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Asiamoney Best Bank Awards 2017: Sri Lanka

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Best Domestic Bank: Commercial Bank

Best Corporate and Investment Bank: NDB Investment Bank

Best Digital Bank: Commercial Bank

Best Bank for SMEs: Hatton National Bank

Best International Bank: HSBC

Best Bank for CSR: Hatton National Bank
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Award winners:


Best Domestic Bank: Commercial Bank

It is impossible to ignore the Commercial Bank of Ceylon in Sri Lanka. It’s the biggest private-sector bank, with 256 branches and 650 ATMs forming the widest network among the country’s non-government banks. 

Its profits after tax for the first nine months of 2016, at Rs10.2 billion ($67.2 million), narrowly outstripped arch-rival Hatton National Bank (HNB). But at over Rs710 billion, ComBank has by far the biggest deposit base, the biggest capital base, the best cost-to-income ratio and total assets close to Rs1 trillion. This helps explain why it’s also the island’s biggest bank by market capitalization – more than one-and-a-half times the size of HNB – and makes it Sri Lanka’s third-biggest listed entity overall. ComBank’s return on average equity stands at a healthy 19.56%. 

“Business is very good,” says CEO Jegan Durairatnam. “But it could always be better.” And ComBank seems well-positioned to progress in 2017. Durairatnam insists the firm is insulated from Colombo’s growing property bubble. Its capital adequacy ratio stands at a prudent 11.40%, while a clean-up of its loan book sees non-performing loans of just 1.41%. Loans and receivables to customers grew by a healthy 12.6% in 2016.

The careful Durairatnam has plenty of room to build on recent initiatives, including: the launch of a special savings account designed to support entrepreneurs; a 37% growth in the bank’s SME lending portfolio; a 22% rise in the home loans portfolio; a 40% growth in the bank’s credit card base; the launch of education loans and green development loans; and Sri Lanka’s first-ever remittance card, aimed at customers who bring foreign exchange into the country.

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Best Corporate and Investment Bank: NDB Investment Bank

The long-term competitive landscape in Sri Lankan corporate and investment banking is expected to see a rise in substantial players active in the country. But it remains hard to look beyond NDB Investment Bank (NDBIB) for this award.

In 2016, the investment bank raised a healthy Rs47.6 billion ($317 million) for its clients in debt and equity capital.

One of the strong points of NDBIB is the diversity of its business. Its revenues were fairly evenly split between its four key lines of securitization and commercial paper, debentures, loans and other debt instruments, and equity and corporate advisory. This came despite headwinds including political instability and an ensuing uncertain policy framework.

Nonetheless, NDBIB brought some landmark transactions to the markets. In debt, these included: a Rs4 billion structured loan facility for LAUGFS Group, structured over eight years as a series of zero-coupon instruments; a Rs5.3 billion structured loan it raised for the state’s People’s Leasing Company, working with the State Bank of India and Bank of Ceylon to successfully raise funds; and a total of Rs31.5 billion raised in listed debentures. 

NDBIB also managed a rash of mid-sized M&A deals and corporate restructurings, most notably a Rs13 billion restructuring for local agribusiness and property firm Carson Cumberbatch Group.

NDBIB is becoming the partner of choice for some of Sri Lanka’s most important clients. For example, since Sanasa Development Bank’s maiden entry into the equity capital markets in 2012, NDBIB has played a pivotal role in all of its capital raising exercises. In 2016, this included advising SDB on an innovative funding package to bolster tier-1 and tier-2 capital. 

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Best Digital Bank: Commercial Bank


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Jegan Durairatnam, Commercial Bank 
The Commercial Bank of Ceylon might still have an old-fashioned name, but 2016 has seen ComBank make a big leap into Sri Lanka’s banking future. A revamped website saw its online customer base grow by 34% over the year to claim the title of the country’s most-used online banking site. 


And ComBank’s reputation for solidity among Sri Lankans helped expand the value of transactions made through its platform by 10% and the volume of financial transactions by 28%. Alongside this, ComBank’s mobile banking base grew to 450,000 people, or by 70%, in 2016.

New launches were at the heart of these improvements. For example, ComBank launched e-Passbook, a mobile phone app, for the first time in south Asia, which gives customers a real-time view of balances and transactions. It also launched the facility for customers to apply for loans and fixed deposits through its online banking platform. 

CEO Jegan Durairatnam told Asiamoney that his next aim is to position ComBank to ensure Sri Lanka’s tech-savvy millennials feel as confident and comfortable enough to bank with him as their parents and grandparents did. 

Be prepared to see more modernization from us,” he pledges. 

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Best Bank for SMEs: Hatton National Bank

Small and medium-sized enterprises make up 80% of all Sri Lanka businesses, employ 35% of its workers and contribute about one third of the island’s GDP. Eight years after the end of the civil war, the government has identified the sector as critical to binding and normalizing the economy. 

HNB, as one of Sri Lanka’s premier commercial banks, has been a pioneer in banking SMEs. By the end of 2016, HNB’s SME portfolio was valued at Rs180 billion ($1.19 billion), and grew 24.4% over 2015. The bank introduced distributor financing for SMEs last year.

HNB’s commitment was demonstrated by it becoming the first commercial bank in the country to offer microfinance, an initiative that this year extended further across the island’s north and northeast, now recovering from 25 years of conflict. 

CEO Jonathan Alles says HNB has directed its SME cells to roll out directly from the 46 branches HNB now has in these war-torn regions, alongside the bank’s dedicated microfinance arm, HNB Grameen, its partnership with Bangladesh’s famous Grameen Bank. 

Such initiatives, as well as plans to offer a host of technology-led services for SMEs, will go a long way to achieving Alles’ ambition of becoming Sri Lanka’s “most future-ready bank”.

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Best International Bank: HSBC

One of the more fashionable things that a Sri Lankan can do is produce a foreign credit card to pick up the dinner tab for friends and family. And in Colombo’s smarter establishments, around one in two of those flourishes will feature an HSBC logo. 

As the clear market leader in cards on the island, that solid fee income for HSBC helped bring in taxed profits of $54 million for the local unit in the nine months to September 2016. But it also hints that there’s more in the long-standing HSBC presence in Sri Lanka than credit cards. 

As a full-service bank, HSBC is the preferred destination for wealthy Sri Lankans to have an each-way bet on a country emerging from a crippling civil war. Sri Lankan plutocrats have tended to keep their wealth offshore since their country plunged into war in 1983, and it’s to HSBC and, to a lesser extent, Standard Chartered they’ve flocked with their cash. 

As Sri Lankans seek property back home, particularly in Colombo and along the coast, HSBC is enjoying that business too. The war ended eight years ago, but local banks still don’t have the same cachet, while old banking habits die hard – all good news for HSBC.

Of course HSBC’s expertise on the island extends into wholesale banking as well. It was, for example, a bookrunner on the sovereign’s $1.5 billion dual tranche issue in July. 

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Best Bank for CSR: Hatton National Bank


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Jonathan Alles,
Hatton National Bank
In a country looking to build a safe, sustainable recovery after decades of conflict and upheaval, it is no surprise that all the big financial institutions in Sri Lanka take their commitment to corporate social responsibility seriously. This award was therefore fiercely contested.


Good corporate citizenship for a Sri Lankan bank doesn’t come much more profound than caring for Adam’s Peak. Sacred to Buddhists, Hindus and Muslims alike, Adam’s Peak’s remoteness, high in the island’s central highlands, is no impediment to pilgrims, who tend to leave the holy site in a mess after paying their respects. 

Enter HNB, which was founded 129 years ago near here (HNB’s ‘H’ is for the mountain town of Hatton), so sponsorship of the mountain clean-up, drinking water and sanitation facilities is also close to its heart.

Potable water is at the centre of HNB’s national safe water campaign, where it has built purification plants, storage tanks and upgraded plumbing systems across the island, in a region where kidney disease is prevalent. It sponsors similar programmes for cancer and HIV awareness. 

HNB’s literacy campaign supports more than 200 schools and reaches 50,000 children. 

Its efforts don’t stop at typical CSR projects. For example, in a country with a rapidly ageing population, HNB has introduced a government pensioners personal loans scheme. 

HNB’s CSR activities are smart and focused. Yes, it is aimed at building business, and tends to be branded, but it is also subtle – sometimes Sri Lankans don’t even know HNB has been there before them


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