The Board of Directors of Silkbank Limited, in their meeting held on August 23, 2013, announced the half yearly results of the Bank for the period-ended June 30, 2013, showing growth in deposits and revenues. The Bank significantly improved the deposit mix through increase in low-cost current and saving accounts, invested in high yielding consumer assets and rationalized cost through synergies/re-engineering processes and restricting investment to existing resources. The Bank had made strategic investments in new business lines such as consumer loans, credit card and Islamic banking business last year, which have started to contribute towards the bottom line of the Bank. The investments related to the promotion and expansion of new businesses including launch of new Islamic Banking branches in the first quarter, a one-off industry wide provisioning and the impact of the continuous discount rate cuts by the government, resulted in the Bank posting an after tax loss of Rs. 140 million for the second quarter of 2013. However, with the revenue pipeline from new businesses and the existing product portfolio, the Bank is well positioned to increase revenues and declare profits in future. The Board of the Bank has set a clear strategy for 2013 with fresh injection of capital, through sale of preference shares by the Bank along with additional primary and tier II capital, which will enable the Bank to expand its branch network to support the continued reduction in cost of funds. Furthermore, with the asset-base mix moving towards higher yielding assets, margins are set to widen in the future, ensuring higher profitability in the coming years. In addition to converting non-earning assets into earning assets, the Bank will continue to make its cost base increasingly efficient while rigorously growing its new business initiatives and ensuring the future robustness of the existing businesses as well.
