By:Staff Writer
January 27, Colombo (LNW): LB Finance PLC has posted an impressive financial performance for the nine months ended 31 December 2025, demonstrating resilient growth, solid asset quality and strong capital buffers amid a gradually improving economic environment.
The company reported a 24% year-on-year rise in Profit after Tax to Rs. 8.93 billion, driven by sustained income growth, prudent cost control and disciplined risk management. On a consolidated basis, Group PAT stood at Rs. 9.04 billion, while total Group assets exceeded Rs. 369 billion, reflecting increasing contributions from subsidiaries.
Total assets of the company grew to Rs. 349.4 billion, supported by steady expansion across core lending and deposit-taking operations. Income rose 23% year-on-year to Rs. 42.57 billion, while Total Operating Income increased 24% to Rs. 27.18 billion, translating into a 25% increase in Profit before Tax to Rs. 14.39 billion.
Shareholder returns strengthened further during the period. Earnings per Share improved to Rs. 16.12, compared to Rs. 12.95 a year earlier, while Net Asset Value per share increased to Rs. 104.45. Profitability ratios remained healthy, with annualised ROE at 21.82% and ROA at 4.03%, underscoring the company’s ability to grow profitably without compromising balance sheet strength.
Public confidence in LB Finance remained evident, as customer deposits climbed to Rs. 158.33 billion, while loans and receivables expanded to Rs. 282.25 billion. Growth outpaced broader industry trends, supported by strong demand across key customer segments and sound credit underwriting standards.
The company further diversified its funding base by securing foreign funding lines, benefiting from improving macroeconomic conditions and renewed investor confidence. Capital adequacy remained well above regulatory thresholds, with the Capital Funds to Total Deposit Liabilities Ratio at 36.55%, significantly higher than the statutory minimum. Liquidity levels also stayed comfortable, with available liquid assets of Rs. 31.65 billion.
Asset quality indicators improved despite portfolio expansion. The gross NPL ratio declined to 1.46%, while provision coverage stood at nearly 190%, resulting in a negative net NPL ratio. Cost efficiency gains, supported by digital adoption, kept the cost-to-income ratio at 30%.
During the period, LB Finance acquired a controlling stake in Associated Motor Finance Company PLC, strengthening its presence in vehicle financing. Continued investments in digital platforms such as LB CIM enhanced customer engagement, AI-driven credit assessments and operational efficiency, particularly for SMEs and micro-entrepreneurs.
