,104,933

Dividend paid

(4,482,131)

(1,843,053)

(4,482,131)

(1,843,053)

Repayment of principal portion of lease liabilities

(472,480)

(488,003)

(310,010)

(262,986)

Net cash (used in)/generated from financing activities

(4,954,611)

16,773,877

(4,792,141)

16,998,894

Net cash generated during the period

5,620,367

(8,968,369)

5,705,341

(8,808,417)

Cash & cash equivalents at the beginning of the year

24,593,341

26,624,318

24,725,465

26,727,226

Cash & cash equivalents at the end of the period

30,213,708

17,655,949

30,430,806

17,918,809

7

NOTES TO THE FINANCIAL STATEMENTS

1. Analysis of Loans and Advances and Impairment

Bank

Group

As at

30.06.2020

31.12.2019

30.06.2020

31.12.2019

(Audited)

(Audited)

Rs 000

Rs 000

Rs 000

Rs 000

1.1 Gross loans & advances

747,728,503

719,623,694

782,993,951

751,077,905

Less: Accumulated impairment under stage 1

3,980,979

3,838,089

4,083,643

3,930,386

Accumulated impairment under stage 2

7,051,958

5,516,738

7,166,025

5,642,568

Accumulated impairment under stage 3

25,428,063

20,891,363

27,590,347

22,458,317

Net loans & advances

711,267,503

689,377,504

744,153,936

719,046,634

1.2 Product-wise loans and advances

Local currency

Bills of exchange

396,281

463,168

396,281

463,168

Leasing

32,057,330

31,898,575

63,888,039

61,738,905

Housing loans

45,172,131

43,280,931

45,172,131

43,280,931

Export loans

2,561,700

1,738,969

2,561,700

1,738,969

Import loans

66,251,700

65,293,369

66,251,700

64,090,962

Refinance loans

14,388,492

12,100,433

14,388,492

12,100,433

Term loans

322,851,789

311,781,833

324,898,420

313,252,282

Hire purchase

7,752

13,217

20,924

24,328

Loans against investment fund account (IFA)

103,382

109,523

103,382

109,523

Overdraft

86,653,528

90,231,915

86,551,720

90,088,904

Staff loans

8,393,347

8,301,356

8,559,306

8,486,523

Pawning

31,639,264

33,170,643

31,639,264

33,170,643

Credit cards

14,859,228

16,390,482

14,859,228

16,390,482

Money market loans

22,432,603

8,987,078

22,432,603

8,987,078

Factoring

2,954,480

3,856,292

3,800,188

4,857,674

Others

13,845

58,126

478,922

349,316

Sub total

650,736,852

627,675,910

686,002,300

659,130,121

Foreign currency

Bills of exchange

2,170,358

2,124,676

2,170,358

2,124,676

Housing loans

1,039,169

1,075,431

1,039,169

1,075,431

Export loans

26,829,380

25,674,968

26,829,380

25,674,968

Import loans

7,350,254

4,243,612

7,350,254

4,243,612

Term loans

54,088,847

54,236,868

54,088,847

54,236,868

Overdraft

5,434,243

4,556,316

5,434,243

4,556,316

Others

79,400

35,913

79,400

35,913

Sub total

96,991,651

91,947,784

96,991,651

91,947,784

Total gross loans and advances

747,728,503

719,623,694

782,993,951

751,077,905

1.3 Movement of Impairment During the period

Bank

Stage 1

Stage 2

Stage 3

Total

Rs 000

Rs 000

Rs 000

Rs 000

Balance as at 1st January 2020

3,838,089

5,516,738

20,891,363

30,246,190

Net charge to profit or loss

142,890

1,535,220

5,554,599

7,232,709

Write-off during the period

-

-

(19,440)

(19,440)

Interest income accrued on impaired loans & advances

-

-

(1,824,803)

(1,824,803)

Other movements

-

-

826,344

826,344

Balance as at 30th June 2020

3,980,979

7,051,958

25,428,063

36,461,000

Group

Stage 1

Stage 2

Stage 3

Total

Rs 000

Rs 000

Rs 000

Rs 000

Balance as at 1st January 2020

3,930,386

5,642,568

22,458,317

32,031,271

Net charge to profit or loss

153,257

1,523,457

6,165,863

7,842,577

Write-off during the period

-

-

(19,440)

(19,440)

Interest income accrued on impaired loans & advances

-

-

(1,840,737)

(1,840,737)

Other movements

-

-

826,344

826,344

Balance as at 30th June 2020

4,083,643

7,166,025

27,590,347

38,840,015

8

NOTES TO THE FINANCIAL STATEMENTS

2. Analysis of Commitments and Contingencies and Impairment

Bank

Group

As at

30.06.2020

31.12.2019

30.06.2020

31.12.2019

(Audited)

(Audited)

Rs 000

Rs 000

Rs 000

Rs 000

2.1 Gross commitments and contingencies

408,510,013

392,833,728

403,926,964

390,056,933

Less: Accumulated impairment under stage 1

848,543

775,864

849,091

775,981

Accumulated impairment under stage 2

285,341

297,123

285,341

297,282

Accumulated impairment under stage 3

122,116

344,241

122,116

344,241

Net commitments and contingencies

407,254,013

391,416,500

402,670,416

388,639,429

2.2 Product-wise commitments and contingencies

Local currency

Credit related commitments & contingencies

Undrawn - direct credit facilities

127,510,552

119,899,774

121,804,607

115,833,027

Undrawn - indirect credit facilities

43,517,591

43,755,348

43,517,591

43,755,348

Acceptances

85,518

35,202

85,518

35,202

Documentary credit

287,516

1,253,178

287,516

1,253,178

Guarantees

45,350,761

47,040,632

45,354,461

47,045,832

216,751,938

211,984,134

211,049,693

207,922,587

Other commitments & contingencies

Capital commitments

1,181,582

952,390

2,300,778

2,237,142

Operating lease commitments

52,122

46,287

52,122

46,287

1,233,704

998,677

2,352,900

2,283,429

Sub total

217,985,642

212,982,811

213,402,593

210,206,016

Foreign currency

Credit related commitments & contingencies

Undrawn - direct credit facilities

23,922,297

29,735,694

23,922,297

29,735,694

Undrawn - indirect credit facilities

1,132,128

1,709,364

1,132,128

1,709,364

Acceptances

11,170,636

14,134,602

11,170,636

14,134,602

Documentary credit

17,124,188

16,082,147

17,124,188

16,082,147

Guarantees

1,750,969

2,094,327

1,750,969

2,094,327

55,100,218

63,756,134

55,100,218

63,756,134

Other commitments & contingencies

Capital commitments

3,449

45,958

3,449

45,958

Forward exchange contracts

33,760,588

13,218,467

33,760,588

13,218,467

Currency SWAPs

101,660,116

102,830,358

101,660,116

102,830,358

135,424,153

116,094,783

135,424,153

116,094,783

Sub total

190,524,371

179,850,917

190,524,371

179,850,917

Total gross commitments and contingencies

408,510,013

392,833,728

403,926,964

390,056,933

2.3 Movement of Impairment During the period

Bank

Stage 1

Stage 2

Stage 3

Total

Rs 000

Rs 000

Rs 000

Rs 000

Balance as at 1st January 2020

775,864

297,123

344,241

1,417,228

Net charge to profit or loss

72,679

(11,782)

(222,125)

(161,228)

Write-off during the period

-

-

-

-

Other movements

-

-

-

-

Balance as at 30th June 2020

848,543

285,341

122,116

1,256,000

Group

Stage 1

Stage 2

Stage 3

Total

Rs 000

Rs 000

Rs 000

Rs 000

Balance as at 1st January 2020

775,981

297,282

344,241

1,417,504

Net charge to profit or loss

73,110

(11,941)

(222,125)

(160,956)

Write-off during the period

-

-

-

-

Other movements

-

-

-

-

Balance as at 30th June 2020

849,091

285,341

122,116

1,256,548

9

NOTES TO THE FINANCIAL STATEMENTS

3. Analysis of Deposits

Bank

Group

As at

30.06.2020

31.12.2019

30.06.2020

31.12.2019

(Audited)

(Audited)

Rs 000

Rs 000

Rs 000

Rs 000

Local Currency Deposits

Demand deposits

36,099,007

31,425,842

36,086,975

31,415,117

Saving deposits

221,257,236

193,430,471

218,344,448

193,430,628

Call deposits

34,157

65,370

34,157

65,370

Fixed deposits

433,686,075

404,651,874

449,490,517

417,601,592

Certificates of deposits

13,603,284

13,039,590

13,603,284

13,039,590

Margin deposits

1,083,889

1,037,075

1,083,889

1,037,075

Total local currency deposits

705,763,648

643,650,222

718,643,270

656,589,372

Foreign Currency Deposits

Demand deposits

5,129,442

3,611,703

5,129,442

3,611,703

Saving deposits

24,935,345

23,671,412

24,935,345

23,671,412

Fixed deposits

51,790,310

46,020,700

51,790,310

46,020,700

Margin deposits

241,914

296,455

241,914

296,455

Total foreign currency deposits

82,097,011

73,600,270

82,097,011

73,600,270

Total deposits

787,860,659

717,250,492

800,740,281

730,189,642

EXPLANATORY NOTES

  1. There are no changes to the accounting policies and methods of computation since the publication of the annual accounts for the year 2019.
  2. The Group Financial Statements comprise a consolidation of the Bank and its fully owned subsidiaries, Siyapatha Finance PLC, Sampath Centre Ltd, SC Securities (Pvt) Ltd and Sampath Information Technology Solutions Ltd.
  3. There are no material changes during the period in the composition of assets, liabilities and contingent liabilities. All known expenditure items have been provided for.
  4. These interim Financial Statements are presented in accordance with Sri Lanka Accounting Standard - LKAS 34 (Interim Financial Reporting) and provide the information as required in terms of Rule 7.4 of the Colombo Stock Exchange.

5. Market Price of a Share

2020 (Rs)

2019 (Rs)

Market Price as at 30th June

126.40

139.20

Highest Market Price during the quarter ended 30th June

130.00

174.90

Lowest Market Price during the quarter ended 30th June

96.00

136.00

Weighted Average Market price during the quarter ended 30th June

114.85

148.82

10

EXPLANATORY NOTES (Contd…)

  1. There are no material events that took place after the reporting date which require adjustment to or disclosure in the Financial Statements other than the item disclosed in Note 11 below .
  2. Comparative Information
    The Bank re-classified comparative information wherever necessary to conform to the current period's presentation.

7.1 Statement of Profit or Loss

The following line items in the Statement of Profit or Loss for the period ended 30th June 2019 were reclassified to conform to the current period's presentation.

For the period ended 30th June 2019

Bank

Group

Reclassified

As reported in

Reclassified

As reported in

2019

2019

Rs 000

Rs 000

Rs 000

Rs 000

Net gain/(loss) from trading

2,168,215

2,199,980

2,168,215

2,199,980

Net gain/(loss) on derecognition of financial assets

- at fair value through profit or loss

31,765

-

31,765

-

Depreciation and amortisation expenses

1,212,111

645,961

1,186,574

809,989

Other expenses

3,975,432

4,541,582

4,292,746

4,669,331

  1. COVID - 19 Impact
    Although it appears that the Sri Lankan economy is returning to normalcy after a prolonged lockdown, the impact created by COVID-19 is likely to prevail for some time as the majority of the world still continues to operate under mobility restrictions in a bid to control the spread of Covid-19. These restrictions will no doubt continue to impact most of the key segments of the Sri Lankan economy while the banking sector too will continue to remain under pressure for the rest of the year.
    Amidst this backdrop, Sampath Bank is fully committed to support the relief measures introduced by the government in a bid to revive the economy. Taking immediate action in this regard, approximately 50% of the Bank's loan portfolio was granted relief under the government announced moratorium scheme, which resulted in a substantial drop in
    Bank's NII for the quarter ended 30th June 2020. However, the Bank sees these relief measures as a national duty and continues to provide the necessary assistance to all segments who are requiring special attention.
    While it is difficult to gauge the real impact, given that the COVID-19 situation is still evolving, the Bank has made adequate impairment provisions to ensure that the impact to it's loan book is adequately reflected in the financial statements. While continuing to use the Probabilities of Default (PDs) prevailed as at 31st December 2019, as permitted by the "COVID - 19 Pandemic: Guidance Notes on the Implications on Financial Reporting" issued by CA Sri Lanka, the Bank has made additional provisions for customers who have shown signs of stress and continue to carry an increased credit risk. In addition to these provisions made for identified significant customers, the Bank also made an additional provision by way of a management overlay, changing the probabilities assigned for macro-economic variables.
    The Bank used the prices / yield rates prevailed as at 30th June 2020 to ascertain the fair value of investments recognized at Fair Value through Profit or Loss (FVPL) and Fair Value through Other Comprehensive Income (FVOCI). The resultant gains and losses have been accounted in Profit or Loss / OCI respectively for FTPL and FVOCI portfolios.
    The Bank will continue to assess the financial implications from COVID - 19 and the effect of relief measures and incorporate the required adjustments to the financial statements as and when reliable information become available.
  2. New amendments to Income Tax Law announced by the Government
    As per the announcement dated 12th February 2020, income tax rate applicable for the Banking sector has been reduced to 24% with effect from 01st January 2020. However, given the fact that the said amendment is yet to be enacted, both income tax and deferred tax were calculated at the rate of 28% for the period ended 30th June 2020.
    Had we considered the revised rate of 24%, the income tax charge recognised in the P&L would have increased by Rs 389 Mn. This includes a reversal of Rs 219 Mn in current tax expense and an additional charge of Rs 608 Mn in deferred tax. Further, deferred tax charge to OCI will be reduced by Rs 108 Mn.
  3. Funds Raised in Previous Years
    The funds raised via capital markets in the previous years were fully utilised for the objectives stated in the relevant prospectuses.
  4. Mr S. H. Amarasekera (Non-Executive, Non Independent Director) was appointed to the Board of Directors effective from 18th August 2020.

11

SAMPATH BANK PLC (ORDINARY SHARES)

TOP 20 SHAREHOLDERS AS AT 30TH JUNE 2020

Name of the Shareholder

No. of shares

% holding

1

Vallibel One PLC

57,039,028

14.95

2

Employees' Provident Fund

38,041,260

9.97

3

Mr Y S H I Silva*

31,266,429

8.20

4

Ayenka Holdings Private Limited

18,006,054

4.72

5

Rosewood (Pvt) Limited - Account No.1

17,068,459

4.47

6

BBH-Matthews International Funds-Matthews Asia Growth Fund

13,125,953

3.44

7

Citi Bank Newyork S/A Norges Bank Account 2

11,404,089

2.99

8

Sri Lanka Insurance Corporation Ltd - Life Fund

9,943,521

2.61

9

Akbar Brothers Pvt Ltd A/C No. 1

8,414,541

2.21

10

Phoenix Ventures Private Limited

8,303,325

2.18

11

BBH-Matthews Emerging Asia Fund

7,399,518

1.94

12

Employees Trust Fund Board

5,372,517

1.41

13

Pemberton Asian Opportunities Fund

4,246,166

1.11

14

Sampath Bank PLC Account No. 4 (Sampath Bank Pension Fund)

3,848,882

1.01

15

Seylan Bank PLC / W D N H Perera

3,611,759

0.95

16

SEB AB - Tundra Sustainable Frontier Fund

3,440,766

0.90

17

Jinadasa Brothers (Pvt) Ltd

2,829,629

0.74

18

Morgan Stanley and Co.LLC-RWC Frontier Markets Equity Master Fund

2,664,471

0.70

19

SSBT-AL Mehwar Commercial Investments L.L.C.

2,432,466

0.64

20

Commercial Bank of Ceylon PLC/P.Subasinghe

2,390,500

0.63

250,849,333

65.76

Shares held by Directors

647,587

0.17

Balance held by other shareholders

129,961,065

34.07

Total

381,457,985

100.00

*Mr Rushanka Silva, the Managing Director of Indra Traders (Pvt) Ltd, was appointed as a Non Executive, Non Independent Director of the Bank with effect from 01st September 2017. Accordingly the shareholding of Mr Y S H I Silva, who is the main shareholder of Indra Traders (Pvt) Ltd, has been excluded from the public shareholding of the Bank.

As at

30.06.2020

Number of public shareholders

24,489

Percentage of public holding

90.61%

Float Adjusted Market Capitalization

Rs 44 Bn

Bank complies with the minimum public holding requirement under option 1 of listing rules section 7.13.1 (a).

12

Directors' Holding in Shares of Sampath Bank PLC

No. of shares held

Director's Name

As at 30.06.2020

As at 31.12.2019

1

Prof M Ranasinghe

50,135

15,135

2

Ms D S Wijayatilake

-

-

3

Ms A Senanayake

-

-

4

Mr R Pathirana

24,456

24,456

5

Mr Rushanka Silva

-

-

6

Mr D K de Silva Wijeyeratne

-

-

7

Ms A Nanayakkara

-

-

8

Dr J T V S Weerawarana

-

-

9

Mr Deshal De Mel

-

-

10

Mr Vajira Kulatilaka (appointed w.e.f. 25th June 2020)

-

Not applicable

11

Mr M N R Fernando (Managing Director)

572,996

572,996

13

Segment Information - Group

Banking

Leasing, Hire purchase &

Dealing/Investment

Other

Eliminations/Unallocated

Total

Factoring

For the six months ended 30th June

2020

2019

2020

2019

2020

2019

2020

2019

2020

2019

2020

2019

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Net interest income

14,341,363

16,364,582

1,857,612

1,916,671

2,735,937

2,907,782

-

-

-

-

18,934,912

21,189,035

Dividend income

-

-

-

-

4,759

127,850

-

-

-

-

4,759

127,850

Net fee & commission income

3,734,454

4,610,926

191,231

205,087

37,850

7,196

-

-

-

-

3,963,535

4,823,209

Foreign exchange profit

631,070

(320,257)

-

-

1,220,151

1,403,588

-

-

-

-

1,851,221

1,083,331

Other income

101,079

131,748

150,381

158,379

458,843

151,609

101,527

33,342

-

-

811,830

475,078

Total revenue from external customers

18,807,966

20,786,999

2,199,224

2,280,137

4,457,540

4,598,025

101,527

33,342

-

-

25,566,257

27,698,503

Inter segment revenue

269,618

130,364

-

-

-

-

229,395

349,917

(499,013)

(480,281)

-

-

Total operating income

19,077,584

20,917,363

2,199,224

2,280,137

4,457,540

4,598,025

330,922

383,259

(499,013)

(480,281)

25,566,257

27,698,503

Less :Impairment charge

6,986,197

6,775,635

710,746

808,187

354,817

305,584

5,455

10,372

-

-

8,057,215

7,899,778

Net operating Income

12,091,387

14,141,728

1,488,478

1,471,950

4,102,723

4,292,441

325,467

372,887

(499,013)

(480,281)

17,509,042

19,798,725

Less : Total operating expenses

8,029,894

8,604,678

758,983

857,240

1,642,676

1,475,066

276,269

285,816

(291,592)

(410,595)

10,416,230

10,812,205

Segment result

4,061,493

5,537,050

729,495

614,710

2,460,047

2,817,375

49,198

87,071

(207,421)

(69,686)

7,092,812

8,986,520

Less: Taxes on financial services

1,612,376

3,046,504

Less: Income tax expenses

1,484,068

1,767,015

Profit for the period

3,996,368

4,173,001

Non controlling interest

-

-

Profit attributable to equity holders of the Bank

3,996,368

4,173,001

As at 30th June

2020

2019

2020

2019

2020

2019

2020

2019

2020

2019

2020

2019

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Segment assets

714,774,201

685,159,936

75,610,749

63,782,317

221,559,843

193,013,829

7,408,513

6,945,269

(12,376,038)

(10,316,194)

1,006,977,268

938,585,157

Unallocated assets

-

-

-

-

-

-

-

-

38,371,267

23,023,215

38,371,267

23,023,215

Total assets

714,774,201

685,159,936

75,610,749

63,782,317

221,559,843

193,013,829

7,408,513

6,945,269

25,995,229

12,707,021

1,045,348,535

961,608,372

Segment liabilities

575,250,624

536,617,870

81,486,621

68,810,412

283,823,201

257,190,498

2,777,475

2,580,683

(8,755,019)

(7,937,158)

934,582,902

857,262,305

Unallocated liabilities

-

-

-

-

-

-

-

-

-

-

-

-

Total liabilities

575,250,624

536,617,870

81,486,621

68,810,412

283,823,201

257,190,498

2,777,475

2,580,683

(8,755,019)

(7,937,158)

934,582,902

857,262,305

For the six months ended 30th June

2020

2019

2020

2019

2020

2019

2020

2019

2020

2019

2020

2019

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Rs 000

Cash flows from operating activities

44,675,880

(14,084,738)

1,595,220

1,580,367

32,494

(3,771)

341,446

178,457

(2,155,294)

(652,129)

44,489,746

(12,981,814)

Cash flows from investing activities

-

-

396,716

(2,630,076)

(33,767,415)

(11,237,604)

(242,505)

(209,044)

(379,060)

1,251,227

(33,992,264)

(12,825,497)

Cash flows from financing activities

(4,954,611)

16,773,877

438,175

(604,736)

-

-

(389,969)

128,697

114,264

701,056

(4,792,141)

16,998,894

Capital expenditure

-

-

(166,413)

(258,297)

-

-

(281,148)

(62,784)

(348,106)

(672,209)

(795,667)

(993,290)

14

ANALYSIS OF FINANCIAL INSTRUMENTS BY MEASUREMENT BASIS

Bank - As at 30th June 2020

Fair value

Fair Value

through Other

through Profit or

Amortised Cost

Total

Financial Assets

Comprehensive

Loss

Income

Rs 000

Rs 000

Rs 000

Rs 000

Cash & cash equivalents

-

29,186,055

-

29,186,055

Balances with Central Bank of Sri Lanka

-

12,482,619

-

12,482,619

Placements with banks

-

1,064,050

-

1,064,050

Reverse repurchase agreements

-

17,512,806

-

17,512,806

Derivative financial instruments

1,310,794

-

-

1,310,794

Financial assets recognised through profit or loss - measured at fair value

14,550,670

-

-

14,550,670

Financial assets at amortised cost

- loans & advances

-

711,267,503

-

711,267,503

- debt & other instruments

-

166,807,633

-

166,807,633

Financial assets - fair value through other comprehensive income

-

-

19,950,699

19,950,699

Other assets

-

7,781,557

-

7,781,557

Total Financial Assets

15,861,464

946,102,223

19,950,699

981,914,386

Fair value

Financial Liabilities

through Profit or

Amortised Cost

Total

Loss

Rs 000

Rs 000

Rs 000

Due to banks

-

2,678,398

2,678,398

Derivative financial instruments

1,524,398

-

1,524,398

Securities sold under repurchase agreements

-

1,405,852

1,405,852

Financial liabilities at amortised cost

- due to depositors

-

787,860,659

787,860,659

- due to other borrowers

-

49,787,091

49,787,091

- due to debt securities holders

-

36,882,097

36,882,097

Dividend payable

-

247,518

247,518

Other liabilities

-

11,235,197

11,235,197

Total Financial Liabilities

1,524,398

890,096,812

891,621,210

Bank - As at 31st December 2019 (Audited)

Fair value

Fair Value

through Other

through Profit or

Amortised Cost

Total

Financial Assets

Comprehensive

Loss

Income

Rs 000

Rs 000

Rs 000

Rs 000

Cash & cash equivalents

-

17,789,176

-

17,789,176

Balances with Central Bank of Sri Lanka

-

31,028,270

-

31,028,270

Placements with banks

-

7,251,305

-

7,251,305

Derivative financial instruments

862,754

-

-

862,754

Financial assets recognised through profit or loss - measured at fair value

11,130,230

-

-

11,130,230

Financial assets at amortised cost

- loans & advances

-

689,377,504

-

689,377,504

- debt & other instruments

-

156,293,495

-

156,293,495

Financial assets - fair value through other comprehensive income

-

-

17,331,724

17,331,724

Other assets

-

7,152,067

-

7,152,067

Total Financial Assets

11,992,984

908,891,817

17,331,724

938,216,525

Fair value

Financial Liabilities

through Profit or

Amortised Cost

Total

Loss

Rs 000

Rs 000

Rs 000

Due to banks

-

1,511,665

1,511,665

Derivative financial instruments

604,069

-

604,069

Securities sold under repurchase agreements

-

16,398,511

16,398,511

Financial liabilities at amortised cost

- due to depositors

-

717,250,492

717,250,492

- due to other borrowers

-

55,661,729

55,661,729

- due to debt securities holders

-

37,642,049

37,642,049

Dividend payable

-

88,898

88,898

Other liabilities

-

12,320,390

12,320,390

Total Financial Liabilities

604,069

840,873,734

841,477,803

15

ANALYSIS OF FINANCIAL INSTRUMENTS BY MEASUREMENT BASIS

Group - As at 30th June 2020

Fair value

Fair Value

through Other

through Profit or

Amortised Cost

Total

Financial Assets

Comprehensive

Loss

Income

Rs 000

Rs 000

Rs 000

Rs 000

Cash & cash equivalents

-

29,403,142

-

29,403,142

Balances with Central Bank of Sri Lanka

-

12,482,619

-

12,482,619

Placements with banks

-

1,064,050

-

1,064,050

Reverse repurchase agreements

-

19,212,555

-

19,212,555

Derivative financial instruments

1,310,794

-

-

1,310,794

Financial assets recognised through profit or loss - measured at fair value

14,550,670

-

-

14,550,670

Financial assets at amortised cost

- loans & advances

-

744,153,936

-

744,153,936

- debt & other instruments

-

166,853,252

-

166,853,252

Financial assets - fair value through other comprehensive income

-

-

19,950,755

19,950,755

Other assets

-

8,250,003

-

8,250,003

Total Financial Assets

15,861,464

981,419,557

19,950,755

1,017,231,776

Fair value

Financial Liabilities

through Profit or

Amortised Cost

Total

Loss

Rs 000

Rs 000

Rs 000

Due to banks

-

2,678,398

2,678,398

Derivative financial instruments

1,524,398

-

1,524,398

Securities sold under repurchase agreements

-

1,344,656

1,344,656

Financial liabilities at amortised cost

- due to depositors

-

800,740,281

800,740,281

- due to other borrowers

-

61,246,363

61,246,363

- due to debt securities holders

-

40,845,589

40,845,589

Dividend payable

-

247,518

247,518

Other liabilities

-

14,395,126

14,395,126

Total Financial Liabilities

1,524,398

921,497,931

923,022,329

Group - As at 31st December 2019 (Audited)

Fair value

Fair Value

through Other

through Profit or

Amortised Cost

Total

Financial Assets

Comprehensive

Loss

Income

Rs 000

Rs 000

Rs 000

Rs 000

Cash & cash equivalents

-

17,977,598

-

17,977,598

Balances with Central Bank of Sri Lanka

-

31,028,270

-

31,028,270

Placements with banks

-

7,251,305

-

7,251,305

Reverse repurchase agreements

-

2,304,392

-

2,304,392

Derivative financial instruments

862,754

-

-

862,754

Financial assets recognised through profit or loss - measured at fair value

11,130,230

-

-

11,130,230

Financial assets at amortised cost

- loans & advances

-

719,046,634

-

719,046,634

- debt & other instruments

-

156,308,796

-

156,308,796

Financial assets - fair value through other comprehensive income

-

-

17,331,780

17,331,780

Other assets

-

7,522,839

-

7,522,839

Total Financial Assets

11,992,984

941,439,834

17,331,780

970,764,598

Fair value

Financial Liabilities

through Profit or

Amortised Cost

Total

Loss

Rs 000

Rs 000

Rs 000

Due to banks

-

1,567,974

1,567,974

Derivative financial instruments

604,069

-

604,069

Securities sold under repurchase agreements

-

16,384,511

16,384,511

Financial liabilities at amortised cost

- due to depositors

-

730,189,642

730,189,642

- due to other borrowers

-

67,311,166

67,311,166

- due to debt securities holders

-

41,371,586

41,371,586

Dividend payable

-

88,898

88,898

Other liabilities

-

12,276,319

12,276,319

Total Financial Liabilities

604,069

869,190,096

869,794,165

16

DEBENTURE INFORMATION

  1. Market Values

Debentures - 2015/2020

Highest (Rs)

Lowest (Rs)

Quarter End (Rs)

2020

2019

2020

2019

2020

2019

Fixed

- 9.90%

N/T

N/T

N/T

N/T

N/T

N/T

Floating rate

N/T

N/T

N/T

N/T

N/T

N/T

N/T - Not Traded

Debentures - 2016/2021

Highest (Rs)

Lowest (Rs)

Quarter End (Rs)

2020

2019

2020

2019

2020

2019

Fixed

- 12.75%

101.99

100.00

101.33

100.00

101.33

100.00

Floating rate

N/T

97.50

N/T

97.50

N/T

97.50

N/T - Not Traded

Debentures - 2017/2022

Highest (Rs)

Lowest (Rs)

Quarter End (Rs)

2020

2019

2020

2019

2020

2019

Fixed

- 12.50%

N/T

N/T

N/T

N/T

N/T

N/T

N/T - Not Traded

Debentures - 2018/2023

Highest (Rs)

Lowest (Rs)

Quarter End (Rs)

2020

2019

2020

2019

2020

2019

Fixed

- 12.50%

N/T

99.51

N/T

99.51

N/T

99.51

N/T - Not Traded

Debentures - 2019/2024

Highest (Rs)

Lowest (Rs)

Quarter End (Rs)

2020

2019

2020

2019

2020

2019

Fixed

- 13.90%

114.32

N/T

114.32

N/T

114.32

N/T

N/T - Not Traded

  1. Interest Rates

2020

2019

Debentures - 2015/2020

Coupon rate

Effective rate

Coupon rate

Effective

rate

Fixed

- 9.90%

9.90%

10.15%

9.90%

10.15%

Floating rate

Note 01

2020

2019

Debentures - 2016/2021

Coupon rate

Effective rate

Coupon rate

Effective

rate

Fixed

- 12.75%

12.75%

12.75%

12.75%

12.75%

Floating rate

Note 01

2020

2019

Debentures - 2017/2022

Coupon rate

Effective rate

Coupon rate

Effective

rate

Fixed

- 12.50%

12.50%

12.89%

12.50%

12.89%

2020

2019

Debentures - 2018/2023

Coupon rate

Effective rate

Coupon rate

Effective

rate

Fixed

- 12.50%

12.50%

12.89%

12.50%

12.89%

2020

2019

Debentures - 2019/2024

Coupon rate

Effective rate

Coupon rate

Effective

rate

Fixed

- 13.90%

13.90%

13.90%

13.90%

13.90%

Note 01

Debentures - 2015/2020

Floating rate is equivalent to the six month net treasury bill rate plus 1.25 % p.a. payable semi annually.

Debentures - 2016/2021

Floating rate is equivalent to the six month gross treasury bill rate plus 1.00 % p.a. payable semi annually.

17

DEBENTURE INFORMATION Cont ..

(c)

Interest Rate of Comparable Government Securities

2020

2019

3 Month Treasury Bill

5.08%

8.24%

6 Month Treasury Bill

5.22%

8.49%

5 Year Treasury Bond

6.61%

9.83%

(d)

Current Yield & Yield to maturity

Fixed

Floating

Debentures - 2015/2020

9.90%

2020

2019

2020

2019

Current yield

N/T

N/T

N/T

N/T

Yield to maturity of last trade

N/T

N/T

N/T

N/T

N/T - Not Traded

Fixed

Floating

Debentures - 2016/2021

12.75%

2020

2019

2020

2019

Current yield

12.58%

12.75%

N/T

11.60%

Yield to maturity of last trade

11.26%

12.75%

N/T

12.37%

N/T - Not Traded

Fixed

Debentures - 2017/2022

12.50%

2020

2019

Current yield

N/T

N/T

Yield to maturity of last trade

N/T

N/T

N/T - Not Traded

Fixed

Debentures - 2018/2023

12.50%

2020

2019

Current yield

N/T

12.56%

Yield to maturity of last trade

N/T

12.65%

N/T - Not Traded

Fixed

Debentures - 2019/2024

13.90%

2020

2019

Current yield

12.16%

N/T

Yield to maturity of last trade

9.13%

N/T

N/T - Not Traded

(e)

Ratios - Bank

30.06.2020

31.12.2019

Debt to Equity Ratio (%)

49.5%

61.5%

Interest Cover (Times)

3.7

4.9

Quick Asset Ratio (%) (as per CBSL Return)

80.7%

77.7%

18

SELECTED PERFORMANCE INDICATORS (AS PER REGULATORY REPORTING)

Item

As At

As At

As At

As At

30.06.2020

31.12.2019

30.06.2020

31.12.2019

(Audited)

(Audited)

Bank

Group

Regulatory Capital (Rs 000)

Common Equity Tier 1 Capital

92,049,303

96,794,652

96,533,413

101,088,754

Tier 1 Capital

92,049,303

96,794,652

96,533,413

101,088,754

Total Capital

115,994,607

123,364,882

120,638,415

127,814,196

Regulatory Capital Ratios (%)

Common Equity Tier 1 Capital Ratio

13.30

14.22

13.16

14.05

(Minimum Requirement: 2020 - 6.5%, 2019 - 7.0%)

Tier 1 Capital Ratio

13.30

14.22

13.16

14.05

(Minimum Requirement: 2020 - 8.0%, 2019 - 8.5%)

Total Capital Ratio

16.77

18.12

16.44

17.76

(Minimum Requirement: 2020 - 12.0%, 2019 - 12.5%)

Leverage Ratio % (Minimum Requirement - 3%)

7.42

8.12

7.54

8.24

As At

As At

30.06.2020

31.12.2019

Bank

Assets Quality (Quality of Loan Portfolio)

Gross Non - Performing Advances Ratio, % (Net of Interest in Suspense)

7.03

6.37

Net Non - Performing Advances Ratio, % (Net of Interest in Suspense and

Provision) *

4.43

4.53

Profitability

Interest Margin, %

3.57

4.46

Return on Assets (Before Tax), %

1.09

1.66

Return on Equity (After Tax), %

7.56

11.78

Regulatory Liquidity

Statutory Liquid Assets (Rs 000)

249,464,527

181,901,984

Statutory Liquid Assets Ratio (Minimum Requirement - 20%)

Domestic Banking Unit (%)

28.12

21.51

Off-Shore Banking Unit (%)

33.88

26.88

Total Stock of High-Quality Liquid Assets (Rs 000)

134,450,085

106,699,496

Liquidity Coverage Ratio (%) - Rupee

(Minimum Requirement: 2020 - 90%, 2019 - 100%)

251.15

177.29

Liquidity Coverage Ratio (%) - All Currency

(Minimum Requirement: 2020 - 90%, 2019 - 100%)

127.11

149.17

Net Stable Funding Ratio (%)

(Minimum Requirement: 2020 - 90%, 2019 - 100%)

127.68

126.80

* Net Non-performing Advances Ratio is calculated based on the CBSL requirement after deducting CBSL provisions.

19

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Sampath Bank plc published this content on 12 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 13 August 2020 15:22:03 UTC