As we take a moment to glance back at the journey through 2023, a year filled with speculation and uncertainty, it is with immense pride and satisfaction that I report our successful navigation through the multitude of challenges with grace and determination. The challenges we faced tested the mettle of our organisation, but they also served as opportunities for growth and innovation. Guided by our core principles of integrity, innovation and excellence, we emerged stronger and more resilient than ever before. It is a year we exhibited sustained growth and firm commitment to delivering value to our stakeholders, a testament to unwavering dedication and a force for positive change in our ever-evolving landscape.

At the heart of our success lies a simple yet powerful truth – Commercial Bank is more than just a financial institution; it is a catalyst for change, a champion of progress and a steadfast partner in the journey towards a brighter future. Rooted in values as solid as the bedrock beneath our feet, we are driven by a singular mission – to make a difference, not just in the lives of our customers, but in the communities we serve and the world at large.

As we look back on the challenges overcome and the victories won, we cannot help but feel a sense of immense pride and satisfaction. Through sheer resilience, resolute dedication and the indomitable spirit of our team, Commercial Bank has not merely weathered the storms of 2023, but emerged as a towering monument of strength and fortitude.

In 2023, Sri Lankan businesses encountered a mix of challenges amidst efforts to stabilise the economy. Despite achieving a degree of macroeconomic stability through adherence to IMF programs, concerns over debt sustainability, revenue mobilisation and energy pricing persisted. The government prioritised social safety nets and financial stability, while grappling with the task of managing inflation amidst tax increases. Although positive indicators such as rebounding of credit to private sector and external sector resilience were observed, businesses continued to navigate uncertainties, including access to credit and vulnerabilities in the external sector, highlighting the ongoing complexities in fostering sustainable growth. The Commercial Bank has always been an ardent intermediator in helping enterprises to overcome such challenges.

Steering along a growth trajectory

Throughout the year, our primary goal has been to steer the Bank along a growth trajectory. I am pleased to inform that we have successfully achieved this goal.Despite the diverse challenges posed by the ever-changing economic landscape, we have managed to create enviable shareholder value through prudent decision-making, strategic investments and a relentless pursuit of excellence in all aspects of our operations. Our comprehensive approach to growth has been multifaceted, encompassing innovative product development, expansion into new markets and strategic partnerships aimed at enhancing our competitiveness. By leveraging emerging opportunities and mitigating risks effectively, we have not only sustained our momentum but have also positioned ourselves for sustained growth in the years to come. This achievement reflects the dedication and hard work of our entire team, whose firm commitment to our vision has been instrumental in driving our success.

Commitment to customers

At the heart of our success lies our steadfast commitment to supporting all our customers, particularly during times of hardship. We have remained by their side, offering assistance and guidance to help them overcome obstacles and emerge stronger. Our dedication goes beyond financial aid; we see ourselves as partners in their journey towards growth and success. Throughout the year, we have implemented tailored support programs, such as restructuring loan repayments and providing financial counselling addressing their individual needs. Additionally, we have invested in initiatives to enhance financial literacy and empower our customers to make informed decisions about their financial futures. Our customer service teams have consistently gone the extra mile to ensure each interaction is marked by empathy, professionalism and genuine support. Through fostering strong relationships built on trust and mutual respect, we have not only strengthened our connection with our customers but also earned their loyalty and admiration. As we navigate uncertain times, our commitment to standing by our customers remains solid, supporting them every step of the way towards overcoming challenges and achieving their aspirations.

Sustainable practices and corporate responsibility

As a responsible corporate entity, Commercial Bank remains committed to fulfilling our societal obligations and supporting the communities where we operate. Through ethical business practices and transparent financial operations, we not only contribute significantly through taxes but also actively engage in initiatives promoting fiscal resilience and community welfare. Our adherence to tax regulations underscores our commitment to governance principles and contributes to sustainable development of economies. By upholding tax obligations diligently, we positively impact the fiscal landscape, fostering economic stability and growth.

Moreover, our Corporate Social Responsibility (CSR) initiatives are integral to our identity as a socially responsible corporation. Through strategic partnerships and targeted investments, we address societal challenges such as education, healthcare, environmental conservation and poverty alleviation. By leveraging our resources, we make meaningful and lasting impacts on individuals and communities, enhancing our reputation as a socially responsible entity. Additionally, our sustainability commitment reflects our acknowledgment of environmental stewardship's importance and resource conservation. By integrating sustainable practices, we aim to minimise our environmental impact and contribute to future generations' well-being. By adopting energy-efficient technologies to promoting eco-friendly initiatives, we strive for a sustainable future.

Resilience and strategic agility in times of uncertainty

Throughout this turbulent period, our resilience, adaptability and strategic planning capabilities were put to the test. We leveraged our robust risk management framework, coupled with a proactive approach to scenario planning and contingency measures, to navigate through uncertain waters successfully. Moreover, our firm commitment to our core values and objectives served as a guiding light, enabling us to stay focused on our long-term goals and objectives amidst the chaos. As we reflect on the challenges overcome and the lessons learned from the past year, we are confident in our ability to tackle whatever challenges lie ahead. Armed with a stronger sense of purpose, renewed determination and a deep-seated commitment to excellence, Commercial Bank is well-poised to navigate through uncertain times and seize new opportunities for growth and innovation. Together, we have weathered the storm and emerged stronger, united in our pursuit of excellence and success.

Throughout the year, we have consistently reinforced our balance sheet strength and reaffirmed our position as the leading private sector bank. Our solid performance stands as a testament to our resilience and enduring dedication to serving our customers and stakeholders with distinction. As we celebrate our achievements, we look forward to building upon this foundation of success and strategic agility charting new heights of prosperity in the future.

Robust performance and strategic expansion

In terms of performance, I am delighted to report that Commercial Bank has once again delivered robust results across diverse sectors, both domestically and internationally. Despite the challenging economic environment, our commitment to excellence and strategic initiatives have yielded exceptional outcomes, reinforcing our position as a leader in the banking industry.

The Bank achieved two significant milestones during the year when total assets crossed Rs. 2.500 Tn. and deposits surpassed Rs. 2.000 Tn., the first private sector commercial bank to do so.

Across our domestic operations, we have continued to expand our market presence and enhance our product offerings, resulting in sustained growth and profitability. Our focus on customer-centricity and innovation has enabled us to meet the evolving needs of our clients effectively, driving increased engagement and satisfaction levels. Our prudent risk management practices and streamlined operational processes have contributed to improved efficiency and effectiveness, optimising our performance and maximising shareholder value.

Our overseas ventures have flourished, with our international operations contributing significantly to our overall success. Through targeted investments and strategic partnerships, we have strengthened our foothold in key markets, leveraging local expertise and market insights to capitalise on emerging opportunities. Our international expansion strategy has not only diversified our revenue streams but has also enhanced our resilience to regional market fluctuations, positioning us for sustained growth and profitability in the long term.

Elevating excellence for superior service

Our commitment to operational excellence has been consistently acknowledged through over 100 awards and accolades during the year, reaffirming our reputation as a provider of superior service and innovative solutions. These accolades underscore our unwavering dedication to delivering value to our customers, while also highlighting our success in implementing cost reduction strategies and sustainable practices. By prioritising efficiency, innovation and sustainability in all aspects of our operations, we are not only driving positive financial outcomes but are also contributing to the long-term sustainability of our business and the communities we serve.

Charting the path to financial excellence

Looking ahead, we remain committed to building on our achievements and further strengthening our position as a leading financial institution. Through continued investment in technology, talent development and customer-centric initiatives, we are confident in our ability to deliver sustained growth and value creation for our shareholders, customers and other stakeholders. Together, we will continue to innovate, adapt and excel, setting new standards of excellence in the banking industry.

Our strategic direction remains focused, driven by a commitment to digital transformation, technological innovation and data-driven decision-making. Recognising the importance of embracing emerging technologies, we aim to revolutionise our operations and offerings through digital transformation. By investing in cutting-edge solutions, we streamline processes, enhance efficiency and provide seamless, personalised experiences to customers across all touchpoints, empowering them to manage their finances with ease.

Our commitment extends beyond digitisation to the adoption of transformative technologies like artificial intelligence and blockchain. By leveraging these advancements, we seek to drive operational efficiencies and stay ahead in a competitive landscape. Anchored in data-driven decision-making, we harness analytics to inform strategic initiatives and anticipate customer needs proactively.

In parallel, we prioritise enhancing the customer journey, exceeding expectations and fostering lasting relationships built on trust. Through continuous refinement of products, services and processes, we drive engagement and foster long-lasting relationships. By benchmarking against industry standards and best practices, we maintain our position as innovators and strive for operational excellence. Looking ahead, we are excited about the possibilities as we execute our strategic roadmap, committed to innovation, customer-centricity and excellence. Staying true to our core values and embracing change with agility, we are confident in our ability to thrive and create sustainable value for all stakeholders.

Our commitment to prudent growth, proactive risk management and sound corporate governance practices serves as the foundation of our operational ethos, guiding us as we navigate the complex financial landscape. In an environment characterised by uncertainty and volatility, safeguarding stakeholders’ interests and preserving institutional integrity are paramount. To achieve this, we have implemented robust risk management framework, addressing various risks such as credit, market, operational, IT and compliance risks. Through a proactive approach, we anticipate and mitigate potential threats, ensuring financial stability and resilience.

Our steadfast commitment to corporate governance, transparency and ethical conduct underscores our dedication to fostering trust and accountability within our organisation and among stakeholders. Adhering to rigorous governance principles ensures that our decision-making processes are ethical, informed and aligned with the interests of all stakeholders.

A journey of gratitude, resilience, and excellence

As we reflect on the past and look towards the future, I am imbued with a profound sense of gratitude and confidence for Commercial Bank's journey. Our dedicated team has been the cornerstone of our success, showcasing resilience and excellence in the face of challenges. Their passion and pursuit of innovation have propelled us to new heights and will be our driving force as we continue to serve our customers, shareholders and other stakeholders with unwavering commitment.

I am grateful for the wisdom and guidance of our esteemed Board of Directors. I extend my appreciation to Mr K Dharmasiri who retired in January 2023, for his invaluable contribution during his tenure. Special thanks are due to Mr Sanath Manatunge, Managing Director/Chief Executive Officer for his leadership and guidance in navigating the complex financial landscape and in fostering a culture of excellence within our organisation. Our gratitude extends to the Governor and officials of the Central Bank of Sri Lanka whose guidance and support has been crucial in maintaining a stable and conducive regulatory environment, enabling us to achieve our goals.

Our investors’ confidence and our stakeholders’ loyalty, including our customers and business partners, have been pivotal to our enduring success. Your belief in our vision has empowered us to reach where we are today.

Building tomorrow together

In closing, I invite each of our stakeholders to join us in our ongoing journey towards excellence and prosperity. Let us continue to work hand in hand, united by our shared values and aspirations, to build a future where opportunities abound, communities thrive and dreams are realised. Together, we can achieve greatness and leave a lasting legacy of positive impact. I urge you to stay engaged, support our endeavours and collaborate with us as we embark on this exciting path forward. With your continued partnership and unwavering commitment, there is no limit to what we can achieve together. Thank you for your trust, your dedication and your belief in the vision of Commercial Bank. Together, let us shape a brighter tomorrow for generations to come.

Prof A K W Jayawardane
Chairman

February 21, 2024
Colombo