Banks - Snapshot

[First Guy]

[You must be registered and logged in to see this image.]

• Sorted according to P/B multiples
  
• ROE is calculated as per March end equity and not average so might not give an accurate picture.
  

[You must be registered and logged in to see this image.]

[First Guy]

Interesting table above.

SAMP looks attractive as per earnings, ROE, Book value and has the lowest NPL. Only concern is the growth with capitaliation hovering around the minimum requirement levels. Core capital ratio is around 8% and due to this its rating was also downgraded.

PABC is also struggling with capitalization. Possible rights issue or PP ?

NTB and COMB showing good returns and comfortable capital which will help them grow. NTB has the best NIM as well. Looks like it should get closer to COMB.

The graph shows PABC, NDB, SEYB and NTB almost on the trendline while HNB and SAMP together below and COMB above. Will SAMP and HNB reach the line in future?

UBC has ample cash. It needs to grow its loan book considerably in the coming periods to keep up with the others.

[කිත්සිරි ද සිල්වාTop contributor]

Thanks FG.

[sereneTop contributor]

Interesting table above.

SAMP looks attractive as per earnings, ROE, Book value and has the lowest NPL. Only concern is the growth with capitaliation hovering around the minimum requirement levels. Core capital ratio is around 8% and due to this its rating was also downgraded.

PABC is also struggling with capitalization. Possible rights issue or PP ?

NTB and COMB showing good returns and comfortable capital which will help them grow. NTB has the best NIM as well. Looks like it should get closer to COMB.

The graph shows PABC, NDB, SEYB and NTB almost on the trendline while HNB and SAMP together below and COMB above. Will SAMP and HNB reach the line in future?

UBC has ample cash. It needs to grow its loan book considerably in the coming periods to keep up with the others.

 
Thanks FG.Another fabulous work.
1.6X P/B

[chutiputhaTop contributor]

My dear FG,It's Great and Remarkable ur effort.
Can couple SEYB.X par with ur chart.
+++

[First Guy]

My dear FG,It's Great and Remarkable ur effort.
Can couple SEYB.X par with ur chart.
+++

HNB, COMB and SEYB have non voting shares. I don't think it makes sense to compare them with the voting share. What we need to look at is how much of a discount are they trading compared to the voting share.

[LeonTop contributor]

Thanks FG. +

[kassTop contributor]

Thanks FG

[NuinthTop contributor]

Thx FG, very useful.

[Ethical TraderTop contributor]

Thanks FG. Good professional work.

[First Guy]

Thank you for the encouragement. I would like to have some others' comments too. Just so that I don't think I am always right

[First Guy]

[You must be registered and logged in to see this image.]

[yellow knifeTop contributor]

thanx

[BackstageTop contributor]

Thanks FG.

I would also like to see how Sanasa compares as well. I have a feeling that their model of banking, with widespread rural tentacles would have relevance in the years up ahead.

[First Guy]

SAMP gave 13/- (6/- cash + 7/- scrip) dividend which is an increase over the last year

HNB gave a 7/- final (3.50/- cash + 3.50/- scrip) 8.50/- in total which is same as last year

[First Guy]

[You must be registered and logged in to see this image.]

I thought this will be appropriate in this thread.

BOC tops the total operating income followed distantly by HNB and COMB.

BOC has only the 2nd lowest costs against total operating income (2nd to COMB)

Going by current average valuations of other banks, BOC can fetch a market cap of more than 140 B if listed, making it the 3rd large listed company after CTC and JKH

[Market loverTop contributor]

Tks FG

[yellow knifeTop contributor]

Thanx FG

We are really seeing CSE now...Thanx for including BOC.

We are seeing a more complete picture now.

[sanjulanka]

Thanks FG..

[tharindufit]

Thanks FG :-)

BoC seem to be using technology more being a state bank visiting Borella BoC recently to withdraw some cash I was impressed how they used self operated numbering system instead of waiting in queue.

[First Guy]

Chart with P/E of all banks. 2nd one is without DFCC, ABL and UBC

[You must be registered and logged in to see this image.]

[Ethical TraderTop contributor]

Thanks. You omitted CDB.

[blacknights]

Thanks. You omitted CDB.

It's a Finance company ET.

[Ethical TraderTop contributor]

Thanks Blacknights.

Thanks. You omitted CDB.

It's a Finance company ET.

[balapasTop contributor]

Moody’s revises three SL bank outlooks to negative


Moody’s Investors Service has affirmed the long-term ratings of three banks in Sri Lanka (B1 negative). Moody’s has also revised their ratings outlooks to negative from stable.

The affected banks are Bank of Ceylon, Hatton National Bank Ltd, and Sampath Bank PLC. The baseline credit assessments (BCAs) and Adjusted BCAs of the three banks were affirmed at B1.

The rating actions follow the affirmation of Sri Lanka’s B1 sovereign rating, and the change in outlook on the sovereign rating to negative from stable on 20 June 2016.

The counterparty risk assessments (CRAs) of the three banks were affirmed at Ba3(cr)/NP(cr).In Moody’s view, the operating conditions for Sri Lanka’s banks have weakened because of lower-than- expected policy effectiveness.

As a result, Moody’s has changed Sri Lanka’s Macro Profile to “Moderate -”from “Moderate”. The credit ratings on the three banks were affirmed and their outlooks changed to negative because Moody’s affirmed Sri Lanka’s B1 sovereign rating and changed its outlook to negative from stable on June 20, 2016.

The ratings and outlooks of banks typically follow the ratings and outlooks of their respective governments if the banks’ ratings are positioned at the same level as capped by the sovereign rating.

The fiscal consolidation path targeted by the authorities and outlined in the IMF program is ambitious; sustaining such efforts will challenge the government’s institutional capacities and might affect GDP growth over the short term. The decrease in score for Sri Lanka’s Macro Profile has had no impact on the BCAs of the three Sri Lankan banks.

Moody’s has affirmed the b1 BCAs and b1 Adjusted BCAs of the three banks.

For Bank of Ceylon, its b1 BCA was affirmed owing to the bank’s broadly stable asset quality with a 3.8% problem loans ratio at end-March 2016, as well as Moody’s expectation that its profitability will increase because of lower loan loss provisions and improved margins.

For Hatton National Bank Ltd., its BCA was affirmed because of the bank’s moderate capital adequacy position with a TCE ratio of 10.3% at end-March 2016. In addition, it has healthy profitability with a return on average assets of 1.8% for 1Q 2016. The BCA also captures the bank’s tight liquidity profile as seen in the high loans-to-deposits ratio of 98% at end-March. The bank’s asset quality improved in 2015 and early 2016, with problem loans of 2.4% as of the same date.

Moody’s notes that the bank’s rapid credit growth of 26% in 2015 could mask asset quality challenges because a large proportion of loans is unseasoned.

The BCA of Sampath Bank PLC was affirmed because of the bank’s healthy asset quality; a problem loans ratio of 1.64% at end-2015 and problem loans coverage of 111%. Similar to Hatton National Bank, Sampath Bank reported very high loan growth of 24% in 2015, which could mask asset quality challenges. Profitability remains key credit strength of the bank, with its return on average assets over the last three years averaging at 1.23%.

The bank’s capital levels are low, with a TCE ratio of 6.9% end-2015.

The Counterparty Risk Assessments of the three banks were affirmed because

of the respective affirmation of these banks’ Adjusted BCAs.

[You must be registered and logged in to see this link.]