Kicking off the much-anticipated financial sector earnings for the 1st quarter, Asia Asset Finance PLC (AAF), a proud financial subsidiary of the global giant Muthoot, led the pack with an exceptional performance that underscores its strength and stability in a dynamic market. The company reported earnings of Rs.115.7Mn in the 1st quarter of 2024, compared to Rs.55.2Mn in the same period in 2023, translating into an impressive 109.75% growth.
Asia Asset Finance, an A+ (Fitch Rated) company with a stable outlook and a proud 53 year history, continues to perform under challenging circumstances to ensure the sustainability of its business operations.
The company’s loan portfolio continued its upward trajectory, with Rs.21.8Bn in loans reported for the quarter ended June 2024, marking a notable increase from Rs.19.05Bn at the year-end. AAF’s deposits also grew substantially, with Rs.17.5Bn in new deposits recorded, of which Rs.2.9Bn was raised in the June quarter alone. This growth reflects AAF’s solid reputation and the trust it has garnered among its customers.
AAF’s net interest margin, a critical indicator of its profitability, was maintained at a healthy 8.53%, contributing to the strong financial results for the quarter. The company earned a net interest income of Rs.447Bn in the three months, up 10.16% from the previous year, demonstrating the effectiveness of its interest rate management and strategic focus on high-quality loan assets. Additionally, AAF generated Rs.237.9Mn from other service charges, up an impressive 172% from the same period last year, highlighting the success of its diversified revenue streams.
Despite its aggressive growth strategy, AAF has remained vigilant in managing risks. The company provisioned Rs.120.1Mn for potential bad loans during the quarter, ensuring that its balance sheet remains resilient. Moreover, AAF’s Stage 3 loans ratio, representing loans overdue for 90 days or more, improved to 18.9% from 22.1% at the start of the year, reflecting its effective credit risk management practices.
Commenting on the company’s performance, the CEO of AAF, Rajiv Gunawardana, noted, “Our strong Q1 results are a testament to the efficacy of our growth strategy and our unwavering commitment to delivering value to our stakeholders. As a Fitch A+ rated company and a subsidiary of the globally renowned Muthoot Group, we are well-positioned to continue our upward trajectory and achieve even greater milestones in the coming quarters.”
Asia Asset Finance PLC’s outstanding Q1 performance not only sets a strong foundation for the rest of the financial year but also reaffirms its status as a leading financial institution in Sri Lanka, recognized for its excellence and stability.
