Maldives Monetary Authority MMA reveals the improvements made by local banking sector during the 4th quarter of 2016.
Net assets of the commercial banks registered an annual growth of 6% (MVR2.5 billion) at the end of 2016's 4th quarter.
According to MMA the growth in net assets was mainly contributed by the increase in treasury bills investments and net loans during the period. While investment in treasury bills rose by 31% which is MVR 2.4 billion in annual terms, net loans rose by 14% with MVR 2.2 billion.
Looking at the asset quality of the banks, nonperforming loans (NPL) continued its downward trend during the year 2016 and decreased by MVR 0.4 billion at the end of quarter 4, 2016, when compared with the corresponding quarter of 2015.
The capital adequacy of the banking sector remained robust, as the capital ratios were maintained well above the minimum requirement.
The pre-tax profits earned by the commercial banks increased by 40 percent when compared with the same period last year and totaled MVR 2.7 billion during the last quarter of 2016.
MMA said this was mainly due to the improved interest income earned by the commercial banks owing to increased lending. Moreover, the reversal of loan loss provisions resulting from large loan recoveries during the year also contributed to the increase in pre-tax profits.