IN
WITH
IN STEP WITH ASPIRATIONS
CONTENTS
We at Seylan Bank have always aligned our business strategies with the aspirations of our stakeholders. Powering opportunities and possibilities with our wide spectrum of services delivered through our network of branches together with all the channels including digital platforms and our team we strived to create a customer-centric experience for our customers. Moving ahead with tenacity in step with aspirations of our stakeholders, we are committed to creating and delivering sustainable value.
1 | About this Report | SUSTAINABLE RESULTS | |
2 | Seylan Bank at a Glance | 137 | Financial Calendar |
3 | Key Financial Highlights | ||
138 | Statement of Directors' Responsibility for | ||
4 | Chairman's Message | ||
Financial Reporting | |||
6 | Message From Director/Chief Executive Officer | ||
139 | Chief Executive Officer's and Chief Financial | ||
Officer's Responsibility Statement | |||
140 | Independent Auditor's Report | ||
OUR VALUE | 145 | Income Statement | |
CREATION STORY | 146 | Statement of Profit or Loss and Other | |
10 | Value Creation Model | Comprehensive Income | |
147 | Statement of Financial Position | ||
12 | Stakeholder Engagement for Lasting Relationships | ||
148 | Statement of Changes in Equity | ||
14 | Materiality as a Compass of Stakeholder Engagement | ||
152 | Statement of Cash Flows | ||
16 | Economic Overview | ||
154 | Notes to the Financial Statements | ||
20 | Financial Viability and Investor Security | ||
25 Aspiring to Fulfil Customer Needs
32 | Step in to Our Digital Future | ANNEXES | |
35 | Empowering Our Employees | 250 | Ten Years at a Glance |
45 | Our Business Partners | 251 | Summary of Performance Indicators |
49 | Protecting the Environment | 252 | Statement of Comprehensive Income in US Dollars |
54 | Serving the Wider Community | 253 | Statement of Financial Position in US Dollars |
58 | Business Unit Performance | 254 | Investor Information |
59 | Sustainability Performance Indicators | 259 | Branch and ATM Network |
61 | Independent Assurance Report | 260 | Geographical Analysis |
261 | Global Reporting Initiative (GRI) Content Index | ||
264 | Alphabetical Index | ||
SUSTAINABLE | 265 | Glossary | |
STEWARDSHIP | 268 | Sinhala Translation of Chairman's Message | |
64 | Board of Directors | 269 | Tamil Translation of Chairman's Message |
68 | Senior Management Team | 270 | Corporate Information |
74 Corporate Governance
94 Report of the Board Audit Committee
- Report of the Board Human Resources and Remuneration Committee
- Report of the Board Nomination Committee
- Report of the Board Integrated Risk Management Committee
- Report of the Related Party Transactions Review Committee
- Directors' Statement on Internal Control
- Auditors' Report on Internal Control
- Report of the Board of Directors on the State of Affairs of the Company
- Annexure to the Report of the Board of Directors on the State of Affairs of the Company
- Risk Management
SEYLAN BANK PLC A n n u a l R e p o r t 2 0 2 1 | 1 | |
About this Report
Seylan Bank is pleased to present its ninth Integrated Annual Report for the calendar year of 2021.
IN
WITH
The theme for the Annual Report 2021, 'In Step with Aspirations' resonates strongly with our commitment to deliver sustainable value across our diverse groups of stakeholders. This has been our core purpose which has shaped our journey thus far.
As always we have been a constant source of inspiration and a guiding force of strength to all our stakeholders during this challenging phase. As we pivot to be a technologically transformed Bank with a strong customer-centric mandate we are committed to uphold the highest standards of transparency and accountability
to maintain the trust garnered over the years.
Forward Looking
Narrative
This Integrated Annual Report (IAR) 2021, presents a transparent view of the financial performance and position of the Bank which integrated with Investor, Employee, Customer, Business Partner, Environment and Community capitals. The Bank's strategy, its business model, risk management and corporate governance illustrate the holistic picture of the Bank and its value creation efforts towards its stakeholders
Scope and Boundary of Reporting
Reporting Period
The scope of the Annual Report 2021 covers the 12-month period from 1 January to
31 December 2021 and is consistent with the annual reporting cycle for financial and sustainability reporting. Any material events after this date and up to the Board approval date of 22 February 2022 have also been included. There are no significant changes from previous reporting periods in the scope and aspect boundaries. The most recent Annual Report, covered the 12-month period ended 31 December 2020. Comparative financial information, if reclassified or restated, has been disclosed and explained in the relevant sections.
Reporting Boundary
The content of this Report does not cover the activities of its subsidiary, Seylan Developments PLC, which produces its own Annual Report. This Report presents material information on economic, social and environmental performances of Seylan Bank PLC in respect of the reporting period.
Compliance
Both financial and non-financial information contained in this Report comply with applicable rules and guidelines stipulated by the Central Bank of Sri Lanka, the Companies Act No. 07 of 2007, Listing
Rules of the Colombo Stock Exchange and
the Institute of Chartered Accountants of
Sri Lanka.
Sustainability Reporting Framework
In addition, this Report includes details of the Bank's relationship with its key stakeholders in creating sustainable value and these are described in the relevant sustainability sections. The Bank's Report is based on the Global Reporting Initiative (GRI) and is prepared in accordance with "core" criteria.
Content of the Report with comparative information and limitations
This Report presents performances of the Bank in a way our stakeholders can get a comprehensive view of the Bank's policies, operations and processes. Transparency in reporting helps the Bank identify and address its weaknesses, while building on its strengths. Key Performance Indicators are presented with comparative data relating to the previous year.
Independent Assurance
The Bank engaged Messrs KPMG to obtain an independent assurance of its sustainability report. Their Sustainability Assurance Report appears on pages 61 to 62 in this Annual Report. Further, Messrs KPMG has given their opinion on the financials given on pages 140 to 144 of this Annual Report.
This integrated report can be accessed through the Bank's website
at https://www.seylan.lk/ about-us/investor-relation
Feedback may be directed to :
Ms Champika Dodanwela
Chief Financial Officer
Seylan Bank PLC
Tel: (94)-(11)-2456358
Fax: (94)-(11)-2452583
Email: champikad@seylan.lk
SEYLAN BANK PLC A n n u a l R e p o r t 2 0 2 1 | 2 | |
Seylan Bank at a Glance
Seylan Bank is a licensed commercial bank and a public limited liability company incorporated in Sri Lanka and listed on the Colombo Stock Exchange. The Bank offers a comprehensive suite of products and services to its corporate, Medium and Small Enterprises (SME) and retail customers. Seylan Bank is focussed on delivering a positive societal and environmental impact underpinned by a unique customer-centric and people-driven culture.
The Bank's strategic pivot in response to the changes occurred by the pandemic has resulted in the acceleration of its digital initiatives. Thus, the Bank is well-positioned to be a 'future ready' bank by harmonising its wide physical and unparalleled reach with digital capabilities to provide a differentiated service.
There were no significant changes in the size, structure, ownership or supply chain of the Bank during 2021.
Vision
To be Sri Lanka's leading financial services provider as recognised by all our stakeholders
Mission
We provide our customers with financial services that meet their needs in terms of value, pricing, delivery and services. We will do so through a team of Seylan bankers who are recognised and rewarded for results orientation. We will ensure that our efforts translate to meeting the expectations of our shareholders, whilst always acting as responsible corporate citizens.
Our suite of banking services consists of Branch Banking, Retail Banking, Corporate and Foreign Currency Banking, International/Trade Finance and Treasury are the main business lines.
The service delivery is ably supported by the functions of marketing, information technology, branch credit, human resource, credit administration, risk management, finance, etc.
Seylan Developments PLC (SDP)
is a public liability company established in Sri Lanka on 3 September 1992, quoted in the Colombo Stock Exchange on the same day and re-registered under the Companies Act No. 07 of 2007 on 22 May 2008. Seylan Bank PLC is the parent company which holds 70.51% as at 31 December 2021. SDP reported profit after tax of LKR 350.8 Mn during 2021.
For more details ( Please refer note 28.1)
SEYLAN BANK PLC A n n u a l R e p o r t 2 0 2 1 | 3 | |
Key Financial Highlights
Bank
2021 | 2020 | Change |
LKR'000 | LKR'000 | % |
Group
2021 | 2020 | Change |
LKR'000 | LKR'000 | % |
For the Year | |||||||||
Gross Income | 54,767,049 | 57,224,196 | (4.29) | 54,750,691 | 57,227,750 | (4.33) | |||
Profit before Income Tax | 6,027,776 | 4,111,247 | 46.62 | 6,184,680 | 4,295,636 | 43.98 | |||
Income Tax Expense | 1,447,236 | 1,099,947 | 31.57 | 1,449,010 | 1,197,578 | 21.00 | |||
Profit Attributable to Equity Holders of the Bank | 4,580,540 | 3,011,300 | 52.11 | 4,653,003 | 3,038,629 | 53.13 | |||
Other Comprehensive Income for the Year, net of Tax | (1,521,020) | 1,832,025 | (183.02) | (1,479,099) | 1,865,107 | (179.30) | |||
Total Comprehensive Income Attributable to | |||||||||
Equity Holders of the Bank | 3,059,520 | 4,843,325 | (36.83) | 3,161,541 | 4,893,981 | (35.40) | |||
Revenue to Government | 3,382,048 | 2,628,243 | 28.68 | 3,383,822 | 2,725,874 | 24.14 | |||
Gross Dividend * | 1,602,572 | 775,535 | 106.64 | 1,602,572 | 775,535 | 106.64 | |||
At the Year End | |||||||||
Total Equity Attributable to Equity Holders of the Bank | 52,053,009 | 48,966,975 | 6.30 | 53,958,234 | 50,769,823 | 6.28 | |||
Retained Earnings | 29,196,617 | 24,683,224 | 18.29 | 29,967,349 | 25,381,609 | 18.07 | |||
Customer Deposits | 488,653,328 | 440,303,126 | 10.98 | 488,653,328 | 440,303,126 | 10.98 | |||
Customer Loans and Advances | 441,976,662 | 393,766,147 | 12.24 | 441,976,662 | 393,766,147 | 12.24 | |||
Total Assets | 607,576,911 | 557,707,420 | 8.94 | 608,090,133 | 558,005,932 | 8.98 | |||
Information per Ordinary Share | |||||||||
Basic/Diluted Earnings per Share (LKR) ** | 8.57 | 5.64 | 51.95 | 8.71 | 5.69 | 53.08 | |||
Dividend per Share (LKR) * | 3.00 | 1.50 | 100.00 | 3.00 | 1.50 | 100.00 | |||
Net Assets Value per Share (LKR) | 97.44 | 94.71 | 2.88 | 101.01 | 98.20 | 2.86 | |||
Market Value (LKR) - As at End of the Year | |||||||||
Voting Shares | 44.00 | 46.00 | (4.35) | - | - | - | |||
Non-Voting Shares | 33.30 | 34.00 | (2.06) | - | - | - | |||
Statutory Ratios (%) | |||||||||
Capital Adequacy | |||||||||
Common Equity Tier 1 Capital Ratio (%) | |||||||||
(Minimum Requirement | - 7.00 %) | 10.72 | 11.46 | (6.46) | 10.92 | 11.70 | (6.67) | ||
Total Tier 1 Capital Ratio | (%) | ||||||||
(Minimum Requirement - 8.50 %) | 10.72 | 11.46 | (6.46) | 10.92 | 11.70 | (6.67) | |||
Total Capital Ratio (%) | |||||||||
(Minimum Requirement - 12.50 %) | 14.11 | 14.30 | (1.33) | 14.28 | 14.49 | (1.45) | |||
Liquidity | |||||||||
Statutory Liquid Assets Ratio - Domestic | |||||||||
Banking Unit Operations | (%) | ||||||||
(Minimum Requirement - 20 %) | 22.84 | 31.31 | (27.05) | - | - | - | |||
Statutory Liquid Assets Ratio - Foreign Currency | |||||||||
Banking Unit Operations | (%) | ||||||||
(Minimum Requirement - 20 %) | 23.30 | 22.47 | 3.69 | - | - | - | |||
Liquidity Coverage Ratio - Rupee (%) | |||||||||
(Minimum Requirement - 2021 - 100 %, 2020 - 90 %) | 163.02 | 176.95 | (7.87) | - | - | - | |||
Liquidity Coverage Ratio - All Currency (%) | |||||||||
(Minimum Requirement - 2021 - 100 %, 2020 - 90 %) | 132.70 | 142.75 | (7.04) | - | - | - | |||
Other Ratios | |||||||||
Price Earnings Ratio - Voting (Times) | 5.13 | 8.16 | (37.13) | - | - | - | |||
Price Earnings Ratio - Non-Voting (Times) | 3.89 | 6.03 | (35.49) | - | - | - | |||
Dividend Cover (Times) * | 2.86 | 3.88 | (26.29) | - | - | - |
* Dividends are accounted for as per the Sri Lanka Accounting Standard - LKAS 10.
** Earnings per share has been restated as per Sri Lanka Accounting Standard - LKAS 33.
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