Sri Lanka's fourth biggest commercial lender by assets said the it boosted loans to bigger companies, Fitch Ratings confirmed an 'AA-(lka)' rating of
Fitch said, "HNB's loan book is shifting towards larger, mid-sized corporates from its previous focus on retail and SME sectors, which, while adding to diversification, results in lower returns.
Exposure to large- and medium-sized corporates raised to 35% of the loan book at end-2013 from 29% at end-2012.
It was the primary reason the bank's loan book to expand 17 in 2013, outpacing a 9% loan growth in the broader banking sector.
HNB's loan growth was 18% compared in 2012 with 21% in the banking sector. HNB was decreasing its pawning or gold-backed loan exposure now that quality began to deteriorate.
HNB's regulatory non-performing-loans ratio enhanced slightly to 3.64% at end-2013 from 3.66% a year earlier was driven by growth in the loan book, while gross NPLs increased 18%.
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