Hatton National Bank PLC (HNB) has reported a strong financial performance for the first half of 2026, demonstrating continued balance sheet expansion, resilient asset quality and sustained business momentum despite a challenging economic environment.

For the six months ended June 2026, the HNB Group recorded a Profit After Tax (PAT) of Rs. 22.5 billion, while the Bank reported a PAT of Rs. 23.1 billion. The performance was supported by significant growth in lending and deposits, with advances increasing by Rs. 224 billion and deposits rising by Rs. 138 billion during the first half of the year.

The Bank’s loan portfolio expanded by 15% during the first half of 2026, with gross loans and advances reaching Rs. 1.7 trillion. Meanwhile, the Bank’s total asset base surpassed Rs. 2.55 trillion, while customer deposits exceeded Rs. 2.1 trillion. The deposit base was supported by a CASA ratio of approximately 34%, reflecting the strength of HNB’s low-cost funding franchise.

HNB’s core banking income also recorded notable growth. Net Interest Income increased by 21% year-on-year to Rs. 55.2 billion, while the Net Interest Margin improved to 4.40%, compared with 4.26% in 2025. The improvement was supported by strong lending growth and higher interest income from loans and advances, which helped offset funding cost pressures.

The Bank also recorded strong growth in non-interest income, with net fee and commission income increasing by 30% year-on-year. The increase was driven by higher digital banking activity, increased card transactions and stronger contributions from transaction banking and leasing operations. As a result, total operating income rose by 27% year-on-year to Rs. 76.7 billion.

Despite higher operating costs, particularly those associated with foreign currency-denominated technology and payment processing expenses, HNB maintained disciplined cost management. The Bank’s annualised cost-to-income ratio improved to 34.48%, compared with 38.56% in 2025.

The expansion of the lending portfolio resulted in Rs. 4.1 billion in impairment provisions during the first half, compared with an impairment reversal recorded during the corresponding period of the previous year. Nevertheless, asset quality remained resilient, with the Bank’s Net Stage 3 ratio maintained at 1.17%.

Commenting on the results, Damith Pallewatte, Managing Director and CEO of HNB PLC, said the first-half performance reflected consistent execution and continued customer confidence. He highlighted the Bank’s ability to expand its lending and deposit portfolios while maintaining sound asset quality, strong capital and liquidity positions.

Looking ahead, HNB said it remains focused on executing its strategic priorities while supporting Sri Lanka’s economic recovery. The Bank plans to continue investing in digital capabilities, technology, employees and customer experience while maintaining prudent risk management and financial discipline.

HNB’s capital and liquidity position remained robust during the period. The Bank reported a Tier I Capital Ratio of 15.44%, a Total Capital Ratio of 18.18% and an all-currency Liquidity Coverage Ratio of 186.69%, providing substantial capacity to support continued business expansion while remaining comfortably above regulatory requirements.

The Bank’s performance was further reinforced by several national and international recognitions. HNB was named “Best Bank for Large Corporates in Sri Lanka 2026” by Euromoney for the second consecutive year. It has also received recognition from The Banker, The Asian Banker and Global Business Magazine across retail, corporate and SME banking categories. In addition, HNB was recognised as Sri Lanka’s Best Corporate Citizen 2025 by the Ceylon Chamber of Commerce.

With continued growth in lending and deposits, strong capital and liquidity buffers, resilient asset quality and expanding digital banking capabilities, HNB enters the second half of 2026 with a strengthened financial position and a clear focus on supporting customers, businesses and Sri Lanka’s broader economic recovery.