Commercial Bank Group has delivered a robust financial performance for the first quarter of 2026, combining record asset growth with stronger profitability, improved asset quality, and liquidity ratios that remain far above regulatory benchmarks.
The banking giant reported total assets of Rs. 3.61 trillion by the end of March, becoming the first private banking group in Sri Lanka to cross the Rs. 3.5 trillion threshold. The achievement comes amid a broader recovery in banking activity following the institution’s lending-focused expansion strategy initiated in 2025.
A closer examination of the bank’s quarterly results reveals that loan growth continued to dominate operations. Gross loans and advances reached Rs. 2.16 trillion after expanding by over Rs. 71 billion within the first three months of the year. Deposits rose even faster, climbing by more than Rs. 171 billion to Rs. 2.87 trillion.
The accelerated growth in deposits significantly strengthened liquidity buffers, allowing the bank to maintain liquidity coverage ratios far above the minimum statutory requirement. Rupee liquidity coverage stood at 368.83%, while all-currency liquidity reached 282.77%, providing the institution with a substantial safeguard against market volatility.
The bank’s Net Stable Funding Ratio also remained exceptionally strong at 165.35%, exceeding the required 100% benchmark by a wide margin.
Commercial Bank executives attributed the performance to disciplined financial management and a continued emphasis on risk mitigation. Chairman Sharhan Muhseen said the bank’s strategic focus on strengthening the balance sheet and maintaining prudent controls had positioned the institution for sustainable long-term growth.
CEO Sanath Manatunge highlighted that the bank had continued to strengthen governance standards, compliance measures, sustainability initiatives, and support for national economic priorities while pursuing expansion.
The group’s financial performance reflected this stability. Total operating income increased to Rs. 50.84 billion, while net operating income surged 21% to Rs. 47.66 billion. Although operating expenses rose by nearly 16%, the increase was offset by stronger revenue generation and reduced impairment costs.
Provisioning expenses dropped significantly from the previous year, reflecting earlier precautionary provisioning measures. Nevertheless, the bank stated it continues to monitor sectors vulnerable to global and domestic economic disruptions and maintain adequate protective overlays.
Profitability ratios also improved steadily. Return on assets before tax rose to 3.21%, while return on equity climbed above 21%, signalling stronger earnings efficiency and shareholder returns.
The bank’s net interest margin remained stable at 4.5%, despite pressure from changing interest-rate conditions. Meanwhile, the cost-to-income ratio improved slightly, indicating enhanced operational efficiency.
Another notable improvement came in asset quality. The Stage 3 impaired loan ratio fell to 1.34%, down from 1.54% at the end of 2025. Provision coverage on impaired loans also strengthened to 75.04%, suggesting that the bank remains cautious despite improving credit conditions.
Commercial Bank PLC, considered separately from the group, also posted strong earnings growth. Profit before tax reached Rs. 26.64 billion, while profit after tax rose to Rs. 17.17 billion during the quarter.
Financial analysts say the results position Commercial Bank among the strongest-performing financial institutions in Sri Lanka as banks continue navigating post-crisis recovery, rising taxation, and uncertain global economic conditions.
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