Profit up 23%. Bad loans doubled.
Net Interest Income rose 41.0% from a year ago to LKR 3.79 Bn, but impairment charges rose to LKR 478 Mn from LKR 85 Mn, so Profit After Tax grew 22.9% to LKR 1.13 Bn. Gross non-performing loans more than doubled to LKR 7.53 Bn.
Share price
- Close, 22 October 2026
- LKR 75.70
- Results declared
- 22 October 2026
Jul–Sep 2026 results, line by line
| LKR Mn | Jul–Sep 2026 | YoY | QoQ |
|---|---|---|---|
| Net Interest Income | 3,792 | +41.0% | +10.8% |
| Net Fee Income | 500 | +79.0% | −9.5% |
| Total Operating Income | 4,730 | +36.7% | +7.5% |
| Impairment Charges | 478 | +464.9% | +17.2% |
| Operating Expenses | 1,851 | +28.2% | +9.4% |
| Cost to Income | 39.1% | −2.6 pts | +0.7 pts |
| Profit Before Income Tax | 1,835 | +23.4% | +3.8% |
| Profit After Tax | 1,129 | +22.9% | +4.8% |
YoY against the same quarter a year ago. QoQ against the previous quarter.
What drove it
- 01Interest costs outpaced interest income
Interest Expenses rose 74.4% YoY against 57.9% for Interest Income, so the share of interest income kept as Net Interest Income fell to 44.1% from 49.4% a year ago. Since March, loans and leases grew 9.8% and deposits 17.6%.
- 02Where operating profit went
Higher Net Interest Income added LKR 1,103 Mn and fees LKR 166 Mn. Higher impairment charges (LKR 393 Mn) and operating expenses (LKR 407 Mn) took away about LKR 800 Mn, leaving LKR 2,401 Mn against LKR 1,933 Mn a year ago.
- 03Non-performing loans more than doubled
Gross non-performing loans rose to LKR 7.53 Bn from LKR 3.52 Bn a year ago. Provision cover fell to 71.3% from 112.0%, leaving LKR 2.16 Bn uncovered.
- 04Capital headroom is thin
Tier 1 was 10.82% against a 10.0% minimum and Total Capital 14.75% against 14.0%, after the LKR 2.12 Bn rights issue in May. Liquid assets were LKR 27.7 Bn against LKR 10.6 Bn required.
Valuation at LKR 75.70
Company figures. The last 12 months run from October 2025 to September 2026. The shares trade at 90% of book value.
Three things to watch next quarter
- Non-performing loans. Do they stop rising, after more than doubling in a year?
- Capital headroom. Does the 14.75% total capital ratio stay clear of the 14% minimum as the book grows?
- Net Interest Income. Can it keep growing while interest costs rise faster than interest income?
The company
Capital Trust Securities. For information only. Not investment advice. Source: Vallibel Finance PLC interim financial statements to 30 September 2026 (unaudited). Company figures.