INVESTOR RELATIONS

LankaBangla Finance Limited disseminates information on its operations and initiatives on a regular basis. LankaBangla Finance Limited website serves as a key investor awareness facility, allowing stakeholders to access information on LankaBangla Finance Limited at their convenience. LankaBangla Finance Limited’s dedicated investor relations personnel play a proactive role in disseminating information to both analysts and investors and respond to specific queries.

FINANCIAL HIGHLIGHTS

LankaBangla Finance Limited

Financial Position 2012 2013 2014 2015 2016 Growth of 2016 over 2015 5 Year CAG R (%)/Average*
Total Assets 19,499 26,630 32,353 44,615 57,622 29.16% 31.11%
Total Liabilities 15,628 22,315 27,705 39,156 51,453 31.40% 34.70%
Business Disbursement 6,370 11,070 19,750 35,770 45,539 27.31% 63.52%
Property Plant and Equipment 50 73 129 878 999 13.83% 111.72%
Term Deposits 7,677 10,876 16,717 30,081 40,033 33.09% 51.12%
Total Investment Portfolio 18,634 25,732 31,228 42,600 55,205 29.59% 31.19%
Operational Performance
Operating Revenue 3,628 3,490 4,090 5,298 5,997 13.18% 13.38%
Operating Expenses 374 407 718 957 1,248 30.50% 35.19%
Financial Expenses 1,829 2,409 2,631 3,219 3,565 10.76% 18.15%
Net Profit Before Tax 1,233 344 465 1,046 1,107 5.87% -2.66%
Net Profit After Tax 1,236 448 652 1,030 1,072 4.08% -3.49%
EBITDA 3,275 3,103 3,415 4,310 4,737 9.89% 9.66%
Financial Ratios
Gross Profit Ratio 49.58% 30.96% 35.69% 39.25% 40.55% 3.31% 39.90%
Operating Profit Ratio 39.28% 19.28% 18.14% 21.19% 19.73% -6.90% 20.46%
Return on Capital Employed 8.81% 3.14% 2.70% 3.12% 2.46% -21.20% 2.79%
Capital Adequacy Ratio (2011: Test Run. Effct. From 2012) 19.6% 16.8% 15.07% 14.17% 13.23% -6.63% 13.70%
Gross Non performing assets to gross advances/Non performing loans (assets) to total loans (assets) 3.96% 4.84% 5.08% 3.72% 3.51% -5.65% 4.22%
Cost to Income Ratio 20.78% 37.71% 49.18% 46.01% 51.35% 11.60% 41.00%
Debt Equity Ratio 4.04 5.17 5.96 6.65 7.86 18.11% 5.94
Financial Expense Coverage Ratio 1.78 1.28 1.28 1.35 1.33 -1.26% 1.40
Return on Equity (%) 12.67% 10.95% 14.54% 20.38% 18.44% -9.54% 15.40%
Return on Assets (%) 2.04% 1.94% 2.21% 2.68% 2.10% -21.64% 2.19%
Equity Parameters
Authorized Capital 3,000 3,000 3,000 3,000 10,000 233.33% 35.12%
Paid-up Capital 1,894 2,083 2,188 2,406 2,767 15.00% 9.94%
Shareholders' Equity 3,871 4,315 4,647 5,459 6,170 13.03% 12.36%
No. of Share Outstanding 189.41 208.35 218.77 240.64 276.74 15.00% 9.94%
Net Asset Value (NAV) Per Share 13.99 15.59 16.79 19.73 22.29 13.03% 12.36%
Earnings Per Share (EPS)* 4.47 1.62 2.35 3.72 3.87 4.08% -3.49%
Market Price Per Share (Closing)* 46.4 57.6 40.00 29.0 34.8 20.00% -6.96%
Price Earnings Ratio (Times)* 10.79 30.92 14.77 6.78 8.98 32.59% 14.45
"Dividend Payment (C-cash & B- bonus)" 10% B 5% B 10% B 15% B 15% B - -
- 15% C 10% C 15% C 15% C - -
Dividend Payout Ratio (%) 56.60% 43.67% 67.11% 87.61% 96.80% 10.49% 14.36%
Dividend Coverage (Times) 1.84 2.29 1.49 1.43 1.29 -9.49% -8.44%
Dividend Yield (%) 1.69% 3.01% 4.55% 10.34% 8.62% -16.67% 5.64%
Profit Per Employee (mn) 6.15 1.37 1.38 1.98 1.59 -19.58% 2.49
"Credit Ratings"
Long Term A2 A2 A2 A1 AA3 - -
Short Term ST-3 ST-3 ST-3 ST-3 ST-2 - -

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MESSAGE FROM THE
CHAIRMAN

"LankaBangla has been developing its strategies for years based on diversification in markets with high growth potential, a customer-centric business model and technology as key elements in order to face the transformation process being experienced in its business segments. Sustaining earnings amidst challenging times and taking result oriented initiatives have helped us to elevate the company performance to the next level."

Dear Stakeholders,

It is indeed a proud moment for me to present to you the audited financial statements of LankaBangla Finance Limited for the year 2016. On behalf of the board members and everyone from LankaBangla I welcome you all to the 20th Annual General Meeting.

During the reporting period, LankaBangla Finance Limited has shown sustained performance and operating growth in all the business segments. As you know, we were in a sluggish credit market and the competition was stiff, yet 2016 has proved to be another year of success for us. Your patient guidance was the driving force behind this achievement and for that I would like to thank you all.

From macro-economic perspective, Bangladesh is making advances in various socio-economic indices. We’ve made remarkable progress in GDP growth and inflation rate is showing a downward trend. Industry showed declined trend in interest rate. We believe that our economy is better placed for business growth and with your continued support we will continue serving our client with innovative financial services and keep stretching the boundaries of our targets in the coming days.

You will be happy to know that during the year 2016 consolidated profit after tax of the Company stood at BDT 795.64 million against BDT 420.93 million in the previous year registering an 89.02% growth over 2015. The Company’s standalone net profit after tax increased to BDT 1,072.05 million which is 4.08% higher over the year 2015. Our consolidated investment portfolio has reached to BDT 57,462 million at the end of 2016 which was BDT 47,212 million at the end of 2015 showing 21.71% growth.

Automation of processes has played the key role in facilitating our commitment to service and forward strategy. In 2017, we are planning to have some significant technological integration which will simplify our processes and exemplify our service excellence in the industry. To facilitate our vision of being the most preferred financial solution provider of the country, widening our reach through extended branch network has no other alternatives. To bump up the growth of customer acquisition five new branches have been opened during 2016 and we are planning on launching 10 more branches in 2017 at major townships and industrial hubs throughout the country. Our company’s strength lies in the trust of the people and the wide reach covering all strata of society.

Various risks are inevitable in this line of business and a strong risk management framework is the prerequisite for an efficient financial organization. I can proudly say that LankaBangla has robust risk management architecture to define its risk appetite and monitor, report and review various risks inherent to the business in order to ensure sustainable asset quality against economic shocks. Our efforts in maintaining the NPL ratio at a minimal level is showing remarkable progresses and we have kept it at 3.22% which is one of the best in the industry. Capital Adequacy Ratio stands at 12.45% as against Bangladesh Bank’s stipulation of 10.00%. We have taken necessary measures to remain compliant, in line with the regulatory requirements, with regard to its forecasted future growth.

Realizing our vision depends on placing our clients at the center of everything we do. Achieving this objective begins with developing a precise understanding of their needs and what matters to them, and offering them the products, services and solutions to achieve their goals. How we do this is equally important, and we are focused on making the changes necessary to serve our clients quickly, efficiently, reliably and respectfully.

We have continued our support to underprivileged people of the community in particular to ensure their education, health and living through LankaBangla Foundation. Through conscience corporate governance and effective business model, we have proudly contributed towards a sustainable society.

The Board of Directors of LankaBangla Finance Limited believes in maintaining a consistent dividend policy. Considering the capital structure of the Company as well as future business strategy the Board has recommended 15.00% cash dividend and 15.00% stock dividend for the year 2016.

I am very proud to inform you that LankaBangla Finance Limited became the joint winner of SAFA, an Apex Body of the South Asian Association for Regional Co-operation (SAARC), BPA award for Best Presented Annual Report under Financial Service Sector category for consecutive second term. This achievement shows consistency in our continued efforts toward reaching the point of excellence in terms of service, functional expertise and transparency. Our subsidiary company, LankaBangla Securities Limited, has secured 1st position in terms of turnover for 11 consecutive years from 2006 to 2016 in Dhaka Stock Exchange (DSE), and for 12 consecutive years from 2005 to 2016 in Chittagong Stock Exchange (CSE), depicting outstanding performance.

To grow sustainably and profitably, we will continue our focus on further strengthening our capital position and financing the emerging business sectors. We are confident that our strategic focus on people, processes and technology along with our cost efficient approach in achieving an optimum mix of interest and non-interest income will help us to overcome the increasing competition and other challenges.

I would like to thank all the employees and the members of the Board of Directors for their relentless efforts and rock-solid commitment, without which our Company would not be able to hold this strong position. The workforce at LankaBangla is the greatest asset who with their determination and dedication has worked to take the company to the position where it is today. I like to extend my profound gratitude to Bangladesh Bank, Bangladesh Securities and Exchange Commission, Dhaka Stock Exchange Limited, Chittagong Stock Exchange Limited, Registrar of Joint Stock Companies and Firms, National Board of Revenue and all other regulatory authorities for their valuable guidance, support and cooperation. On behalf of the Board of Directors, I pledge that we will continue to add value for the shareholders through formulation and execution of prudent business strategies and practices whilst ensuring that we contribute towards the achievement of national priorities.

In closing, I thank all our shareholders and customers for their strong support and encouragements. We hope that with your continued co-operation and patronage, we will move on to a successful 2017.

With warm regards,

Yours sincerely,
Mohammad A. Moyeen
Chairman

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Managing Director's

Review & Statement

"In 2016, LankaBangla is entering into another growth trajectory. With a larger platform, we are well positioned for large scale expansion of our personal financial services and SME financial services. We have been emerging as customer centric financial institution with full range of financial services."

Dear Stakeholders,

2016 marks the completion of two decades of our operation and it has been a tremendous journey so far. We have placed ourselves as one of the leading financial service providers of the country and now we are all set for the big jump, which is to be the most preferred financier to our customers.

Investor Relation Department

Masum Ali

Senior Assistant Vice President, Board Secretariat, Regulatory Reporting & Corporate Affairs

Address : Safura Tower, Level-14 20 Kemal Ataturk Avenue Banani, Dhaka 1213
Phone : +880 2 9883701-10, Ext 402
Cell : +88 01713 069817
Fax : +880 2 8810998
E-mail : masum@lankabangla.com