Peoples Bank Annual Report 2022 1

CREATING A LEGACY OF CARING FOR
GENERATIONS TO COME…
The saga of People’s Bank is one built on a legacy of unmatched
strength, capacity, resilience and a deep sense of care for the customers
it serves and ultimately Sri Lanka’s economy which it aims to dearly
protect and push forward. This is, and has always been, the character
and ingrained identity of the Bank. Over the past six decades, the Bank
has served generations of customers from all walks of life and varying
socio economic and demographic profile through both good times and
bad. Standing firm with all its stakeholders in this time of need,
we look forward to caring for generations to come as
we remain focused on our role to help usher in a
new era of prosperity for the entire nation.
2
CONTENTS
PEOPLE’S BANK ANNUAL REPORT 2022
3 About our Integrated Report
7
ABOUT PEOPLE’S BANK
67
MANAGEMENT DISCUSSION
205
FINANCIAL STATEMENTS
AND ANALYSIS
8 Our Bank 206 Directors’ Responsibilities for
68 Head of Finance’s Review Financial Reporting
9 Our Group
72 Business Line Reviews 207 Auditor General’s Report on
10 Our Journey
72 Retail Banking Financial Statements
12 Highlights of the Year
73 Enterprise Banking 209 Income Statement
75 Corporate Banking 210 Statement of Comprehensive

Income
15
REFLECTIONS FROM THE TOP
77 Treasury
78 Overseas Customer Services
80 International Banking
211
212
Statement of Financial Position
Statement of Changes in
Equity – Bank
16 Letter from the Chairman 82 Manufactured Capital
214 Statement of Changes in
87 Intellectual Capital Equity – Group
20 General Manager/
Chief Executive Officer's Review 95 Human Capital 216 Statement of Cash Flows
24 Board of Directors 108 Social and Relationship Capital 217 Notes to the Financial
28 Corporate Management 108 Customer Capital Statements
36 Executive Management 115 Business Partner Capital
38 Chief Managers 120 Investor Capital

124 Community Capital
129 Natural Capital
39
DRIVING VALUE CREATION
137
GOVERNANCE
325
SUPPLEMENTARY REPORTS
40 Operating Environment 138 Risk Management Report 326 Income Statement USD
47 Stakeholder Engagement 168 Corporate Governance 327 Statement of Financial
194 Board Subcommittee Reports Position USD
50 Materiality
194 Board Audit 328 Ten Year Summary – Bank
55 Our Strategy
Committee Report (BAC) 329 Ten Year Summary – Group
60 Our Value Creation Model and
195 Board Human Resources
Capital Balances 330 Basel III – Market Discipline
and Remuneration
Disclosure Requirement under
62 Commitment to Sustainability Committee Report (BHRRC)
Pillar III
196 Board Integrated Risk
Management Committee 326 External Assurance on
Report (BIRMC) Sustainability Report
197 Board Executive Credit 348 GRI Content Index
Committee Report (BECC)
353 Senior Managers
198 Board Nomination
Committee Report (BNC) 356 Branch Managers
199 Board Investment Banking 364 Glossary of Financial/

Committee Report (BIBC) Banking Terms
200 Board Information 368 Corporate Information
Technology Committee
Report (BITC)
201 Board Strategic Planning Review
Committee Report (BSPRC)
202 Directors’ Statement on Internal
Control over Financial Reporting
204 Auditor General’s Assurance
Report on Internal Controls
PEOPLE’S BANK ANNUAL REPORT 2022 3
ABOUT OUR INTEGRATED REPORT
We have the pleasure of presenting SCOPE AND BOUNDARY VALUE CREATION

to you the 8th Integrated Annual
The Report covers the operations We have excelled in creating value
Report for People’s Bank, covering the
of People’s Bank and its subsidiaries for our stakeholders by staying true
12 month period ending 31 December
People’s Leasing & Finance PLC and to our strategies and achieving the
2022. It is a review of the Bank’s
People’s Travels (Pvt.) Ltd. The key performance standards expected
performance in creating value for our
financial aspects included under the under the various capitals. Our value
stakeholders in the short, medium
Financial Capital and Investor Capital creation capital balances model is
and long term, with reference to the
are discussed with reference to the presented on pages 60 to 61, the
six defined Capitals. It also describes
Group including the Bank, and the strategy initiatives are presented
the special efforts we have made
non-financial aspects covered by the on pages 55 to 59, and the capital
to support our stakeholders – our
Manufactured Capital, Intellectual performance is described on
clients, our staff, the government, and
Capital, Human Capital, and Social and pages 68 to 136.
communities across the nation as we
faced the unprecedented economic Relationship Capital are discussed in
the context of the Bank unless stated
catastrophe and political uncertainty MATERIALITY
during the year. otherwise. The report retains our
usual cycle for annual financial and We have conducted materiality
sustainability reporting from 1 January assessments, compiled the material
This Report builds on our previous
2022 to 31 December 2022. matters and formulated the
Integrated Annual Report published
management responses to address the
on 31 December 2021 and is consistent
During the year under review, there topics, and these resolutions can be
with our annual reporting cycle for both
were no significant changes from the seen in the section on pages 50 to 54.
financial and sustainability reporting.
previous reporting period in terms of The material aspects identified guide
both scope and aspect boundaries, the contents of the rest of the report.
nor were there any restatements as A major innovation we have made
compared to the Annual Report this year is to introduce a forward
issued in the previous year. looking element into materiality. The
material topics have been forecasted
for a 5-10 year period. In line with
this development, a future-oriented
Integrated Reporting Boundary approach has been taken when
describing the performance of the
other capitals and the business units.
Financial Reporting Non-Financial

Boundary Reporting Boundary CAPITALS
The following six capitals are

defined by the International
Integrated Reporting Framework:
Financial Capital
Manufactured Capital
Financial Manufactured Intellectual Human Social and Natural
Capital Capital Capital Capital Relationship Capital Intellectual Capital
Capital
Human Capital
Social and relationship Capital

People’s Leasing and People’s Travels
Customer Capital
Finance PLC (Pvt) Ltd.
Community Capital
Business Partner Capital
People’s Bank Investor Capital
Natural Capital
In the spirit of integrated reporting,
During the year under review, no significant changes took place in the size or the inter-connections between the
capitals are also brought out when
structure of the company compared to the previous year.
describing them.
4 PEOPLE’S BANK ANNUAL REPORT 2022
About our integrated Report
STRATEGY The above have been formulated with the background of a volatile situation
and the awareness that the banking industry is vulnerable to disruption.
Our strategic performance has been
reviewed on pages 55 to 59.
REPORTING FRAMEWORKS
The following includes amongst others.
A new set of strategic objectives
have been set out for the next two
years, culminating in June 2025:
Regulations Voluntary Standards
Driving excellence
People’s Bank Act No. 29 of 1961 Code of Best Practice on Corporate
Building Customer (as amended) Governance issued by the Chartered
Centricity Accountants of Sri Lanka in
Banking Act No. 30 of 1988
December 2017
(as amended)
Future-ready
Global Reporting Standards of the
CBSL Directives
Global Reporting Initiative
The underlying enablers are: Exchange Control Act No. 24 of 1953
UN Sustainability Development Goals
Financial Transactions Reporting (SDGs)
Act No. 6 of 2006
Lean-Agile Mindset Integrated reporting framework
Prevention of Money Laundering issued by the International Integrating
Act No. 5 of 2006 Reporting Council (IIRC)
Data-driven Mindset
Banking Act Direction No. 11 of 2007
Growth Mindset on Corporate Governance for Licensed
Commercial Banks
People’s Bank has reported the information cited in the GRI Content Index
(page 348 to 352) for the period 1 January 2022 to 31 December 2022 with
reference to the GRI standards.
CLASSIFICATION OF OUR REPORT
Transparency Accountability Governance Sustainability
The Bank has endeavoured The Bank has complied with Good governance has The Bank has a Corporate
to present all information legal requirements, rules and been a watchword in Sustainability Policy
material to our stakeholders regulations with regard to the administration of the formulated to serve
in this integrated report in a accountability practices. Bank from the inception, as a guide for decision
spirit of full disclosure. particularly as a state bank, makers to ensure that
Quality assurance checks have
and the levels of scrutiny every aspect of the
In addition to statutory been signed off both internally
are critical to ensure total Bank’s operation complies
reporting we have included and by recognised external
compliance. with the environment
several aspects of voluntary professionals on the accuracy
friendly philosophy of the
reporting as part of our of the information contained
organisation.
integrated report. in the report.
PRECAUTIONARY PRINCIPLE
We apply the precautionary principle with regard to our social and environmental sustainability. While being aware that our
operations have an overall positive impact on society and the environment, we have taken the necessary steps to ensure
that any risk of a negative impact is mitigated. These are described on pages 124 to 128 and 129 to 136 respectively, under
the headings “Community Capital” and “Natural Capital”.
QUALITY ASSURANCE
We have added more graphs, tables, and infographics, to improve the comparability and clarity of the data. describe
Internal controls that are already in place, and enable traceability and verifiability that have made it easier to ensure the
accuracy and consistency of the information. The increased use of visual components has improved the Report's readability
and succinctness. All of the Bank’s direct and indirect material impacts have been included to ensure that the report is
comprehensive. We have made an effort to present a fair analysis of all pertinent information, and both internal and
external assurances have been obtained to ensure the validity and dependability of the information.
Aspect Internal assurance External assurance
Financial Reporting Board of Directors, Internal Audit The Auditor General’s Department
Sustainability Indicators Board of Directors, Internal Audit, Business Heads Messrs. Ernst & Young
Corporate Governance Board of Directors, Internal Audit The Auditor General’s Department
Internal Control Board of Directors, Internal Audit The Auditor General’s Department
THE EVOLUTION OF OUR INTEGRATED ANNUAL REPORT
KEY AWARDS AND RECOGNITIONS FOR THE 2021 ANNUAL REPORT

INTERNATIONAL ARC AWARDS 2022 SOUTH ASIAN FEDERATION OF
Gold – Written Text: Banks ACCOUNTANTS (SAFA) AWARDS
Gold – Financial Data: Banks: national People’s Bank 2021 Annual Report –
Joint Bronze in the Public Sector Bank category:
CMA EXCELLENCE IN INTEGRATED REPORTING Being the only Public Sector Bank in Sri Lanka
AWARDS 2022 to be podiumed.
People’s Bank 2021 Annual Report as one of the
top ten “Best Integrated Annual Reports”
FORWARD-LOOKING
STATEMENTS QUERIES AND
This report contains forward-looking FEEDBACK
statements that are based on
assumptions and information that is
currently available, and may include We value your feedback to help us
forecasts on the Bank’s business to improve future Reports. Please
forward your comments, questions
prospects, anticipated developments, and suggestions to:
trends, and market conditions,
operations, and exchange rates. Azzam A Ahamat
By their very nature, they involve Head of Finance
significant risks and uncertainties, and Finance and Management Accounting
the actual results may differ from the Department
forecasts. People’s Bank,
No. 75, Sir Chittampalam A Gardiner
Mawatha,
VIDEO SNAPSHOT OF OUR Colombo 2.
ANNUAL REPORT
+94 11 248 1481 (ex. 498)
We are introducing a video summary
of our Annual Report to enable you [email protected]
to get a quick overview of the salient [email protected]
information.
www.peoplesbank.lk
You can access the video from

the below link
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7
ABOUT REFLECTIONS DRIVING MANAGEMENT DISCUSSION GOVERNANCE FINANCIAL SUPPLEMENTARY

PEOPLE’S BANK FROM THE TOP VALUE CREATION AND ANALYSIS REPORTS STATEMENTS INFORMATION
PEOPLE’S
ABOUT
BANK
12 / Highlights of the Year

10 / Our Journey
9 / Our Group
8 / Our Bank
7
OUR BANK
People’s Bank is the largest financial

services provider in Sri Lanka based on
customer numbers and geographical
reach across the entire island. It has
OUR VISION BHAG
the largest branch network in the
sector and, as a result, over 14.7 million Inspiring the Nation towards To be the most customer sought
customers across the nation. We serve Transformational Growth after bank with the industry best
customers from all walks of life, in employee satisfaction levels.
addition to the Government, Corporate
and SME sectors. The staff strength
of the Bank stands at 7,377 spread
across a network of 745 branches,
providing industry-leading products OUR MISSION OUR VALUES
and services, while upholding the
highest standards of professionalism, z We are in the business of z Being the pride of the nation
sustainability, and compliance in all providing financial services that
z Customer focus and agility
facets of its operations. Designated contribute to the quality of life,
by the Central Bank of Sri Lanka as a and enterprise development, z Integrity and accountability
Domestic Systemically Important Bank via affordable, accessible, and
z Continuous learning culture
(D-SIB), the People’s Bank has made efficiently delivered solutions
and team spirit
a vital contribution to the economic
z We empower and develop our
development of the country for z Empowerment and diversity
human resources, so that they
more than six decades, since it was
will care for and protect our
established under the People’s Bank
customers
Act No. 29 of 1961. The Bank continued
to play its role as a premier State Bank z We contribute to national
by supporting the nation with financing economic development, while
for essential items throughout the being competitively profitable
economic turmoil of the year under
z We believe in giving back
review. In recent times we have
to the society we operate in
moved heavily into digitalisation to the
while being sustainable in our
point where a majority of customer
business practices
transactions are now conducted
digitally. The Bank has also made
a major contribution to promoting
financial literacy country-wide.
OUR GROUP
PEOPLE’S BANK
ABOUT
Year of Incorporation Main Products and Services
FROM THE TOP

REFLECTIONS
1961 Retail Banking
Enterprise Banking
Customer Segments Corporate Banking
Individuals International Banking
Micro Enterprises
Performance Highlights
Small and Medium Scale Businesses
Assets LKR 2,972 Bn.
Corporate, Government and
VALUE CREATION
DRIVING
State-Owned Enterprises Profit after tax LKR 17.2 Bn.
Number of Branches Staff Strength

745 7,377
Ownership 75% 99%
AND ANALYSIS
Year of Incorporation 1995 1993
Individuals Individuals
Micro Enterprises Micro Enterprises
Customer Segments Small and Medium Small and Medium
REPORTS
GOVERNANCE
Scale Businesses Scale Businesses
Leasing and Hire Purchases Inbound Travel

Microfinance Outbound Travel
Main Products and Services Deposits Destination Management
Loans STATEMENTS
FINANCIAL
Assets Assets
LKR 195 Bn. LKR 92 Mn.
Profit after tax Profit after tax

Performance Highlights LKR 4.1 Bn. LKR 10.4 Mn.
INFORMATION
SUPPLEMENTARY
Number of Branches 111 2
Staff Strength 3,062 15

OUR JOURNEY
1961 to 1969 1980 to 1989 2000 to 2009

z Inaugurated on 1 July 1961. z Launched the Extended Minors’ z “Jana Jaya”, savings cum loan
z First branch was opened at Savings Scheme. scheme was launched.
Duke Street, Colombo. z 300th branch was opened z The Central ATM Switch was
z Commenced pawning services. at Ingiriya. introduced.
z Inaugurated the Co-operative z Total number of employees z The number of branches with
Rural Banking Scheme and a reached 10,000. People’s Automated Banking
new Agriculture Credit Scheme z The computerisation process began System (PABS) increased to 218
becoming the pioneer lender to at our Head Office and selected city and 119 branches were connected
the small farm sector. branches and a Black Light System to the Central ATM Switch.
was introduced, substantially z A Treasury automation package
1970 to 1979 reducing customer turnaround time. was implemented.
z The Bank obtained the first ever
z “Athamaru” loan scheme was
introduced to finance economic
1990 to 1999 public rating of BBB+ from Fitch
Ratings Lanka.
activities of the informal sector. z First ATM was installed at the
Headquarters Branch. z The Bank received the first capital
z 100th branch was opened at
tranche of LKR 2 Bn., second capital
Marandagahamula. z The Bank supported the
tranche of LKR 1 Bn. and third capital
z Employee count reached 5,000. Government’s 200 Garment
tranche of LKR 1.5 Bn. as the Equity
Factory Programme.
z First fisheries bank was opened Capital Investment in the Bank by
at Koralawella. z 160 branches were computerised. the Government of Sri Lanka in
z Launched “Vanitha Vasana”, and keeping with the agreement signed
“Isuru udana” savings schemes, between the Government, ADB and
“Surathura” loan Scheme, People’s Bank.
“Videshika” deposit scheme. z For the first time, received the
SAFA (South Asian Federation of
Accountants) Award for the 2008
Annual Report.
Our journey
PEOPLE’S BANK
ABOUT
2010 to 2019 2020 2022
z Won one Grand Award and three z The Bank extended unparalleled z Launched two new brands,
Gold Awards in the National support to the Nation, customers Excelsior and Elegance, to cater to
Category at the 2012 International and the general public during the premium market segment.
ARC Awards for the Bank’s Annual COVID-19. People’s Bank raised the z Introduced our CSR umbrella Brand
Report 2011. highest ever by the industry to date, “Mahajana Mehewara”.
FROM THE TOP

REFLECTIONS
z 23 SME centres were established Tier II Debentures worth LKR 20 Bn.
z Successfully launched Strategic
across the island. z The only entity amongst the Top Planning 2022-2024.
z People’s Bank became the first bank 3 and only state bank to have a
z The Bank received several awards
to be connected to the National positive incline in brand value.
and accolades during the year
Common ATM Switch. from international entities, as well as
z The Bank’s asset base crossed one 2021 Sri Lankan organisations.
trillion rupees, as the second largest z The Bank celebrated its 60th – People’s Bank was named among
bank in the industry. Anniversary with the theme the World’s Top 1000 Banks by
VALUE CREATION
DRIVING
z The Bank garnered the triple “Pride of the Nation”. the Banker Magazine, while Asian
accolades of “Bank of the Year 2014” z People’s Wave became the most Banker Magazine included us
at the European Global Banking and downloaded mobile app in the among the Asian Banker’s Top
Finance Award-Sri Lanka 2014 as well country with over a million active 500 Banks.
as “Best Banking Group Sri Lanka” users, and the launch of People’s – Received four awards at the
and “Most Sustainable Bank Pay wallet app. International ARC Awards 2022
Sri Lanka” at the World Finance including two gold awards.
Banking Awards 2014.
– Annual Report 2021 was among
AND ANALYSIS
z The Bank launched a Green Banking the top ten Best Integrated
Concept in demonstrating its Annual Reports at the CMA
sustainability commitments. Excellence in Integrated
z Opened Sri Lanka’s first fully Reporting Awards 2022.
digitalised branch in Colombo and – The Bank was a joint Bronze
received the prestigious ISO/IEC winners at the Public Sector
27001:2013 quality certification for Bank category in South Asian
Information Security Management Federation of Accountants
first for any State bank in the Nation. (SAFA) Awards.
z People’s Wave became the – Won the Bronze Award for
most downloaded finance app the State Sector at TAGS
REPORTS
GOVERNANCE
in Sri Lanka. Awards 2022.
z The Bank raised LKR 10.0 Bn. via – The Bank was recognised as
debenture issue post People’s Bank Sri Lanka’s most outstanding
(Amendment) Bill passed by the workplace for women at the
Parliament. SBUs reached 239 – WFWP Awards 2022.
a feat achieved in just three years.
z The Bank signed the largest ever
and the longest tenor bilateral
STATEMENTS
FINANCIAL
funding facility secured by any

commercial bank in Sri Lanka to date.
INFORMATION
SUPPLEMENTARY
HIGHLIGHTS OF THE YEAR
Bank Group
2022 2021 Change 2022 2021 Change

% %
Operating performance (LKR Bn.)

Interest income 321.9 197.3 63.1 351.4 222.4 58.0
Net interest income 75.8 82.5 -8.1 91.0 96.9 -6.0
Gross income 357.2 207.2 72.4 391.2 236.8 65.2
Operating profit before taxes on financial services 29.5 37.2 -20.7 36.7 45.7 -19.7
Profit before tax 21.3 30.4 -29.8 26.7 37.2 -28.3
Income tax 4.1 6.7 -37.8 6.2 9.2 -32.7
Profit after tax 17.2 23.7 -27.5 20.5 28.1 -26.9
Special levy and dividends paid 0.7 2.2 -69.9 0.9 2.3 -63.4
Retained profit 16.5 21.5 -23.2 19.7 25.7 -23.6
Financial position (LKR Bn.)

Total assets 2,972.0 2,647.6 12.3 3,133.1 2,832.6 10.6
Gross loans and receivables 1,915.8 1,937.0 (1.1) 2,061.1 2,103.6 -2.0
Total deposits 2,371.5 2,071.5 14.5 2,450.1 2,168.7 13.0
Shareholders’ funds 145.3 136.1 6.8 189.3 177.6 6.6
Performance ratios (%)

Return on average assets (before tax) 0.8 1.2 0.9 1.4
Return on equity (after tax) 12.2 19.9 11.2 17.7
Interest margin 2.7 3.4 3.1 3.7
Cost to income ratio 50.4 51.1 53.1 53.3
Loans to deposits ratio 80.8 93.5 84.1 97.0
Assets quality ratios (%)

Impaired loans (Stage 3) ratio 12.8 4.0 12.6 4.7
Impairment (Stage 3) to Stage 3 loans ratio 29.9 50.2 30.5 46.9
Statutory liquid assets ratio (%)

(min. requirement – 20%)
Domestic banking unit 21.4 23.5
Off-shore banking unit 20.1 25.9
Liquidity coverage ratio (%)

(min. requirement – 90%)
Liquidity coverage ratio – rupee 213.1 155.8
Liquidity coverage ratio – all currency 119.5 105.7
Regulatory capital ratios (%)

Common equity Tier 1 capital
(min. requirement – 8.0%) 11.4 12.0 12.8 13.0
Tier 1 Capital
(min. requirement 2022 – 9.5%/2021 – 8.5%) 11.9 12.6 13.3 13.4
Total Capital
(min. requirement 2022 – 13.5%/2021 – 12.5%) 16.3 17.8 17.2 17.9
Shareholder ratios (LKR)

Earnings per share 17,192 23,720 -27.5 19,572 26,351 -25.7
Net asset value per share 145,294 136,077 6.8 189,332 177,638 6.6
Highlights of the year
PEOPLE’S BANK
ABOUT
TOTAL ASSETS TOTAL DEPOSITS
LKR Bn. LKR Bn.
3,000 2,500
2,972
2,372
2,400 2,000
2,648
2,072
2,230
1,835
1,800 1,500
FROM THE TOP

REFLECTIONS
1,875
1,491
1,735
1,423
1,200 1,000
600 500
0 0
2018 2019 2020 2021 2022 2018 2019 2020 2021 2022
VALUE CREATION
DRIVING
TOTAL EQUITY INTEREST INCOME
LKR Bn. LKR Bn.
160 350
322
145
128 280
136
96 210
102
95
91
197
184
180
64 140 166
AND ANALYSIS
32 70
0 0
2018 2019 2020 2021 2022 2018 2019 2020 2021 2022
NON-FUNDED INCOME PROFIT BEFORE TAX

LKR Bn. LKR Bn.
35 35
34
28 28
30
REPORTS
GOVERNANCE
24
21 21
21
21
20
14 14
14
13
11
7 7
9
0 0
2018 2019 2020 2021 2022 2018 2019 2020 2021 2022
STATEMENTS
FINANCIAL
COST TO INCOME RATIO TOTAL CAPITAL RATIO

% %
70 20
56 16
17.8
61.9
61.3
16.3
54.3
15.5
14.7
51.1
14.5
50.4
42 12
INFORMATION
SUPPLEMENTARY
28 8
14 4
0 0
2018 2019 2020 2021 2022 2018 2019 2020 2021 2022
MARKET AND CUSTOMER
Over 73% of conventional 682,300

banking transactions conducted new customers onboarded
through digital channels
Launch of two new product

packages to cater to the premium
Over 90%
customer satisfaction
customer segment
EMPLOYEES
Total number of Female employees
employees 7,377 4,542
Retention ratio Total training hours
97.6% 176,577
Total training cost Average training time per
LKR 92.8 Mn. permanent employees 24
Number of hours on digital training

40,970
NATIONAL BUSINESS COMMUNITY ENVIRONMENT

CONTRIBUTION PARTNERS
Total special levy and 258 Launch of 2.7 million

dividends paid registered suppliers “Mahajana accounts opened
LKR 661 Mn. Mehevara” digitally
LKR 14.8 Bn. CSR Brand
Provision of financial value created for 20
support for essential
sectors such as
local suppliers LKR 38.2 Mn. green branches
Investment in powered by
exports, energy, solar energy
and health CSR initiatives
PEOPLE’S BANK
ABOUT
15
FROM THE TOP

REFLECTIONS
REFLECTIONS
VALUE CREATION
DRIVING
FROM THE TOP
AND ANALYSIS
16 / Letter from the Chairman
20 / General Manager/Chief Executive Officer’s Review
24 / Board of Directors
28 / Corporate Management
36 / Executive Management
38 / Chief Managers
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
LETTER FROM THE CHAIRMAN
We remain committed to
prioritising customer experiences
as the bedrock on which we will
seek organic growth. This entails
creating innovative banking
products and services that address
changing customer needs and
making them available via
channels closer to them.
The year under review was the

most turbulent one for the Sri Lankan
economy in 75 years. The country
was plagued with reduced remittances,
shortage of foreign exchange, high
inflation, and lack of Rupee liquidity.
In addition, there was the default on
foreign debt, which resulted in Sri Lanka’s
standing with international creditors
plummeting. This macro-economic
turmoil permeated virtually every
sector of the economy.
Naturally, the Bank could not remain

unscathed by turbulence of this
magnitude. Market circumstances
considered, the Bank had to steer
through stresses on many fronts be
liquidity, high interest rates, provision
for high impairment, and squeezed
profit margins. The country downgrade
led to our foreign partners suspending
lending, which further constrained
particularly dollar liquidity.
A NEW STRATEGIC
DIRECTION
The unprecedented situation we
were faced with necessitated a
course correction in mid-stream.
The existing strategic plan for the
period 2022-2024 was superseded
by a new plan for the period June
2022 to June 2025. The plan was
Letter from the Chairman
PEOPLE’S BANK
ABOUT
formulated with inputs from all key People’s Bank’s resilience and ability to usual operations with our unwavering
stakeholders, including front-line operate under challenging conditions support. We will continue to grow
staff at the branches. can be attributed to its prudent risk while staying true to our fundamental
management practices, proactive values as a bank that supports its
Concurrent with the introduction of measures taken to address potential customers and the economy.
the new plan we also promulgated a risks and challenges, and strong
new Vision and a Big Hairy Audacious liquidity position.
DIGITAL LEADERSHIP AND
FROM THE TOP

REFLECTIONS
Goal (BHAG).
In the context of limitations of CUSTOMER-CENTRICITY
The Vision: Inspiring the nation resources we have had to prioritise Customer centricity is one of our
towards transformational growth their utilisation. With foreign exchange strategic objectives, and digitalisation
BHAG: To be the most customer being limited, and the need to service is a major thrust of another, driving
sought after bank with the industry essential imports, we had to reserve excellence.
best employee satisfaction. any remaining resources for priority
areas such as export industries. In view In this regard, I am happy to note that
VALUE CREATION
DRIVING
Given the context in which the plan of all things known, we had to also take our digitally-led and customer-centric
was formulated we have brought a a cautious view of credit growth. approach has enabled us to remain
process-oriented view into the next competitive, and achieve significant
level of the plan. This includes three To address asset quality deterioration, growth over the years, and we will
strategic objectives: Driving excellence, the Bank has implemented rigorous continue to build on this strategy.
building customer centricity, and risk management practices to identify Moreover, we are open to exploring
being future ready. Associated with and manage potentially problematic the possibility of offering a complete
the objectives we have identified three loans. In terms of liquidity, we have virtual banking experience in the
strategic enablers: Lean-agile mindset, maintained a robust liquidity position future, as we strive to become the
AND ANALYSIS
data driven mindset, and growth by actively managing liquidity risk premier digital bank in Sri Lanka. The
mindset. and maintaining adequate liquidity success of our digitalisation strategy
buffers at all times. In the face of high is shown by the fact that over 70% of
A plan giving emphasis to the above inflation and interest rates, People's transactions are carried out digitally.
gives greater flexibility, in a milieu such Bank engaged in optimising its funding
as the present where rigid, inflexible mix, diversifying its funding sources, Another initiative undertaken during
plans are not appropriate. The plan is and managing its interest rate risk the year was the launch of the new
further elaborated on with 26 strategic exposure. website, to which we will be adding
initiatives for the business units, 6 for a Chatbot in the near future. The
the supporting units, and around 600 Contact Centre will be given enhanced
Key Performance Indicators (KPIs),
HELPING SMEs AND THE
capabilities, and People’s Pay features
but we anticipate some flexibility in RURAL SECTOR
will continue to be improved.
REPORTS
GOVERNANCE
implementation. People’s Bank was established with
the primary objective of serving the To commemorate the World Children’s
rural population, and we have stayed Day, People’s Bank hosted a Minor
NAVIGATING THROUGH
true to our founding principles by Savings Deposit Campaign from
THE STORM
continuing as an affordable and 1 October to 31 December 2022,
Despite all the stresses of the accessible bank that aids economic targeting minor accounts, featuring
macro-economic environment, the growth in line with the Government’s a variety of creative activities.
Bank turned in a very commendable objectives while serving the public.
STATEMENTS
FINANCIAL
financial performance during the Although the current interest rates

year. The Group recorded a post-tax have made it challenging for SMEs to
STEPPING INTO NEW AREAS
profit of LKR 20.5 Bn. and a Capital obtain loans, we have been able to Another innovative step was channels
Adequacy Ratio of 17.2% at the end of provide some funding at concessional catering exclusively to the affluent
the year. Both these achievements are rates when we were supported by customer market, with Excelsior
praiseworthy when viewed through the an international financial institution. and Elegance services already being
lens of the operating context. People’s We also stretched out a helping hand launched, and are in the process of
INFORMATION
SUPPLEMENTARY
Bank has been accorded global to the agricultural sector, to support being enhanced. The “Vaasi Kotiyai”
recognition by the esteemed The supply chain financing and assist promotion for overseas remittances is
Banker Magazine (UK) as one of the smallholders. Once economic stability ongoing and has yielded encouraging
Top 1000 Banks in the World, based on is restored and the rates decrease, results. It has significantly increased
ranking of Consolidated Tier-I capital. they will be able to resume their our market share in a domain where it
was formerly relatively small.
We moved beyond our traditional We have also brought the “soft sell” contract staff. This will be of great
role when we partnered with the strategy into social media. Through advantage in areas such IT, where we
Export Development Board and the our YouTube channel we disseminate are suffering from a drain of skilled
BOI to build linkages between local content such as cuisine, not directly staff due to our salaries not being
manufacturers and overseas buyers, related to banking or any business competitive with the private sector,
creating new export opportunities. The objectives. The physical appearance and we are facing constraints in how
EDB was able to assist our customers of our branches also underwent a far we can upgrade remuneration for
on many aspects of exporting including facelift, with use of colour and layout permanent staff.
export procedures, regulations, to facilitate customer convenience.
and shipping.
STRATEGY FOR THE COMING
DEVELOPING SOFT SKILLS YEAR AND FACING FUTURE
REBRANDING AND FOR THE FUTURE CHALLENGES
“SOFT SELLING”
One of our BHAG goals is to attain the The third of our strategic objectives
We recognised the fact that in the industry’s best employee satisfaction is being future ready. People's Bank
present economic climate many levels. Employee satisfaction is maintained its profitability in a very
customers may not be responsible to being continually gauged through volatile environment by taking a
an aggressive “hard sell” approach. a satisfaction survey, and we keep proactive approach to enhance
We made a major shift in our branding striving to increase our score. resilience, which involved identifying
when we brought our CSR activities potential risks and taking steps to
under our “Mahajana Mehewara” As result of the changes that took mitigate them. This included taking
Brand, which became an integral place in 2022 and aligned with the a flexible strategic approach,
part of the People’s Bank Brand. The new strategic plan, and the strategic leveraging technology, and
activities carried out under the new objectives, we are re-orienting our diversifying the portfolio.
brand included providing water and training more towards soft skills.
electricity to remote rural schools. A programme was commenced for To minimise the impact of market or
To mark our 61st anniversary, we Executive Management which focused bank-wide shocks, we have prepared
donated medical supplies valued at more on analytical and conceptual recovery plans that involved stress
LKR 5 Mn. to Lady Ridgeway Hospital, skills needed by staff at middle and testing the portfolio, implementing
meeting their urgent requirements. senior levels. Amongst the subjects to contingency plans, and identifying
Additionally, we made an initial be covered are developing customer potential sources of liquidity. The Bank
donation of LKR 1 Mn. to the “Feed A service excellence, customer centric has implemented an early warning
Child” fundraising initiative, which was mindset, and personality development. monitoring system to identify potential
organised by “Manusath Derana” and risks before they became significant.
Sri Lanka College of Paediatricians. Talented, high performers leaving This involved analysing market trends,
the Bank remains a serious concern, monitoring customer behaviour, and
We have formed a collaborative to which we have responded by tracking regulatory developments.
partnership with the Central Cultural implementing incentive programmes,
Fund (CCF), which operates under the such as competitive salaries, Given the current economic conditions,
Ministry of Buddhasasana, Religious opportunities for career advancement we have slowed down loan growth and
and Cultural Affairs. Through this and professional development, and focused on quality rather than quantity.
partnership, we have developed an creating a positive work environment This involved tightening the credit
advanced digital e-Ticketing solution that fosters employee engagement standards, reducing the risk exposure,
for CCF, comprising a multilingual, and loyalty. and focusing on higher-margin
web-based platform for purchasing business lines. With an increasing
tickets, and mobile apps for CCF to A new HR system is in the pipeline, proportion of our customer base
verify tickets. This initiative is expected which will automate most of the HR coming from youth and millennials
to boost our foreign currency deposit processes which are at present mostly we can expect our focus on
base and generate additional income being carried out manually. This will digitalisation to pay increasing
from fees for the Bank. give us greater flexibility, among dividends in the years to come.
other things, in setting pay-scales for
PEOPLE’S BANK
ABOUT
People's Bank will continue to “Importantly, to our valued customers and other
support exporters and encourage
manufacturing by providing financing stakeholders – our success is undoubtedly yours.
to export-oriented businesses, offering Your continued trust and confidence in us has not
incentives for local manufacturers,
and promoting trade finance activities.
only enabled us serve the country in a manner
The Bank will offer long-term loans for previously unseen but also help the Institution
FROM THE TOP

REFLECTIONS
project funds by providing financing
for infrastructure projects, renewable
distinguish itself from the rest in the Banking and
energy projects, and partnering with Financial Services space; both from a quantitative
government agencies to promote
and qualitative perspective!”
export activities. Renewable energy
can be expected to be a priority area
in the future given the current
Responding to the threat of our heartfelt gratitude to the Governor
concerns with global warming.
impairment staging classification, of the Central Bank of Sri Lanka,
VALUE CREATION
DRIVING
People's Bank has adopted a rigorous the Secretary to the President, the
Responding to the threat of
approach to risk management and Secretary to the Treasury and the
cybersecurity, People's Bank has put
credit analysis, such as implementing Senior Advisors to the President for
in place robust security measures
more stringent lending criteria, their support and guidance on all
and protocols to protect against
conducting thorough due diligence matters of a related nature. To my
cyberattacks. This includes regular
on borrowers, and monitoring their colleagues on the Board of Directors,
vulnerability testing and penetration
creditworthiness more closely. a big thank you for your dedication
testing, implementing multi-factor
The Bank is also closely looking at and wise counsel as we navigate the
authentication for user accounts,
the sustainable developments from Institution through these challenging
AND ANALYSIS
encrypting sensitive data, and regularly
the ESG front. times. I also owe a big thank you to
updating security software and
our outgoing Chief Executive Officer/
systems to stay ahead of emerging
General Manager Ranjith Kodituwakku
threats. We are very conscious that EXPRESSING MY SINCERE for his dynamic leadership and the
this is an area where threats are GRATITUDE incumbent Acting Clive Fonseka,
ever-increasing, and we have to be
Challenging times such as these calls together with the Management and
continuously vigilant.
for men and women of exceptional staff at all levels for their efforts.
wisdom and vision, who have the Importantly, to our valued customers
We are closely monitoring
courage to take tough and correct and other stakeholders – our success
developments on many fronts
decisions. I extend my sincere is undoubtedly yours. Your continued
including those from a macroeconomic
appreciation and gratitude to His trust and confidence in us has not
stand point, and, at every instance
REPORTS
GOVERNANCE
Excellency the President who also only enabled us serve the country
so necessary, we have engaged
serves as the Minister of Finance, the in a manner previously unseen but
with various stakeholders including,
Honourable Prime Minister and the also help the Institution distinguish
amongst other, the Ministry of Finance
State Ministers of Finance for their itself from the rest in the Banking
and the Central Bank of Sri Lanka
leadership in these extraordinarily and Financial Services space; both
to ensure that matters of a delicate
difficult circumstances. I also extend from a quantitative and qualitative
nature are dealt with in a manner it
perspective!
saves the Bank and the entire financial
system from any undue consequence.
STATEMENTS
FINANCIAL
Sujeewa Rajapakse
Chairman
INFORMATION
SUPPLEMENTARY
2 March 2023
GENERAL MANAGER/CHIEF EXECUTIVE OFFICER’S REVIEW
Improvements in the
macroeconomic environment
will help us reformulate our
strategies and implement
progressive programmes that
reflect the new economic reality.
Blessed with a rich legacy of

surmounting formidable obstacles
over the past 61 years, People's
Bank successfully overcame some
of the most daunting challenges
it has ever had to endure as an
institution. The severe economic
upheaval experienced by the entire
country formed the basis of such
challenges, aggravated by negative
growth in Gross Domestic Product
(GDP), the collapse of tourism, sharp
drop in inward remittances and the
downgrade of the nation’s sovereign
ratings. This resulted in a substantial
reduction in foreign currency facilities,
which was worsened by international
banks’ reluctance to lend to Sri
Lankan banks under such adverse
circumstances.
PRIORITISING NATIONAL
INTERESTS
The foremost challenge faced by the
Bank was that of managing liquidity,
which was already scarce, given the
country’s dire economic straits. This
was further compounded by the
pivotal role played by the Bank in
helping the nation overcome its foreign
currency shortfall, by providing US
Dollar (USD) facilities for importing
essential items. People’s Bank helped
finance approximately 50% of the
oil imports which amounted to
approximately USD 2 Bn., as well as
100% of the coal imports, most of
the pharmaceutical imports by the
General Manager/Chief Executive Officer’s Review
PEOPLE’S BANK
ABOUT
State Pharmaceuticals Corporation “When the Government declared a debt moratorium,
(SPC), including vaccines, in addition
to fertiliser imports during the most banks experienced significant impairments
recent years. Our support for State- in their USD assets. People’s Bank successfully
Owned Enterprises (SOEs) for the
procurement of essentials amounted
avoided this situation due to our minimal exposure to
to over LKR 700 Bn. Extending such International Sovereign Bonds (ISB) and zero exposure
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REFLECTIONS
facilities placed enormous pressure on
the Bank's liquidity.
to Sri Lanka Development Bonds (SLDB) compared to
leading private banks and other state bank peers.”
SIGNIFICANT CHALLENGES
The unprecedented increase in interest ratio of 16.3% and in Group level it was the favourable exchange rates, in
rates, which began in April last year 17.2%. Additionally, we have provided addition to our new programme,
was yet another obstacle faced by the impairments at 35 cents per USD on “People's Remittance Wasi Kotiyai“
VALUE CREATION
DRIVING
Bank. The shortfall in the interbank International Sovereign Bonds (ISBs), promotional campaign, which
markets reached a record high of which is one of the highest provisions motivated customers with benefits
LKR 800 Bn. in April 2022. Banks were currently available in the country. worth over LKR 30 Mn., and helped
compelled to pay interest rates of drive the increase in numbers.
30-33% to attract and retain deposits. We have not paid any significant
In addition, many retail customers, dividends to the Government in Our emphasis on digital channels has
as well as companies which were recent years, and this has been one of yielded a significant increase in digital
in serious financial difficulties, were the main reasons for our very healthy transactions, accounting for over 73%
unable to honour their commitments capital adequacy levels. Additionally, of the overall. We aspire to further
AND ANALYSIS
on loan repayments. These we have issued Tier two debentures enhance this figure to 80% or even
developments brought about serious that comply with Basel III requirements, 90%. Through the People's Bank app,
stresses on Rupee liquidity. totalling LKR 35 Bn. in 2019 and our customers can perform various
2020 for LKR 10 Bn. and LKR 20 Bn. transactions in a matter of seconds,
The Sri Lankan Rupee (SLR) respectively at a weighted average thus adding convenience to their lives.
depreciated by nearly 80% in a short rate of approximately 11% which is Our digitisation drive has enabled us
period, accompanied by high levels a highly favourable rate. to curtail on new recruitments, as most
of inflation. When the Government functions are now automated.
declared a debt moratorium, most Key aspects of our Group performance
banks experienced significant for the year include: Despite the fuel crisis, the majority
impairments in their USD assets. z Top line/total operating income of our branches and Special Banking
People's Bank successfully avoided this Units (SBUs), as well as 1,300 ATMs,
REPORTS
GOVERNANCE
reached LKR 130.0 Bn.
situation due to our minimal exposure (2021: LKR 110.7 Bn., 17.4% growth) CDMs, and kiosks, remained operational.
to International Sovereign Bonds Additionally, we facilitated the
z Overall net deposits grew by 13.0%
(ISB) and zero exposure to Sri Lanka disbursement of pensions, salaries,
to reach LKR 2,450.1 Bn. Of this,
Development Bonds (SLDB) compared and government subsidies without
LKR deposit growth was 10.2%
to leading private banks and other interruption.
state bank peers. z Net loans contracted by 3.8%
to LKR 1,915.8 Bn. Current focus is on recovering loans
(end 2021: LKR 1,990.7 Bn.) granted to state owned enterprises,
STATEMENTS
FINANCIAL
FINANCIAL PERFORMANCE z The Bank’s Tier 1 and Total CAR private enterprises, and individuals.
The Group has recorded a modest post were 13.3% and 17.2% respectively
tax profit of LKR 20.5 Bn., which is a z All key regulatory measures were all We have reduced our focus on credit
26.9% reduction compared to the 2021 successfully met at the year end. growth due to the prevailing high
figure of LKR 28.1 Bn. This impaired rates of interest. Credit growth is
performance was primarily due to our expected to resume during the second
emphasis on supporting the national CORE AREAS OF FOCUS half of 2023 along with the expected
INFORMATION
SUPPLEMENTARY
economy, rather than pursuing more reduction in inflation and interest rates.
We have remained unwavering in
lucrative opportunities. our goal of boosting inward foreign
currency remittances, and have
Our capital levels remain the highest successfully increased our share
among systemically important banks from 6% to more than double that
in Sri Lanka, with a capital adequacy amount. Our efforts were aided by
“As a state bank that is committed to national strengthening the newly established
Information Security Unit, which is
development, we have been steadfast in our support headed by the Chief Information
of Micro, Small and Medium Enterprises (MSMEs) Security Officer.
which are vital for the economy.”

POSITIVE OUTCOMES FROM
THE IMF BAILOUT
HELPING THE MSME SECTOR Accountants of Sri Lanka and the
The International Monetary Fund
Basel Committee on Banking. We have
As a state bank that is committed to (IMF) Extended Funding Facility
implemented the suggestions of the
national development, we have been (EFF) of USD 2.9 Bn. has been
Basel Committee on Banking, which
steadfast in our support of Micro, Small approved, followed by the World
stipulate that board members do not
and Medium Enterprises (MSMEs) Bank’s immediate commitment of
carry executive responsibility, within
which are vital for the economy. We USD 1.5 Bn., and ADB commitment
People’s Bank. We have appointed
have financing schemes which offer of USD 1 Bn. Combined with the
boards or committees in accordance
loans at attractive rates, in addition to USD 3 Bn. expected through the
with CBSL requirements.
subsidy schemes, interest concessions, restructuring of selected state-owned
and moratoriums. The Bank has taken enterprises (SOEs), the Government
The compliance function has been
steps to enhance financial inclusion, hopes to implement an ambitious plan
established to ensure compliance with
promote financial literacy, assist with to boost foreign reserves to at least
statutory regulations, CBSL guidelines
cash-flow management, accounting USD 8.4 Bn. in the near future. The
and directives and adherence to the
and aid in the expansion of businesses restructuring effort will be supported
People’s Bank code of conduct and
among entrepreneurs. Various training by the Asian Development Bank
anti-money laundering policies. We
programmes have been organised (ADB), the World Bank, the United
have appointed regional internal
for entrepreneurs, including some States Agency for International
audit officers along with off-site audit
in collaboration with the Export Development (USAID) and the
reviews. They are currently developing
Development Board, as many SMEs Japan International Cooperation
a digitised dashboard for monitoring
are engaged in exports. Additionally, Agency (JICA).
certain areas under credit risk
we have helped SMEs establish management. We continue to update
partnerships with foreign buyers and IMF facilities come with conditions
policies and procedures and have
initiated certain programmes with such as economic reforms and policies
established credit concentration across
foreign embassies. aimed at addressing the root causes
single borrower limits, geographical
of the country's economic problems
limits, industry sector-wide limits and
with the aim of placing the country on
STRENGTHENING are setting sector limits. Additionally,
a sustainable path. It can help boost
CORPORATE GOVERNANCE, we have established key risk indicators
investor confidence, reduce borrowing
for all core departments and are
RISK MANAGEMENT AND costs and help unlock additional
strengthening the functions of the
INTERNAL AUDIT sources of financing from other
Rehabilitation Revival Unit, Credit
multilateral institutions. In addition,
We have adapted the Code of Best Post-grant Review Units, Regional Risk
interest rates and the exchange
Practice in Corporate Governance for Officers and the stress testing exercise
rates will be market–based, leading
public enterprises in Sri Lanka. This is by covering more areas. We are also
to improved exports, remittances,
an initiative of the Ministry of Finance,
and reduced imports. Banks can
with inputs from the Chartered
expect foreign currency funding
as relationships with the foreign
lenders improve.
PEOPLE’S BANK
ABOUT
FOCUSING ON THE FUTURE the Governor and Officials of the
CBSL, Secretary to the Treasury and
We are in the process of implementing Officials of the Ministry of Finance, my
a state-of-the-art HR system that will fellow members of the Corporate and
improve the efficiency in the Bank Executive Management, our unions,
and minimise manual procedures. We and most importantly our customers
have also formulated a strategic plan who continue to inspire us with their
for 2022 - 2024 that is focused on
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REFLECTIONS
patronage and loyalty. Together
driving excellence, building customer- we can work towards our goal of
centricity and being future-ready. making People’s Bank the best bank
in Sri Lanka.
To improve financial stability, we
intend implementing measures such
as enhancing LKR deposits; increasing
inward remittances and export
revenue; recovering loans given to
VALUE CREATION
DRIVING
state enterprises, businesses and
individuals; supporting micro, small,
and medium-sized enterprises which
are essential for improving the overall Clive Fonseka
economy, and enhancing customer
General Manager/
service efficiency. These steps can
Chief Executive Officer (Actg.)
boost liquidity, creditworthiness,
revenue and customer loyalty leading 2 March 2023
to sustainable growth.
AND ANALYSIS
With the potential improvements in the
overall economy, including enhanced
foreign currency reserves, improved
liquidity, as well as higher inward
remittances and tourism incomes,
Sri Lanka could look forward to a very
positive year ahead, paving the way
for future growth and development.
MY APPRECIATION
REPORTS
GOVERNANCE
Our greatest asset is our staff, who
have displayed tremendous loyalty
and commitment, working as a team
with determination, that has helped
us overcome many barriers and
obstacles. My thanks are due to each
and every one of them. I also wish to
STATEMENTS
FINANCIAL
express my sincere appreciation to

our Chairman, the Board of Directors,
INFORMATION
SUPPLEMENTARY
BOARD OF DIRECTORS
From left to right:

Ms Shyama Wijekoon (Secretary to the Board of Directors), Mr Dushmantha Thotawatte,
Mr Manjula Wellalage, Mr Sujeewa Rajapakse
25
ABOUT REFLECTIONS DRIVING MANAGEMENT DISCUSSION GOVERNANCE FINANCIAL SUPPLEMENTARY

PEOPLE’S BANK FROM THE TOP VALUE CREATION AND ANALYSIS REPORTS STATEMENTS INFORMATION
Mr Isuru Balapatabendi, Ms Visakha Amarasekere, Mr A M P M B Atapattu

From left to right:
Board of Directors
resource management and overall

management practices and principles
Mr Sujeewa Rajapakse in both private and public sectors. Mr Manjula Wellalage
Chairman Director
Mr Sujeewa Rajapakse is a Managing Mr Manjula Wellalage is an Attorney-

Partner of BDO Partners, a firm of Mr Isuru Balapatabendi at-Law who has been in practice at
Chartered Accountants. A Fellow of Director the Private Bar for nearly two decades.
The Institute of Chartered Accountants Prior to becoming an Attorney-at-
of Sri Lanka (FCA) and a Fellow of the Mr Isuru Balapatabendi is an Attorney- Law, he served as the Resource and
Institute of Chartered Management at-Law and currently operates a Law Research Officer in charge of the
Accountants of Sri Lanka (FCMA) Chamber in the practice of Civil and Community Based Legal Aid Project
and a Member of the Association Commercial Law. He also holds a LLM which was spearheaded by the Ministry
of Chartered Certified Accountants from the University of Pittsburgh, of Justice. He has also discharged his
(ACCA). Mr Rajapakse holds a Pennsylvania, USA. duties in the capacity of Resource
Master of Business Administration Officer to the Resource, Research
(MBA) from Postgraduate Institute Mr Balapatabendi served as a State and Information Centre (Constitution
of Management (PIM), University Counsel in the Attorney General’s Affairs) of the Ministry of Justice
of Sri Jayewardenepura. During his Department, prior to being appointed a and Constitutional Affairs. During his
professional career that spanned nearly Diplomat to the Embassy of Sri Lanka illustrious legal career, Mr Wellalage
four decades, he held the honorary in The Hague, The Netherlands from has organised numerous projects and
positions of President, Vice President 2008 to 2010, during which he served programmes on constitutional reform
and Council Member (elect) of the as the representative of Sri Lanka, as well as raising community legal
Institute of Chartered Accountants to the organisation for Prohibition of awareness whilst intervening to resolve
of Sri Lanka (CA Sri Lanka), Former Chemical Weapons and the Hague critical legal issues at national level on
Chairman of Auditing Standards Convention of Private International behalf of the Ministry of Justice.
Committee of CA Sri Lanka, President Law (HCCH). He was also appointed
of Practicing Accountants Forum as the Head of Chancery at the
of Sri Lanka, Treasurer of Sri Lanka Sri Lankan Mission in The Hague. He
Cricket, Treasurer for Cricket World was appointed as the Legal Advisor to Ms Visakha Amarasekere
Cup 2011, Board Member and Technical the Minister of Investment Promotions Director
Advisor to South Asian Federation in 2012, for legal matters relating to
of Accountants (SAFA), Technical investment laws in Sri Lanka and Board Ms Visakha Amarasekere counts nearly
Advisor to Confederation of Asia of Investment. Mr Balapatabendi has 20 years of experience at the General
Pacific Accountants (CAPA). Currently also served in the Director Boards Treasury and is currently attached to
he is serving as the Board Member at of Sri Lanka Insurance Corporation, the Department of External Resources
Haycarb PLC, Dipped Products PLC, Seylan Bank, and Bank of Ceylon, as an Additional Director General
Hayleys Agriculture Holdings Ltd. and prior to being appointed to the (CUD). She holds a BSc (Hons) Degree
Lanka Holdings (Pvt) Ltd. Also, he is People’s Bank Board. He also served in Economics and Management from
a Council Member of the University in the Director Boards of Sri Lanka the University of London, UK and
of Sri Jayewardenepura. Ports Authority and Colombo West a Master of Arts in Development
International Terminal (Pvt) Ltd. He Economics from the Vanderbilt
He was the Chairman of People’s is currently the Chairman of People’s University USA. She is a Chartered
Leasing & Finance PLC. He has Insurance PLC and serves as a Director Management Accountant (CIMA) UK
served in the directorates of National of Celio Naturals (Pvt) Ltd. as well. and is also a Chartered Public Finance
Development Bank PLC, NDB Capital
Accountant. She has represented the
Holdings Ltd. – Bangladesh, The He has served as an Executive General Treasury on the Boards of
Finance Company PLC (appointed Committee Member of the Bar several key State-Owned enterprises
by the CBSL under the restructuring Association of Sri Lanka. He was including the Ceylon Electricity Board,
programme) Unidil Packaging Ltd. & appointed the Chairman of the Junior Ceylon Petroleum Corporation, and
Unidil Packaging and Solutions Ltd., National Law Conference in 2007 and Bank of Ceylon.
and Deputy Chairman of Softlogic Life as the Convener of the National Law
Insurance PLC. Conference 2020. Mr Balapatabendi
was also elected as the Secretary of
His expertise includes all accounting the Bar Association of Sri Lanka for
and auditing standards and practices, the year 2022/23 and also for the
Government regulations related to year 2023/24.
financial disciplines and ethics, human
Board of Directors
PEOPLE’S BANK
ABOUT
for his Master’s Degree in International Mr Atapattu has also performed his
Development awarded by Flinders duties as the Treasury Representative
Mr Dushmantha University in 2004 and he holds a on the Board of Investment, People’s
Thotawatte Licentiate Certificate of the Institute of Bank, Sri Lankan Airline Limited,
Director Charted Accountancy, Sri Lanka. Sri Lanka Tea Board, National Lotteries
Board, Sri Lanka Savings Bank,
Mr Dushmantha Thotawatte was Before assumed the current position Lankaputhra Development Bank,
FROM THE TOP

REFLECTIONS
appointed to the Board of Directors he worked as a Senior Additional Cooperative Wholesale Establishments,
with effect from 8 July 2022. Secretary to the President of Sri Lanka University of Vocational Technology
Mr Thotawatte is a Fellow Member of and he was assigned to duties of and the Insurance Regulatory
the Institute of Chartered Accountants economic reforms in the section of Commission of Sri Lanka.
of Sri Lanka with a Bachelor of Stabilisation Recovery and Growth
Commerce (Special Degree) from the of the economy. As Director General,
University of Sri Jayawardenepura (Planning) of the Ministry of Education
& a Master in Financial Economics he was prepared of Capital Budget Ms Shyama Wijekoon
VALUE CREATION
DRIVING
from the University of Colombo. He of the Ministry of Education and Secretary to the Board of
is an accomplished leader who has monitored the development projects Directors
extensive experience in the field of of the Ministry.
Financial Management, Corporate Ms Shyama Wijekoon joined the Bank
Governance, Strategic Management Further, as a Deputy Secretary to the in 2016 as an Assistant Secretary to
and Public Relations, together a Treasury, he was in charged for donor the Board and subsequently promoted
successful track record as Chief funding projects, implementation to the position of Board Secretary in
Executive Officer, Chief Financial of trade and tariff policies of the 2022. She is an Attorney-at-Law. She
Officer and Chief Internal Auditor in Government, and monitoring of holds a Masters of Law (LLM) degree
AND ANALYSIS
many state-owned enterprises and national budget. Also, he has initiated from Cardiff Metropolitan University
private organisations and counts over the ‘Enterprise Sri Lanka Subsidiary – UK. In Addition she has successfully
40 years of experience. Loan & Development Programme’ completed a course on Shipping
as a national budget proposal of the Law & Practice from Institute for the
Government. Development of Commercial Law and
Practice – ICPL – CCC.
Mr A M P M B Atapattu Mr Atapattu has functioned as
Director Director General of the Department of Apart from all above, she holds a
Development Finance he has initiated post Graduate Executive Diploma in
Mr A M P M B Atapattu currently warehouse receipts financing system Bank Management (PGEDMB) from
serves as a Secretary to the Ministry of for grain farmers and fertiliser cash the Institute of Bankers of Sri Lanka
Trade, Commerce and Food Security subsidy scheme for farmers. Feather, which will immensely help her to keep
REPORTS
GOVERNANCE
and he has over 28 years of work he has implemented Refinanced Loan her career up in the capacity of the
experience in Banking, Finance and Schemes called “Small and Medium Secretary to the Board.
Business Administration. Enterprise Regional Development
Project” (SMERDP) funded by the She is a life Member of Association
He Graduated from University of Asian Development Bank, “Small and of Professional Bankers of Sri Lanka.
Sri Jayawardenapura with a BSc in Medium Enterprise Development
Management (Public Administration) Facility Project” (SMEDeF) funded by
Second Class Upper Division the World Bank, “Small and Medium
STATEMENTS
FINANCIAL
Degree, he holds a Master’s Degree Enterprises Line of Credit (SMELoC)

in International Development from funded by the Asian Development
Flinders University, Australia and Bank. In addition, he has executed
has completed two post graduate the SME Development Programme
diplomas: Economic Development funded by the German International
from University of Colombo and Cooperation (GIZ) as well as the
Development Economy from Institute “Rooftop Solar Power Generation Line
of Development Economies, Japan. His
INFORMATION
SUPPLEMENTARY
of Credit Project” (RSPGLoC) funded

research topic was “Rationalisation for by the Asian Development Bank.
Industrial Development in Sri Lanka”
CORPORATE MANAGEMENT
Front row left to right:

Ms Preethie Katulanda, Ms Roshini Wijerathna, Mr Azzam A Ahamat, Mr Rohan Pathirage
Back row left to right:

Ms Ganga Senanayake, Ms Nilmini Premalal, Mr A S M W Kumarasiri, Mr K A Nihal
PEOPLE’S BANK
ABOUT
FROM THE TOP
REFLECTIONS
VALUE CREATION
DRIVING
AND ANALYSIS
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY

Mr Clive Fonseka, Ms Renuka Jayasinghe, Ms P S J Kurukulasooriya,
Ms Nipunika Wijayaratne, Ms Shameela Loku Kaluge

Mr Dhammika Dasa, Mr E A M Dissanayake, Mr Wickrama Narayana, Mr T M W Chandrakumara
Corporate Management
In 2002, Mr Fonseka commenced his Havelock Properties Limited, Director

tenure at People’s Bank, and since of People’s Leasing Fleet Management
Mr Clive Fonseka November 2011, he has been a member Ltd., Director of People’s Micro
Chief Executive Officer/General of the Bank’s Senior Corporate Commerce Limited, Director of Lankan
Manager (Actg.) Management team as Deputy General Alliance Finance Limited, Bangladesh,
Manager. In this role, he oversaw the Director of People’s Travels (Pvt) Ltd.,
A veteran in the industry, Mr Fonseka, Foreign Exchange operations, activities and Alternate Director of the Institute
is a Fellow of the Institute of Bankers of the Primary Dealer Unit, Investment of Bankers of Sri Lanka.
of Sri Lanka and holds an MBA Banking Unit, and USD and LKR Money
from the Postgraduate Institute Market operations, in addition to In his previous role as Senior
of Management at the University managing relationships with local and Deputy General Manager (Human
of Sri Jayewardenepura. He has foreign commercial banks and financial Resources and Legal) of People’s
been awarded a Distinction for institutions. Prior to joining People’s Bank, Mr Pathirage successfully
the ACI Dealing Certificate and Bank, he held senior positions at managed the Bank’s workforce of
has accumulated over 29 years of American Express Bank and Standard over 10,000 employees and oversaw
experience in the field of Treasury Chartered Bank. senior executive recruitments in line
Management. Furthermore, he is with the Bank’s HR requirements. He
a Certified Member (CMA) of the Mr Fonseka has been appointed as the also led the Bank’s legal team of 70
Institute of Certified Management Acting Chief Executive Officer/General members and functioned as Deputy
Accountants of Australia. Manager of People’s Bank with effect General Manager – Secretary to the
from 2 January 2023. Board of Directors of People’s Bank.
During the period spanning from 2018 His administrative support has been
to 2020, Mr Fonseka assumed the invaluable to all matters relating to
role of President of the Association of the Bank’s Board of Directors and its
Primary Dealers, in addition to holding Mr Rohan Pathirage various subcommittees.
membership in several committees, Senior Deputy General Manager –
including the National Payment Overseas Customer Services
Council, Financial System Stability
Consultative Committee, and the With over 28 years of experience Ms Renuka Jayasinghe
task force dedicated to studying and in Human Resources, Legal and Deputy General Manager –
designing new alternative benchmark Administration in the banking sector, Retail Banking
interest rates. Additionally, he held Mr Rohan Pathirage is a highly qualified
membership in the Market Working and accomplished professional. He Ms Renuka Jayasinghe, who
Group on Domestic Financial Market holds a Master’s Degree in Banking commenced her career at the Bank
Infrastructure Development Project from Massey University, New Zealand, as a Management Trainee in 1987,
of the Central Bank of Sri Lanka as well as a Postgraduate Diploma in has more than 36 years industry
(CBSL). Presently, he serves as a Banking. In addition, he is an Attorney- experience. Her career trajectory in
Non-Independent Non-Executive at-Law, holding a Law Degree from the Branch Banking has shown a rapid
Director at People’s Leasing & Finance University of Colombo. He has served ascent through the ranks, taking up
PLC, People’s Leasing Property as a senior member of People’s Bank positions such as Branch Manager,
Development Limited, Lankan Alliance Corporate Management team, and has Zonal Senior Manager, Regional
Finance Limited, and LankaPay (Pvt) been a member of key management Manager, Assistant General Manager,
Limited. Credit Information Bureau committees. Deputy General Manager (Cooperative
of Sri Lanka, National Payment and Development), Deputy General
Council, Sri Lanka Banks’ Association Mr Pathirage currently holds the Manager (Retail Banking, Process
(Guarantee) Ltd., Financial Ombudsman position of Senior Deputy General Management, and Quality Assurance),
Sri Lanka (guarantee) Ltd., Institute Manager – Transaction Banking and Deputy General Manager (Business
of Bankers of Sri Lanka and Lanka and Overseas Customer Services Support Service). Currently, she
Financial Services Bureau Limited. Prior of People’s Bank. He also serves as serves as the Deputy General Manager
to his current appointments, he acted Director of People’s Leasing & Finance (Retail Banking).
as Chief Examiner for the Institute of PLC, Chairman of People’s Leasing
Bankers of Sri Lanka’s IABF/DABF
Examinations.
PEOPLE’S BANK
ABOUT
Ms Jayasinghe holds a First Class
BCom Special Degree from the
University of Sri Jayewardenepura and Ms P S J Kurukulasooriya Ms Roshini Wijerathna
a professional banking qualification Deputy General Manager – Deputy General Manager –
from AIB, Sri Lanka. She is a Life Strategic Planning, Performance Risk Management
Management and Research
Member of the Association of
Professional Bankers of Sri Lanka and Ms Roshini Wijerathna currently heads
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REFLECTIONS
the Institute of Bankers of Sri Lanka. Ms Jayanthi Kurukulasooriya joined the the Risk Management and Credit
Moreover, she has been appointed Bank as a Management Trainee in 1994 Control functions of the Bank, where
as a Member of the Dean’s Advisory and counts over 28 years of experience she has served for over 32 years. Her
Committee (DAC) of the Faculty of in the banking field. Her experience experience in the Bank’s Treasury
Humanities and Social Sciences of the mainly encompasses in the areas of Division spans over 26 years, during
University of Sri Jayewardenepura, Branch Banking, Credit, Staff Training, which she has deputised the Primary
effective from 1 January 2021. Human Resources Development, Credit Dealer Unit since 2003, and the
Administration, Channel Management Treasury thereafter. Since 2017, she has
VALUE CREATION
DRIVING
and Retail Banking. Prior to joining the been actively involved in strengthening
Bank, she has gained experience as the Bank’s risk management processes,
Mr Azzam A Ahamat a Senior Assistant Accountant at the playing a key role in this area.
Head of Finance Road Construction and Development
Company. Being highly qualified in her chosen
profession, Ms Wijerathna’s academic
Mr Ahamat joined People’s Bank on
She holds a BSc Business qualifications include a Bachelor
3 January 2017, bringing with him a
Administration (Special) Degree of Science (Physical Science) with
wealth of experience spanning nearly
with a Second Class Upper Division a Second Class Upper from the
two decades in strategic financial
AND ANALYSIS
(Honours) from the University of University of Colombo, a Master of
management, alternate investments,
Sri Jayewardenepura and Master’s Business Administration Finance) from
and risk management, having served
Degree in Business Administration the same university, and a Diploma
in prestigious institutions both locally
(MBA) from the University of Colombo. in Treasury and Risk Management
and internationally. He has worked
She is a Fellow Member(FIB) of the from IBSL. She has also obtained
with some of the largest multinational
Institute of Bankers of Sri Lanka, a a distinction for the ACI Dealing
professional service firms and Tier I
member of AAT Sri Lanka, a Licentiate Certificate – ACI, Financial Markets
service providers across a multitude of
member of The Institute of Chartered Association, and is an Associate
sectors and market spaces.
Accountants of Sri Lanka and holds Member of the Institute of Bankers
a Diploma in Human Resource of Sri Lanka.
Mr Ahamat holds several high-
Management (Dip HRM) as well. She
profile professional memberships,
was able to enhance the Bank’s image Ms Wijerathna has held leadership
REPORTS
GOVERNANCE
including Fellow Membership of the
by winning three Gold Medals at the positions in various professional
Chartered Institute of Management
Convocation (1997) of Institute of associations, having been a President
Accountants (UK), Fellow Membership
Bankers of Sri Lanka for obtaining and Secretary of the Association
of the Association of Chartered
maximum number of distinctions, of Primary Dealers, and currently,
Certified Accountants (UK), and
completing examination within two a member of the Sri Lanka Forex
Fellow Membership of the Institute of
consecutive years and obtaining Association and Association of
Certified Management Accountants of
highest aggregate marks at the Professional Bankers. She is also an
Sri Lanka. Additionally, he is a Certified
Intermediate and Final Examinations, Ex-Co member of the Association of
STATEMENTS
FINANCIAL
Practising Accountant (AUST.), a

which is still an undefeated record. Banking Sector Risk Professionals,
Certified Member of the Chartered
and serves as a member of the
Institute for Securities & Investment
Governing Board of the Institute
(UK), and the Chartered Institute of
of Bankers of Sri Lanka.
Credit Management (UK), as well as a
Technical Specialist of the Institute of
Risk Management (UK).
INFORMATION
SUPPLEMENTARY
Mr Ahamat functions as a Director

of People's Leasing & Finance PLC,
People's Insurance PLC and Lanka
Alliance Finance Limited Bangladesh.
Ms Katulanda began her legal career Mr Dasa obtained a BSc Degree in

as a legal intern at People’s Bank, Mathematics and Computer Science
Ms Nipunika Wijayaratne and has since gained close to two from the University of Kelaniya. Prior
Deputy General Manager – decades of experience working as to taking up his current position at
Banking Support Services an individual practitioner and as a the Bank, he has held multiple Senior
member of the corporate sector, Management positions at prominent
Ms Nipunika Wijayaratne serves as the with 17 years of service in this role. organisations such as Aitken Spence
Deputy General Manager of Banking During this period, she has worked in Group, KPMG Sri Lanka, and Fiserv.
Support Services, counting over various legal divisions and held senior
32 years of experience in banking, positions in Finance Sector – Business
having joined the Bank in 1990 as a Establishments that are subject to
Management Trainee. monitoring by the Central Bank of Mr K A Nihal
Sri Lanka (CBSL). Deputy General Manager –
She holds a BSc Degree in Agriculture Human Resources
from the University of Peradeniya and On 1 December 2021, Ms Katulanda
an MBA in Finance from University assumed the position of Additional Mr K A Nihal, who currently holds the
of Colombo. She has experience in Chief Law Officer, and she was position of Deputy General Manager –
Trade Services and Correspondent subsequently promoted as the Chief Human Resources, joined the Bank
Banking and prior to joining the Bank, Law Officer on 23 December 2022. in 1994 as a Management Trainee. He
she served in the private sector. She is counts over 28 years of experience
an Associate Member of the Institute across disciplines such as Branch
of Bankers of Sri Lanka. She is also Operations, Information Technology,
an Executive Committee Member of Mr Dhammika Dasa Treasury, and Human Resources.
International Chamber of Commerce Chief Information Officer
Sri Lanka and an alternate member of He holds a Bachelor of Management
the Governing Board of the Institute (Special) Second Upper Degree
Counting 26 years experience in
of Bankers of Sri Lanka. offered by the University of
the IT industry, Mr Dhammika Dasa
serves as the Chief Information Sri Jayewardenepura. In addition,
Officer (CIO) at People’s Bank. He has he holds the professional banking
considerable exposure to and expertise qualification, Diploma in Banking
Ms Preethie Katulanda and Finance from the Institute of
in a diverse range of disciplines,
Chief Law Officer including Strategic Management, Bankers of Sri Lanka (IBSL) and he has
Programme Management, Project completed the Diploma in Professional
Ms Preethie Katulanda is a senior legal Management, Infrastructure Human Recourse Management from
professional with 29 years of active Technology Management, Software CIPM Sri Lanka. Mr Nihal also possesses
practice as an Attorney-at-Law. She also Development, and Implementation a certificate on Treasury and Foreign
holds a Master of Business Management Exposure. Over the years, he has Exchange Operations.
(HRM) Degree from the University honed his skills across a number of
of Colombo, in addition to having domains such as Finance, Insurance,
successfully completed professional Banking, Manufacturing, Logistics, and
qualifications in Human Resource Leisure in Sri Lanka, Australia, and New
Management from the Institute of Zealand. Additionally, he possesses
Personnel Management (IPM). a comprehensive understanding of
Information security implementations.
PEOPLE’S BANK
ABOUT
He holds many prestigious positions in Mr Narayana obtained a Bachelor
professional Associations relevant to of Science Degree in Business
Mr E A M Dissanayake his long years of specialised banking Administration from the University of
Chief Internal Auditor expertise in trade finance operations, Sri Jayewardenepura, followed by an
including immediate past president MBA in Banking and Finance from the
Mr Mahinda Dissanayake, possessing of Trade Finance Association of Postgraduate Institute of Management
over 30 years of experience in Bankers (TFAB), Banking Committee University of Sri Jayewardenepura, and
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REFLECTIONS
Branch Banking and Internal Auditing, member of the International Chamber an MSc Degree in Management from
serves as the Chief Internal Auditor of Commerce Sri Lanka, Executive the University of Sri Jayewardenepura.
at People’s Bank at present. He is a Committee member of the Lanka Additionally, he is a Fellow Member of
Fellow Member of The Institute of SWIFT User Group and Ex-Co member the Institute of Bankers of Sri Lanka.
Chartered Accountants of Sri Lanka of the Association of Professional
(FCA) and an Associate Member of the Bankers of Sri Lanka (APB). He also Prior to his tenure at the Bank,
Institute of Bankers of Sri Lanka (AIB). serves as a Director of People’s Mr Narayana served in various private
Travels Ltd. sector manufacturing companies. He
VALUE CREATION
DRIVING
In addition, he holds an MBA from currently lectures at the University of
the University of Colombo and a Sri Jayewardenepura, the University
Bachelor of Science Degree in Public of Colombo, the Institute of Bankers
Administration (General) from the Mr Wickrama Narayana of Sri Lanka, and the Center for
University of Sri Jayewardenepura. Deputy General Manager – Banking Studies at the Central Bank
Furthermore, he has obtained a Enterprise Banking of Sri Lanka (CBSL).
Diploma in Information Systems,
Security Control, and Audit from the Having joined People’s Bank as
Institute of Chartered Accountants a Management Trainee in 1994,
AND ANALYSIS
of Sri Lanka, awarded with technical Mr Wickrama Narayana has amassed Ms Nilmini Premalal
collaboration from the Institute of more than 28 years experience in Deputy General Manager –
Chartered Accountants of India. various aspects of banking such Payment, Process Management
& Quality Assurance
as Branch Banking, Corporate and
Offshore Banking, as well as strategic
planning. His expertise in SME lending Ms Nilmini Premalal, who functions as
Mr A S M W Kumarasiri with specialised focus on small Deputy General Manager – Payment,
Deputy General Manager – business lending, project finance, Process Management and Quality
International Banking entrepreneurship development, Assurance, joined People’s Bank in
business revival, and rehabilitation, 2002 as a Management Trainee. She
Mr A S M W Kumarasiri, who spans over 12 years. At present, he counts about 20 years of experience
leads Enterprise Banking in People’s within the Bank, serving in the Finance
REPORTS
GOVERNANCE
counts more than 36 years banking
experience, and over 20 years in Bank, where he applies his expertise & Management Accounting Department
international trade related service across Commercial Credit, SME, for over 18 years, and then moving on
at the People’s Bank, International Development Finance, Microfinance, to the Strategic Planning, Performance
Banking Division, currently serves as Commercial Banking, and Business Management and Research Department
its Deputy General Manager. He holds Revival. for a two-year period.
a Bachelor of Sciences Degree in
Public Administration with a Second While serving as Deputy Head of
Finance, Ms Premalal implemented
STATEMENTS
FINANCIAL
Class Honour from University of

Sri Jayewardenepura, as well as an several specialised initiatives which
MBA (Finance) from the University of made a significant contribution to
Colombo. He is also an Associate of the Bank’s overall performance. As
the Institute of Bankers of Sri Lanka. Assistant General Manager, she played
a key role in creating and developing
the Bank’s strategic plan, covering
the areas of Strategic Planning,
INFORMATION
SUPPLEMENTARY
Performance Management, and

Research Department.
Ms Premalal holds a BSc Business From 2018 to the end of 2020,

Administration (Special) Degree with Mr Chandrakumara held the position
Second Class Upper Division from the of Assistant General Manager (Banking Ms Ganga Senanayake
University of Sri Jayewardenepura, Support Services), overseeing six Deputy General Manager –
and an MBA from the University of departments: Supplies, Transport, Recoveries
Kelaniya. She is a Fellow Member of Security, Maintenance Engineering,
The Institute of Chartered Accountants Building Engineering, and Desktop Having commenced her career
of Sri Lanka (FCA), a Certified Publishing. During this period, he with People’s Bank in 1990 as a
Management Accountant of Sri Lanka gained invaluable experience in Management Trainee, Ms Ganga
(FCMA), and an Associate Member of procurement, construction and Senanayake counts more than 32 years
the Institute of Bankers of Sri Lanka maintenance, stores and inventory of experience in the banking industry.
(IBSL). She has also contributed her control, in addition to transport and During this period, she has held several
knowledge to the banking community security procedures. From 2020 to key positions in the Branch Banking
through visiting lectures and evaluating 2023, he acted as Assistant General Services, including Branch Manager,
examinations at the IBSL Sri Lanka. Manager (IT Administration and Regional Manager, and Assistant
She is a member of the Association of Business Support) and Assistant General Manager. Currently, she
Professional Bankers Sri Lanka and has General Manager (Channel serves as the Deputy General Manager
partly completed the CIMA (UK). Management Department), where of the Recoveries Department.
he gained significant exposure in
Ms Premalal currently serves as a implementing the 5S system to the Ms Senanayake obtained a Second
Director on the Board of People’s Branch Network and CEFT operations. Class Upper Division Special Degree
Micro Commerce Ltd. and she in BSc Agriculture from the University
previously served as a Director on Mr Chandrakumara holds a Second- of Peradeniya. She is an Associate
the Board of People’s Merchant Bank Class Upper Division Degree in Member of the Institute of Bankers of
and concurrently held the position BCom (Special) from the University Sri Lanka. She has also acquired
of Chairman of the Board Audit of Kelaniya and an International extensive knowledge and experience
Committee at People’s Merchant Bank. Diploma in Supply Chain Management in the fields of Debt Recovery and
(International Trade Centre/WTO Credit Administration, and has been
(UNCTAD), Geneva, Switzerland). He appointed as a resource person for
is an Associate Member of the Institute many “Knowledge Enhancement”
Mr T M W Chandrakumara of Certified Management Accountants programmes organised by the Staff
Deputy General Manager – of Australia (CMA), a Licentiate of The Training College of the Bank.
Channel Management Institute of Chartered Accountants
of Sri Lanka (LICA), a member of the Prior to joining the Bank, Ms Senanayake
Mr Chandrakumara commenced Accounting Technicians of Sri Lanka worked as an assistant lecturer on
his career at People’s Bank as (MAAT), and the Institute of Bankers a probationary basis in the Faculty
a Management Trainee in 1994, of Sri Lanka (AIB). Additionally, he is a of Agriculture at the University of
accumulating more than 29 years of Corporate Member of the Institute of Peradeniya. As an innovative thinker,
experience in the banking industry. He Supplies and Materials Management of she has made significant contributions
currently serves as the Deputy General Sri Lanka (MISMM). to numerous successful initiatives
Manager (Channel Management). aimed at achieving the Bank’s strategic
Mr Chandrakumara has been in charge objectives, including the Network
During the course of his career, he of the Service Delivery Channels, Rationalisation project in 2021/22.
has participated in various exposure which includes 743 regulatory units
programmes, both locally as well as of the Branch Network comprising
internationally, acquiring extensive ATMs, CDMs, CRMs, and KIOSKs since
knowledge in business banking December 2022.
management practices at various
management-level capacities.
PEOPLE’S BANK
ABOUT
Ms Shameela Loku Kaluge
Deputy General
Manager – Treasury, Investment
Banking and Financial
Institutions (Actg.)
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REFLECTIONS
Ms Shameela Loku Kaluge commenced
her career with the Bank in 2002 as
a Management Trainee, gaining over
20 years of experience in the Bank’s
Treasury Unit. She has ascended
rapidly to her current position as
the Acting DGM of the Treasury,
Investment Banking, and Financial
VALUE CREATION
DRIVING
Institutions functions of the Bank.
Through 2011 and 2022, Ms Loku
Kaluge deputised in several areas of
the Treasury functions, including the
Primary Dealer Unit (PDU), and since
2017, she has been overseeing the
overall functions of the Treasury
and PDU.
AND ANALYSIS
She holds a Bachelor of Science
Degree in Biological Science with
a Second Class Upper from the
University of Kelaniya, a Master of
Science in Computer Science from
the University of Colombo, and an
MBA (Finance) with distinction from
Cardiff Metropolitan University, UK.
Additionally, she holds a Diploma
in Treasury, Investment, and Risk
Management from the Institute of
REPORTS
GOVERNANCE
Bankers of Sri Lanka (IBSL). She has
also achieved a distinction in the
ACI Dealing Certificate and is an
Associate Member of the IBSL.
Ms Loku Kaluge was appointed as a

Director of the Association of Primary
Dealers (APD) in 2017 and currently
STATEMENTS
FINANCIAL
serves as the Secretary of APD. She

also serves as a member of the
Sri Lanka Forex Association and the
Association of Professional Bankers.
INFORMATION
SUPPLEMENTARY
EXECUTIVE MANAGEMENT

Mr L U L Alwis, Mr Mangala Kariyawasam, Mr Anura Dissanayake, Mr Nalaka Wijayawardana, Ms Aruni Liyanagunawardana
Mr Prasad Ariyawanse, Ms Sriya Galappaththi, Ms Samanthi Senanayake

Mr Naleen Pathiranage, Mr Anura Perera, Mr Yasas Rajapakse, Ms Deepika Premadasa, Mr Shantha Gangabadage
Mr Indika Kodithuwakku, Ms Gayathri Jayasena
PEOPLE’S BANK
ABOUT
FROM THE TOP
REFLECTIONS
VALUE CREATION
DRIVING
AND ANALYSIS
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL

INFORMATION
SUPPLEMENTARY
Mr A U A Anzar, Mr Lakmal Jayarathne, Ms Thushari Hewawasam, Ms Dhammika Dasanayake

Mr Jayanath Dias, Mr Saman Samarakoon, Mr R Ravikaran

Ms Virajini Munasinghe, Mr Manjula Dissanayake, Mr Nalin Perera, Ms Nilanthi Rubasinghe
Mr T G S P Kumarasiri, Mr Chaminda Ihalakorala, Ms Indumini Rathnayake, Ms Sadhana Perera
CHIEF MANAGERS
1. Mr K K N Priyantha 20. Mr M S Kanakkahewage 39. Mr A M M S M Ruwais

Chief Manager – Investigation & Regional Manager – Chief Manager –
Inquiries Department Colombo South R.H.O. Internal Audit Department
2. Ms M V P Peiris 21. Mr K Kodeesswaran 40. Mr M S C P T Marasinghe

Regional Manager – Regional Manager – Jaffna R.H.O. Chief Manager –
Nuwara-Eliya R.H.O. People’s Card Centre
22. Ms M M A Amarasiri
3. Mr D M Kapila Regional Manager – Ampara R.H.O. 41. Ms M V D Perera
Regional Manager – Kandy R.H.O. Chief Manager – G.M.’s Department
23. Mr G D N L Potthewela
4. Mr N K Wimalasiri Regional Manager – Badulla R.H.O. 42. Ms L P N Gunawardhana
Regional Manager – Galle R.H.O. Chief Manager – Development &
24. Mr A Jayaasith Micro Finance Department
5. Mr D S P N Rathnayaka Regional Manager – Wanni R.H.O.
Regional Manager – Matara R.H.O. 43. Ms R Arunasalam
25. Mr D M D Dissanayaka Chief Manager – Overseas
6. Ms V G Kanagasabai Regional Manager – Matale R.H.O. Customer Services
Regional Manager –
Trincomalee R.H.O. 26. Ms G A A Ranasinghe 44. Ms A D R Mendis
Chief Manager – Senior Law Officer – Corporate &
7. Mr P A P R S Perera Human Resources Department Institutional Banking Division
Kurunegala R.H.O. 27. Mr G H U S Gunaratne 45. Ms D S Lawrence
Chief Manager – Senior Law Officer –
8. Mr E P A Sisira Kumara Staff Training College
Regional Manager – Colombo North R.H.O.
Batticaloa R.H.O. 28. Ms M T S N Samarasekara 46. Mr J Jayawardena
9. Mr S L M A S Samarathunga
Supplies & Stores Department Colombo Outer R.H.O.
Colombo North R.H.O. 29. Ms L N A N K Nissanka 47. Ms Y K Athauda
10. Mr H G N Arohana
Commercial Credit Legal Department
Hambanthota R.H.O. 30. Mr M H M Rizan 48. Ms P R K N Fernando
11. Ms K A A S Peiris
Internal Audit Department Legal Department
Puttalam R.H.O. 31. Mr W A L Weerasooriya 49. Ms S M D Kumari
12. Mr R M N P Gunathilaka Chief Manager – Senior Law Officer –
Regional Manager – Risk Management & Credit Control Anuradhapura R.H.O.
Monaragala R.H.O. 32. Mr H D Gunarathna 50. Ms V K Subasinghe
13. Mr A Danawalavithana Chief Manager – Information Senior Law Officer –
Regional Manager – Technology Department Legal Department
Anuradhapura R.H.O.
33. Ms W D Piyaseeli 51. Mr H C K Gunawardena
14. Mr B S Ranatungage Chief Manager – Chief Manager –
Regional Manager – Internal Audit Department Engineering Services
Colombo Outer R.H.O.
34. Ms K Subasinghe 52. Ms C V Ebeneezer
15. Ms W D P D Buddhika Chief Manager – Corporate & Chief Dealer – Treasury Unit
Regional Manager – Institutional Banking Division
Kalutara R.H.O. 53. Ms D E H Weerasuriya
35. Mr N Sriskantha Chief Dealer – Treasury Unit
16. Mr H M U H Herath Chief Manager –
Regional Manager – Centralized Back Office 54. Ms W W T R Fernando
Ratnapura R.H.O. Chief Dealer – Treasury Unit
36. Mr R L J Peiris
17. Mr G R S Kodagoda Chief Manager – Credit Review 55. Mr K M C B Senaratne
Regional Manager – Department Chief Security Superintendent –
Gampaha R.H.O. Security department
37. Ms V P Abeyratne
18. Ms P G N P Liyanage Chief Manager – Corporate & 56. Mr A M T N De Silva
Regional Manager – Institutional Banking Division Chief Manager –
Polonnaruwa R.H.O. IT Infrastructure & Operations
38. Mr S M A R Senanayaka
19. Ms A M V D L Adikari Chief Manager – Corporate &
Regional Manager – Kegalle R.H.O. Institutional Banking Division
PEOPLE’S BANK
ABOUT
39
FROM THE TOP

REFLECTIONS
DRIVING
VALUE CREATION
DRIVING
VALUE
CREATION
AND ANALYSIS
40 / Operating Environment
47 / Stakeholder Engagement
50 / Materiality
55 / Our Strategy
60 / Our Value Creation Model and
REPORTS
GOVERNANCE
Capital Balances
62 / Commitment to Sustainability
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
OPERATING ENVIRONMENT
GLOBAL ECONOMY The impact of the Russia-Ukraine war

on growth in Europe has turned out
Global growth reached an estimated 3.4% in 2022, reducing from 6.2% in 2021. to somewhat less than expected. This
However this reduction has to be seen in the context of 2021 being a year of is partly attributable to Government
recovery from the pandemic. The growth in 2022 was somewhat less than support to economies. However,
previous forecasts due to the Russia-Ukraine war, resulting food and energy signals from the fourth quarter suggest
crises, global inflation, and resurgence of COVID-19 in China. that manufacturing and service sectors
are contracting while consumer and
Major economies were affected by high inflation and resulting tight monetary business confidence have weakened.
policy, and heavy indebtedness all of which contributed to retard growth. The
major growth engines of the world the U.S., Euro Area, and China all experienced The U.S. economy grew by 2.7% in
economic retardation. Spillover effects into Emerging Market and Developing 2022, an estimate bolstered by growth
Economies (EMDES) economies have also been acute. The impact of tight in the last six months. This makes it
policies is expected to curb inflation, but the impact may not be felt till 2024. likely that monetary policy makers
could continue to raise interest rates
GROWTH BY CATEGORY 2018-2022 for a period. Rising food prices and
tight labour markets pushed inflation
% to levels not seen in recent times.
7.5 Consumer spending remained strong
in the fourth quarter while housing and
5.0 manufacturing slipped. The demand for
new hires is exceeding the supply of
2.5 available workers, and unemployment
has slipped to its lowest levels in half
0 a century. There is a greater tendency
for workers to switch jobs and there is
-2.5 also a trend towards early retirement.
-5.0 UNITED STATES GROWTH RATES

2018 2019 2020 2021 2022
2019-2023
Global economy Advanced economies %

Emerging market and developing economies Low income developing countries
9
Growth in advanced economies has decelerated – in fact it is one of the 6

highest decelerations in recent decades. Particularly in the second half of 2022
consumer purchasing power was eroded by high inflation and tight monetary 3
policy. Activity in the housing sector was also weak. Russia’s invasion of Ukraine
hampered gas supply to the Euro area, driving energy prices and inflation. 0
Energy supply chains to industry were also affected, resulting in uncertainty
which hampered production. -3
Fiscal flexibility has been considerably constrained, and many countries are -6
experiencing concerns over debt sustainability with global financial conditions 2019 2020 2021 2022 2023
(forecast)
making it more difficult to service debt. However many governments have
introduced measures to cushion the effect of rising prices on households
and firms, retarding fiscal consolidation.
Operating environment
PEOPLE’S BANK
ABOUT
Continued outbreaks of the pandemic, The forecasts for EMDE countries THE SRI LANKAN ECONOMY
which caused mobility restrictions, are mixed. The WEO January 2023
have retarded growth in China, which report holds out the prospects of In the year under review Sri Lanka was
achieved only 3.0% growth. There has rising growth rates in 2023 and 2024. beset by many crises: political turmoil,
also been the impact of droughts and However the World Bank January 2023 scarcity of foreign exchange, drawing
dampening in the property sector. Global Economic Prospects Report down of foreign current reserves,
All these factors culminated in being paints a much less optimistic picture. spiraling inflation, and high interest
rates. All these factors combined to
FROM THE TOP

REFLECTIONS
a drag on consumption, food and According to this source, the outlook
energy production, and residential for EMDE countries, other than China, result in making 2022 the worst year
investment. Fiscal and monetary policy is largely poor, with their total debt for the Sri Lankan economy since
measures have only partially alleviated being the highest for 50 years. The independence.
the issues. However, the Chinese Russia-Ukraine was has also increased
economy is expected to grow by costs. Moreover, in these countries Sri Lanka’s access to international
5.2% in 2023, and contribute to a health. education, and nutrition markets had already been constrained
third of the global growth. are still reeling from the setbacks with the credit downgrading in 2020.
The country continued to service its
VALUE CREATION
DRIVING
that originated from the COVID-19
pandemic. This leaves little room for external debt and finance imports
CHINA GROWTH RATES using its own reserves and loans from
fiscal flexibility. The projection for per
2019-2023 the banking sector. As result official
capita income growth in EMDEs, other
than China, for the period 2020-2024 reserves slumped from USD 7.6 Bn. In
%
is approximately the same as for 2019 to below USD 400 Mn. in June
10 2022. Net foreign assets in the banking
developed countries. This indicates
that the gap between the two cannot system also fell to USD -5.9 Bn. in
8 June. The scarcity of foreign exchange
be expected to narrow.
caused severe scarcities of essentials
AND ANALYSIS
6 such as fuel, gas, pharmaceuticals, and
It was also a turbulent year for financial
markets, globally. Global stocks and industrial raw materials.
4
bonds lost more than USD 30 Tn.
in 2022 after inflation. Inflation, Remittances from overseas workers
2 also went into a tailspin. These
rising interest rates, and the war in
Ukraine were the main causes. In remittances have on average
0
New York, heavy selling on the last compensated for 80% of the trade
2019 2020 2021 2022 2023
(forecast) trading day of the year sent market deficit over the past two decades. The
indexes into a tailspin, with the S & P remittances, which had already declined
Global growth is expected to slip to 500 and Nasdaq falling 19% and 33% since the COVID-19 pandemic, suffered
2.9% in 2023, but recover to 3.1% in respectively, during 2022. The market a further decline after the Central Bank
REPORTS
GOVERNANCE
2024. The dampening is anticipated value of stocks traded across all artificially pegged the Rupee at 200
mainly due to tight monetary policies exchanges suffered an erosion in value per dollar in October 2021.This caused
imposed by Central Banks and the of USD 25 Tn. Bond markets have also many Sri Lankan expatriates to resort
Russia-Ukraine war. It is mainly encountered heavy selling. to remitting money through unofficial
advanced economies that will be channels, whereby they could obtain
affected by the slowdown. In China higher rates. From January-May
growth is expected to pick up due to 2022, remittances received were just
reduced inflation and recovery from USD 1.3 Bn. Which was less the half
STATEMENTS
FINANCIAL
the effects of the Ukraine war. the figure for the corresponding
period in 2021.
With the situation becoming

unsustainable, the Rupee was sharply
devalued to LKR 360 to the Dollar
in May 2022.
INFORMATION
SUPPLEMENTARY
Extremely high inflation and interest exports in 2022 exceeded USD 13 Bn.
EXCHANGE RATE OF USD rates have caused tremendous and were approximately 5% higher
hardship to the less affluent sections than previous highest figure in 2021.
LKR
of the populations; many businesses Imports on the other hand,
400
are also in dire straits. reduced 11.4 YoY to USD 18.3 Bn.
320
With escalating inflationary pressures,
IMPORTS AND EXPORTS
the Central Bank maintained a tight
240
monetary policy throughout the
USD Bn.
year under review. The key policy
160 25
interest rates, SDFR and SLFR were
increased by 10 pps in total to 14.50%
80 20
and 15.50% respectively by end
October 2022. There has been some
0 15
moderation of inflation rates in the
2018 2019 2020 2021 2022
period October-December 2022,
10
which is reflected in Consumer Price
Indices, which can be at least partly
REMITTANCES attributed to the measures taken. The 5
monetary policy is expected to be

USD Mn. 0
relaxed in 2023, which should result in 2019 2020 2021 2022 2023
7,500
a softening of interest rates from the (forecast)
middle of the year.
6,000
Imports Exports
Sri Lanka defaulted on its sovereign
4,500
debt in April 2022. This resulted The growing economic hardships
in Sri Lanka’s Fitch rating (which brought about political turmoil, in
3,000
had already been downgraded to the form of popular protest, on an
CCC) being further downgraded to unprecedented scale. Government
1,500 Restricted Default (RD). This closed buildings, Including the President’s
off all avenues for foreign borrowings official residence, were stormed by
0 unless there is some easing of the crisis
2018 2019 2020 2021 2022 protestors. This culminated in the
situation. resignation of the incumbent President.
Inflation reached unprecedented The period of political uncertainty that
The economy contracted by 4.8% YoY followed in turn made formulation
levels during the year; year-on-year
in the first half of 2022 (compared of a cohesive policy to address the
inflation in August 2022 recording
with 9.3% growth in 1H2021), and crisis difficult.
64.3%. Many factors have fuelled this
is estimated to have contracted by
spiraling inflation, including the sharp 8 %-9.2% in the year. Around 25% of
depreciation of the Rupee against the the population is below the poverty INFLATION RATES
USD, domestic and global supply side line, and this situation can be expected
disruptions, and the delayed impact %
to be prolonged.
of relaxed monetary policies of the 7.5
recent past. Moreover the impact of Headwinds on both the local and
sharp reduction in tax rates in 2019 6.0
global scene contributed to the
was also a contributory cause, not foreign exchange crisis. Expenditure
only by fuelling aggregate demand on merchandise imports in 1Q2022 4.5
but also by necessitating financing the exceeded those for the corresponding
quarter in 2021. This brought about 3.0
growing budgetary deficit. The impact
of the ban on chemical fertilisers in an urgent need to restrict imports
2021 caused food scarcities which also to essentials. As a result there was a 1.5
drove up prices and also resulted in fall in import value, whereas exports
severe shortages of foreign exchange. remained steady. Sri Lanka’s total 0
2018 2019 2020 2021 2022
PEOPLE’S BANK
ABOUT
There is widespread agreement that SRI LANKAN of banks is demonstrated by the stage
the only practicable way of alleviating BANKING SECTOR 3 loans to total loans ratio. As of end
the present situation is to obtain an August 2022, stage 3 loans recorded
Extended Fund Facility (EFF) from the With the daunting conditions in the an increase of LKR 475.1 Bn. (56.9%),
IMF, negotiations for which are under economic and financial environments, reaching LKR 1.3 Tn. Furthermore
way. An IMF Mission in August 2022 the financial sector too is under Stage 3 loans to total loans increased
reached a staff level agreement. This severe stress. Low foreign exchange to 10.6% by end August 2022 from
FROM THE TOP

REFLECTIONS
agreement is not binding and is subject liquidity and high interest rates have 7.1% at the end of 2021. Extension
to ratification by the IMF Board. their toll on the banking sector. Banks of debt moratoriums for companies
are facing higher bad loans and and individuals also led to increased
Some of the broad highlights of the non-performing loans as the impacts of impairments. Rising interest rates
agreement are: the crisis seep into virtually all sectors and restrictions in imports effectively
of the economy. Downgrading of the squeezed any growth in advances.
z The EFF will be for USD 2.9 Bn.
country rating severely constrained
z The objectives are to restore banks’ access to foreign currency and The fuel crisis and power interruptions
macro-economic stability and debt counterparty transactions.
VALUE CREATION
DRIVING
affected industrial output and
stability, while preserving financial
commercial operations of banks’
stability and protecting from the In the current milieu, banks are customers. Delays in payment
vulnerability encountering, or can be expected to to certain key industries such as
z Debt relief from Sri Lanka’s creditors face, major headwinds in the form construction, renewable energy, and
and additional financing from of contraction of economic output, fertiliser have affected their cash flows
multi-lateral partners will be required prevailing high interest rates, and and impaired their loan repayment
to ensure debt sustainability and tax revisions. The major exposure to capacity. The macro-economic
close financial gaps. SOEs, particularly of the state banks, conditions have affected the retail
is another major concern. Despite
AND ANALYSIS
segment as well; with the inflation
An authorities programme has also slowing of credit to government from and the resulting rise in consumer
been agreed to by the fund some of commercial banks, financing by Banks prices customers are having to divert
the key elements of which are; to SOEs increased by 52.9% YoY in their incomes to food and other
z Supporting fiscal consolidation by June 2022. Nevertheless, loans to the essentials leaving little space for loan
tax reforms that will raise revenue Government and SOEs from private repayments. Increased provisions
banks account for 33% of their total for loan impairments led to reduced
z Introducing cost recovery pricing for
assets; losses on these loans are profitability. This in turn resulted in
fuel and electricity to minimise fiscal
yet to be recognised. Private credit dampened investor confidence, which
losses from state-owned enterprises
showed signs of picking up, showing hinders raising capital from the local
z Raising social spending with better an increase of 17.1% YoY in June 2022. or international markets. Declining
targeting to cushion impacts on To strike a positive note, it has to be profits also led to lower retained profit,
REPORTS
GOVERNANCE
poor and vulnerable said that, despite coming under severe impacting capital adequacy ratios,
z Rebuilding foreign exchange stress, the banking system did succeed constraining the banks’ capability
reserves through a market in maintaining acceptable levels of to grant new loans. The reduction
determined and flexible exchange capital and impairment ratios. of purchasing power of consumers
rate, supported by the policy will also prompt them to keep their
package under the programme There is an increasing trend in financial assets in liquid form, rather
z Ensuring financial stability by putting impaired loans, driven by the current invest in savings or time deposits.
a healthy and adequately capitalised macro-economic backdrop which
STATEMENTS
FINANCIAL
banking system in place. has not been assuaged despite reliefs Banks are also beset with by higher
granted to the borrowers from banks. operating coats driven by inflation,
At September 2022, top tier banks Rupee depreciation, and increases in
had reported bad loan provisions impairments. This has naturally resulted
over 70% in excess of that of a year in narrowed profit margins. There has
before. This has been heavily driven been a disconcerting incidence of
by dollar denominated International migration among professionals and
Sovereign Bonds (ISBs) and Sri Lanka
INFORMATION
SUPPLEMENTARY
other skilled staff, particularly among

Development Bonds (SLDBs). the millennial generation. If the trend
Impairments for ISBs have been around continues banks could be faced with
25-30% while for SLDBs it has been severe problems of human resources
around 20%. The Central Bank has in the years ahead.
stated that the decline in asset quality
Key indicators of the banking sector
2018 2019 2020 2021 2022 YoY change

2022 (%)
Assets and Liabilities (LKR Bn.)

Assets 11,794 12,523 14,666 16,924 19,400 14.6
Net loans and advances 7,580 7,961 8,970 10,180 11,300 11.0
Deposits 8,492 9,162 11,141 12,671 15,300 20.7
Borrowings 1,763 1,679 1,692 2,181 1,900 -12.9
Profit before tax 195 172 190 259 192.2 -25.8
Profit after tax 126 111 136 198 151.7 -23.4
Capital adequacy (%)

Core capital (tier 1 capital)
adequacy ratio 13.1 13.0 13.0 13.2 12.3
Total capital adequacy ratio 16.2 16.5 16.5 16.5 18.3
Asset quality (%)

Gross non-performing
advances ratio 3.4 4.7 4.9 4.5 N/A
Net non-performing advances ratio 2.0 2.8 2.4 1.7 N/A
Stage 3 loans to total loans – – – 7.6 11.3
Profitability (%)
Return on assets (ROA) before tax 1.8 1.4 1.4 1.6 1.0
ROA after tax 1.1 0.9 1.0 1.2 0.8
Return on equity (ROE) 13.2 10.3 11.4 14.5 10.5
Interest margin 3.6 3.6 3.1 3.4 4.0
Liquidity Indicators
Credit to deposit ratio 90.6 88.7 82.6 82.7 73.9
Liquid assets ratio 27.6 31.0 37.3 33.8 29.9

PEOPLE’S BANK
ABOUT
Market interest rates
December December December September December September December

2018 2019 2020 2021 2021 2022 2022
SDFR 8.0 7.0 4.5 5.0 5.0 14.5 14.5
SLFR 9.0 8.0 5.5 6.0 6.0 15.5 15.5
FROM THE TOP

REFLECTIONS
AWDR 8.8 8.2 5.8 4.8 4.9 11.6 14.1
AWFDR 10.9 10.1 7.1 5.6 5.9 15.4 18.5
AWLR 14.4 13.6 10.3 9.4 9.9 16.9 18.7
BANKING INDUSTRY ASSETS AND NET LOANS AND ADVANCES
VALUE CREATION
DRIVING
LKR Tn.
20
16
12
AND ANALYSIS
4
0
2019 2020 2021 2022 2023
(forecast)
Assets Net loans and advances
People’s Bank performance compared with banking sector
2022 2021
Banking People’s Bank People’s Bank Banking People’s Bank People’s Bank
REPORTS
GOVERNANCE
sector share (%) sector share (%)
Assets (LKR Bn.) 19,400 2,972 15.3 16,924 2,648 15.6
Deposits (LKR Bn.) 15,300 2,372 15.5 12,671 2,072 16.3
Profit before tax (LKR Bn.) 192.2 21.3 11.1 285.7 30.4 10.6
Profit after tax (LKR Bn.) 151.7 17.2 11.3 198.4 23.7 12.0
Tier 1 capital adequacy ratio (%) 12.3 11.9 – 13.2 12.6 –

STATEMENTS
FINANCIAL
Total capital adequacy ratio (%) 15.3 16.3 – 16.5 17.8 –
ROA before tax (%) 1.0 0.8 – 1.6 1.2 –
Interest margin (%) 4.0 2.7 – 3.4 3.4 –

INFORMATION
SUPPLEMENTARY
LOOKING TO THE FUTURE

Looking at the overall economy,
there are some grounds for optimism
considering the proposed IMF-EFF
programme, the progress on the
negotiations so far, and the policy
reforms implemented. There are
reasonable grounds to expect a
turnaround in the economy in the
latter part of 2023. This however
hinges on many aspects including
those on a political front. If there is a
clear path of direction the country is
likely to realise sustainable progress
in the medium-term. However there
are serious concerns on the possibility
of domestic debt restructuring. There
are no definite signs of this yet, but
the possibility hangs like a Sword of
Damocles over the banking sector.
Regarding the banking sector, the main

challenges facing the banks continue
to be foreign currency liquidity,
capital adequacy, and maintaining
asset quality. Liquidity, both in local
and foreign currency will have to be
monitored extremely carefully. The
sector should do its utmost to ensure
that commitments to multi-lateral
agencies and LCs entered into are
not defaulted. Any foreign currency
commitments should continue to be
prioritised for essential imposts such as
fuel and pharmaceuticals, and essential
food items. Portfolio quality will have
to be managed with sensitivity to
different customer segments and their
position. In particular the SME sector
will have to be dealt with empathy;
else many enterprises in the sector
may not survive. The Banks should
perform multi-scenario analyses on the
non-performing ratio and the differing
implications on their capital. Thereby
they could ascertain the level of risk
tolerance leading to levels of NPA.
STAKEHOLDER ENGAGEMENT
PEOPLE’S BANK
ABOUT
At People’s Bank, stakeholder ourselves we offer our stakeholders STAKEHOLDER
involvement is crucial to ensure that numerous opportunities to interact ENGAGEMENT PROCESS
our strategic planning decisions are with us throughout the year. These
ethical, sustainable, and fair. Our exchanges influence the course of our Identifying our Stakeholders
stakeholders are the people, groups strategies, keeping them in alignment The Bank’s major stakeholders are
and organisations that affect or are with stakeholder requirements and identified based on their level of
affected by our business activities. expectations while we develop engagement, impact on our operations,
FROM THE TOP

REFLECTIONS
In order to maintain a continuous competitive, sustainable value for them and the decision-making process.
dialogue between these entities and in the short, medium-, and long-term. Their frequent inputs help us to
better fulfil our role as a responsible
corporate citizen.
Investors Customers Employees/ Regulators/ Suppliers Community/

Trade Unions Legislators Environment
VALUE CREATION
DRIVING
Who The z Public sector clients All full-time z Governments z Suppliers Local communities
they Government z Corporate and and part-time and regulators z Business and ecosystems
are and institutional banking ecosystems z Other non- partners
corporative clients governmental
societies organisations
z Retail and SME clients
z Brokers and
intermediaries
Why To have To continuously To earn the loyalty To ensure ethical To nurture and To ambitiously
AND ANALYSIS
they continued innovate and develop and dedication of a operations and strengthen a contribute towards
matter access products that meet team of motivated prudent risk sustainable achieving the
to us to capital customer needs, thereby employees who management supply chain so UN Sustainable
for the differentiating ourselves share the same across the Bank that we continue Development
sustainable from the competition vision as the to attract more to create shared Goals (SDGs)
growth and and setting the bar Bank, by creating funding, finance value, setting and responsibly
performance in terms of customer opportunities to new client the industry playing our part in
of our experience and grow, be successful segments, and benchmark for addressing the most
business. customer and achieve their mitigate potential responsible pressing social and
satisfaction. full potential. impacts from future and sustainable environmental issues
uncertainties. sourcing. of today.
REPORTS
GOVERNANCE
Prioritising our Stakeholders
Stakeholders are ranked according to the level of influence they have on the operations of the Bank.
This would also determine the adjustments we need to make in our ongoing interactions with them.
Regulators/Legislators Investors FINANCIAL

STATEMENTS
Suppliers Customers
Stakeholder influence
Employees/Trade Unions
Keep satisfied Key player

INFORMATION
SUPPLEMENTARY
Community/Environment
Monitor Keep informed
Stakeholder interest
Stakeholder engagement
Engaging with our stakeholders

The table below describes the way in which we engage with them among others.
Investors Customers Employees/Trade Unions
Key concerns/ z Consistent economic performance z Research and innovation z Health and safety
expectations z Environmental, social and z Quality of service z Flexibility of hybrid working
governance (ESG) criteria z Relationship management environment
z Sustainable growth z Compliance
z Transparent, fair, and attractive
z Transparency remuneration
z Affordably of services
z Business continuity
z Employee development
z Convenience and accessibility
z Brand reputation and image
z Employee engagement
z Financial stability of the Bank
z Organisational resilience
z Talent pipeline and retention
z Speedy complaint resolution
z Cost optimisation
z Career opportunities
z Health and safety
z Asset quality
z Diversity and inclusion
z Stable ratings
z Business continuity
z Privacy and cybersecurity
z Rewards and recognition
z Customer communication
z Incentives and benefits
Channels of Frequency Mode of engagement Frequency Mode of engagement Frequency Mode of engagement
engagement and
frequency Annually Annual report Ongoing Customer satisfaction Annually Performance appraisal
surveys
Quarterly Financial statements Ongoing Customer networking Ongoing Collective bargaining
Continuous Corporate website Ongoing Corporate website Ongoing Multi-level staff

meetings
Ongoing Written Ongoing Relationship Ongoing Staff induction and

communications, management orientation
emails, phone calls
Ongoing Financial literacy Ongoing Training programmes
programmes
Ongoing Customer hotline Ongoing Group intranet/email
Ongoing Social media Ongoing Pulse magazine
Our strategic We collaborate with our investors We deliver the most up-to-date We offer a secure and stimulating
response to provide strong returns and quick and convenient digital banking work environment that supports both
long-term sustainable value, while tools and apps. They are innovatively personal and career development
also keeping them promptly and designed to enhance our customers’ through rewards and recognition,
openly informed of our successes user experience advancement, fair compensation,
and problems. and training opportunities
Value delivered to our stakeholders

Investors Customers Employees/Trade Unions Regulators/Legislators
Return on equity Total number of customers: Employee engagement score 69.6% Contribution to GoSL LKR 13.9 Bn.
12.2% Over 14.7 million. LKR 26.6 Bn. spent on staff benefits paid as taxes
Earnings per 682,300 New customers onboarded Percentage of grievances
share LKR 17,192 People’s Wave app has scored redressed 50%
Special Levy a monthly average of 35,000 Retention 97.6%
and dividends downloads and 411 billion
Promotions 33
LKR 661 Mn. transactions
An average of 107,000 Facebook
visits per month.
Stakeholder engagement
PEOPLE’S BANK
ABOUT
Regulators/Legislators Suppliers Community/Environment
z Governance and transparency z Maintaining strong, ethical relationships z Future talent pipeline
FROM THE TOP

REFLECTIONS
z Risk management z Building capability and expertise z Social and environmental impact
z Industry support for policies z Responsible procurement z Prudent water and energy
z Microfinance and SME development z Responsible sourcing z Consumption
z Research and innovation z Operational improvement z Waste management
z Sustainability performance z Technological advances including
z Responsible financing
z Regulatory compliance digital solutions z Green financing
z Quality of service z Commitment to community
development
z New business opportunities
VALUE CREATION
DRIVING
z Guidance on financial management
z Fair process and fair price
and business
z Climate change
z Financial literacy
Frequency Mode of engagement Frequency Mode of engagement Frequency Mode of engagement
Weekly Regulatory reporting Ongoing Supplier surveys Ongoing Press releases,

media briefings
AND ANALYSIS
Ongoing On-site surveillance Ongoing Supplier relationships Ongoing Corporate website
Ongoing Industry forums Ongoing On-site meetings Ongoing Public events

and meetings and visits
Ongoing Press releases Ongoing Social media Ongoing Social media
REPORTS
GOVERNANCE
We keep the lines of communication We establish trustworthy connections We support social economic development,
open with government through continuous in order to secure dependable and sustainability and environmental
dialogue, meeting regulatory requirements sustainable supply chains conservation within the community.
and timely submission of relevant
information.
STATEMENTS
FINANCIAL
Suppliers Community/Environment
Payments to suppliers LKR 15.9 Bn. Investment in CSR LKR 38.2 Mn.
Number of suppliers from local
communities 258
INFORMATION
SUPPLEMENTARY
MATERIALITY
Material topics are those issues that or importance of a topic is assessed The material topics, together with
concern our various stakeholders in by its significance and relevance to the our strategic objectives, help us to
their interactions with the Bank, and Bank or our stakeholder. Significance formulate Key Result Indicators (KRIs).
consequently have an impact on the is evaluated by the probability Our dedication to achieving the
Bank’s financial performance, position, of occurrence of a topic and the strategic objectives is demonstrated
our ability to operate in society, and magnitude of its impact. In this Report, by how we evaluate our performance
our capacity to create long-, medium-, we have also included a long-term against KRIs.
and short-term value for those forecast of the degree of materiality.
stakeholders. All of our stakeholder
groups engage with us continuously
MATERIALITY ASSESSMENT
throughout the year, and we use the
CREATING SHARED VALUE
We follow a clear material assessment
feedback and suggestions they offer Based on the findings of our materiality process which helps us identify the
to identify the key issues that are most analysis, we formulate our strategies. important material topics that affect
important to them – issues that are All significant issues are handled by the Bank and its stakeholders. This
“material”. the appropriate Business Unit Heads in helps us to formulate the required
accordance with our strategic priorities responses, and plan strategies to
We conduct a materiality assessment and responsibilities. Resources are navigate the risks and opportunities
annually to determine the content of allocated according to the level of risk that lie ahead in the short, medium
our review. The degree of materiality and opportunities relevant to each topic. and long-term.
Materiality assessment process

The following aspects guide us to prioritise the material topics of our Bank:
Voluntary
frameworks
and standards
adopted by
the Bank in
determining Matters
External
Operating material topics: Strategic highlighted Direct inputs
stakeholder
context of priorities of through from key
engagement
the Bank the Bank internal stakeholders
activities
z GRI Standards sources
z UNSDGs
z UN Global
Compact
We are conscious of the fact that materiality and the related priorities are constantly evolving. We therefore have carried
out a forward-looking exercise to project the developments in the materiality profile in the medium- to long term.
Developments during the year

The economic and political turbulence of the year has brought many serious issues affecting both the Bank and its
stakeholders. These include: currency devaluation, shortage of foreign exchange, high inflation, high interest rates, and
impact of the crisis on customers. This gamut of issues has been categorised under macroeconomic factors. In the
circumstances, the Bank has had to optimise use of scarce resources such as foreign exchange.
Materiality
PEOPLE’S BANK
ABOUT
The material topics selected for inclusion in the report are given in the table below:
No. Material topic GRI Standard number Reason for materiality Management approach Reference to the
GRI 3-3 capital sections
1. Financial GRI 201: A positive financial Increase revenue by Head of Finance’s

performance Economic Performance outcome reinforces leveraging market Review (page 68 to 71),
the Bank’s capacity for opportunities and Business Line Review
FROM THE TOP

REFLECTIONS
GRI 207: Tax
stability, resiliency, and effective cost (page 72 to 81), Risk
growth while enhancing management. Manage Management Report
brand equity risks strategically, (page 138 to page 167)
reinforce capital position
and strengthen the
balance sheet
2. Digital GRI 417: Retain the competitive Continuous investment Manufactured Capital
leadership Marketing and Labelling edge, providing in digitalisation to (page 82 to 86),
VALUE CREATION
DRIVING
exceptional customer maintain our position Intellectual Capital
service that boosts as the most digitalised (page 87 to 94),
brand equity and Bank, delivering value Customer Capital
positions the Bank to our economy and (page 108 to 114)
well in the financial stakeholders
marketplace
3. Customer GRI 417: Customer experience Offer customers a Manufactured Capital

experience Marketing and Labelling is vital to gain market compelling value (page 82 to 86),
share and increase the proposition. While this Intellectual Capital
AND ANALYSIS
GRI 418: Customer Privacy
sustainability of the includes digitalisation, (page 87 to 94),
Bank the new physical look Customer Capital
and feel of the branches (page 108 to 114)
has contributed greatly
to enhancing the Bank’s
image
4. Operational GRI 402: Essential to reduce Enhance the efficiency Manufactured Capital
efficiency Labour/Management costs and improve of all key operations of (page 82 to 86),
Relations benefits for all the Bank mainly through Intellectual Capital
stakeholders automation to increase (page 87 to 94),
profitability Customer Capital
(page 108 to 114),
REPORTS
GOVERNANCE
Business Partner Capital
(page 115 to 119), Human
Capital (page 95 to
107), Natural Capital
(page 129 to 136)
5. Employee GRI 401 : Employment High employee Investment in Human Capital

productivity productivity is crucial digitalisation is the key (page 95 to 107)
to advancing the to improving employee
STATEMENTS
FINANCIAL
Bank’s operations and productivity

strategic goals
6. Talent GRI 402: Labour/ Identify and retain the Build staff morale and Human Capital
management Management Relations skills and competencies promote employee (page 95 to 107)
needed and plan for retention. Succession
GRI 404: Training and
future ones planning is a vital
Education
component
GRI 405: Diversity and
INFORMATION
SUPPLEMENTARY
Equal Opportunity
GRI 406:
Non-discrimination
Materiality
7. Training and GRI 404: Training and Develop a high Invest in training and Human Capital
development Education performance team development, and the (page 95 to 107)
of employees to infrastructure required,
implement the strategic to develop industry-
plan of the Bank and leading capabilities and
deliver an outstanding help our employees
stakeholder experience reach their full potential
8. Health and GRI 403: Occupational Ensure a safe Ensure health and safety Human Capital
safety Health and Safety and healthy work standards at work and (page 95 to 107),
environment that is put in place proactive Manufactured Capital
GRI 416: Customer Health
secure, motivating, and systems and procedures (page 82 to 86)
and Safety
engaging to cope with any
ongoing health issues
and possible future
epidemics
9. Compliance GRI 417: Marketing and Elevate the Bank’s Ensure full compliance Human Capital
Labelling reputation and with all applicable (page 95 to 107)
strengthen brand equity laws and regulations Intellectual Capital
GRI 418: Customer Privacy
by maintaining strong (page 87 to 94)
GRI 205: Anti-corruption governance and
oversight framework
GRI 206: Anti-competitive
Behaviour
10. Integrity, GRI 205: Anti-corruption Contribute towards Develop a rigid, moral, Human Capital
transparency, an ethical society law-abiding culture, (page 95 to 107),
GRI 206: Anti-competitive
and and confidence in the and compliance culture Risk and Governance
Behaviour
accountability banking system among within the Bank to (page 138 to 204),
the general public ensure employees Head of Finance’s
maintain the highest Review (page 68 to 71),
standards Intellectual Capital
(page 87 to 94)
11. Need to reskill GRI 404: Bank being unable Proper reskilling of staff Human Capital
employees Training and education to meet the Gen Z and encourage them to (page 95 to 107)
customers due to the keep abreast with the
reason that the staff latest technologies and
was not being reskilled assist customers.
to keep abreast with
the latest technologies.
12. Responsible Minimise the risk of While there is a need Customer Capital
lending NPLs which is high as to promote financial (page 108 to 114)
many customers are inclusion we have to
seriously affected by exercise caution in
the prevailing economic lending, concentrating
environment on sectors that are less
affected
13. Customer Promote financial Reach out to segments Customer Capital

access inclusion by widening of the population that (page 108 to 114),
customer access are still not banking; Manufactured Capital
identify the reasons, and (page 82 to 86)
take suitable steps to Community Capital
draw them in (page 124 to 128)
Materiality
PEOPLE’S BANK
ABOUT
14. Brand equity Increase market Increase brand equity Intellectual Capital
share and achieve through leadership in (page 87 to 94)
a competitive edge digitalisation, strong
which can be reinforced governance, innovation,
by strengthening the customer service,
FROM THE TOP

REFLECTIONS
brand reputation customer relationship
management and
market dominance
15. Supplier value GRI 204: Procurement Minimise the risk of Strengthen long-term, Business Partner Capital
creation Practices business disruptions mutually beneficial (page 115 to 119)
GRI 308: Supplier due to a breakdown in business partner
Environmental Assessment the supply chain relationships and create
shared value
VALUE CREATION
DRIVING
GRI 414: Supplier Social
Assessment
16. Risk and Enhance the integrity, Adopt a proactive Risk Management
governance trust, and stability of approach to risk Report (page 138
the Bank management following to 167), Corporate
sound governance Governance Report
practices (page 137 to 204),
Intellectual Capital
(page 87 to 94), Head
AND ANALYSIS
of Finance’s Review
(page 68 to 71)
17. Cybersecurity GRI 418: Customer Privacy The Bank in Improve IT security Risk Management
threats common with many systems and capabilities Report (page 138
other institutions, to cope with increasing to 167), Intellectual
is vulnerable to threats Capital (page 87 to 94)
cyberattack which pose Manufactured Capital
threats to the security, (page 82 to 86)
confidentiality and
integrity of data which
needs to be addressed
18. Socio-economic GRI 202: Market Presence Align with national Reduce social Community Capital
REPORTS
GOVERNANCE
impacts GRI 203: Indirect Economic priority issues disparities by assisting (page 124 to 128)
Impacts socioeconomic
development of local
GRI 413: Local communities
Communities
19. Environmental GRI 302: Energy Contribute towards Reduce our carbon Natural Capital
impact a sustainable green footprint by investment (page 129 to 136)
GRI 303: Water and
environment through in green infrastructure
Effluents
STATEMENTS
FINANCIAL
sustainable business and renewable energy

GRI 305: Emissions practices sources, and considering
environmental factors
when making financing
and investment decisions
20. Macroeconomic The unprecedented Adopt flexible strategies All capitals, but
factors economic and political and operational plans especially Head of
turbulence during the to cope with the Finance’s Review
INFORMATION
SUPPLEMENTARY
year brought a number situation. Where there (page 68 to 71),

of issues seriously are resource limitations Customer Capital
affecting both the Bank caused by the crisis, (page 108 to 114),
and its stakeholders in the available resources Investor Capital
its wake, the impact of have to be utilised to (page 120 to 123).
which the Bank has to give optimum benefit
strive to minimise. to priority sectors.
Materiality
The materiality analysis has been carried out under two time frames; short-, SOME OF THE FORECASTED
and medium- to long term. Under the respective time frame, each material DEVELOPMENTS
topic is given a ranking of high, medium, or low according to its importance to
stakeholders and its importance to the Bank. z While how far the present
macro-economic issues will persist
Importance: into the future cannot be foreseen,
High: Considered a priority for action there is a strong possibility that at
Moderate: Adequate action is required to control potential impacts least some of them will continue to
be important in the long term.
Low: Adequate measures are already in place or the impact is beyond our control
z ESG issues will be more important to
stakeholders in the future, as global
SHORT-TERM: ONE YEAR PERIOD experience has shown; while Bank
will prioritise financial performance,
stakeholders (including but beyond
1, 2, 3, 4, 9, 11, shareholders) may value ESG impact
High
even at the cost of Bank’s absolute

13, 16, 20
Importance to stakeholders
performance.
z Intangible assets, such as software
and innovation, can become more
Moderate
important than tangible assets in

6, 8, 10, 12, 17 5, 7, 14 the future. This can be expected to
impact digital leadership and brand
equity.
z Talent management could become
more important for the Bank in the
Low
15, 18, 19 future considering emigration/brain

drain which is becoming acute in the
current economic context, and the
human resources skills needed to
Low Moderate High
cope with increasing demands.
Importance to People’s Bank z Socio-economic impacts could
be expected to increase in
importance for both sides due to
LONG–TERM MATRIX: 5-10 YEAR PERIOD increasing public concern with
environmentalism, especially in the
The long-term matrix has been developed based on a projection of the evolution
context of global warming, and
of the risk profile,
social issues.
z Employee productivity while
still being very important to the
2, 3, 9, 11, 14, 16,
High
Bank, could be less important to

10, 12, 19
18, 20 stakeholders.
Importance to stakeholders
z Stakeholders could be expected

to grow more concerned with
transparency and accountability,
Moderate
especially corruption issues.

8, 15, 17 1, 4, 5, 6, 7, 13
z Supplier value creation would be of
increased importance to suppliers,
in the light of the need to build
lasting relationships in the future.
The focus could be on developing
Low
a comprehensive supply chain

ecosystem and the Bank could
depend on suppliers more for digital
Low Moderate High innovation, rather than develop all
capabilities in-house.
Importance to People’s Bank
OUR STRATEGY
PEOPLE’S BANK
ABOUT
2022 was a year of unexpected STRATEGY EVOLUTION
turbulence with the first quarter
bringing a series of challenges from
low liquidity in foreign and local
currency, steep increases in inflation
and interest rates, to political strife and 1 Vision and BHAG
economic distress. Vision: Inspiring the Nation towards Transformational Growth
FROM THE TOP

REFLECTIONS
The Strategic Plan for 2022-2024 BHAG: To be the most customer sought after bank with the industry best
was developed by the People’s Bank employee satisfaction level.
with the consultation of an external Our BHAG is measured as:
consultancy firm. All the Corporate
z Being the primary bank for 35% of our customers
and Executive management members
and other team members including z Obtaining highest net promoter score (NPS) among leading local competitors
selected Branch Managers covering all z Being the top bank in the country for export and inward remittances
VALUE CREATION
DRIVING
regions participated in the process of z Winning the Gold Award by Great Place to Work Sri Lanka (Extra Large
developing the plan. Enterprise category)
The strategy addresses the fundamental

market trends detailed below:
3 Key Strategic Objectives

01 We need to
constantly z Driving Excellence z Being Future Ready
improve service
Building Customer-Centricity
AND ANALYSIS
z
levels
Customers have more knowledge

and options; they can demand
more from a bank or business 4 Enabling Mindsets
and greatly value convenience
z Lean-Agile z Data-driven z Growth
02 We need to become
customer-centric 8 Modules
REPORTS
GOVERNANCE
Excellent customer service is not z Corporate z IT
the same as customer-centricity.
Across industries there is a shift z Treasury and International Banking z HR
from being product-centric to
customer-centric, enabled by
z Enterprise z Finance
sophisticated data analytics z Retail z Bank-wide
STATEMENTS
FINANCIAL
03 We need to be
future-ready
20+ Initiatives
Mapped by module as well as strategic objective
The evolution of technology is

an underlying factor and a key
enabler of both the above trends.
Technology is the single biggest 50+ Activities
disruptor that is impacting
INFORMATION
SUPPLEMENTARY
how financial services can be

conceptualised and delivered,
and it is constantly changing –
we need to be agile and 150+ Work streams
adapt quickly
Our strategy
INITIATIVES UNDER STRATEGIC PILLARS
BUILDING CUSTOMER
DRIVING EXCELLENCE BEING FUTURE-READY
CENTRICITY
1. Operational excellence 1. Customer service 1. Getting ahead of disruption

z Business development growth
improvements
z Number of strategic partners
z Operational process improvements z Growth of C1/C2 customers and z Foreign account growth
z Digital transformation of retention of C3 - C5 Customers z Overseas branch expansion
operations (Retail)
z Growth in remittance value/
z Improvements in TAT z Acquire/re-engage high-potential
volume
lapsed customers (Corporate/
z Re-alignment of Branch focus z Network of foreign investors
SMEs)
z Improved customer satisfaction z FDIs channeled through the Bank
z NII per customer growth
z Time utilisation of Branches z Develop an ecosystem – identify
z Customer issues resolution TAT
z Increase in customer wallet improvements and map industries and all touch
share and retention points
z Dealer/distributer finance
z PBT of each division/ revenue/leads
product and service line 2. Building growth
z Growth in export income
mindset-oriented team
2. Portfolio quality Implementation of the succession
2. Better targeting and z
z Asset quality improvement value propositions planning strategy

z Reduction in NPA z Organisation-wide initiatives
z High-priority sector growth
managed by HR
z Treasury volume growth
3. Performance-driven culture z Number of inter-department
z Foreign based customer growth initiatives
z Employee engagement
z Average wallet size of customers z Number of employees
z Revenue/cost per employee
z Number of customised “graduating” from the learning
z Employee upskilling propositions offered academy
z Meaningful retention and z Improved customer satisfaction z Transformational/dynamic
contribution to the Bank training modules
z Export customer growth
z External vs. internal hires
z Non-traditional export customer
growth
z Credit card growth – NII, volume
and average limit
The Strategic Plan consists of 26 strategic initiatives for the main Business Units, and six more for the supporting units,
encompassing a total of 59 Board oversight Key Performance Indicators (KPIs) that are quantifiable and measurable. While
the strategic initiatives run for the full period of the strategic plan, there are steps with time frames under each initiative.
These results are monitored through regular reviews conducted throughout the year.
Our strategy
PEOPLE’S BANK
ABOUT
OPERATIONALISATION OF THE STRATEGY
Funnelled approach to cascading with a range of SMART KPIs resulting in a robust methodology for strategy execution.
Wide
Strategy/ Outcome
FROM THE TOP

REFLECTIONS
Project plan KPIs
Path to success
Key initiatives Initiative KPIs
Focus
Activity and
Action items Effectiveness
and activities KPIs
VALUE CREATION
DRIVING
Workstreams Timeline KPIs
Narrow
REVIEW MECHANISM 4. Differentiating schematic from 8. I. Introduce new loan products in
AND ANALYSIS
non-schematic-SME line with the above
There is a stringent review process
within the Bank to ensure that the 5. Engage with a larger segment of II. Allow new MSMEs concessionary
strategic initiatives are implemented micro, small and medium-sized rates and terms.
as per the plan. We conduct a monthly customers to facilitate credit III. Low interest rates during capital
review meeting headed by the CEO/ facilities but also to create a repayment, grace periods,
General Manager, and a quarterly business-conducive environment comfortable security coverage
review meeting by the Board Strategic 6. Ensure the credit facilities are easily with relaxed securities for small
Plan Review Committee (BSPRC) deliverable on the need basis of ticket sizes
headed by the Chairman. Performance MSMEs IV. More empowerment for
against the KPIs is carefully evaluated
7. Identify the priority sectors in credit approval to expedite
at these meetings, and corrective
REPORTS
GOVERNANCE
lending in line with Government’s disbursements
measures are recommended where
necessary. Economic Policy Framework. V. Strengthen the Credit Units who
Focused priority sectors: evaluate requests
z Agriculture (farming, livestock, VI. Participate in concessional
SHORT AND MEDIUM-TERM fisheries, agri produce collectors lending schemes directed by
MEASURES TO IMPROVE and intermediaries, small rice Ministry of Finance, Central Bank
THE PERFORMANCE OF THE millers) of Sri Lanka and Ministry of
BANK IN THE FUTURE Industries and Commerce
STATEMENTS
FINANCIAL
z Manufacturing industries focused

1. Micro, Small and on direct and indirect exports and VII. Business counselling
Medium-sized Enterprise imports substitution
VIII. Set up a desk for women
(MSME) Development z Food and beverages and youth entrepreneurship
z Innovation and technology-based development to address lack
1. Export sector specific SME hubs
business of financial literacy and support
2. Targeted sales & products for business planning across both
non-traditional export sectors
z Essential services (health,
segments
INFORMATION
SUPPLEMENTARY
education, logistics, telecom)

3. Partnership Strategy for
Enterprise Banking
z Constructions
Our strategy
IX. Nurture entrepreneurship in young 15. Introduced a new “women 5. To increase deposit base
graduates through an incubation entrepreneur development policy” of the Bank:
system developed by the Bank to empower women entrepreneurs
a. Experiment alternative channels
X. Direct entrepreneurs to support 16. Participation to the “Helaviru”
b. Strengthen daily collection
agencies such as Industrial digital platform introduced by the
process in the branch network
Development Board, CISIR, SLT as financial service provider
and introduce mechanism to
SLTDA, SLIM etc.
17. Introduced and implemented the monitor the daily collection
XI. Develop linkages with large new concept of “One village one regularly
corporates for supply chains and product” in all 24 regions
c. Implementing strategies to
business improvements
increase demand deposits
XII. Appoint 24 Development Officers/ 2. Deposits of the Bank
Field Officers to cover the 24
d. Re-launch deposit products
regions to grow MF/DF portfolio 1. Maintain interest margin at a
competitive level to gain the
XIII. Liaise with Smallholder Agri
competitive market edge when 3. Pawning
Business Partnership Programme
reducing the deposit interest rate
(SAPP) to offer facilities to farmers 1. Extended working hours where
(whilst maintaining the position as
XIV. Establish a Credit Revival Unit to the market leader) when and where there is potential to grow Pawning
rehabilitate sick projects necessary, and market the higher market share.
9. Introduce a sustainable financing interest rates offered by the Bank 2. Continuous marketing strategies to
policy for the Bank and provide benefits to saving promote Pawning within respective
products, attracting customers by geographical area.
10. Conduct entrepreneurship
enhancing the quality of customer 3. Conducting attitude development
development sessions in view to
service, providing additional programme for pawning staff.
enhance financial inclusiveness
benefits etc.
of MSME customers with the 4. Re-arrange Pawning lobby by
collaboration of the International 2. Offer customer oriented-features/ ensuring privacy of the customer.
Finance Corporation (IFC) attributes of savings products 5. Educate customers to utilise
when promoting existing products/ pawning discount rate which offer to
11. Arrange a special trade fairs to
introducing new products and certain savings products.
promote products of existing
give priority for the qualitative
MSME customers
aspects, and provide attention to
12. Liaise with coconut cultivation the requirements of customers and 4. Credit Card Business
board to grant “Kapruka Ayojana provide efficient, quality service
Loans” with new improvements through the bundle of features 1. Increase the credit card base, credit
affiliated with savings products. card profitability and the fee income
13. Launch of special interest generated from credit cards (in
concessionary rate loan scheme 3. Mechanisms to follow up minor addition to the interest income);
for the development of Tea Small accounts which are having where most of the transactions are
Holders through a credit line stagnated balances, with a view to carried out through virtual platforms
funded by the ADB increase minor (low cost) deposit today through introducing a reward
14. In view to develop the base and maximise the return on system, Near Field Communication
entrepreneurship skills of women, investment made by the Bank by (NFC), use social media for
implemented a special interest providing the initial deposit. advertising credit cards, use pop
concessionary loan scheme 4. Increase the demand deposit base up messages to search engines
along with a non-repayable grant (current account deposits) of the and deploying more POS machines
(10%-25%) through ADB funded Bank as a highest income generating covering all regions.
credit line source through introducing various 2. Streamline credit card promotional
benefits to current account holders. campaigns.
Our strategy
PEOPLE’S BANK
ABOUT
3. Upgrade service quality and 8. Introducing Lean concept for
efficiency through staff training. smoothening of processes by
eliminating bottle necks in the
4. Improve overall customer
recovery processes.
experience of People’s Bank
card holders. 9. Expediting recovery through Debt
Recovery Module.
5. Upgrade the knowledge of the staff
FROM THE TOP

REFLECTIONS
members (in the Branch network) 10. Continuous trainings and awareness
on credit cards. programs for all staff members.
6. Attract potential customers through 11. Special monitoring of top 25
higher educational institutes prior to customers at each division
entering the job market. and sectors.
7. Introducing mobile POS and soft 12. Monitoring of financial contribution
POS machines of all CRO (Customer Relationship
Officers) by providing specific
VALUE CREATION
DRIVING
8. Increasing fee based income
targets and KPIs.
through credit cards
13. Conducting recovery camps
9. Tapping of untapped customer
base, identifying their requirements
through a BI tool. 6. Management of Expenses
1. Cost reduction measures on

5. Reducing Non-Performing
expenses
Loans
2. Introduce structural changes for
AND ANALYSIS
1. Expedite recovery through legal process improvement and cost
proceedings (litigation). leadership.
2. Train all the credit officers on 3. Resource optimisation and
recovery and litigation procedures. harnessing maximum benefits from
expenses borne by the Bank
3. Help small scale customers of
the Bank to overcome their 4. Drive further bank-wide cost
unexpected/unfavourable situations saving programs
and to develop their business
providing financial literacy and
financial advices to reduce their 7. New Channels
REPORTS
GOVERNANCE
unnecessary cost, increase turnover,
potential market etc., with a view 1. Promote special loans and card
to protect our customers and to schemes among university students
strengthen their business with new as a lucrative future customer
business opportunities as well. segment of young professionals.
4. “VIEWPOINT” centres to support 2. Capitalising digital channels.

and partnering with genuine
defaulters.
STATEMENTS
FINANCIAL
8. New Product Development

5. Monthly Recovery Champions to
incentivise employees. 1. Customised and market based
6. Maintain close engagement with innovative deposit products
non-performing customers. 2. Market driven asset products
7. NPL Review Committee to
stringently monitor recovery
INFORMATION
SUPPLEMENTARY
efforts and results.

OUR VALUE CREATION MODEL AND CAPITAL BALANCES
Inputs as at 31 December 2021 ACTIVITIES
FINANCIAL CAPITAL
BUSINESS UNITS
NII LKR 82.5 Bn. ROE 19.9% Taxes Paid LKR 16.3 Bn.
Fee Income LKR 8.3 Bn. ROA 1.2% Capital adequacy ratio 17.8%
Retail
Overseas
Banking
Banking
MANUFACTURED CAPITAL
Head office building: Cost incurred LKR 1,447.6 Mn.
percentage completion 3.0%
Cost of branch renovation LKR 189.6 Mn.
INTELLECTUAL CAPITAL
Brand equity index 3.8 Fitch Lanka Credit Rating AA-(lka)
Customer Satisfaction 91%
Corporate
HUMAN CAPITAL
Banking
Total staff 7,568 Staff retention 98.2%
18,813 hours of digital training 4,637 female employees
Number of promotions 99
Financial
Intermediation
CUSTOMER CAPITAL
Acting as an
Number of customers: Over 70% of transactions conducted digitally intermediary
Close to 14.5 million
Number of customer touch points 2,326 between various
New customers onboard close stakeholders
to 510,000
International
BUSINESS PARTNER CAPITAL

Banking
Number of suppliers 258 Total value of purchases LKR 12.3 Bn.
Number of correspondent banks 42 Number of Vostro agents 78
INVESTOR CAPITAL
Equity Capital LKR 136.1 Bn. ROE 19.9%
Earnings per share LKR 23,720
COMMUNITY CAPITAL
Enterprise
Banking
Number of Community projects 12 Expenditure on Community Projects

LKR 12.7 Mn.
Treasury
NATURAL CAPITAL
Branches using solar power 20 Number of accounts opened digitally 1.7 million
Our Value Creation Model and Capital Balances
PEOPLE’S BANK
ABOUT
Outputs as at 31 December 2022
FINANCIAL CAPITAL
SUPPORT SERVICES
NII LKR 75.8 Bn. ROE 12.2% Taxes Paid LKR 13.9 Bn.
Fee Income LKR 16.4 Bn. ROA 0.8% Capital adequacy ratio 16.3%
Human Information
FROM THE TOP

REFLECTIONS
Procurement
Resources Technology
Head office building: Cost incurred LKR 2,204.2 Mn.
percentage completion 21.3%
Cost of branch renovation LKR 211.3 Mn.
Administration
VALUE CREATION
DRIVING
Brand equity index 4.0 Fitch Lanka Credit Rating A(lka)
Customer Satisfaction Over 90%
HUMAN CAPITAL
Total staff 7,377 Staff retention 97.6%
40,970 hours of digital training 4,530 female employees

Communications
Marketing and
AND ANALYSIS
Number of promotions 33
Maturity
transformation
CUSTOMER CAPITAL
Using short-term
funds to finance Number of customers Over 73% of transactions conducted digitally
long-term assets Over 14.7 million
Number of customer touch points 2,301
New customers onboard 682,300
and Compliance
Risk Management
REPORTS
GOVERNANCE
Number of suppliers 258 Total value of purchases LKR 15.9 Bn.
Number of correspondent banks 43 Number of Vostro agents 82
INVESTOR CAPITAL
Equity Capital LKR 145.3 Bn. ROE 12.2%
Planning
Strategic
Earnings per share LKR 17,192

STATEMENTS
FINANCIAL
COMMUNITY CAPITAL
Number of Community projects 44 Expenditure on Community Projects
LKR 38.2 Mn.
Capital Financial
Management Management
INFORMATION
SUPPLEMENTARY
NATURAL CAPITAL
Branches using solar power 20 Number of accounts opened digitally 2.7 million
COMMITMENT TO SUSTAINABILITY
People’s Bank is committed to anticipates using this investment in an People’s Bank employees are among
sustainable business practices and efficient manner. The Bank’s Corporate the important stakeholders, responsible
“giving back” to the communities in Sustainability Framework (CSF) guides for carrying out and overseeing the
which it operates. The Bank invests the decision-makers in formulating policy initiatives. The Board of Directors
a considerable sum of money each corporate sustainability projects is responsible for developing the
year in corporate sustainability, and according to the established framework. CSF, while Corporate and Executive
Management are in charge of execution
and fund allocation in accordance with
policy guidelines.
While fulfilling the objectives of the policy the Bank aims to satisfy the needs of stakeholders in the
areas that are material to them.
STRATEGIC OBJECTIVES
Driving Excellence Building Customer Being Future Ready

Centricity
Material matters Material matters Material matters
Financial performance Customer experience Digital leadership

Operational efficiency Responsible lending Cybersecurity threats
Employee productivity Socioeconomic impacts Macroeconomic factors
Risk and governance Brand equity
Compliance Customer access
Talent management Health and safety
Integrity transparency and
accountability
Environmental impact of the
business
Supplier value creation
Training and development
People’s Bank Corporate Sustainability Policy
1 2 3
Social Sustainability Environmental Sustainability Economic Sustainability
PEOPLE’S BANK
ABOUT
1 SOCIAL SUSTAINABILITY
The Bank has concentrated on these key areas:
Sustainability activity Materiality SDG relevance
Child development: The Bank ensures that it plays its part in the education z Socioeconomic
FROM THE TOP

REFLECTIONS
and development of children and university students, and as a result alleviates impacts
poverty and raises the living standards of the less affluent communities in
the country.
Heritage, culture and religious development: The country and its people z Socioeconomic
have been blessed with a vast and rich cultural heritage, and the Bank has impacts
promoted its social value by supporting the arts, culture and religions within
the communities in which it operates.
Diversity and gender equality: The Bank recruits staff in a transparent z Operational efficiency
VALUE CREATION
DRIVING
equitable manner, and is completely inclusive, employing people from all z Employee
socioeconomic groups from all areas of the country. Gender parity is one productivity
of the key areas of pride with 39.6% of senior management represented by
z Talent management
female staff members.
2 ENVIRONMENTAL
SUSTAINABILITY
Employees
AND ANALYSIS
The Bank is committed to applying
the latest business practices
into its operations, and fostering
environmental awareness and Society Processes
responsibility among our employees,
clients and suppliers.
People’s Green Pulse, our

environmental sustainability
programme was initiated in 2016 to
lead the way among the banking
fraternity in:
Customers Buildings
REPORTS
GOVERNANCE
z Measuring and minimising the
environmental Impact due to bank
operations.
z Educating and creating awareness People’s Green Pulse:
among the internal and external Buildings, Nature and You
community.
z Buildings
z Taking the leadership in
STATEMENTS
FINANCIAL
environmental friendly banking z Processes

initiatives of the country. z Customers
z Employees
z Society
INFORMATION
SUPPLEMENTARY
Buildings z Environmental impact

The Green Buildings programme is continuing successfully covering all
new buildings and refurbishments of existing buildings. Selected branches
designated under the Digitised Banking Programme will be certified as Carbon
Neutral buildings. Solar Power generating systems will be incorporated
into buildings according to LEED/GREENSL/CIOB Green Mark Certification
guidelines. All contractors are required to follow LEED/GREENSL/CIOB Green
Mark Certification for new key branches and their materials will need to comply
with the requirements.
Processes z Operational efficiency

The People’s Bank has taken the lead in digitalisation of processes and island z Employee
wide rollout of digital services, earning the reputation of the Greenest Bank, productivity
with the introduction of paperless banking in most of its operations:
z Environmental impact
z Cash and cheque deposit machines (CDM)
z Customer experience
z KIOSK for utility bill payments
z Customer access
z Widest ATM network in the country
z Digital leadership
z Paperless accounts opening and E-Statements for accounts
z Loan processing in paperless environment
z Internet, mobile and web based banking systems
z Debit and credit cards
z 24/7 People’s Call Centre
Customers z Operational efficiency

The Green Banking concept has been introduced to customers through the z Employee
multiple channels made available to them. In particular these areas have proved productivity
to be popular with customers:
z Opening of accounts through Express Banking which is a paperless
operation
z Socioeconomic
z E-statements that can be requested by account holders
impact
z SMS and Internet Banking
z Customer access
z Debit cards – in the pursuit of a cashless society
z Health and safety
z Express Banking roll-out for new customers
z Responsible lending
z CDM-Cash Depositing, ATM-Cash Withdrawals and Kiosk-Bill Payments
z Green Loan system with lower interest rates
Employees z Employee
To create the full impact of these programmes it is important that all staff productivity
members are total adherents of the sustainability philosophy. To this end z Compliance
employees are encouraged to obtain concessionary loans for the purchase of
solar power systems, use environment friendly building methods and seek to
purchase electric or hybrid vehicles. They will also be encouraged to switch to
electronic documentation and communication methods for both internal and
customer communications.
Society z Compliance
In the Bank’s quest to become the Greenest Bank in the country, we present z Environmental impact
the following characteristics to the general society:
z Minimum carbon emissions from our operations
z We have put carbon management into place and invested in carbon
trading programmes
z We work as a catalyst in educating the society as a whole by promoting
and practising environmental sustainability
z Tree planting projects have been undertaken to maximise the production
of carbon credits
PEOPLE’S BANK
ABOUT
3 ECONOMIC SUSTAINABILITY
The objectives of Economic Sustainability takes us back to the roots of the People’s Bank which was established to give an
opportunity for a large underserved part of the country’s population to partake of the financial services that were available
at the time. It was particularly targeted at the grass root level customer – the farmer, fisherman and rural entrepreneur
among others. In the six decades since then the Bank has transformed itself into a national powerhouse of financial service
excellence. Our aim is to be recognised as Sri Lanka’s market leader for financial services.
FROM THE TOP

REFLECTIONS
With this in mind the Bank has set up a series of initiatives for Economic Sustainability:
A Sustainability Reporting framework has been established (composed of a z Risk and governance
Central Sustainability Committee, Regional Sustainability Officers, Branch/ z Compliance
Department Sustainability Officers). The framework includes a key information
z Integrity, transparency
VALUE CREATION
DRIVING
gathering process.
and accountability
Providing necessary financial aid to startup new businesses and improve z Responsible lending
existing businesses at affordable rates z Socioeconomic
impact
z Customer access
Acceleration of economic development by uplifting the SME sector of the z Responsible lending
country, whilst enhancing their managerial and marketing capabilities. z Socioeconomic
impact
AND ANALYSIS
z Customer access
Creating new employment and income generating opportunities through z Responsible lending
appropriate Micro Financing projects. z Socioeconomic
impact
z Customer access
Enhancing export capabilities of potential entrepreneurs. z Responsible lending

z Socioeconomic
impact
z Customer access
REPORTS
GOVERNANCE
Promoting environment friendly operations by funding eco friendly projects z Environmental impact
such as solar power projects. z Responsible lending
z Socioeconomic
impact
Improve the financial literacy of the business community and financial z Employee
inclusiveness by establishing Digital Centres, Self Banking Units and Bank productivity
Branches throughout the country. z Customer experience
STATEMENTS
FINANCIAL
z Socioeconomic
impact
z Brand equity
z Customer access
Financially cater to all sectors of the economy (Agriculture, Fisheries, Livestock, z Financial performance
Export Agriculture, Trading etc.) as per the Asset and Liability Framework of z Customer experience
INFORMATION
SUPPLEMENTARY
the Bank in order to ensure all sectors will benefit from the facilities offered by
z Customer access
People’s Bank.
z Socioeconomic
impact
z Brand equity
FUTURE OUTLOOK z Non account holders who do not

have a financial relationship with
Future prospects for the Bank are the Bank must offer adequate
promising as we come out of the year benefits (either commercial or non
of economic turbulence of 2022, and commercial) to the Bank as the
we will follow a clear set of guidelines corporate sustainability project
for all sponsorship requests coming sponsorship benefits.
under three main elements of the
Corporate Sustainability frame of
z All corporate sustainability project
reference. They will be considered sponsorships must comply with
in relation to the following criteria: the “Guidelines on Advertising and
Promotional Activities of Public
z Final objective/outcome of the Enterprises” which was laid down
corporate sustainability project or by the Ministry of Finance and
sponsorship should come under Planning under the Public
Social Sustainability, Economic Enterprise Circular No: PED 57.
Sustainability or Environmental
Sustainability frame work/s
z Stakeholders who request
sponsorships for Corporate
Sustainability projects must have an
account/financial relationship with
the People’s Bank
z The particular account/financial
relationship must be a profitable
venture to the Bank as well as the
stakeholder.
z The standard cost benefit analysis
should be done prior to the
consideration of sponsorship for any
corporate sustainability project.
z Other than any special project, the
sponsorship amount should not
exceed 10% of the annual profit of
the particular venture and justifiable
benefits must result for the Bank
and the society.
z Special Corporate Sustainability
projects must be approved by the
Executive Operations Committee
and the Board of Directors with the
proper recommendations at their
respective authority levels.
PEOPLE’S BANK
ABOUT
67
FROM THE TOP

REFLECTIONS
MANAGEMENT
VALUE CREATION
DRIVING
DISCUSSION
AND
AND ANALYSIS
ANALYSIS
68 / Head of Finance’s Review
REPORTS
GOVERNANCE
72 / Business Line Reviews
72 / Retail Banking
73 / Enterprise Banking
75 / Corporate Banking
77 / Treasury
78 / Overseas Customer Services
STATEMENTS
FINANCIAL
80 / International Banking
82 / Manufactured Capital
87 / Intellectual Capital
95 / Human Capital
108 / Social and Relationship Capital
108 / Customer Capital

INFORMATION
SUPPLEMENTARY
115 / Business Partner Capital

120 / Investor Capital
124 / Community Capital
129 / Natural Capital
HEAD OF FINANCE’S REVIEW
From the People’s Bank’s perspective, as a State Bank’s deposits – similar to the industry –
are interest sensitive Term Deposits and
Institution with a social cause and a national role in over 90.0% of whose maturities are within
addition to its commercial goals – its performance a period of 12 months or less and thus
gets repriced at a faster pace relative to
is even more inextricably tied with the country’s its loan book. Plus, in view of its equally
social cause, it deferred any repricing of
economic fortunes. During its over six decade operating loans particular of its more vulnerable
history, whilst it has dealt with many challenges and customer segments across both retail
and Small and Medium Scale Enterprises
economic cycles, 2022 was unlike any seen. During the (SMSE). In addition, deteriorated macro-
year under review, the Bank had to face challenges circumstances, naturally dictated
deteriorated asset quality and higher
from a liquidity front, foreign currency in particular, impairment charges whilst inflationary
an earnings front and a general operational front. pressures inevitably led to cost escalations
– all of which creating added earnings
pressure. However, all in all, as we have
always done and in accordance with the
MACRO OVERVIEW foreign currency in particular, an earnings
founding principles, we looked beyond
front and a general operational front.
2022 was a year of unseen like before the bottom line when formulating our
macro-economic setback for Sri Lanka. strategies and viewed 2022 as a year
From a liquidity front, downgrade of
It was the year which witnessed the where improved resilience, far sighted
the country’s sovereign rating saw the
culmination of external shocks and investments in the long term sustainability
withdrawal of lines and limits by several
stresses over the years snowball into and customer centricity far more important
overseas lenders. Prior to 2020 – the
deep economic distress, a year which saw relative to any top or bottom line measure.
Bank benefitted from being the largest
the country’s useable foreign reserves To the Bank’s benefit, it was able to deal
borrower from foreign counter parties
dip to an all-time, the country’s rating with each of these obstacles thanks to its
amongst Locally Incorporated Licensed
downgrade to levels unprecedented and dedicated staff and astute leadership and
Commercial Banks. However, pursuant to
the ensuing foreign currency liquidity its focus on technology and digitalisation
sovereign rating to CCC just by November
result in, amongst other, a complete which were all invaluable assets during
2020 from being B prior to the onset
halt in economic activity during much of these trying times.
of COVID-19 – i.e. simply in a matter
the second quarter of the year. This in of months – saw the Bank lose over
aggregate saw the rupee devalue by over From a total capital adequacy perspective,
USD 1.0 Bn. in external foreign currency
80.0%, inflation sore to a record 70.0% notwithstanding such extreme adversity
access it once had. This coupled with the
levels and, as a curtailment measure the Bank was able to successfully maintain
need to continue to support the nation
thereto, interest rates rise to a historic healthy levels of solvency under existing
by importing essentials in a time of dire
high of even north of 30.0%. Needless to Basel III rules which compared well with
need – which included primarily crude oil,
say, as the backbone of any economy, the industry peers. This was thanks to the
coal and pharmaceuticals and the general
Banking sector was at forefront of such numerous efforts taken by the Bank to
perception related setbacks as similarly
challenge and consequence. augment its regulatory capital since the
faced with other State Peers – saw the
onset of Basel III on 1 July 2017 which
Bank deal with significant challenges
The Operating Environment on pages 40 included, amongst other, improving its
in its FCY operations. Whilst these
to 46 more fully sets out the broader earnings retention and amendment of
challenges yet continue to exists, the
global, local and sector operating context the People’s Bank Act and the Debenture
Bank has made notable strides towards
in which the industry in general and the issuances which followed thereafter.
systematically addressing them over the
Bank operated. short-term which will be further aided if
macro-economic circumstances show KEY HIGHLIGHTS
People’s Bank’s challenges sustained further improvement. From
a rupee front, whilst there were early z Consolidated gross income reached
and approach
set-back during the first four months of LKR 391.2 Bn. representing an 65.2%
From the People’s Bank’s perspective, as a 2022 due to the macro-economic shocks, growth (2021: LKR 236.8 Bn.). This was
State Institution with a social cause and a including high interest-rates, thanks to primarily driven by the high interest rate
national role in addition to its commercial early measures taken to restrain credit environment and increases in non-funded
goals – its performance is even more growth whilst driving deposits, the Bank sources of income which included
inextricably tied with the country’s was able to successfully overcome such one-off fee income and foreign currency
economic fortunes. During its over six hurdles and limiting circumstances. exchange gains.
decade operating history, whilst it has
dealt with many challenges and economic From an earnings front, the extraordinarily
cycles, 2022 was unlike any seen. During high interest rates which prevailed, saw the
the year under review, the Bank had to Bank’s Net Interest Margins come under
face challenges from a liquidity front, severe pressure. Close to two third of
Head of Finance’s Review
PEOPLE’S BANK
ABOUT
z Consolidated net interest income lead to any substantial mark-to-market losses. Further, reflective of its far-sightedness and
diminished by 6.0% to LKR 91.0 Bn. having been accurately classified in the first instance, the Bank had no requirement to seek
(2021: LKR 96.9 Bn.). Net interest any regulatory or supervisory consent to reclassify its debt investments to amortized cost.
margins slipped to 3.1% from 3.7% in As a result, this considered, the Bank’s capital adequacy of the Bank as reported depicts a
2021. On a Bank standalone basis, net realistic figure.
interest margins slipped to 2.7 % from
3.4% in 2021. 2022 2021 2020 2019 2018
FROM THE TOP

REFLECTIONS
z Consolidated operating expenses LKR Bn. LKR Bn. LKR Bn. LKR Bn. LKR Bn.
totalled LKR 59.0 Bn.; a 16.8% increase
(2021: LKR 50.5 Bn.). Excluding the Total operating income 130.0 110.7 90.8 96.5 89.8
Bank’s Pension Trust Fund related – Net interest income 91.0 96.9 74.4 78.6 71.2
expenses, total cost increase was 13.2%.
– Non-interest income 39.0 13.8 16.4 17.9 18.7
z Impairment charges of the Bank rose
by 130.4% year-on-year reflecting NIM – (%)
pressures on credit quality including
– Consolidated 3.1 3.7 3.3 3.8 4.0
staging of some of its key customer
VALUE CREATION
DRIVING
exposures. In this context, it must – Bank 2.7 3.4 3.0 3.2 3.5
be pointed out that, to the Bank’s
benefit, the Bank’s exposure sovereign
Interest income grew by 58.0% to
investments subject to the external NET INTEREST MARGIN
LKR 351.4 Bn. Interest income from
debt restructuring was only USD
loans and advances to other customers
51.4 Mn. which was substantially far %
accounted for 73.7% thereof while
lower relative to comparable peers. 5
the balance 26.3% was generated on
z Consolidated ROA (before tax) investments in debt instruments (primarily
recorded at 0.9% and ROE as 11.2% in Government securities). Interest 4
AND ANALYSIS
in 2022, compared to 1.4% and 17.7% expenses grew by a higher 107.5% to LKR
respectively in 2021. 260.4 Bn., reflecting the massive increase 3
in interest on deposits that had to be
INCOME STATEMENT incurred to retain term deposits when 2
interest rates soared to 30% and beyond.
Total operating income and Of the total interest expenses, deposit
1
net interest income related expenses made up close to 80.6%
of which more than 80% was on account
Given the constraints of the operating 0
of term deposits. The balance 19.4% was 2018 2019 2020 2021 2022
environment, there were restraints on paid on other sources of funding.
the main source of the Bank’s operating
Consolidated Bank
income, net interest income. Lending had Consequently, the net interest income
REPORTS
GOVERNANCE
to be prioritised to serve sectors that declined from LKR 96.9 Bn. in 2021 to
were of national importance; beyond this, LKR 91.0 Bn. in 2022, a drop of 6.0%. Non-interest income
caution had to be exercised in lending The Group’s net interest margin declined In the prevailing climate of volatility of
overall macro-circumstances considered. from 3.7% to 3.1% YoY. A multitude of interest rates, improving its sources of
factors contributed to this situation which non-interest income is a priority area
Driven by both the rising interest income included the interest bearing liabilities of the Bank to develop. Non-interest
and non-interest income, the Bank’s (deposits in particular) getting re-priced income comprises fee and commission
consolidated gross income increased faster and at relatively higher rates than income, trading income and other
by 65.2% to reach LKR 391.2 Bn. The
STATEMENTS
FINANCIAL
the interest earning assets and the offer sources of operating income. The Group’s
main sources of income continued to of higher rates to attract/retain deposits non-interest income increased from
be interest income, fee and commission in the wake of intense competition given LKR 13.8 Bn. in 2021 to LKR 39.0 Bn. in
income, and other operating income. the lower level of market liquidity that 2022, an increase of 181.8%. This however
Consolidated total operating income for prevailed. Further, the Bank witnessed a primarily was driven by the gains on
the year was LKR 130.0 Bn., increasing shift of deposits from low cost current foreign currency revaluation and one-off
from LKR 110.7 Bn. in 2021. The Bank’s and savings accounts to term deposits, a increases in fee and commission income.
operating income accounted for 84.8% of phenomenon seen across the industry in These excluded, on a normalised basis,
total consolidated operating income in the
INFORMATION
SUPPLEMENTARY
times of high interest rate regimes, leading non-funded income to total income would
year under review. the CASA ratio to drop to 30.2% during be close to 23.8% which is yet reflective
the year from 39.3% in 2021. of its improve its other sources of income.
Due to the prudent decisions taken in the
These efforts are reasonably expected to
past, the profile of our investment portfolio
continue in the years ahead.
was such that the sudden rise in interest
rates that occurred in April 2022 did not
Consolidated fee and commission income, Operating costs effective from 1 October 2022 from the
which includes fees related to loans and 24% applicable earlier, the charge to
advances, trade-related transactions and Total operating costs increased by income statement on account of income
credit cards and fees earned on digital 16.8% to LKR 59.0 Bn. in 2022 from tax reduced due to lower profitability,
transactions, increased from LKR 9.6 Bn. LKR 50.5 Bn. in 2021. The largest an increase in the deferred tax asset on
in 2021 to LKR 17.2 Bn. in 2022. Other component of operating costs which provision for impairment charges for loans
operating income which mainly consists is personnel expenses accounted and advances and the deferred tax being
of net earned premiums from insurance for approximately 54.6% of the total recomputed at the new income tax rate
business decreased from LKR 6.0 Bn. in operating costs. Personnel costs recorded of 30%.
2021 to LKR 5.6 Bn. in 2022. an increase of 16.8% at the Bank level
during 2022, when compared with A team of highly competent specialists,
2021. This increase reflected increases under the purview of the Head of
Impairment charges in remuneration that had to be granted Finance, manages the Bank’s tax
to staff in view of primarily inflationary matters. In addition, the services of an
Impairment charges more than doubled
pressures. outside consultant has been utilised to
from the previous year, which had to
be expected due to the challenging handle the computation of the income
Other operating costs increased by 17.6% tax liability, the filing of tax returns and
macro-economic conditions. The entire
from LKR 22.8 Bn. in 2021, to LKR 26.8 Bn. related administrative functions. Rigorous
business sector, from the MSMEs to the
during the year under review. Despite monitoring by the Internal Audit, the
large corporates and to the state owned
the spiralling inflation and resulting cost Compliance Unit, and the external auditors
was severely stressed. As a result, during
pressures, the Group’s cost to income ensure compliance. The Bank follows its
the year, the Bank made a prudent
ratio (inclusive of VAT on financial principles of social responsibility in tax
assessment of the degree of risk which
services) was broadly maintained at close matters as well. The Head of the Tax
major customers were subject to as a
to 53.0% levels; at the Bank level, there Unit continually liaises with the Inland
result of prevailing market circumstances.
was a modest improvement to 50.4% Revenue Department to ensure adherence
Based on this, decisions were made on
in 2022 from 51.1% in 2021. Relative to to laws and regulations. There were no
transferring customers to higher stages in
54.3% in 2020, this demonstrated the non-compliances with tax laws and related
risk categorisation as requisite under the
Bank’s efforts to consistently improve regulations during the year.
circumstances.
its cost efficiencies, especially through
automation and digitalisation. With
For the Group, impairment charges rose
from LKR 14.5 Bn. in 2021 to LKR 34.4 Bn.
efforts in this connection yet continuing, STATEMENT OF FINANCIAL
in 2022 (an increase of 137.2%). Taking
further improvements can be reasonably POSITION
expected over the short-to-medium term
the Bank alone, the corresponding figures
as the Bank intensifies its focus on further Deposits
were LKR 14.5 Bn. and LKR 33.3 Bn.
improving productivity and operational
(an increase of 130.4%). The Bank’s drive to increase deposits
efficiencies, much of which is aided by its
clearly brought results when the deposit
digitalisation efforts.
In the year under review, impairment base grew by 13.0% from LKR 2,168.7 Bn.
provision for exposures in Stage 1 at end 2021 to LKR 2,450.1 Bn. at end
decreased by 17.9% while that for Profitability 2022. This increase is highly commendable
Stages 2 and 3 increased by 79.5% and in an environment where disposable
27.1% respectively. Cumulative Stage 3 The Group’s pre-tax profit contracted incomes of retail customers were severely
provisions reached LKR 117.1 Bn. at the by 28.3% to LKR 26.7 Bn. in 2022 from affected due to inflationary pressures
end of 2022 from to LKR 92.2 Bn. in LKR 37.2 Bn. in 2021. This is largely and MSMEs and corporates were
the previous year. As at end 2022, on a attributable to the contraction in net interest experiencing severe cash flow constraints.
consolidated basis, impaired loans (Stage income, increase in impairment charges and Undoubtedly, attractive interest rates that
3) ratio increased to 12.6% from 4.7% the operating costs as detailed above. were being offered contributed to the
previous year. On a stand-alone basis, the deposits growth. Our focus on technology
figures for the Bank were 12.8% and 4.0% Contributing to the state’s and drive for excellence in customer
respectively. In the current context, the service too contributed to these results.
coffers
Bank accords highest priority for reducing Total deposits accounted for 79.8% of
the exposures to the state and the state- The Group’s contribution to government the fund base reflecting the strength of
owned organisations and recovering loans for the year 2022 were LKR 17.8 Bn. which the Bank’s deposit franchise and the wide
granted to risk elevated industries and was 13.1% lower than the contribution branch network, its broad customer base,
corporates, MSMEs and individuals who for 2021 of LKR 20.4 Bn. Despite the and the confidence among a large section
are experiencing stress on their cashflows. increase in the income tax rate to 30% of the population that it has built up over
the years.
PEOPLE’S BANK
ABOUT
A very significant achievement during the year was the increase in the market share of our issuance of Basel III compliant Additional
inward remittances. This is an indication of the success of the drive to increase overseas Tier I and Tier II Debt Instruments. Since
remittances, especially the “Vaasi Kotiyayi” campaign. The fruits of this campaign were amendment of its Act on 30 September
evident by the fact that we were able to double our market share of remittances. It is also 2019 – the Bank has successfully issued
noteworthy that this contributed significantly to arrest the decrease in the CASA ratio. Basel III compliant additional Tier 1
and Tier 2 Debentures to the tune of
2022 2021 2020 2019 2018 LKR 35 Bn. It must be said that these
LKR Bn. LKR Bn. LKR Bn. LKR Bn. LKR Bn. successes are also owed to the General
FROM THE TOP

REFLECTIONS
Treasury, Ministry of Finance for their
Current Accounts and support and assistance extended to the
Savings Accounts (CASA) 739 853 757 571 543 Bank on this front over the years.
Term deposits 1,707 1,310 1,172 1,012 943
Others 4 6 6 6 10 Liquidity
Total 2,450 2,169 1,935 1,589 1,495 Managing liquidity became a matter of
paramount importance during the year for
CASA (%) 30.2 39.3 39.1 35.9 36.3
VALUE CREATION
DRIVING
several reasons. Due to genuine difficulties
Currency caused by the macro-economic climate,
Local (%) 87.8 90.1 89.8 91.8 93.4 clients from all banking units, corporates,
MSMEs, and individuals were experiencing
Foreign (%) 12.2 9.9 10.2 8.2 6.6
great difficulties in honouring their loan
Total (%) 100.0 100.0 100.0 100.0 100.0 commitments. In addition, there was a
shortfall in the interbank market.
Loans and advances At end 2022, the Bank’s Statutory Liquid

Assets Ratio across its Domestic Banking
AND ANALYSIS
There were many constraints on lending during the year under review. These included
Unit and Off Shore Banking Unit was
liquidity constraints and the need to prioritise lending to sectors that were of national
21.4% and 20.1%, respectively as compared
importance, even if there were other more lucrative opportunities. Furthermore,
with 23.5% and 25.9% at end 2021. Our
caution had to be exercised when lending at high rates and the potentially high risk of
performance in this regard compares
impairments in many sectors. Gross loans and advances portfolio contracted by 2.0% in
favourably with the regulatory minimum
2022, from LKR 2,103.6 Bn. to LKR 2,061.1 Bn.
of 20.0%. Our All Currency Liquidity
Coverage Ratio was 119.5% as compared
2022 2021 2020 2019 2018
with 105.7% at end 2021; the regulatory
LKR Bn. LKR Bn. LKR Bn. LKR Bn. LKR Bn.
minimum stands at 90.0%.
Total advances (gross) 2,061 2,104 1,876 1,544 1,490
By type Looking ahead
REPORTS
GOVERNANCE
Overdraft 111 392 258 145 126 Needless to say, the process of recovery
Trade finance 423 299 251 234 281 will be a long and arduous one and one
which hinges on many moving parts. That
Pawning 185 195 175 163 150 said, we remain optimistic that we on the
Term loans 1,166 1,092 1,073 880 808 right path to recovery and the changes
which have taken place, those taking place
Lease rental receivable 64 79 82 88 95
and, more importantly, those likely under
Others 113 47 38 34 30 the Ministry of Finance and the Central
STATEMENTS
FINANCIAL
Total 2,061 2,104 1,876 1,544 1,490 Bank of Sri Lanka under guidance of
International Monetary Fund, the World
Bank and other bilateral agencies – will
The loans and advances by type reveal a sharp drop in overdrafts and substantial shape the country’s future for the better
increase in trade finance. The latter reflects the priority given to supporting exports.
We look forward with cautious optimism!
Solvency
Our capital ratios remain the highest among the systemically important banks in
INFORMATION
SUPPLEMENTARY
Sri Lanka. As at end 2022, the Consolidated Tier 1 Ratio and total Capital Adequacy Ratio
were 13.3% and 17.2% respectively (2021: 13.4% and 17.9%) whilst, on a Bank standalone
basis, it was 11.9% and 16.3%, respectively (2021: 12.6% and 17.8%). To save any doubt, and
needless to say, these were existing Basel III rules considered. A factor that has enabled
Azzam A Ahamat
us to preserve the CAR has been our capital augmentation measures taken since the
onset of Basel III on 1 July 2017 which included, amongst other, improving our earnings Head of Finance
retention and the amendment of the People’s Bank Act which has allowed for the 2 March 2023
BUSINESS LINE REVIEWS

RETAIL BANKING
KEY HIGHLIGHTS
Two new premium customer segments
have been identified by the Bank, and
LKR 172 Bn. LKR 450 Bn. new products have been launched to
pawning portfolio retail loan cater to each of these segments.
portfolio z Elegance – a high net worth
individuals and top end salary
earners that will be serviced by
Branch Managers.
z Excelsior – upper middle level salary
Curated banking Personal loans earning professionals that will be
services packages processed serviced by Excelsior Ambassadors
Elegance and within 24 hours who will be appointed from the
existing branch staff. Both segments
Excelsior
will be entitled to a range of
benefits, such as exclusive services
at any branch, customised credit
and debit cards with special perks,
The Retail Banking Division of to surpass their previous performances
travel insurance, and access to
People’s Bank provides a wide on a daily and weekly basis.
airport business lounges.
range of products and services to Despite the challenges faced during
cater to individuals from all walks of the year, the Bank has successfully
life, including savings and deposit implemented a unique motivational FUTURE OUTLOOK
schemes, loan schemes for individuals, gaming strategy to build teams,
A series of meetings will be held
professionals, as well as pawning resulting in positive outcomes. The
with the Regional offices to conduct
services. Despite a challenging Bank has experienced growth in its
a review of the previous year’s
economic environment characterised market share in the categories of
performance, evaluate the results,
by the impact of COVID-19, liquidity savings and current accounts, as well
clarify the lessons learned, and
crises in both foreign and local as in total deposits within the banking
identify necessary changes to be
currency, inflation, surging prices, and sector. The success of these schemes
implemented in the new financial
interest rates, the Retail Banking Unit can be attributed to the Bank’s
year. The successful team building
has taken the lead in driving growth by motivational initiatives.
and motivational activities will be
undertaking an ambitious, island-wide Throughout the year, the Retail
continued, along with the event
campaign to increase retail deposits. Banking unit holds awards ceremonies
calendar which has already been
to acknowledge exceptional
scheduled for 2023.
To foster teamwork and instill a positive performance in each promotional
competitive culture throughout the campaign and product category.
New products will be developed based
network, the Division implemented These ceremonies also include awards
on current customer requirements,
an innovative strategy that included for the best branch and other related
and existing products will be modified
sharing inspirational verses and categories.
to provide customers with greater
motivational messages among teams,
benefits. Customer retention will be a
transforming official circulars into This interactive and motivational
major focus, and service levels will be
visually appealing and engaging action activity yielded exceptional results,
increased to improve the customer
cards, closely monitoring branch highlighting the importance of a
offering. The new premium segments
office performance, and announcing positive and competitive culture
are part of this initiative.
outcomes through colourful and in driving growth in challenging
appealing displays on official economic environments. The Retail
WhatsApp groups. Daily ranking Banking Unit’s commitment to serving
charts were generated to showcase the best interests of its customers and
the top 10 branches in each grade serving as the face of the Bank has
for each product category, creating been evident throughout this period,
a competitive culture that fostered and its efforts to reinvigorate the
teamwork and motivated branch teams industry are commendable.
ENTERPRISE BANKING
PEOPLE’S BANK
ABOUT
KEY HIGHLIGHTS
In addition to financial support, the
Bank's Regional Credit units worked
USD 90 Mn. Interest income
closely with customers, providing
worth of low-cost grew by 165%
advice on business strategies,
financing restructuring their assets, and guiding
FROM THE TOP

REFLECTIONS
their revival. Here too, some funding
was provided depending on their
cash flow and repayment capability.
Our nationwide network of Branch
Managers, experts in various industries
More than 4,000 Three MOUs in their regions, closely monitored the
new customers were singed with performance of customers and provide
external parties guidance where needed.
VALUE CREATION
DRIVING
The Bank acknowledged that
the agriculture sector had faced
some challenges during the year,
The Enterprise Banking Department into strategically significant sectors. and initiated two programmes in
is committed to serving the Our Business Revival Unit provided conjunction with the Central Bank
Sri Lankan economy by catering advice and financial support to to assist the sector:
to the needs of micro, small, and affected enterprises for restructuring z Domestic Agriculture Development
medium enterprises. The department their finance facilities and revamping Programme (funded by CBSL): A
AND ANALYSIS
comprises four sections: Commercial their business strategies. Our focus pilot project to ease the supply chain
Credit, SME Credit, Micro Finance and was on retaining customers, revitalising financing; the Bank has supported
Development Banking, and the newly their businesses, and preventing them more than 120 customers with
established Business Revival and from defaulting on their debts. approximately LKR 150 Mn.
Project Finance unit. z Smallholder Agri-business
The Bank went beyond the
Partnership Programme: Under
During the year, the Department moratoriums issued by the Central Bank
this programme, the Bank has
played a critical role in supporting of Sri Lanka, and provided its own
accommodated more than 1,000
businesses that were severely affected relief packages to clients. We were
customers with LKR 500 Mn.
by the prevailing economic conditions, able to accommodate the majority of
which had improved significantly in the requests from our commercial, SME
The People’s SPARK programme is
second half of the year. However, the and micro customers for modifications
an innovative initiative designed to
REPORTS
GOVERNANCE
SME sector faced further challenges in to their loan conditions and repayment
equip recent graduates with the skills
2022 due to power and fuel shortages, plans, whilst some were provided
and resources they need to pursue
price hikes, and rising interest rates. with additional funding specifically for
entrepreneurial ventures following the
Additionally, foreign exchange working capital needs.
completion of their degrees. From a
restrictions made it difficult for some
large pool of applicants, we selected
industries to function, and the Central Nearly USD 90 Mn. worth of low-cost
45 candidates who received training
Bank issued moratoriums for some financing, acquired directly from the
through the University of Colombo,
sectors to assist them. Asian Infrastructure Investment Bank
STATEMENTS
FINANCIAL
led by a panel of experienced mentors.

in China, was disbursed at a very low
Upon completing the programme, they
Our Department's first priority interest rate of between 5% to 5.5%
were granted loans to launch their
was to provide support to SMEs in to revive these affected businesses.
own businesses and are now being
managing the immediate economic This funding line allowed businesses
supported and supervised by our
stresses, recovering their businesses, to improve their cash flows during a
regional credit units. This programme
and preparing for future growth. Our time when regular interest rates were
is particularly significant given the
second priority was to improve our prohibitively high, and they could
current climate, which offers limited
contribution to the growth of the use this working capital injection
INFORMATION
SUPPLEMENTARY
prospects for government employment

export industries. as a lifeline. In addition to regular
among university graduates.
customers, the Bank was also able to
To achieve these objectives, we increase its customer base through
Although lending overall was
implemented various programmes this exercise, as many businesses who
limited due to the prevailing
to revive and safeguard impacted had no access to affordable funding
economic conditions, funds were
businesses by infusing working capital became new customers of the Bank.
provided for certain strategically
Business Line Reviews
important categories. As foreign exchange was scarce, and the Bank was teams to assess and lend to green
compelled to prioritise the needs of certain state-owned enterprises (CEB, projects. We have also developed
Lanka Coal, Petroleum Corporation, and Fertiliser Corporation) for energy, green finance loan schemes, and will
fuel, and fertiliser supplies. The remaining available funds were distributed fairly issue green bonds. In the near future,
among our customers on a case-by-case basis. Priority was given to exports, we will expand into Blue Financing to
pharmaceuticals, and the food and beverage sectors for these allocations. The further to our environmental and social
focus was on stability rather than growth at this time, and despite the challenges governance (ESG) guidelines.
faced during the year, we have remained faithful to the guidelines and achieved
the Department's targets successfully. The Bank values its partnership with
Multi-Purpose Cooperative Societies
(MPCS) and Rural Banks throughout
PERFORMANCE HIGHLIGHTS Sri Lanka and is seeking to refresh
2022 Loans granted this relationship for mutual benefit.
We will re-launch the “One Village
Number of loans Amount
One Product” microfinance model
LKR Mn.
to revitalise micro-enterprises. Our
Loan schemes with refinance – SME 936 6,066 Branch Managers are empowered to
provide low-interest loan schemes
SME loans – under People’s Bank own funds 568 1,132
to finance these enterprises while
Loan schemes with refinance – D & MF 494 617 improving their financial discipline.
D & MF loans – under People’s Bank own funds 5,152 1,696
Loan schemes with refinance – CC 247 1,775

Our Enterprise Banking Department
aims to achieve a loan growth of
Commercial credit – under People’s Bank own funds 1,828 16,995
25% in the upcoming year. As retail
TOTAL 9,225 28,280 customers are spending less, we will
look to the business sector to drive
growth in the coming months. With
More than 4,000 new customers enable profitable and efficient trade.
the strategies and plans we have
were acquired during the year which The Bank and EDB will assist small
developed, we aim to meet this target
was 211% higher than the budgeted. manufacturers in accessing new
and maintain our commitment to the
Three MOUs were singed with external overseas markets. We will prioritise
Department’s goals.
parties in year 2022. Interest income supporting new customers in the
grew by 165% due to increased interest Export Sector with value-added
rates industry wide. Only 90% out of exports, such as tea, coconut, pepper,
budgeted advances were granted and and other spices. We will engage
NPL value was below the budgets with customers regularly and provide
which reflects rigorous monitoring education on business planning, online
and control of the enterprise and digital marketing, and other
banking department. skills to improve their knowledge
and abilities.
FUTURE OUTLOOK The Bank also plans to promote

The outlook for Enterprise Banking advanced agricultural practices, such
appears promising, assuming an as Controlled Environment Agriculture,
improvement in the global economic utilising greenhouses, polytunnels
climate. While personal and housing and sprinkler and drip irrigation water
loans have been reduced, small systems. This will optimise land, water,
businesses have demonstrated signs of and fertiliser usage and enhance
recovery by the year-end. the yield of designated fruits and
vegetables with high export potential.
To boost foreign exchange earnings,
we aim to establish Export Hubs Looking forward, the Bank intends
throughout the country in partnership to explore Green and Blue Financing.
with the Export Development Board We are currently negotiating with
(EDB) to facilitate local sellers’ multilateral and regional banks for a
connections with foreign buyers and line of funding, which will train local
CORPORATE BANKING
PEOPLE’S BANK
ABOUT
KEY HIGHLIGHTS
challenges, we recognised the need to
revisit our import-driven strategies and
Prioritising Operating
devise new approaches to overcome
support to income
critical issues.
exports and grew by 141%
imports substitutes
FROM THE TOP

REFLECTIONS
The Government’s imposition
of import restrictions on several
categories of goods had a constraining
effect on credit growth. As a result,
we had to realign our focus from
Commitment to Partnered with import customers to exporters and
support SOEs BOI and EDB manufacturers of import substitutes.
In addition to supporting state-owned
enterprises, we provided assistance
VALUE CREATION
DRIVING
to customers in vital sectors such
as agriculture, manufacturing, IT,
and health, facilitating the import of
essential equipment and medicines.
The Corporate Banking Division We have developed our primary
specialises in catering to the business strategies and performance to align
Our portfolio was heavily weighted
sector by offering a range of products with the overall economic goals of the
towards the state-owned enterprise
and services that are often customised country. These strategies involve:
(SOE) sector, accounting for
to suit the individual requirements z Limiting non-essential imports to approximately 70% of our exposure,
AND ANALYSIS
of clients, which include high-profile conserve scarce foreign currency with only around 25-30% allocated
state-owned enterprises (SOEs),
z Prioritising support to the export to tourism and the private sector.
contractors, manufacturers, exporters,
and import substitution sector This year, we sought to reduce this
and importers who provide vital
z Encouraging foreign currency and imbalance by selectively pursuing
services to the nation and employ
high-volume SLR deposits export-oriented private sector
thousands of individuals. Hence, the
customers, with a particular focus
Corporate Banking Division plays a z Increasing inward remittance
on funding growth in priority sectors
critical role in ensuring the growth and volumes
such as IT.
development of the national economy. z Promoting the growth of the private
sector in selected categories based Despite this focal shift, the Corporate
Following the challenges of on their priority status and viability Banking Division faced numerous
post-pandemic recovery efforts
REPORTS
GOVERNANCE
to offset the high exposure to the challenges during the course of the
across the country, corporate clients SOE sector. year, including the impact of the global
have encountered several additional
pandemic on foreign currency liquidity,
setbacks, such as political instability, As a state-owned bank, we had to as well as the lingering effects of the
economic uncertainties, high inflation, prioritise and honour pre-existing Easter Sunday attack and continuing
a decline in global demand, and a commitments to support key political turmoil. Furthermore, our
worldwide financial crisis. All these state-owned enterprises (SOEs), such Bank granted the highest number of
factors have combined to adversely as the Ceylon Petroleum Corporation, moratoriums in terms of volumes and
affect all sectors of the economy,
STATEMENTS
FINANCIAL
Lanka Coal, Ceylon Electricity Board, number of customers, compared to

severely hampering business and Ceylon Fertilizer Company. other commercial banks in the country.
continuity. This downturn has had Additionally, we provided off-balance
a cascading impact on supporting sheet facilities to major contractors The increase in interest rates added
industries, including a significant drop involved in infrastructure projects to the negative impact on the
in the tourism sector. Moreover, foreign for entities such as the Water Board, Department’s performance, resulting
currency inflows have reduced, with Road Development Authority, Urban in a 97% drop in profit before tax.
Sri Lankan expatriates exhibiting a Development Authority, and other Although the Department recorded
INFORMATION
SUPPLEMENTARY
clear preference for informal players large-scale initiatives. However, this an operating income of LKR 31.9 Bn,
who offer higher conversion rates continued support placed significant which represents an increase of 141%
for remittances. Consequently, the pressure on our foreign reserves, and compared to the previous year,
Bank and the country as a whole we made the strategic decision to non-performing loans and advances
have faced a dire foreign currency allocate resources based on essential increased by 1%, reaching 6% of the
liquidity position. needs of the country. In light of the total loans and advances granted by
evolving situation and emerging the Corporate Banking Division.
Venturing beyond our traditional role, we partnered with the Board of Investment FUTURE OUTLOOK
(BOI) and the Export Development Board (EDB) to facilitate local manufacturers
in establishing connections with potential overseas buyers and create The year ahead will be challenging,
opportunities for exports. Although the outcomes of these efforts may only be but the aim is to continue to maintain
seen in the long term, we pursued these opportunities nevertheless. The EDB and grow the portfolio of customers,
provided our customers with essential information on procedures, regulations, while shifting our attention to new
shipping arrangements, and coordination where required. As a result, our Bank areas of opportunity. Primarily we will
was able to acquire several new export customers who were previously working concentrate on the export oriented
with other banks. manufacturers and services and
provide support and advisory services
The increase in exchange rates and import restrictions led to steep price hikes sharing the expertise of BOI and EDB.
in imported goods and raw materials, which negatively impacted business Together we will create opportunities
continuity and profits. In order to prevent customers from slipping into for export customers to grow, and
non-performing status, we monitored their businesses vigilantly and offered follow up to ensure efficient transfer
professional advice wherever possible. The Central Bank introduced several of export remittances into the country
moratoriums and concessionary terms and facilities to assist businesses in staying so that our economy reaps the full
afloat. We also provided further benefits and extensions to at-risk customers benefits.
based on our own evaluation. Our primary focus was on retaining clients with
healthy businesses that can grow in the long term despite the current difficulties. We will be partnering with the
Port City Commission monitoring
We expanded our service offerings by onboarding new clients using the the FDIs that come in and channel
digital platform that enables them to conduct regular banking functions such them through the Bank. The IT Parks
as remittances, letter of credit openings, and payroll management. Furthermore, which were planned, and initiated,
we offer cash management and value chain management solutions through but have not progressed due to the
our IT division, which generates additional revenue. Despite the challenges, economic disruptions of last year, will
the Corporate Banking portfolio has been sustained, increasing interest and be revived and completed, leading to
fee income. more opportunities to earn foreign
exchange.
PERFORMANCE HIGHLIGHTS Overall there is optimism based on

the promise of debt restructuring from
2022 2021 2020 India, and the IMF funding expected
in 2023. Following the IMF facility, we
Net income (LKR Mn.) 32,618 13,223 13,565
expect other agencies such the World
Net profit before tax (LKR Mn.) 4,189 5,399 6,142 Bank and the ADB to also open credit
lines to provide further assistance
which will boost the economy into
CORPORATE BANKING ADVANCES AND DEPOSITS a growth phase.
CURRENCY WISE
2022 2021 2020
LKR FC LKR FC LKR FC
Advances (LKR Mn.) 392,670 477,777 322,352 367,818 330,433 365,738
Deposits (LKR Mn.) 43,888 68,676 69,968 84,894 72,437 85,814

TREASURY
PEOPLE’S BANK
ABOUT
KEY HIGHLIGHTS
also led to a decline in tourist arrivals The Treasury Sales Team represents
at the beginning of the year, and the a significant initiative currently
The Bank's
numbers gradually decreased as the underway, which involves collaboration
equity portfolio year unfolded. Furthermore, reduced between the Treasury Officers and
achieving a return interbank market activity presented Customer Relationship Officers. This
of over 30% additional challenges to liquidity. customer-centric initiative aims to
FROM THE TOP

REFLECTIONS
promote Treasury products. The Bank
In order to meet the challenges has taken steps to recruit and train
The Treasury Unit performs a range of the economic downturn and new staff members in both areas,
of key functions including balancing foreign exchange crisis, the Treasury including treasury products and
assets and liabilities, ensuring sufficient department implemented several customer relations.
liquidity, managing foreign exchange key measures to mitigate risks and
transactions, and overseeing the stabilise the situation. These included
FUTURE OUTLOOK
Bank’s overall profitability. This steps to counter the adverse impacts
VALUE CREATION
DRIVING
specialised unit manages the inflow and offset most of the potential Looking ahead to the coming
and administration of funds, as well losses. The highest importance was year, the Treasury Unit anticipates
as the liquidity and associated risks of accorded to maintaining USD liquidity, challenging circumstances, but remains
the Bank’s investments. Furthermore, which required foreign exchange to confident in its ability to overcome
the Investment Banking Unit (IBU), be allocated on a priority basis. Some such obstacles. Our limited exposure
established in 2012, provides additional of the preplanned lending operations to USD-denominated securities
support to the Treasury’s operations had to be curtailed, and funds were means that we need not fear any
through its investment banking redirected to essential services of external debt restructuring. We
activities. The IBU is responsible for entities such as Ceylon Petroleum plan to pursue additional business
AND ANALYSIS
managing the Bank’s listed shares Corporation, Ceylon Electricity Board, acquisitions through the Treasury Sales
and corporate debt portfolios, and and Lanka Coal Company, for the Team, in tandem with the Customer
generating fee income by providing importation of fuel to meet the needs Relationship Managers, in order to
consultancy services to clients for of the transportation and power expand our income opportunities.
their IPOs, debenture issues, and other sectors. Similarly, funds were also Furthermore, the Unit aims to continue
financing and business-related matters. allocated for the importation of goods making astute stock selections to
for State Pharmaceutical Corporation enhance the Bank’s share portfolio,
The Bank faced numerous challenges and fertiliser companies, among others. and also to venture into portfolio
during the year under review, management for high-net-worth
including the lingering impact of The Treasury Unit has made an Individuals. We will also expand our
the 2020 pandemic and the power admirable contribution to the Bank’s Trustee and Custodian Services, as
and foreign exchange shortages of overall profit, despite the challenging these services offer a steady revenue
circumstances, which includes
REPORTS
GOVERNANCE
2021. The downgrading of Sri Lanka stream. There are also anticipated
by international credit agencies was Foreign exchange gains, capital opportunities for advisory services in
a significant issue that affected the gains, interest income, fee income, areas such as restructuring of State
entire financial sector in the country, and income from other Investment Owned Enterprises, as well as Mergers
including People’s Bank. As a result, Banking products. The Unit has and Acquisitions, which would create
many regular lending agencies were also been successful in maintaining additional revenue streams.
unable to fund Sri Lankan banks, sufficient liquidity to fulfil the Bank’s
prompting a critical reassessment of obligations. The Investment Banking The Treasury Unit maintains
inflows and the allocation of available Unit has had a highly successful year, strong relationships with a number
STATEMENTS
FINANCIAL
foreign exchange resources. At the receiving the prestigious award for of funding sources and overseas
start of the year, the large difference the Best Investment Bank in Sri Lanka counterparties on an ongoing basis.
between the official and unofficial in 2022 from Global Banking and These connections have been crucial in
exchange rates resulted in Sri Lankan Finance Review. The Bank’s equity the past for obtaining favourable rates,
overseas workers using informal portfolio performed exceptionally and even though these agencies may
channels to transfer their earnings. well, achieving a return of over 30% not currently be able to provide loans
This trend reversed as the LKR was despite the overall market showing to Sri Lankan banks, the relationships
floated and the margin between the a negative return of 27%. Although will prove valuable in the future
INFORMATION
SUPPLEMENTARY
official and unofficial exchange rates clients postponed several planned when the situation normalises to
narrowed. However, some expatriate activities such as IPOs due to a an acceptable level.
workers continued to use informal cautious approach, the IBU was able
channels, possibly to avoid having to offset the resulting revenue losses
their incomes becoming known to by diversifying into new revenue
the authorities. The fuel shortage and streams, mainly by providing trustee
negative news coverage of the country and custodian services.
OVERSEAS CUSTOMER SERVICES
KEY HIGHLIGHTS
z Leveraging digital platforms and
tools for a more streamlined and
Inward worker Inward worker
efficient service, as well as greater
remittance remittance
customer convenience.
market share increased by
z Expanding its facilitation to the
increased by 50% USD 32.38 Mn.
business segment specially the
exporters in collaboration with
Export Development Board.
“The People’s Remittance Vaasi

“The People’s Market expanded
Kotiyayi” draw spearheaded the thrust
Remittance Vaasi to Malaysia, Spain,
of our main promotional campaign,
Kotiyayi” grand Jordan, Denmark, considerably elevating our profile and
prize of LKR 10 Mn. and Russia yielding outstanding results. Customers
who remitted foreign funds to their
People’s Bank accounts or other bank
accounts through People’s Bank, or
The Overseas Customer Services their foreign exchange earnings, through over-the-counter methods,
(OCS) is the core centre of the Bank as they were able to obtain a more were eligible for prizes, including cash
which facilitates and implements all favourable exchange rate compared and gold sovereigns. The probability
necessary channels and infrastructure to formal channels. The difference in of winning increased in proportion
for attracting Inward Remittances to official and unofficial rates became less with the amount remitted, which was
the Bank whilst providing necessary significant later in the year resulting a great incentive to remit more. The
knowledge and guidance on Foreign in greater reliance of formal channels. culmination of the campaign was a
Currency Accounts and Special Despite these challenges persisting grand prize of LKR 10 Mn. at the end
LKR accounts introduced by the CBSL. during a major part of 2022, the latter of the year. The intensive awareness
OCS is dedicated to helping customers months witnessed recovery trends, campaign contributed to more than
residing in and out of Sri Lanka to with increased foreign employment doubling our share for inward worker
manage their finances in foreign opportunities arising following the remittances.
exchange, repatriate earnings, and easing of the pandemic, and more
carry out transactions in designated Sri Lankans seeking jobs overseas. Our use of digital technology and
foreign currencies. The Bank’s network electronic transaction channels formed
of global partners supports these Given the aforementioned negative a crucial aspect and pivotal shift in
services, allowing the OCS to play a outlook, and recognising our position streamlining our operations. These
significant role in directing foreign as a state Bank, the OCS assumed the helped customers to interact with the
exchange into Sri Lanka. responsibility of augmenting foreign Bank at their own convenient time and
currency inflows and channeling place. This also enabled the receipt
During the year under review, a foreign exchange resources for the of remitted funds in Sri Lanka within
decline in foreign exchange reserves country’s economic regeneration and seconds, facilitated by the state-of-the
significantly impacted the performance development. art technology platforms of the Bank
of the entire Banking industry. and as well as of global partners.
triggered several related crises. In order to address these concerns,
Downgrades by lending agencies the OCS pursued several proactive The Bank’s market expansion plans are
resulted in reduced confidence and innovative strategies in 2022 to progressing according to schedule,
among both Sri Lankan citizens and enhance the outreach, effectiveness, and we have added Malaysia, Spain,
expatriates. Expatriate workers who and efficiency of our operations: Jordan, Denmark, and Russia to our
had returned to Sri Lanka due to z Enhancing awareness regarding our portfolio. We have representatives in
the pandemic, were slow to take up overseas services among Sri Lankan many countries catering to the needs
their previous positions overseas, expatriates working abroad. of Sri Lankan workers residing in
which resulted in an overall drop in different parts of the world. Moreover,
z Providing attractive incentives to
remittances. Additionally, the period of we have expanded our network
encourage this segment to remit
political uncertainty during the first half of overseas correspondent banks,
their earnings through the Bank, and
of the year worsened the situation. As keeping pace with the rising number
dissuading them from using informal
a consequence, Sri Lankan expatriates of Sri Lankan expatriate workers who
channels. It included very attractive
turned to informal channels to remit have relocated overseas this year
Reward Schemes as well.
for employment.
PEOPLE’S BANK
ABOUT
As competitors have followed the lead of People's Bank and introduced
incentive/promotional schemes, we must improve our offerings to retain our
competitive advantage. Building on the awareness and enthusiasm already
created, we aim to increase inward remittances significantly in the coming year,
and enhance our global footprint further.
FROM THE TOP

REFLECTIONS
PERFORMANCE HIGHLIGHT
z Market share of inward worker remittance was increased by 50% in 2022
z Value of inward worker remittance was increased in 2022 by USD 32.38 Mn.
over 2021
z Number of inward worker remittances received in 2022 was increased by more
than 300,000 transactions
VALUE CREATION
DRIVING
z FC deposits of the Bank as at 31 December 2022 was USD 737.7 Mn.
Number of correspondence banks

2022 2021 2020 2019
Vostro
arrangements 82 78 71 71
AND ANALYSIS
Nostro
arrangements 43 42 42 42
FUTURE OUTLOOK The coming year will see the

introduction of new loan schemes
The Bank will expand the scheme for and we are planning to grant Housing
customers with overseas Credit or Loans of up to LKR 25 Mn. or more,
Debit Cards to remit foreign currency and Pre Departure Loan Schemes at
to Sri Lanka without physically visiting concessionary rates. The need to repay
Bank/Exchange House. This will be of these loans will encourage workers to
immense help to Sri Lankan expats, extend their tenure overseas, which
particularly those working on a shift or
REPORTS
GOVERNANCE
will be a continuing source of foreign
roster basis. We are also in the process currency remittances. Spearheading
of developing several other digital its success from the foreign currency
tools to facilitate easier remittance of products launched, the division is
funds to People’s Bank or other bank contriving to make more additions
accounts and cash. to diversify its product range in the
coming year. FINANCIAL
STATEMENTS
SUPPLEMENTARY
INFORMATION
INTERNATIONAL BANKING
KEY HIGHLIGHTS
methods, in addition to harnessing the
power and potential of digitisation.
Over USD 1.0 Bn. Over 1,000
Customer onboarding was enabled
import related trade overseas
through our Corporate Internet
transactions correspondents Banking module, which streamlined
across 110 and expedited the process of
countries conducting business. More customer
contacts and correspondence were
carried out via email and electronic
documentation, resulting in reduced
ISO 9001:2015 Our expertise to operational cost and deliver service
recertification selected SOEs efficiently. Customers were able to
apply online for a range of services,
including LCs, RTGS, loans, and
guarantees. Accelerating the process
further, we simplified the complex
documentation system which was
The International Banking Division embarked on a campaign to attract a legacy of our pre-digitisation era
(IBD) facilitates the international more export-oriented customers and Anti Money Laundering (AML)
business activities of its corporate and increase repatriation of foreign screenings online. To accommodate
customers and branches utilising a exchange earnings. As a major the increased traffic, we expanded
wide range of products and services. initiatives, major zones/regions have operations of our Remittances
Services to support international already been identified and targeted unit, since our export customers
trade include opening letters of exporters in that zone/region will be increasingly opting for transactions
credit (LC), handling export related provided with financial and technical through TT. The International Banking
documents and Pre and Post shipment assistance required. Division remained accessible beyond
financing facilities as well as the regular business hours and facilitated
issuance of guarantees. These services Responding swiftly to mitigate the the delivery of goods to support both
are provided through centralised disruptions caused by the post-COVID exporters and importers, based on
operational units, including the scenario, the International Banking copies of documents and keep opened
Offshore Banking Unit backed by over Division adopted new operational throughout the day.
1,000 overseas correspondents across
110 countries. Offshore transactions are
facilitated by Offshore Banking unit PERFORMANCE HIGHLIGHTS
which offers range of foreign currency
2022 2021
loans, deposits and accounts. LKR Mn. LKR Mn.
During the year under review, a number Letters of credit 188,432 328,452
of factors impeded our operations, Import bills 344,833 393,344
including the post-pandemic recovery
Shipping guarantees 34,251 45,175
and fuel crises, which were followed
by a severe liquidity crisis in both local Bank guarantees 207,249 20,521
and foreign currencies. Consequently, Export bills 10,849 21,552
our limited foreign exchange resources Short term advance – Export 9,360 8,674
were redirected to major state-owned
Short term advance – Import 181,637 87,065
enterprises that provided essential
goods and services, such as Fuel, Coal, Block loan 46,917 45,519
Pharmaceuticals and Fertilizer etc.
During the year 2022, International Banking Division has accommodated
Due to restrictions prevailing during
20,796 numbers of Trade facilities (Trade products) with the value of
the year on several categories of
LKR 1,483 Bn. Import related products have shown a decline compared to
imports we have to shift our attention
2021 due to the sharp depreciation of the Rupee and restrictions and suspensions
towards export-oriented business
placed on the importation of goods with an acute shortage of foreign currencies.
and have ventured to focus on
Offshore Banking Unit has accommodated only USD 596 Mn. worth of
promoting Exports. Our branches
transactions in 2022 compared to USD 1,387 Mn. in 2021.
PEOPLE’S BANK
ABOUT
Despite the challenging environment witnessed the continuation of the
during the year as evidenced by service quality of the service extended
decline in imports and remittances by Trade Services nearly one decade.
and sharp depreciation of Rupee
against major currencies, International
FUTURE OUTLOOK
FROM THE TOP

REFLECTIONS
Banking Division has registered a
substantial increase in both interest Focusing on the future, the
and fee income despite the constraints. International Banking Division plans
We were able to facilitate the to expand its market share by shifting
importation of Fuel and Coal, value its emphasis more towards export
of which exceeded USD 900 Mn. customers and implementing sustained
and also facilitated over 200 import marketing efforts. To achieve this,
transactions with value of USD 13 Mn. the Division will rely heavily on digital
under Indian Credit Line. Demand
VALUE CREATION
DRIVING
platforms and tools to reduce costs
for issuance of Guarantees, Foreign and increase efficiency. We have
Currency Loans has increased but state-of-the-art systems in place and
decline reported in import financing. intend to utilise them effectively to
However, over USD 1.0 Bn. import achieve our 2023 goals and beyond.
related trade transactions has been
executed during the period
under review.
AND ANALYSIS
To reduce operational expenses,
the International Banking Division
leveraged digital platforms and
implemented a programme of
sustainable practices to limit resource
usage which saved substantial cost.
Training and development of staff

members remains as an ongoing
process to maintain the required levels
of knowledge and quality standards.
Due to the prevailing conditions, much
REPORTS
GOVERNANCE
of the training was conducted online in
2022, particularly for staff in outlying
branches. We intend to introduce a
series of E-Learning modules through
our HR department to improve
effectiveness of staff. In addition, we
extended training programmes with
our expertise to selected SOEs with
STATEMENTS
FINANCIAL
the aim of providing awareness on

international trade to their staff.
In recognition of the Quality

Management system in the service
process and delivery, while ensuring
safety and efficiency of import and
export services offered by us, we
INFORMATION
SUPPLEMENTARY
were able to obtain recertification

(ISO 9001:2015) once again for the
consecutive 3rd time from Sri Lanka
Standards Institute which initiatively
obtained in 2013. This re-certification
Manufactured capital refers to the portfolio of tangible assets possessed by the Bank, including
amongst others its physical infrastructure that facilitates the provision of services to our clients.
Despite the advancements in IT and digitalisation, the importance of physical locations remains relevant,
especially in a country where a majority of the population resides in rural areas. In this regard, our
footprint encompasses an extensive network of branches, Service Centres, Self-Banking Units (SBU),
Automated Teller Machines (ATMs), Cash Deposit Machines (CDMs), and other facilities used for
interaction with customers. This also involves the digital infrastructure that has enhanced our
outreach capabilities even further.
OUR APPROACH
Our approach to banking services
has been consistently centred on KEY HIGHLIGHTS
accessibility and affordability, which
are amongst the primary advantages
of People's Bank, given our widespread Largest network of Largest network of
geographical reach. This has also been 745 branches and 289 Self-Banking Units
a significant factor contributing to service centers
the close relationship shared with our
clients. Our extensive branch network,
which is the largest in the country,
combined with the highest number
of SBUs, has been pivotal in the
Customer portfolio Green buildings –
growth of our business and acquisition covers over 65% of Ongoing transition
of new accounts. Additionally, our the population towards renewable energy
continuous efforts to improve service
standards and introduce innovative
digital assets has enabled us to
maintain our leadership role in
offering modern banking services
throughout the country.
PEOPLE’S BANK
ABOUT
MATERIAL THEMES CHALLENGES OPPORTUNITIES
z Digital leadership z Macroeconomic slow down z Acceleration of digital
solutions to improve efficiency
z Customer access z High inflation and stagnant
and reduce costs
income levels
z Political turbulence and uncertainty
FROM THE TOP

REFLECTIONS
z Transportation/logistics issues
z Foreign currency shortage
CONTRIBUTION TO UN SDGs
Affordable and Reduced inequalities
VALUE CREATION
DRIVING
Clean Energy Through our
Building green customer touch
branches and points throughout the
converting existing island, we make our
branches to solar products and services
power, reducing the accessible to people
use of fossil fuels. from all walks of life.
AND ANALYSIS
Decent Work and Responsible
Economic Growth Consumption and
Ensure safe and Production
satisfying work for all Through digitalisation,
employees, which is we eliminate use
well remunerated. of paper as far as
possible both in
banking services
and procurement.
REPORTS
GOVERNANCE
Industry, Innovation Climate Action
and Infrastructure Safeguard the
Increase efficiency future of the planet
in use of resources by minimising
and sustainability use of resources
through technological and reducing
STATEMENTS
FINANCIAL
upgrading, environmental
digitalisation, pollution.
and process
improvements.
INFORMATION
SUPPLEMENTARY
VALUE CREATED
SBUs and ATMs
LKR 1,703.4 Bn. with over

101 million transactions
Digital Apps
LKR 392.6 Bn. with over

75.3 million transactions
Accounts and Loans
Close to 1 million accounts opened

LKR 52.2 Bn. Loans granted digitally
CAPITAL LINKAGES
Green branches and
renewable energy
NATURAL
CAPITAL
SOCIAL AND
FINANCIAL
RELATIONSHIP
CAPITAL
Customer
Cost reductions
convenience
INTELLECTUAL HUMAN
CAPITAL CAPITAL
SBUs and New technology

consistent branding and processes
look and feel
PEOPLE’S BANK
ABOUT
REACHING OUR CUSTOMERS
NUMBER OF BRANCHES AND SBUS
745 Branches 822 ATMs 319 CDMs Nos.

750
289 SBUs 14.7 million 1.57 million 600

Customers Digital App users
FROM THE TOP

REFLECTIONS
450
126 KIOSKs 100 CRMs 50 SCDMs
300
Due to the Bank’s focus on serving rural and underprivileged communities, 150
we have established an extensive network of branches and facilities over time.
0
2018 2019 2020 2021 2022
VALUE CREATION
DRIVING
GEOGRAPHICAL DISTRIBUTION OF BANKING NETWORK/
CUSTOMER TOUCHPOINTS Branches SBUs
The Bank conducts its business operations entirely within Sri Lanka. As indicated
in the map below the Bank's network covers all provinces in Sri Lanka.
The Bank serves all sectors of the economy; agriculture, industry, and services.
Our clients include retail, corporate, and SME customers.
AND ANALYSIS
WESTERN NORTH WESTERN NORTH CENTRAL EASTERN NORTHERN
218 75 54 61 49
107 23 21 19 14
252 76 59 61 50
NORTHERN
PROVINCE 123 27 23 20 14
50 13 6 7 6
51 8 5 4
2
21 3 3 3
REPORTS
GOVERNANCE
NORTH CENTRAL 2
PROVINCE
SOUTHERN SABARAGAMUWA UVA CENTRAL
87 56 49 96
NORTH WESTERN 31 18 18 38
PROVINCE EASTERN
PROVINCE 99 60 58 107
STATEMENTS
FINANCIAL
CENTRAL 32 21 18 41
PROVINCE
14 8 6 16
WESTERN UVA 8 6 4 12
PROVINCE PROVINCE 4 4 2 8
SABARAGAMUWA
INFORMATION
SUPPLEMENTARY
PROVINCE
Branches SBUs ATMs CDMs KIOSKs

SOUTHERN
PROVINCE CRMs SCDMs
INFRASTRUCTURE DIGITAL TRANSFORMATION CUSTOMER ACCESSIBILITY

DEVELOPMENT The Bank’s digital transformation is An important milestone achieved
The construction of the Bank’s new progressing according to plan and during the year was the establishment
Head Office building, which comprises has retained its momentum despite of a Contact Centre, which will
23 floors and 3 basement levels, has logistical difficulties, import restrictions, complement our existing Call Centre.
made satisfactory progress despite and cost escalations at the beginning The Contact Centre, which was
facing obstacles. However, due to of the year. We have initiated the initially conceived as a call centre,
the escalation of costs and import process of onboarding new customers will be extended to link with our
restrictions, the construction of new online, utilising eKYC and video KYC website and app in the near future.
branch buildings and the renovation of in compliance with the guidelines of This state-of-the-art facility offers a
existing ones have been put on hold the Central Bank of Sri Lanka (CBSL). seamless customer experience where
until economic conditions improve. The ability to open accounts online, they can access financial information
As at the end of 2022, construction without requiring customers to visit the with ease. Customers will first be
work on the Head Office was 21.3% branch in person, has been particularly connected to an intelligent chatbot
completed at a cost of LKR 2,204.23 advantageous during periods of limited driven by an AI engine, equipped with
Mn. which is inclusive of consultancy, transportation. This initiative helped a comprehensive Q&A database to
piling, and work on the main building. reduce queues and congestion at address standard queries. In the event
A cost of LKR 211.29 Mn. was incurred the branches and allowed our staff that the chatbot is unable to address
on branch renovation. In addition, to devote more time to financial the inquiry, the call will be seamlessly
expenses of LKR 1,142.3 Mn. were advisory services, rather than routine diverted to the Contact Centre where
incurred to acquire and upgrade transactions. A total of 525,501 new a human operator will provide expert
property, plant, and equipment in customers were onboarded digitally assistance, ensuring our customers
2022. This is inclusive of freehold during the year, and we intend to receive a prompt and effective
land, buildings, furniture, machinery, introduce additional online services resolution to their queries
equipment, and computers, all of next year.
which are productive assets that
Our digital banking services have
FUTURE OUTLOOK
resulted in additional value generated
for the Bank. In accordance with the continued to help us increase our We remain steadfast in our
Bank’s commitment to sustainability, market penetration, reaching out to commitment to retaining our
all renovation, replacement, and hitherto untapped segments. The leadership position in digital banking
new construction projects, including Bank’s digital infrastructure is robust services in the country. As we
the Head Office building, are being and scalable, as evidenced by our embark on the development of our
carried out with environment-friendly, ability to process over 200,000 infrastructure, we recognise the need
sustainability principles in mind. The transactions on a daily basis. During to prioritise digitisation as part of this
Bank is currently in the process of the period of travel restrictions, our process. Such a focused approach is
“greening” all its buildings by installing mobile banking and palmtop banking vital to ensure that we remain at the
solar panels and replacing fluorescent teams were able to reach remote forefront of innovation and continue to
lighting with LED bulbs as part of the locations and provide banking services provide our customers with the most
renovations. Solar energy will be utilised to customers residing in rural and cutting-edge and convenient banking
to supplement the conventional grid suburban areas, where mobility was solutions. Aligned with this objective,
electricity in all new buildings. Presently, curtailed. we are poised to introduce a series of
20 branches are powered with solar new initiatives in the coming years to
energy, and this number is expected to strengthen our position of leadership in
increase to 80 towards the end of 2023. the digital banking landscape.
2022 2021
LKR ’000 LKR ’000
Freehold land 64,000 –
Freehold building 18,818 183,257
Buildings on leasehold land 175,087 1,328
Furniture 70,027 43,582
Machinery, equipment and self banking units 355,512 237,557
Computer 458,832 660,929
Additions to property, plant and equipment 1,142,275 1,126,653

PEOPLE’S BANK
ABOUT
Intellectual capital consists of the Bank’s intangible properties, including all stored knowledge, expertise
acquired by staff members, tacit knowledge, intellectual property, branding and image related
properties, processes, staff training activities, and customer trust and loyalty. It also includes culture,
ethics, innovative capabilities. Knowledge, expertise, and innovativeness are a source of competitive
FROM THE TOP

REFLECTIONS
advantage, which enables us to stand out in the industry.
OUR APPROACH
KEY HIGHLIGHTS
In view of the economic pressures,
political turmoil and restrictions on
the Bank’s promotional activities at 26 awards and Over 90% customer
the beginning of the year we decided accolades won satisfaction
VALUE CREATION
DRIVING
to take a more empathetic route to in 2022
reach the hearts and minds of the
people. Our strategy was to keep
the People’s Bank in top of mind
awareness by conducting a series
Brand equity Fitch Rating of
of activities, supporting the community
in areas where the need was greatest.
index of 4.0 A(lka)
We created a new umbrella brand (Brand Finance)
AND ANALYSIS
for all our CSR activities, Mahajana
Mehewara, and launched a programme
of community service activities
islandwide. Doubled market 99.0% uptime across
share in foreign digital platforms
Public service activities can keep inward worker
the brand alive, but to attract new remittances
customers it is vital that we maintain
excellent service. In order to measure
our performance in this regard we
conducted extensive
research during the
REPORTS
GOVERNANCE
year, to gain valuable
customer insights,
and increase our
performance levels.
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
Intellectual capital
MATERIAL THEMES Peace, justice, and strong institutions

Building an ethical and non-discriminatory organisation through
z Customer experience robust governance and compliance framework.
z Operational efficiency
z Socio-economic impact
z Environmental impact VALUE CREATED
z Brand equity
Customer satisfaction
CHALLENGES Over 90%
z Customer mindset was not
conducive to conventional sales
pitches due to economic conditions
z Foreign remittances through Created two new brands to
banks had slowed down due to cater to lucrative customer segments:
the exchange rate differences and
incentives from unofficial channels z Elegance – for high net worth individual customers
z Business opportunities were stifled z Excelsior – for high value professional salary earners
by the economic conditions
OPPORTUNITIES
CAPITAL LINKAGES
z Win the trust and confidence of
customers and the public through Moving towards paperless
community service projects processes both externally
z Strive for service excellence to with customers and for
appeal to new customer segments internal administration
NATURAL
CAPITAL
SOCIAL AND FINANCIAL CAPITAL
RELATIONSHIP
Industry, innovation, and CAPITAL Accessing lucrative
infrastructure market segments
Growth of through new
Investments in
customer loyalty branding strategies
digitalisation and
and participation and increasing
enhancements to
through effective efficiency through
systems and procedures
communication digitalisation
in the long term have
a positive impact on
industry, innovation,
and infrastructure.
MANUFACTURED HUMAN CAPITAL
Responsible CAPITAL
Resumption and enhancement
consumption and Continued growth of training activities that were
production of digitalisation affected by the restrictions at
Upgrading of systems the beginning of the year, and
and processes promotes moving towards e-learning
operational efficiency programmes to supplement
and conservation of conventional regional
power, water, and other on-the-job training
resources.
PEOPLE’S BANK
ABOUT
BRAND ACTIVITY elements and physical characteristics and unparalleled insight into the
of every branch in the network to mindset and needs of the local banking
People’s Bank has been providing adhere to a consistent look and feel, so consumer, People’s Bank has fostered
a wide variety of financial services that customers know what to expect, a culture that gives employees the
to customers for over 61 years via and will be familiar and comfortable liberty to learn, grow and outperform,
a largely homogeneous approach when they walk into any People’s Bank with the understanding that innovation
where regardless of the specific branch in the country. can only occur where employees
customer segment, the product
FROM THE TOP

REFLECTIONS
feel safe and trusted, and unafraid
offerings have been uniform. However, As part of the brand upgrade we to fail. Outstanding performances by
with developments in the rest of the have launched a new website in the team are duly appreciated and
industry we have had to reconsider three languages, to meet the needs rewarded, with organisation-wide
this approach. We introduced the of our wide range of customers, recognition given to employees who
Elegance Centres where we delivered with information and instructions on set new benchmarks in performance in
the same product offerings to high access to digital banking in addition the CEO/General Manager’s Monthly
net worth customers through a more to the regular features. We have also Core Brief circulated across the Bank.
exclusive service. This strategy seeks
VALUE CREATION
DRIVING
designed and launched a uniform for
to create customer loyalty at the staff, which is voluntary at present, but
higher end of the market and among we are confident that it will be adopted
ORGANISATIONAL
a profitable customer segment. In the as time goes on. KNOWLEDGE
evolving context, it was important to
The collective knowledge and
create well defined product offerings
experience of our employees is one
to fulfil specific requirements of BRAND PERFORMANCE
of the most significant resources of
identified market segments, retain
Our brand performance has continued our operation. During our six decades
existing customers as well as to attract
to improve across a number of key of operation, we have created an
emerging customers.
AND ANALYSIS
performance indicators in 2022: unrivalled pool of expertise and
experience, with a workforce consisting
As a part of our ongoing market
Brand performance 2022 2021 of long-service staffers to interns. We
research, we conducted two mystery
strive to document and share this vast
customer service surveys, one Brand equity 4.0 3.8
store of tacit, accumulated knowledge,
perception and attitude survey and
Top of mind including highly specialised expertise
one net promoter score survey. These
awareness (%) 36 36 in banking through knowledge sharing
test results are tied to the KPIs of
Customer sessions, extensive training and human
the relevant Branch and Regional
satisfaction (%) 91 90 capital management tools. This process
Managers to ensure their buy-in, and
of documentation is essentially one of
achieve high performance levels.
converting tacit knowledge to explicit
In 2021, brand rating of the Bank was
knowledge.
REPORTS
GOVERNANCE
We introduced two product offerings AAA- with a brand strength of 80.9
for the high-end customer segment and a brand value of LKR 44.75 Bn.
The diversity of our employees in terms
and plan to target them, as well as our
of their qualifications, knowledge, and
traditional customers, through mass
media and digital communications in CORPORATE CULTURE experience is considered an important
competitive advantage. Our high
order to capture market share. This As the “Pride of the Nation”, we
employee retention rate of 97.6%
approach will enable the Bank to are rooted in a value-based culture
showcases our success in fostering
achieve the following goals. underpinned by our vision, mission, and
a stimulating workplace where
STATEMENTS
FINANCIAL
z To retain and enhance the strength core values. We nurture a culture that
hard-to-find and hard-to-retain talent
of the relationship with the existing fosters knowledge, encourages new
feel included, respected and inspired.
customers ideas, supports innovation, and cultivates
It also reinforces our organisational
inclusivity. Our culture facilitates
z To grow the high value deposit knowledge base. A number of key
serving customers from all walks of
relationship customer base recruitments at Executive level and
life, catering to their different needs.
z To successfully cross sell other Corporate Management including
We promote open communication
products of the Bank Senior Project Manager, Product
and transparency among all internal
INFORMATION
SUPPLEMENTARY
Manager – Card Business and Chief

stakeholders, and place greater
This year we took a further step in Information Officer (CIO) were
emphasis on accountability on a par
strengthening our branding in our vast successfully completed during the
with job responsibilities. Leveraging
branch network. We have modernised year under review, adding to our
six decades of knowledge, expertise
and standardised the visual branding collective organisational knowledge.
every citizen in Sri Lanka with access

Qualification Number of
to financial services, through the latest There were three key milestones
employees
and most advanced banking solutions. achieved during the year:
MSc/MBA/Postgraduate 622 This led us to pioneer Sri Lanka’s z The digital onboarding of
BA/BSc 1,645
first ever Innovation Centre, thereby customers was introduced,
strengthening our innovation drive and
CIMA/CFA/CMA/CA in adherence to Central Bank
digital initiatives. We have continued
Sri Lanka/Banking 1,800 guidelines, using e-KYC
to develop platforms and launch
Qualifications in Law 89
and v-KYC (video KYC) for
cutting-edge banking solutions to
verification. This enabled us to
Qualifications in IT 306 position our Bank on a par with some
open accounts online for any
Diplomas and other 4,240 of the best global banks and nurture
customer within the country or
internationally savvy banking citizens.
Total 8,702 overseas, if they were holders
of a National Identity Card
To save any doubt, included those with
multiple qualifications. DIGITALISATION (NIC). The customer is able to
upload the required personal
People’s Bank commenced an
details, photograph, and
BUSINESS ETHICS ambitious digitalisation initiative in
copies of his NIC and required
2015, investing in and adopting digital
documents, and request a time
We are committed to embracing capabilities to elevate the Bank’s
slot for the video call with a
the highest standards of business products and services to global
Bank agent for a verification
ethics, integrity, transparency, industry benchmarks and meet the
interview. The Bank has an
and accountability. The Board and expectations of the next generation of
interface with the Registration
Senior Management take the lead banking customers. This pre-pandemic
of Persons Department to
in establishing an environment far-sightedness has today afforded
check the customer’s recorded
where these aspects are practised People’s Bank the brand reputation
information with his or her
across every tier of the Bank every of being the pioneer in digital banking
account opening application.
day. Our employees showcase their in Sri Lanka, with our efforts being
Thereafter the video call
commitment by taking ownership recognised and lauded both locally
and globally. Our digitalisation drive verification is completed and
towards their responsibilities and
has enabled us to achieve cost the account is opened.
conducting themselves in compliance
with all applicable laws and regulations. savings, improve processes, automate z The facility to download an
Our stringent audit and compliance repetitive functions, and onboard more i-Report from the Credit
processes are reflected in our customers without any investments Information Bureau (CRIB) was
ratings. Please refer to page 170 in physical branch expansion. This made available through the
for our comprehensive governance has been reflected in our revenue per People’s Pay App.
framework. During the year under employee which has increased from
z A comprehensive Customer
review, the Financial Intelligence Unit LKR 27.4 Mn. in 2021 to LKR 48.4 Mn.
Relationship Management
of CBSL imposed a fine of LKR 2 Mn. in 2022. Over 73% of conventional
System was introduced, to cater
on the Bank due to operational lapses banking transactions are now
to the needs and wants of each
in identifying two customers in the conducted on our digital channels and
the value of transactions through our individual customer, to enable
years 2007 and 2016. Following this,
mobile apps and internet banking has the Bank to provide a more
the Bank has taken initiatives to further
increased from LKR 601.3 Bn. in 2021 personalised, high quality service
strengthen the operational controls.
to LKR 804.43 Bn. in 2022. and thus gain market share.
The Bank has complied with all the
other laws and regulations except for
the above FIU fine. Our investment in computer
software and hardware has exceeded In the future we hope to integrate
LKR 2.7 Bn. for the year under review, the use of biometric information
INNOVATION as we continue to implement and rollout through our apps, and introduce
new functionalities and applications, Real Time Gross Settlement (RTGS)
What differentiates People’s Bank from implementation.
digitise all functions, internal processes
our competitors is how we continue
and customer interfaces, to create a
to leverage innovation to evolve our Our physical account opening process
seamless, omnichannel experience for
business model and disrupt traditional, at the branch is also done without
our customers.
legacy system banking, and meet the use of paper documentation, and
the rapidly changing consumer and the process can be completed within
business expectations. We place a 6-8 minutes if all the information is
high value on innovation and pursue it available. The process is designed so
relentlessly in our mandate to provide that we can also cross-sell any related
features or services to the customer at
PEOPLE’S BANK
ABOUT
the same time just by the Bank officer
ticking a few boxes. During the past
year 90% of our new customers are
Gen Z and 70% of all transactions are
performed digitally.
FROM THE TOP

REFLECTIONS
Awarded Best People’s Wave People’s Web – Retail
Digital Bank in
Sri Lanka 2022
z One of the most downloaded z Provides a number of retail
by the International retail mobile apps in banking features in addition
Business Magazine Sri Lanka to all options available in
z Over 2.1 million downloads People’s Wave
since launch in 2017 z Over 1.4 million customers
z Allows customers to carry registered at year end
VALUE CREATION
DRIVING
First fully
out over 50 different banking z Nearly 88,000 transactions
digitalised branch
facilities remotely executed monthly for the
in Sri Lanka
z Made a significant value of LKR 5.6 Bn.
contribution to driving
financial inclusivity People’s Web – Corporate
z Monthly average – nearly
50,000 downloads and over z Offers a number of corporate
First Bank IT banking features in addition
1. 4 million transactions for
innovation centre
AND ANALYSIS
value of LKR 28.7 Bn. to those available in People’s
in Sri Lanka
Wyn
z 9,716 customers with
16,358 active users
z Average of 21,000
First Government transactions processed per
bank in Sri Lanka month to a value of nearly
to receive the LKR 31 Bn.
highest international
z Allows transfer of funds
accreditation for
between banks via LankaPay,
information protection
People’s Wyn SLIPS, and RTGS
and security – the
REPORTS
GOVERNANCE
ISO/IEC 27001: 2013 z Facilitates paperless trade
z Mobile banking app finance transactions and
Certification
custom designed for payments to utilities
corporate clients
z Provides transaction
authorisation facilities in
addition to transactions
z Facilitates corporate
STATEMENTS
FINANCIAL
payments to utility providers

z 76,000 downloads since
launch in 2018.
INFORMATION
SUPPLEMENTARY
AWARDS
World Top 1000 Banks –

The Banker Magazine
z People’s Bank ranked amongst the
prestigious World’s Top 1000 Banks
People’s Wiz People’s Pay –
Wallet App International ARC Awards 2022
z First ever real-time digital
z Gold for Written Text: Banks:
customer onboarding banking z V2.0 launched in October
National
application in Southeast Asia, 2021 with enhanced
Africa, and the Middle East tri-language user friendly z Gold for Financial Data: Banks:
interface National
z Paperless process facilitating
opening accounts with z Biometrics and self- z Bronze for Cover Photo/Design:
multiple services and features registration also included Banks: National
z Time-and-cost savings z Partnered with utility
achieved during COVID-19 service providers to provide
pandemic with remote customer with due payment
access to banking services amounts online in real time
z Significant drop in paper
usage contributing to Green People’s Pay –
Banking Vision Merchant Module
z 2.7 million customers
onboarded since launch
z Encourages small businesses
in July 2017 to transition to real time
z Facilitates fast, secure,
People’s Wiz Credit – and low-fee digital payment
Retail Loan Origination to SMEs
System (RLOS) z By end 2022, over 52,000
merchants registered
z Advanced retail loans
processing system replacing
manual system People’s Pay – Remotely
onboarding module
z End-to-end process
from application to post- z Non-face-to-face digital
disbursement customer identification
z Personal loans processed and verification process
within hours of initial request introduced by People’s LankaPay Technnovation Awards
z Rolled out to 300 branches Pay App
z Gold award for “Best Mobile
by end 2022 z Customers can digitally Application” for Retail Payments via
onboard from anywhere in LankaQR (Banks and Non-Bank)
People’s Wiz Credit – the world
z Financial Institution-People’s pay
Corporate Loan Origination mobile banking app
System (CLOS)
Global Banking and Finance Review
z End-to-end digitised
business loan origination z Best Investment Bank 2022 –
system Sri Lanka
z Handles single credit facilities
and credit packages, with
multiple product types and
for a range of businesses
z Rolled out to 82 branches
by end 2022
PEOPLE’S BANK
ABOUT
z Honours – Specialised A.R: CMA Excellence in Integrated Satynmag CIMA
Integrated AR and CSR: Reporting Awards 2022 Women-Friendly Workplace
Non-Traditional Format z People’s Bank 2021 Annual Awards (WFWP Awards) 2022
Report as one of the top ten z One of Sri Lanka’s most
FROM THE TOP

REFLECTIONS
South Asian Federation of Best Integrated Annual Reports outstanding workplaces
Accountants (SAFA) Awards for women
z People’s Bank 2021 Annual Report – TAGS Awards 2022 – CA Sri Lanka
Joint Bronze in the Public Sector z Bronze award in State Bank The Asian Digital Finance
Bank category Category: being the only public Forum and Awards
sector bank in Sri Lanka to be z Best Mobile Electronic Payment
podium Initiative – People’s Wave Mobile
Banking App
VALUE CREATION
DRIVING
AND ANALYSIS
REPORTS
GOVERNANCE
Best Management Practices Global Business Review Magazine Payment Partner Performance
z Institute of Chartered Professional Awards 2022 Awards 2022 – Daraz
Managers of Sri Lanka Most Responsive Bank Best Turn Around Bank
STATEMENTS
FINANCIAL
z z
Sri Lanka 2022 z Best Debit Card Growth
International Business Magazine z Most Consumer Digital Bank
z Best Digital Bank Sri Lanka 2022 Sri Lanka 2022
z Best Development Bank
The Bizz Hybrid Awards 2022 Sri Lanka 2022
z Business Excellence Award
INFORMATION
SUPPLEMENTARY
We are proud to be recognised for our performance with awards, accolades, and accreditations that recognise our
evolution as a bank and our continued investments across enhancing our products, services, systems, and practices to
deliver the best, most efficient and rewarding banking experience to our customers. People’s Bank and its team won a
number of local and international awards during the year under review, where we received high recognition for our
strategic digitalisation drive across the Bank:
FUTURE OUTLOOK
Digital customers
The Bank will actively pursue the
increased to
younger segment of customers, the
2.7 million
Millennials and Gen Z, where the future
islandwide
potential lies. They have grown up
with the digital revolution, are totally
comfortable in cyberspace, and will
be a natural fit for the future of
Over 73% of the
People’s Bank.
Bank’s conventional
banking transactions
We recognise the fact that our
conducted from
strength historically has been
digital channels
accessibility and affordability,
due our vast branch network and
comparatively low rates, but in the
Nearly 50,000 present conditions and in the future
monthly average it will be our service excellence and
downloads of the technological superiority that will
People’s Wave app set us apart.
Over 1.4 million

financial transactions
conducted monthly
on the People’s
Wave app
Digital deposits
exceeded
LKR 551.9 Bn.
as end December 2022
Average of
LKR 45.9 Bn.
digital deposits
monthly
People’s Wiz Retail

Loan Origination
System launched in
300 branches
More than 52,000

merchants are
registered with
People’s Bank QR
Payment Facility
HUMAN CAPITAL
PEOPLE’S BANK
ABOUT
Our Human Capital embodies the personality of the organisation, in its role as the Bank that has traditionally
been close to the hearts of the ordinary man. Although this personality is changing in keeping with the times,
and the shifting demographics of our customers, our people are definitely our greatest asset. People’s Bank
ranks among the largest banks in Sri Lanka and has a workforce of 7,377 from backgrounds, originating from
all parts of the island. As a major state bank, it plays a key role from diverse backgrounds covering all parts of
FROM THE TOP

REFLECTIONS
the island in the lives and the livelihoods of its customers.
2022 was a challenging year coming right after the COVID-19 pandemic, and the Bank had to face
macroeconomic pressures, political turmoil, and high inflation. However our staff pulled together proving that
talent, training, and teamwork are among our key strengths, to deliver the full range of essential services to our
customers and the government in their hour of need, without interruption.
VALUE CREATION
DRIVING
OUR APPROACH The market conditions accelerated The Human Resource functional
the move to online banking transactions. restructuring process commenced
Our staff have been the linchpin of our Our younger recruits adapted quickly last year with the purchase of the
success in the recent past, and this year to the digital workspace, and we new software, and implementation
too we made certain to build on that conducted training sessions for some continued this year and will continue
same sense of trust and commitment of our older staff members to get to in 2023. By 2024 the entire HR system
by giving them all the support required grips with the online medium, and will be available online for any staff
to achieve our goals. During the empower them with the knowledge member to interact with it.
COVID-19 period the Bank provided
to play a leadership role with their
AND ANALYSIS
transportation along the major routes
younger team members. In addition to the above, we have a
for employees to get to work, provided
Bankwide initiative to create a mindset
the facility for staff that possessed
shift in the organisation as a whole.
their own vehicles to claim transport
The aim is to change the culture of our
allowance, and arranged work from
personnel, and transform the Bank into
home systems for staff who could
a future ready 21st century organisation.
work efficiently from home.
The project is coordinated by the HR
department and will be implemented
throughout all sectors of the Bank.
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
Human Capital
KEY HIGHLIGHTS
Total Male: Female: Retention rate:

employees: 2835 4542 97.6%
7377
Profit per Designed, installed, Over 69% One of the

employee: and commenced employee most Women
LKR 2.3 Mn. the pilot phase on engagement Friendly
the new performance Organisations
management system in Sri Lanka
(WFWP
Awards)
MATERIAL THEMES z Transport issues affected staff OPPORTUNITIES

attendance, necessitating special
z Employee productivity transport arrangements by the Bank z Shift to online training modules
z Talent management z Constraints in working from home as where possible
z Training and development the infrastructure did not exist for a z Build teamwork within the
majority of personnel, and impractical departments to ensure that work
z Anti-corruption
for many of the Bank’s functions progressed on schedule
z Reskill employees
z Delays and disruption in training z New deployments at the
programmes due to foreign internship level
exchange and travel restrictions
z The older Gen X managers need
CHALLENGES
training in the digitalised workflow
z Economic crisis in the first systems to enable them to give
quarter of 2022 resulting in leadership to new Gen Z recruits
foreign exchange restrictions z Increase in migration of skilled staff
and fuel shortages through
the rest of the year
No poverty Quality Education Reduced Inequalities

Poverty alleviation Staff training at all Recruitment of all
through creation levels at state-of-the- socio-economic
of employment art facilities, and plans categories and
opportunities for Learning Academy genders based
on competitive
examinations and
Good Health and Decent Work and interviews
Well-being Economic Growth
Post-pandemic action Largest employer
to ensure health in banking category
and safety of all with excellent staff
employees benefits
Human Capital
PEOPLE’S BANK
ABOUT
VALUE CREATED
LKR 26.6 Bn. allocated as
FROM THE TOP

REFLECTIONS
staff benefits
33 members of the staff were

promoted during the year
VALUE CREATION
DRIVING
CAPITAL LINKAGES
AND ANALYSIS
Staff members participate in sustainable practices such as the
distribution of seedlings for tree planting campaigns islandwide
and minimising the use of paper
Employees who work in the green branches will engage

in sustainable resource usage and power saving activities
as a regular work day routine
NATURAL CAPITAL
SOCIAL AND RELATIONSHIP FINANCIAL

CAPITAL CAPITAL
REPORTS
GOVERNANCE
Our employees develop their own Contribution of employees to the
skills by the exposure they get to revenue growth of the Bank
customer relationship management,
Cost saving
supply chain management,
initiatives by staff to reduce
and CSR projects, which leads consumption of power and
to greater job satisfaction and other resources
employee retention
STATEMENTS
FINANCIAL
MANUFACTURED INTELLECTUAL
CAPITAL CAPITAL
The new HR function The updated training modules

restructuring system will that are currently being
contribute significantly to implemented will enhance the
Manufactured Capital. Intellectual capital of the Bank
INFORMATION
SUPPLEMENTARY
Human Capital
OUR TEAM Our human resource statistics

We concluded the year with 7,377 Male Female Total Profit per Revenue per
employees, and our retention rate of employees employees employees employee employee
97.6% proves that we have a loyal and LKR ’000 LKR ’000
cohesive team that has bonded through
adversity. Our workforce consists of 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019
members of all ethnicities and religious 3,184 3,058 4,909 4,778 8,093 7,836 2,112 1,650 22,400 25,489
persuasions from all over the island. 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021
2,979 2,931 4,713 4,637 7,692 7,568 1,843 3,134 24,829 27,385
We have set new targets and achieved
2022 2022 2022 2022 2022
them despite the challenges we
2,835 4542 7,377 2,330 48,425
encountered in the first half of the
year. To achieve this, certain staff
members had to take the load for
Total employees by gender
some of their colleagues, including
who could not report to office. During
that period we saw a great collective Male Female
effort and team spirit, to ensure work
was completed in a timely and efficient 38.4% 61.6%
manner. Once again we were able to
operate almost all our branches daily,
while encouraging customers to use
the available digital channels as much Total workforce by employment contract and gender
as possible.
2022 2021
Workers who are not permanent Male Female Total Male Female Total
employees of the Bank are the
Permanent staff 2,814 4,530 7,344 2,896 4,625 7,521
University selectees and outsourced
security personnel. Bank provide Contract staff 21 12 33 35 12 47
internships to university students who
are in their final year of the degree.
These segments have also been very
supportive and involving throughout
the years.
All of our employees are on full

time basis.
Total permanent workforce by employment category and gender

2022 2021
Male Female Total Male Female Male Female Total Male Female
Nos. Nos. Nos. % % Nos. Nos. Nos. % %
Corporate management 9 7 16 0.12 0.09 10 7 17 0.13 0.09
Executive management 20 12 32 0.27 0.16 21 14 35 0.28 0.18
Officers (3-III – Grade 1) 1,340 2,444 3,783 18.16 33.13 1,387 2,510 3,897 18.33 33.17
Staff assistant grade 606 1,541 2,147 8.21 20.89 605 1,499 2,104 7.99 19.81
Other categories 853 536 1,389 11.56 7.27 894 603 1,497 11.81 7.97
Management trainees – – – – – – – – – –
Customer service
assistants – – – – – – – – – –
Other contracted
employees 7 2 9 0.09 0.03 14 4 18 0.18 0.05
Total 2,835 4,542 7,377 38.43 61.57 2,931 4,637 7,568 38.73 61.27
Human Capital
PEOPLE’S BANK
ABOUT
TOTAL WORKFORCE – DEPARTMENT-WISE TOTAL EMPLOYEES BY AGE
AND GENDER
Nos.
4,000
3,200
FROM THE TOP

REFLECTIONS
2,400
1,600
Male Female
800
Male Female
Branches 62.4% 77.1%
0
VALUE CREATION
DRIVING
Regional Head Office 17.1% 8.7% 18-25 26-45 46-55 >56
Treasury and PDU 0.4% 0.5%
Corporate and OSBU 1.4% 2.6%
Male Female
Overseas Customer Services 1.0% 1.0%
Card Centre 1.0% 0.8%
Head Office 16.6% 9.3%
All of the senior management were hired from the local community.
AND ANALYSIS
Total workforce by geographic distribution and gender
Province Male Female Total Nos. Total %
Western 1,036 1,879 2,915 40
Southern 264 498 762 10
Central 285 468 753 10
North Western 218 384 602 8
Uva 187 236 423 6
Northern 168 195 363 5
REPORTS
GOVERNANCE
Sabaragamuwa 191 321 512 7
Eastern 275 276 551 7
North Central 211 285 496 7
Total 2,835 4,542 7,377 100
Total permanent employees by employment type,

STATEMENTS
FINANCIAL
gender and age group
Years Corporate Executive Officers Staff Management Customer Other Other

management management (3-III – Gr I) assistant trainees service categories contracted
grades assistants employees
Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female
18-25
INFORMATION
SUPPLEMENTARY
26-45 1 832 1,833 547 1,531 492 394
46-55 3 2 16 11 407 479 50 9 284 99 6 2
Above 56 5 5 4 1 101 132 9 1 77 43 1
Total 9 7 20 12 1,340 2,444 606 1,541 – – – – 853 536 7 2

Human Capital
Total employees by employment category and pay scales for contract staff so as to
years of service retain skilled staff. In the interim we
will work with new recruits working
Category <2 3-10 11-20 21-30 31-35 >36 Total in teams with experienced staffers to
ensure smooth workflows in all sectors
Corporate management – – 1 6 4 2 13 as required.
Executive management – – 11 8 7 1 27
Officers (3–III-Grade I) 11 341 1,979 1,071 376 6 3,784 New Recruitment by age
Staff assistant grade – 1,109 958 66 14 2,147 group and gender
Other categories – 1,037 21 287 42 2 1,389 All recruitments are for the Head office.
Corporate management – contract 2 1 – – – – 3
Executive management – contract 5 – – – – – 5 NEW RECRUITMENT BY

AGE GROUP AND GENDER
Management trainees – – – – – – –
Customer service assistants – – – – – – – Nos.

2
Other contracted employees 2 7 – – – – 9
Total 20 2,495 2,970 1,438 443 11 7,377
OUR PROCESSES RECRUITMENT 1
The automation of HR administration There was a delay of more than a year

activities has commenced, but 80% in entry level recruitment of Customer
of the work is still done manually, Service Assistants and Management
and our aim is to make the processes Trainees as these are done through
0
totally digitalised in the near future. competitive entrance examinations, Male Female
Online training began in 2021 and conducted by the Examinations
will be developed further, with Department, and their schedules were
36–45 46–55
the introduction of the e-Learning pushed back due to the COVID-19
programmes. However, we have pandemic.
found that though online training TRAINING AND
is effective for technical skills, it is However, during the year, we were DEVELOPMENT
less effective for soft skills. With the able to complete the examinations
conditions improving, we hope to be for Management Trainees in May In 2022, employee training was
able to conduct such training face-to- and Customer Service Assistants conducted on both soft skills and
face in the future. Online interviews in October, and proceed with the technical expertise. In 2023, the focus
have become common for new hires recruitment process. We still have is expected to shift more towards
and promotions, especially when a shortage of these grades, but the soft skills. An Executive Development
the candidate is unwell, overseas, or situation will ease as these new recruits programme was also commenced
otherwise incapable of visiting the enter the workforce. with an external consultant focusing
office on that day. on the development of analytical
We also observed a drain of IT staff and conceptual skills of Executive
The payroll is partially automated, due to the offers of high salaries Management. Due to the economic
including overtime calculations, leave for such trained personnel from conditions that prevailed in the
management, and other administrative local and foreign companies. As our country, in-person training was
functions. In the future, such functions pay scales are fixed according to somewhat curtailed and training
will be directly linked to the core collective agreements, we are unable programmes for several months were
system and we will have the ability to increase salaries to be on a par with conducted online. However, the Staff
to run them without any human those prevailing in the private sector. Training College was able to provide
intervention. However, with the new HR system, we an average of 24 training hours per
hope to devise a method of revising permanent employee during 2022.
Human Capital
PEOPLE’S BANK
ABOUT
The main focus of staff training has Permanent employees training statistics
been on achieving the goals of the
Bank aligned with the new Strategic Type of training Number of Number of Training
Initiatives for the years 2022-2024 programmes participants hours
mapped to the strategic pillars of

Internal training programmes 386 27,303 172,573
Driving Excellence, Building Customer
Centricity, and Being Future Ready. External training programmes 59 298 3,948
FROM THE TOP

REFLECTIONS
Accordingly, the training objectives Foreign training programmes 2 3 56
are aligned with the Bank’s strategic
Total 447 27,604 176,577
initiatives, employees’ performance
evaluation criteria, and the country's
macro environment and identified Employee training statistics
employees' training needs.
2022
Future training programmes and
VALUE CREATION
DRIVING
activities are planned in order Training cost (LKR Mn.) 92.8
to achieve new goals, and will Training hours 176,577
concentrate on the following areas
Average training hours per permanent employee 24
covering both soft and conceptual
skills: Number of online training sessions 94
z Attitude development and Number of hours on digital training 40,970

motivation for customer service
excellence Training sessions on health and safety
z Customer centric mindset, complaint
AND ANALYSIS
management, and negotiation skills 2022
development
BCP/DRP/occupational health and safety 252
z Personality development, personal
grooming, social and corporate Stress management 5
etiquette Stress management and counselling 71
z Stress management and Stress management, counselling, coaching, and mentoring
counselling skills skills for superiors 60
z Strategic planning
z Technical skills development Training hours by employment category and gender
programmes (mainly focusing on
REPORTS
GOVERNANCE
improving knowledge of products Employment Category Average training hours
which include digital, credit,
Male Female
pawning, treasury and foreign
currency products and improving
Corporate management 11 11
knowledge on audit, compliance,
risk management, and lean Executive management 11 20
management for officer grade Officers (3–III-Grade I) 35 32
employees) Staff assistant grades 24 17
STATEMENTS
FINANCIAL
z Training programmes for newly

Management trainees – –
recruited Management Trainees
z Executive Development Programme
(special training series for senior
management/higher officers on soft
skills development)
INFORMATION
SUPPLEMENTARY
However in the future we will introduce

e-learning systems where the results
of the training will be aligned with the
remuneration, promotions, and other
benefits, which will definitely improve
the effectiveness of the training.
Human Capital
Training initiatives conducted

Programme and Method of Delivery Key Objective
Attitude Development and Motivation for Customer Service To reset the mindset of the participants to develop positive
Excellence (onsite – STC/Regional) attitude and motivate participants to provide an exceptional
Customer Service
Special Training Programme on Accelerating of Foreign To accelerate foreign remittances and streamline same
Remittances & Deposits (Online)
Cross Border Transactions, Export Risk Identification, and Risk To make aware on trade related transactions/documents on
Management (onsite – STC) Cross Border Transactions, Risk associated
Personal Grooming, Social and Business Etiquette (onsite – STC) Personality development and enhance corporate brand image
through employees
Residential Training Programme on Customer Service, Personality To develop team working skills, selling skills communication skills,
Development, Etiquette and Selling Skills Development for personal grooming and motivation of the Excelsior Ambassadors
Excelsior Ambassador – Pasikuda Training Centre in branch network
Leadership, Team Building, Motivation and Managerial Skills To develop sound leadership capabilities and team building skills
Development (onsite – STC) of officer grade staff
Debt Recovery Procedure and Practical Aspects of Debt To instill the importance of recovery of performing advances as
Recovery (onsite – STC/Regional) well as non-performing advances, and enhance the knowledge of
recovery procedure.
Retail Internet Banking (RIB), Retail Mobile Banking (RMB) & To create basic understanding among the staff members on
People's Pay /Corporate Internet Banking (CIB) & Corporate Digital products
Mobile Banking (CMB)/CLOS/RLOS – (onsite –STC/Regional)
Customer Centric Mindset, Complaint Management, and To develop Customer Centric mindset Communication Skills and
Negotiation Skills Development (onsite – STC) handling customer complains effectively.
Stress management and counselling To make participants aware how stress has an impact on their
Skills development (onsite –STC) work, individual performance and take possible actions to
mitigate stress and how they can help their subordinates to
overcome their stress.
Emerging Trends in Fraud Mitigation of Electronic Fund To create awareness of the risk associated with cyber frauds
Transfers (online) and learn about the measures that could be taken to mitigate
such risks.
PERFORMANCE APPRAISAL
The current appraisal methods largely support qualitative evaluations, but not quantitative ones. Quantitative evaluations
are carried out at present only for Branch Managers and above. The evaluations for the other staff are not reward aligned.
This is being addressed with the new HR Restructuring System, where every employee will be evaluated quantitatively as
well as qualitatively and their performance will be taken into account for future promotions, remuneration, and training.
This will be the first time such a scheme has been implemented in the history of the Bank.
During the year, all our eligible permanent employees excluding contract employees engaged in performance reviews which
is 99.8% of total employees in 2022 and the rest will be assessed on the renewal year of their contract.
Human Capital
PEOPLE’S BANK
ABOUT
PROMOTIONS AND RATIO OF BASIC SALARY AND
TRANSFERS REMUNERATION OF WOMEN TO MEN
A formal promotion and transfer policy We have continued to maintain a ratio of 1:1 in the basic salary and remuneration
of the Bank governs all promotions and of women to men by employment category and significant locations of operation.
transfers, which ensures transparency We follow a policy of complete non-discrimination and women are given equal
in the process. Promotion schemes treatment to men. However, the remuneration ratio may change owing to the
FROM THE TOP

REFLECTIONS
have been established for each different service periods of employees and their salary grade.
grade; employees are encouraged to
avail themselves of promotion and
transfer opportunities to broaden their
MATERNITY LEAVE
skills and widen their experience. All 346 employees took maternity leave in 2022. In the past five years we have had a
promotions are conducted through 100% rate of staff retention after returning from leave.
an exam and interview process up
to Senior Manager (Grade 11) level. 2022 2021 2020 2019 2018
The Board of Directors decides on
VALUE CREATION
DRIVING
promotions to Executive, Corporate Number of employees entitled to
Management, and other senior maternity leave 4,542 4,637 4,713 4,778 4,893
management positions through an Number of employees who took
interview process. Opportunities for maternity leave 346 419 483 510 517
promotions to most grades, and to Number of employees who returned
senior management levels usually after maternity leave 346 419 483 510 517
arise when vacancies occur. Transfers
Returned to work (%) 100 100 100 100 100
of staff can happen both within their
present region and to outside regions.
AND ANALYSIS
Any employee who is dissatisfied with
NON-DISCRIMINATION providing sanitisers and masks at all
a transfer directive, can appeal to the
branches and operating ambulance
Appeal Committee established under We are committed to fostering services.
the transfer policy. an environment that safeguards
employees from physical and verbal Bank has taken several actions to
Due to the retirement age being harassment and discrimination on the ensure the occupational health and
reduced from 62 to 60, we organised basis of race, religion, gender, age, or safety in 2022 in order to ensure the
interviews and made arrangements social status. The above policy ensures wellbeing where there is a separate
for the appointment of new Chief fair employee recruitment, reward, and department named “Fire and Disaster
Managers, AGMs, DGMs, and others recognition. All employees are assured Recovery” that falls under the purview
to fill the vacancies that arose. A new of fair and equitable treatment when of DGM (Business Support Services).
REPORTS
GOVERNANCE
cadre plan for the Bank was approved it comes to promotions. We have the Representatives covering branch
for the first time since 2015, and we are highest number of female employees network and head office departments
currently working on it. in the industry which showcases our been appointed as the coordinating
non-discriminatory policy. points. Training sessions have
DIVERSITY AND EQUAL been carried out at head office and
OPPORTUNITY OCCUPATIONAL HEALTH regional levels with the participation
AND SAFETY of these representatives and staff.
As an island wide institution with Officer in-charge is responsible
STATEMENTS
FINANCIAL
61.57% of female employees, this is an Past few years has been fraught with for identification of hazards, risk
area of ongoing concern. The Bank conditions that have been stressful for assessment, and incident investigation.
found itself facing several challenges our employees. We considered that First aid rehearsals have been
in this area, especially when it keeping our staff safe and stress- conducted to ensure quick actions
came to the work-life balance of its free as far as possible was our prime in disaster situations. Special trainings
female employees. Throughout the responsibility. Without ensuring this, on how to prevent and deal with
pandemic, pregnant employees and we could not hope to deliver and office environment hazards have
INFORMATION
SUPPLEMENTARY
lactating mothers were allowed to meet our targets. It was imperative, been carried out during the year
work from home. To alleviate some of therefore, that we issue and implement under review.
the pressures, we devised a system relevant working guidelines in keeping
where only half of the employees were with the health and safety concerns.
required to be at work onsite. We continued to make the necessary
physical arrangements such as
Human Capital
The Bank provides occupational and where the necessary increments

health services as below; TOTAL PARTICIPANTS were carried out based on the Bank’s
z Annual Fire Drill in collaboration with performances, industry standards and
Fire Service Department of Colombo market conditions.
z Ambulance Service for staff
Remuneration and Benefits
z Nawaloka Medical Center at Besides our policy of gender-wise
Head Office non-discrimination, we also adhere
z COVID-19 precautions and booster to an impartial remuneration
vaccination drive structure, offering our employees fair,
z Zumba sessions for staff wellness competitive, and attractive packages.
They include performance based
z Free gym access and sports facilities
Male – 41% Female – 59% rewards and other monetary and
non-monetary benefits which keep our
Expenses incurred in relation staff contented and motivated. Our
to health and safety in 2022 TOTAL PARTICIPANTS
employees are entitled to Gratuity,
BASED ON AGE GROUP Employees’ Provident Fund (EPF),
Health and safety expenditure LKR Mn. and the Employees’ Trust Fund (ETF)
payments in line with the relevant laws
Medical expenses 2,370.8
and regulations. The Bank contributed
Fire and safety 97.2 LKR 1,600.89 Mn. to the ETF and
COVID-19 safety protocols 0.5 LKR 400.22 Mn. to the EPF for the
financial year 2022. Depending on their
Total 2,468.5
employment category, all permanent
employees are entitled to a range of
Nine work related injuries were
benefits. However, the contract and
reported and there has not been
trainee employees are excluded from
any work related ill health incidents
certain benefits. The benefits given
reported in 2022. 20–30 years – 3% 31–40 years – 66%
to permanent employees include
41–50 years – 16% 51–60 years – 15%
annual bonuses, travelling allowances
EMPLOYEE SATISFACTION to certain grades, holiday bungalows,
Succession planning staff loans, medical benefits, death
Employee engagement represents the
gratuity, personal accident insurance
levels of enthusiasm and connection We continually strive to develop a scheme, disability and invalidity
they have with their workplace. new generation of leaders within cover, maternity leave, and retirement
It's a measure of how motivated the organisation. A second batch benefits. All female employees are
people are to put in extra effort for of Managers is due to commence given maternity leave in accordance
their workplace, and a sign of how the Management Development with statutory provisions.
committed they are to stay there. High programme. A total of 50 Branch
level of employee engagement will Managers will be enrolled in this
improve performance, retention, and course. With the assistance of a Promoting Employee
innovation. partner institution, an Executive wellbeing and staff
Development Programme has also engagement
SPPMR department has conducted a been scheduled, targeting Asst. Employees will remain healthy and
survey in the year 2022 on Employee General Managers and Chief Managers. productive if their stress at work is
Engagement within the Bank. This Programme has been crafted to minimised. This is the key to mitigating
Questionnaire has been prepared equip them with the managerial and unauthorised absences of staff and
and distributed to Regional Head conceptual skills needed for future the potential loss of income. We have
Offices (RHOs) to collect information career growth. introduced measures to promote
from branch staff and 307 number
a healthy work culture so that
of completed questionnaires were
REMUNERATION AND employees can lead healthy lifestyles
collected from the branch network.
and work to their satisfaction. Among
Majority of the sample is Female. Most BENEFITS
the steps we have taken to this end
of the respondents are within the age
There is no statutory minimum wage are Yoga Classes and a fully equipped
group of 31-40 and majority of the
for the entry level in the banking gymnasium. The state-of-the-art
staff members are in deputy manager
industry. The Bank pays above the library at the Head Office gives our
grade. Percentage of Internal Customer
minimum entry level wage rate. Salary employees the opportunity to expand
Satisfaction on employee engagement
revisions will take place triennially their knowledge. We also encourage
was 69.6%.
Human Capital
PEOPLE’S BANK
ABOUT
staff members to obtain higher Employee turnover by age group, gender and
qualifications by reimbursing exam employment category
fees on successful completion of an
MBA and professional subscriptions. Years 18-25 26-35 36-45 46-55 56 years
Opportunities are also afforded for years years years years and above
employees to participate in staff M F M F M F M F M F
engagement activities organised
FROM THE TOP

REFLECTIONS
through the Bank’s Sports Club, Art Corporate Management 5 2
Club, and other such organisations. Executive Management 1 5
Officers (3 – lll – Grade 1) 3 12 7 21 3 4 30 28

EMPLOYEE TURNOVER
Staff assistants 3 9 3 2 3
BY GENDER
Other categories 1 4 1 20 9
Management trainees
VALUE CREATION
DRIVING
Customer service assistants
Other contracted employees
Total 6 21 8 24 9 5 59 44
Employee turnover by region and gender
Male Female Total Male (%) Female (%)

Male – 47% Female – 53%
AND ANALYSIS
Ampara 1 1 0.01 –
Anuradhapura 4 2 6 0.02 0.01

EMPLOYEE TURNOVER BY AGE
Badulla 1 2 3 0.01 0.01
GROUP AND GENDER
Batticaloa 1 1 – 0.01
Nos.
Colombo 6 18 24 0.03 0.10
60
Galle 5 6 11 0.03 0.03
48 Gampaha 4 7 11 0.02 0.04
Hambantota 2 1 3 0.01 0.01

36
Jaffna 1 4 5 0.01 0.02
REPORTS
GOVERNANCE
24 Kalutara 5 3 8 0.03 0.02
Kandy 5 6 11 0.03 0.03

12
Kegalle 2 2 4 0.01 0.01
Kurunegala 1 3 4 0.01 0.02

0
26–35 36–45 46–55 >56
Matale 1 4 5 0.01 0.02
Matara 2 3 5 0.01 0.02

Male Female
STATEMENTS
FINANCIAL
Monaragala 3 1 4 0.02 0.01
Nuwara Eliya 1 1 2 0.01 0.01
Polonnaruwa 1 1 0.01 –
Puttalam 2 1 3 0.01 0.01
Ratnapura 3 1 4 0.02 0.01
Wanni 1 – 1 0.01 –
INFORMATION
SUPPLEMENTARY
Trincomalee – – 0 – –
Head Office 31 28 59 0.18 0.16
Total 82 94 176 0.47 0.53

Human Capital
EMPLOYEE COMMUNICATION, Then they are reviewed by a committee consisting of members from corporate
ETHICS AND INTEGRITY management. The CEO/General Manager redresses the concerns based on the
outcome of the review. During 2022, 7 corrective action were taken for a total of
Employee Communication 14 incidents presented.
We have several channels which
promote two-way communication. COLLECTIVE BARGAINING
Through these channels the Bank
engages with staff on matters that A formal collective bargaining agreement, signed with the Union in November
may concern them whilst staff has 2021, for a 21-34 month period remains in force. This is a major achievement
the ability to provide feedback and which bodes well for relations between the Bank and its employees.
engage in constructive dialogue.
These channels offer both formal and Employee union Number of
Employees
informal means of communication to
ensure that interactions within the The Ceylon Bank Employees’ Union 5752
Bank are fruitful. In addition to this,
Officers’ Union 252
team briefings and employee forums
provide staff with the opportunity to Sri Lanka Nidahas Banku Sevaka Sangamaya 37
contribute their thoughts and opinions Jathika Sevaka Sangamaya 140
on the business performance of the
All Ceylon Bank Employees’ Union 24
Bank and other issues of concern.
Pragathi Bank Employees’ Union 993
Total 7198
MINIMUM NOTICE PERIOD
FOR OPERATIONAL
CHANGES
ANTI-CORRUPTION
Employees are provided with adequate
The Bank has a strong anti-corruption culture that has been inculcated through
notice of any operational changes
a series of training programmes conducted by the Internal Audit Department. All
and their possible impacts on their
employees have been educated on the prevention of corruption and fraudulent
functions. This helps to mitigate any
behaviour, and have been informed about the Bank’s anti-corruption policy
adverse impacts on staff morale which
approved by the Board of Directors. We have a zero tolerance policy regarding
may occur. The minimum notice periods
bribery and corruption and are bound to take strict disciplinary action if any
pertaining to operational changes are:
offence is detected. 11,700 hours of training was received by 2,875 employees
during the year.
Operational change Notice period
Anti-Corruption Number (%)

Transfers 2 weeks
Total number and percentage of governance body members
Resignations 1 month
that the Organisation’s anti-corruption policies and procedures
Retirements 3 months have been communicated to All 100
Terminations 1-3 months Total number and percentage of employees that the
Organisation's anti-corruption policies and procedures
have been communicated to All 100
GRIEVANCE HANDLING Total number and percentage of employees that have received
training on anti-corruption 2,875 39%
The Bank introduced a mechanism
to handle grievances of employees Total number and nature of confirmed new incidents of
under a circular “Mechanism to corruption for the year 72 1%
redress employee concerns”. Total number of confirmed incidents in which employees were
Thereby employees may first present dismissed or disciplined for corruption 68 0.9%
complaints and grievances to the CEO/
General Manager.
Human Capital
PEOPLE’S BANK
ABOUT
We have put the following policies in FUTURE OUTLOOK
place to support all staff to maintain
the highest levels of integrity and We are working very hard to achieve
conduct when engaging in business our five strategic initiatives by 2024.
for the Bank: One of the important milestones
is the development of the new HR
z Code of Corporate Governance management system that we initiated
this year. By 2024 we hope to generate
FROM THE TOP

REFLECTIONS
Containing the values and conduct
required by the Bank, the Code of the first evaluations and prepare the
Corporate Governance sets the tone rewards schemes accordingly.
for all employees. Its focus on ethical
behaviour and integrity not only sets We also plan to open up the HR
the tone for employees, but also system to the staff, to enable them
helps build an environment of trust, to interact transparently with the
transparency, and accountability system and obtain any information
that will lead to long-term they need about their employment
VALUE CREATION
DRIVING
investment, financial stability, and history. Further, if they need to update
business integrity for the Bank. their personal details such as a change
of marital status or contact details,
z Code of Conduct for employees they do not need to visit the HR
This links the Bank’s mission, values, Department. They would merely need
and principles with standards to submit the required documents
of professional conduct, as all online through the secure login system.
employees are required to sign The introduction of this new system
this document at the start of their will revolutionise the way employees
AND ANALYSIS
employment with the Bank. interact with the Bank.
z Disciplinary Code
We will provide a face recognition
This document is formal in nature facility, and the employee’s attendance,
and outlines the Bank’s definition leave, salary, overtime, and other
of misconduct whilst setting out HR related functions will be handled
the formal disciplinary procedure automatically. This is particularly
that will be applicable in such a important when we work with the
circumstance. The idea is to set digitally savvy Gen Z employees. Our
out a progressive workplace that task here is to ensure that our older
deftly deals with misconduct issues, team members are brought up to
REPORTS
GOVERNANCE
thereby retaining its integrity. speed to prevent any conflict between
z Whistle-blower Policy the new and old staff members. We
will concentrate on the soft skills such
The whistle-blower policy is yet
as etiquette to help them to operate
another measure in the Bank’s
confidently and efficiently in the
stance against misconduct and
digital space.
corruption and reflects the Bank’s
zero tolerance policy. A Bank
One of our main objectives is to
appointed Director reviews such
STATEMENTS
FINANCIAL
provide leadership development

complaints whilst guaranteeing
training for all grades from Manager
anonymity to safeguard the
upwards, to ensure that they are well
employee. The following issues
prepared to accept and work with the
can be reported directly to the
new generation of recruits who come
immediate supervisor or the Board
in with good digital skills. This will also
Audit Committee.
help us to do our talent mapping for
i. Breach of the Disciplinary Code future personnel planning. This new
INFORMATION
SUPPLEMENTARY
ii. Failure to comply with legal/ combination of young dynamism and

regulatory obligation mature experience with a forward
iii. Miscarriage of Justice looking mindset is the new image
of People’s Bank that we strive
iv. Financial malpractices
to achieve.
SOCIAL AND RELATIONSHIP CAPITAL

CUSTOMER CAPITAL
Our strengths in customer capital has stemmed from our Island wide branch network. However,
with changing economic conditions and the emergence of new customer segments with varying
demographic profiles and expectations which had to adopt new strategies.
OUR APPROACH MATERIAL THEMES

KEY HIGHLIGHTS
We have a customer base z Financial performance
encompassing closed to two third
of the population and our ethos has Over 14.7 million
been to promote accessibility over customers z Operational efficiency
profitability. During the year we z Talent management
had to face the major challenges of z Socio-economic impacts
inflation and the foreign exchange
crisis. People’s Bank still serves its 96% of customer z Brand equity
traditional customer base, which complaints z Customer access
remains loyal to us, but we faced resolved z Health and safety
the need to aggressively open out
to a new group of customers with
different income levels, requirements,
tastes, and aspirations. We were also 682,300
cognisant of the fact that the new new customers
millennial customers, which are now a onboarded during
large proportion of our customer base, 2022 alone
are very receptive to digitalisation;
we had to tailor our products and
communications accordingly.
Two new products
to serve high end
customers: Elegance
and Excelsior
Social and relationship capital
PEOPLE’S BANK
ABOUT
CHALLENGES CONTRIBUTION TO UN SDGs
z Political and economic instability No poverty Reduced Inequalities
z Lack of receptiveness to traditional Financial inclusion Our broad customer
marketing communications of all citizens will base will facilitate
z High interest rates impacted lending empower them and widespread social and
give them access to economic benefits.
FROM THE TOP

REFLECTIONS
z Constraints from regulators on
marketing expenditure financial services.
OPPORTUNITIES
z Realise benefits from digitalisation VALUE CREATED
z Further increase the share of
overseas remittances Channels profitability
VALUE CREATION
DRIVING
LKR 17.2 Bn.,
exceeding budget by
110.3%
AND ANALYSIS
CAPITAL LINKAGES
Reduced paper usage consequent to

digitalisation and green buildings contribute
to conserving natural capital.
NATURAL CAPITAL
INTELLECTUAL CAPITAL FINANCIAL CAPITAL
REPORTS
GOVERNANCE
Technological skills help launch Increased market share in
innovative applications which fills remittances, digitalisation,
customer needs. and opening to new customer
segments led to increased
financial capital.
STATEMENTS
FINANCIAL
MANUFACTURED CAPITAL HUMAN CAPITAL
Investments in digitalisation Alignment of remuneration

give a new customer with customer satisfaction
experience in line with the provides mutual benefits.
expectations of the millennial
INFORMATION
SUPPLEMENTARY
generation.
CUSTOMER PROFILE CUSTOMER GEOGRAPHICAL

OUR PRODUCTS AND
With an extensive island-wide branch PROFILE SERVICE OFFERINGS
network and a rapidly expanding
Retail Deposit products
digital ecosystem, our customer
banking i. Current Accounts
base reached up to 14.7 million
ii. Savings
during the year under review. The Isuru Udana
fact that we had a diverse base is Sisu Udana
exemplified by the fact that 79.5% Yes
of our customers reside outside the VanithaVasana
Western Province. Significantly, 51.1% Jana Jaya
of our customers are female, which is Aswenna
tribute to our gender-neutral approach. Parinatha
Demographics evolve around and People’s Relax
Western – 26% Eastern – 8%
Normal Savings
approximately 24.8% of our customers Southern – 11% Northern – 6%
EtheraWasana
belong to the millennial generation. North Western – 12%
iii. Fixed Deposits
This is a major factor we take into Sabaragamuwa – 9% North Central – 8%
iv. Call Deposits
account the formulation of our Uva – 7% Central – 13%
v. Foreign Currency
products and strategies. Deposits
Advances
CUSTOMER AGE PROFILE CUSTOMER INDUSTRY PROFILE i. Personal Loans
ii. Term Loans
iii. Housing Loans
iv. Pawning
Other
i. Credit/Debit Cards
ii. Gift Vouchers
iii. Mobile Banking/SMS
Banking
iv. Internet Banking
v. Life verification
certificate
Below 10 years – 14% 10–15 years – 16% Agriculture, forestry and fishing – 7% Enterprise i. Current Accounts
16–25 years – 21% 26–45 years – 25% Manufacturing – 2% banking ii. Savings Accounts
46–60 years – 13% Over 60 years – 11% Tourism – 4% iii. Fixed Deposits
Transportation and storage – 4% iv. Overdrafts
Construction – 31% v. Term Loans
Infrastructure development – 27% vi. SME Loans
CUSTOMER GENDER PROFILE
Wholesale and retail trade – 8% vii. Development and
Information technology Microfinance Loans
and communication services – 0% viii.Trade Finance
Financial services – 1%
Professional, scientific
and technical activities – 2%
Wholesale i. Current Accounts
Education – 0%
banking ii. Savings Accounts
Healthcare, social services and
support services – 1%
iii. Fixed Deposits
iv. Overdrafts
Others – 13%
v. Term Loans
vi. Trade Finance
Import/Export
Male – 49% Female – 51% Financing
Shipping and Bank
Guarantees
Facilities for
International Trade
Payments
(Letters of Credit,
Acceptances)
PEOPLE’S BANK
ABOUT
OUR INITIATIVES SERVING THE CUSTOMER
Treasury i. Money Market
and Activities A major promotional campaign Three aspects to our customer service
investment ii. Trading in during the year was the remittance
banking Government 1. People orientation initiatives
promotion, Vaasi Kotiyayi, which
Securities was of great national importance We have carried out many service
iii. Repurchase quality improvement programmes
considering the foreign exchange crisis
Transactions at the Branch level. Based on these
and the trend among our overseas
FROM THE TOP

REFLECTIONS
on Government programmes we have given service
workers to use informal channels
Securities
to remit, money rather than official quality ratings to the branches and
iv. Foreign Exchange
channels. The success of this initiative the pawning centres. This in turn
Transactions
v. Derivative was demonstrated by the fact that has led to performance ratings, by
Transactions we doubled our market share of way of KPIs, to those in leadership
(Forward Exchange overseas remittances. roles; Branch Managers and Regional
Contracts, FX Swaps) Managers. This also helps in placing
vi. Investment Banking Hitherto our policy was to treat people in appropriate leadership
VALUE CREATION
DRIVING
Debt Structuring, roles. Staff are rated based both
customers as a homogenous group.
Advisory Services, on their knowledge and their
An innovative step was launching
Trustee Services experience. If a person is not suitable
new programmes for affluent and
professional customers during the year. for a Manager role he may be
International i. Trade Services
effective as an Operations Manager,
operations ii. Overseas Customer
Services A third pioneering initiative was to or in an audit role. Branches have
iii. Foreign Currency augment our brand by adding a CSR also been provided with a Service
Remittances component to it. This brand initiative, Handbook to help them improve
iv. Foreign Currency named Mahajana Mehewara, brings the level of service. Considering the
AND ANALYSIS
Deposits various CSR initiative originated at market aspect, Branch Managers
v. International Payment and Regional Managers have
different levels, (Head Office, Branch,
and Settlement been allowed a certain degree of
or Welfare Society) under a common
Services discretion to give special deposits
umbrella. Under this programme we
are helping extremely disadvantaged rates to customers. This gives
segments of society including very greater customer satisfaction and
Scan to view the products job satisfaction to our leaders in the
remote and backward schools. We are
and services offered by periphery.
also stretching out a helping hand to
People’s Bank
the health sector.
2. Process orientation initiatives
The synergistic impact of our decades UNDERSTANDING Process orientation is done by
REPORTS
GOVERNANCE
of experience, customer centricity, THE CUSTOMER evaluating a combination of internal
and seamless blend of technology resources and external resources.
and digitalisation continue to enhance Our customer accessibility has A combination of high levels in
our product and service offering. traditionally been based on two both suggests that the Branch or
Our portfolio of offerings is priced factors; our wide network and Region is an extremely suitable
in line with competing products and affordability. But with the current location for expansion. If external
the country’s monetary policy and trend the emphasis in the future will factors are high but internal factors
fosters financial inclusivity. We do not be on service excellence and superior are low this indicates a need to
STATEMENTS
FINANCIAL
engage in anti-competitive, anti-trust, technology. We are also making strengthen the staff. On the other
and monopoly practices. No fines and several efforts to study and understand hand, a combination of low external
penalties were incurred during the our customers. Service excellence resources and high internal ones
reporting year. needs to be measured. We conducted suggests an inappropriate location
three customer-focused surveys and a need for relocation or merger
In 2022, we continued with the during the year; mystery customer of the business unit. A rating of low
process of innovation and product survey, perception and attitude survey, for both indicates an inadequacy
and net promoter score survey. The
INFORMATION
SUPPLEMENTARY
development to meet the rapidly in both the staff and the location,
changing requirements, expectations results of the last, which was recently which again points to the need for
and tastes of customers; in the process commenced, will become available in relocation or merger.
we have to ascertain and address the about a year. All three will basically
different requirements of customer be an indication as to how well we are
segments and demographics. serving our customers, albeit with a
different slant in each.
3. Physical evidence initiatives Excelsior customers will be served by Besides our digital channels, we also
Physical evidence initiatives relate to a dedicated Excelsior Ambassador engage with our customers through
the application of 5S to improve the at every People’s Bank branch, who our dedicated 24X7 Call Centre.
efficiency of the operations of the will cater to their needs swiftly and The Call Centre provides services
Business Unit, which is in progress. efficiently. They will be entitled to to customers in Sinhala, Tamil, and
an Excelsior Visa Credit Card and a English. Customers can have their
Debit Card with enhanced transaction queries on banking products and
OPENING TO NEW limits, and concessions on annual fees. services, as well as on other matters
CUSTOMER SEGMENT They also receive preferential rates on such as health and safety regulations,
foreign currency transactions, other answered swiftly and comprehensively.
We also took a major innovative step
banking transactions, preferential rates
to broaden our products and services
from People’s Insurance for vehicle A major step towards enhancing
while also appealing to a new class of
and property insurance, a special physical look and feel was taken with
customer. Two new package offerings
branded chequebook. The Credit Card the revamping of the branches. The
were launched, Elegance and Excelsior,
holders will be entitled to free travel use of colours and layouts has been
targeted at elite customer segments. It
insurance and a free lounge key access standardised across all branches to point
is noteworthy that these are packages,
membership. customers to the respective counters
and not simply new products.
with which they need to transact.
Elegance is targeted at high-net-worth
Coming to the digital side, our entire
individuals while Excelsior targets CUSTOMER COMMUNICATION website has been redesigned to reduce
high-income upwardly mobile
The adverse economic and political clutter and make it state-of-the-art
professionals. These packages satisfy
conditions during the year made resembling other high profile websites.
the needs of their target customers for
customers less receptive to traditional Both the above changes, gave the
convenience, recognition, flexibility,
marketing channels or messages. A Bank a “youthful look” which makes it
and personalisation. They embed
new strategy had to be woven to resonate with millennial customers.
features that will satisfy the customers’
lifestyle needs. counter this situation. Customers
continue to be concerned with, and Our apps and other digitalised
we are conscious of their right to, applications have been a resounding
Elegance customers will have
fair, accurate, easily comprehensible, success. To state just one example,
numerous privileges such as
and timely information regarding our our People’s Wave app has scored a
preferential tariffs for banking services,
products and services. The Bank’s monthly average of 35,000 downloads
preferential rates for local and foreign
Customer Charter has been crafted in and 411 Billion transactions.
currency deposits, concessionary
rates for personal loans, personalised accordance with Central Bank of Sri
Lanka(CBSL) guidelines. A major thrust
Debit Cards, and the Privilege Visa CUSTOMER COMPLAINTS
Infinite Credit Card which carries a was two-way communication with
number of benefits including free travel customers through digital channels. The Bank’s policy is to give swift
insurance, free Lounge key access We maintain a Facebook page for the attention to any customer grievances
membership, and concierge services. Bank and also a YouTube channel. and grant prompt redress where
They will also have the opportunity The Facebook page has a fan base necessary. We have put a grievance
of using two exclusive Elegance of nearly 347,000 and the Bank’s handling procedure in place which
Customer Centres at Colombo 7 and website has an average of 107,000 functions effectively and efficiently. In
Ratnapura, where they will be served visits per month. These channels the event of any dissatisfaction with
by a dedicated Customer Relationship provide customers the opportunity to our process, a customer has the option
Officer. Elegance Branch Premises ask questions, submit complaints, and of escalating the issue to the Financial
have a sophisticated look and feel and obtain prompt feedback. We respond Ombudsman. Complaints are received
provide refreshments, free wi-fi, and to customer inputs on a 24X7X365 through our 24-hour customer service
other amenities. Elegance customers basis, which is a unique achievement hotline and dedicated Customer
also have the option of having their for a Sri Lankan Bank. Furthermore, Service Handling Unit, and acted
requirements attended to by the we also distinguish ourselves in our on promptly. Employees are kept
Branch Manager at any People’s Bank online content. Our Facebook page has informed about customer complaints
Branch. They are also provided with a diverse content, including videos, much at the monthly Branch Managers’
personalised Elegance cheque book. of which is unrelated to banking. This Conferences and corrective action
Concierge services provide 24/7 type of communication is considered is decided on to prevent recurrence.
personalized assistance for travel to be more effective in the present Complaints relating to interruptions
planning, dinner reservations, sports, economic milieu, rather than taking a of ATM services are handled by the
entertainment tickets, and more, which “hard sell” approach. Central ATM Control Department. Here
are available 365 days a year from too procedures are in place to rectify
home or abroad. the situation with minimum delay.
PEOPLE’S BANK
ABOUT
The details of customer complaints PRODUCT AND SERVICE During the year under review, there
received is given below: LABELLING AND MARKETING were no incidents of non-compliance
COMMUNICATIONS pertaining to product and service
Description Number labelling, marketing communications,
We respect customers’ right to have or any voluntary codes or other
Number of customer fair and accurate information in order guidelines.
complaints received 1,931 to make informed financial decisions,
FROM THE TOP

REFLECTIONS
Number of customer and disseminate clear, accurate, timely
complaints resolved 1,854 and relevant information about our FINANCIAL INCLUSION
Pending Complaints 67 products and services. The Bank’s People’s Bank, by way of its ethos and
Customer Charter has been formulated its wide network, has always been
Pending Investigations 15
in conformance to the requirements of in the forefront of financial inclusion.
Pending Legal cases 29 the Central Bank of Sri Lanka (CBSL). We have set up branches in remote
In progress 5 We deliver all applicable terms and rural locations where no banks have
conditions pertaining to our products ventured before. Though some
and services in a simple, easy to
VALUE CREATION
DRIVING
such branches were not financially
CUSTOMER HEALTH AND comprehend manner. profitable, we looked beyond the
SAFETY bottom line.
The People’s Bank website provides
All our branches and contact information pertaining to interest rates Recently however, we have taken
points have been designed with on deposits and advances, exchange financial inclusiveness to a new level.
customer health and safety in mind, rates, and other applicable charges. Our Self Banking Units are patronised
in accordance with our commitment This information is revised daily. by people of widely differing locations,
to the issue. Our branches have Product and service brochures are social classes, and education levels. It
precautions in place for emergency
AND ANALYSIS
printed in all three languages (Sinhala, would be expected that people with
situations such as fire exits, fire Tamil, and English) with relevant low levels of literacy would be wary
extinguishers, and fire sirens. They information, terms and conditions. of technology. However, we were able
are also protected from any physical These are made available at all our to draw them in because of their trust
threats by armed and non-armed branch outlets. In addition, customers in People’s Bank. Thanks to the Bank
security personnel. Despite the winding can obtain necessary information by financial literacy has come to include
down of the COVID-19 pandemic, we connecting with our dedicated 24-hour the ability to use technology.
have continued to be vigilant regarding Call Centre.
health-related risks. All health and
We also promote financial literacy by
safety protocols that were introduced Our marketing communications are giving loans at interest rates below
at customer touch points according conducted in all three languages. We current market rates. This is possible
to Government guidelines continue ensure all marketing communications when we obtain concessionary finance
REPORTS
GOVERNANCE
in place. are conducted based on principles of at low rates. The Birth of Freedom is
ethical and responsible advertising another programme of the Bank worth
according to Bank’s branding
CUSTOMER PRIVACY highlighting. Every child born in the
guidelines. Prior to publication, all country is entitled to receive a
In the present context where security marketing communications are subject savings account with an LKR 2,000
and privacy of data is subject to many to strict scrutiny and a multilevel initial deposit. This is afforded
threats, we are continuously vigilant approval process, to ensure no to every child on an absolutely
about the need to safeguard our misleading of the public takes place. non-discriminatory basis.
STATEMENTS
FINANCIAL
customers’ interests and the Bank’s

reputation. Mindful of the facts that In 2022, we continued to educate
threats are ever increasing, we strive the public further on the benefits
to make our IT and cyber security and advantages of our new products
frameworks more and more robust. and services via television, radio,
The controls we have in place include newspapers and social media. All
regular IT vulnerability assessments, staff members are also continuously
network upgrades, IT audits by third and thoroughly made aware of
INFORMATION
SUPPLEMENTARY
parties, and continuing training for the new products and services in
staff on IT security. We are pleased to order to ensure clear and concise
report that in the year under review communication with customers.
there were no occurrences of breach
of customer privacy or non-compliance
with security precautions.
OUR PERFORMANCE
VALUE OF TRANSACTIONS
The Branch Network had an
LKR Bn. extremely satisfactory year in terms
1,250 of profitability. We achieved a profit
of LKR 17.2 Bn. that exceeded the
1,000 targeted budget for the year 2022.
However, this has to be judged in the
750 context of increased interest rates and
transfer pricing. This apart, there have
500 been savings from rationalising our
network and improving profitability in
250 Branches and other Business units.
0
2020 2021 2022 SALE OF BANNED OR
DISPUTED PRODUCTS
ATMs CDMs
In compliance with the CBSL Customer
Charter, and our own ethical codes,
we do not sell or market products
MOBILE AND INTERNET BANKING which are banned in the market,
or are the subject of stakeholder
Million LKR Bn.
or public debate. We refrain from
2.5 1,000
financing any project which is illegal
according to our credit policy. There
2.0 800 were no non-compliances during the
year regarding the sale of banned or
1.5 600 disputed products.
1.0 400
FUTURE OUTLOOK
0.5 200 Looking to the future, we can foresee
a continuing increase in our share of
0 0 overseas remittances. Our increasing
2020 2021 2022
focus on the needs of millennial
customers should pay dividends. With
Number of customers (million)
the trend set this year, we should place
Number of financial transactions (million)
more emphasis in or communications
Value of financial transactions (LKR Bn.)
on promoting the Brand rather than
individual products. People’s Bank has
weathered the storms of a turbulent
year and can confidently look forward
to the future.
PEOPLE’S BANK
ABOUT
Our business partners are those who provide the resources, products, and services that are procured
from outside the Bank to keep the wheels of our business turning. The relationships with these partners
are an integral part of our value creation process.
FROM THE TOP

REFLECTIONS
OUR APPROACH
KEY HIGHLIGHTS
The Bank firmly upholds the value of
sustaining a mutually beneficial and
reciprocal partnership with its 383 258 12 member
business partners through proactive suppliers associations
and collaborative efforts, which
generated a volume of LKR 15.9 Bn.
VALUE CREATION
DRIVING
over the past year. This partnership
finds its expression in an open,
responsible, and ethical procurement
policy, ensuring impartial and equitable Over 93% of the Relationships with 43
tendering processes, and upholding value created for correspondent banks
transparency and efficiency in fulfilling suppliers of local and 82 Vostro agents
our contractual commitments. The origin
Bank maintains strict compliance with
all industry regulations and operates
AND ANALYSIS
with transparency and integrity,
adhering to ethical business practices
while meetings its financial obligations
promptly.
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
MATERIAL THEMES
VALUE CREATED
z Operational efficiency
z Supplier value creation
CHALLENGES LKR 14.8 Bn. 93.1%

paid to local suppliers
z Restrictions on imports and limited
availability of foreign exchange
caused delays in the procurement
of certain imported supplies
z Certain projects had to be halted or
postponed due to financial constraints
z Foreign partners’ credit lines
LKR 1.1 Bn. 6.9%
reduced due to downgrading of paid to foreign suppliers
Sri Lanka’s sovereign rating
OPPORTUNITIES
z Ability to resume construction
projects that were halted due to CAPITAL LINKAGES
financial constraints
Encouraging suppliers to embrace sustainable
practices and improve energy efficiency helps
CONTRIBUTION TO UN SDGs reduce their environmental impact.
Gender Equality Imposing rigorous screening procedures

Giving equal opportunities on all suppliers promotes environmental and
for women to reach social sustainability.
The digitisation of
leadership roles and tender processes Ensuring that goods and services procured
play an active part in introduced by the Bank are produced, delivered, and
decision making. during COVID-19 disposed of in a socially and environmentally
pandemic responsible manner enhances the
Decent work and
enhances preservation of natural capital.
economic growth
efficiency. NATURAL CAPITAL
Creating satisfying
and well-remunerated FINANCIAL
Upholding
employment. CAPITAL
ethical business
Sustainable cities and practices Efficient
communities fosters robust supply chain
partnerships with management
Through supply
business partners. improves
chains that function
productivity
seamlessly we deliver INTELLECTUAL
CAPITAL: and generates
value to customers and
cost savings.
communities.
Climate action
Promote responsible
procurement and concern
for the environment MANUFACTURED CAPITAL HUMAN CAPITAL
among suppliers.
Investing in digitisation and Training in supply chain
Partnerships for the goals enhancing procurement management facilitates
Networking with business processes augments business the growth of business
partners delivers value to partner capital. partner capital.
stakeholders.
PEOPLE’S BANK
ABOUT
z New suppliers are selected through
Number of Number of Number of Payments to suppliers
registered suppliers correspondent banks Vostro agents LKR Bn. a formal process that involves initial
Board-approved tender procedures,
2018 2019 2018 2019 2018 2019 2018 2019 followed by rigorous screening.
383 242 43 42 73 71 12.8 12.2 z Critical and high leverage items,
2020 2021 2020 2021 2020 2021 2020 2021 such as DI cards and IT equipment,
242 258 42 42 71 78 11.1 12.3 are procured through a global
FROM THE TOP

REFLECTIONS
tender, and the Bank maintains
2022 2022 2022 2022
partnerships with selected global
258 43 82 15.9
suppliers.
z We subject all of our new suppliers
Business Correspondent banks Procurement Policy to screening procedures that
growth z The Bank’s procurement policy is evaluate their adherence to
Vostro agents
partners environmental and social criteria,
Franchise partners
guided by a Procurement Manual,
ensuring that their production
VALUE CREATION
DRIVING
which is formulated to safeguard
State institutions processes comply with the Central
the Bank's interests while fostering
positive supplier relations. Environmental Authority (CEA)
Suppliers Utility service providers
regulations and prohibit the use of
Material suppliers z The smooth functioning of child or forced labour.
procurement is essential to ensure
Fixed asset suppliers
a continuous supply of goods z Following the COVID-19 pandemic,
Travel and transport and services required by the tenders were also solicited through
Bank, guaranteeing uninterrupted an online process, as described
Maintenance Software suppliers
operations. below:
AND ANALYSIS
partners
Waste management
z Procurement policies are revised to – Tenders are solicited through a
Communication
accommodate evolving needs. dedicated email and opened via
Debt collection agencies Zoom, ensuring transparency
z The Technical Evaluation Committee in the procurement process.
Human resource providers
(TEC) meticulously evaluates all Suppliers are required to register
Others Contractors technical specifications before on the Electronic Government
initiating procurement activities. Procurement (e-GP) system,
Premises providers
z The TEC committees develop which is mandatory under the
both operating and capital Ministry of Finance. This system
SUPPLY CHAIN budgets (CAPEX and OPEX) for promotes fairness, transparency,
MANAGEMENT all activities, which are utilised to and accountability.
REPORTS
GOVERNANCE
The Bank considers supply chain prepare implementation plans – During the year, the Bank faced
management as a mutually beneficial for procurement and operations, various constraints, including
process involving a reciprocal delegating tasks among personnel the COVID-19 pandemic,
relationship. On the one hand, we aim according to their domain political turmoil, economic crisis,
to attain the highest possible value knowledge and the devaluation of the SLR, and
for money in our relationships with organisational structure. subsequent price escalations.
suppliers by procuring products of As a result, certain construction
excellent quality at the lowest feasible
STATEMENTS
FINANCIAL
Supplier relationship projects were put on hold due to

cost. On the other hand, we strive to financial constraints. However,
management
cultivate harmonious relations with the Bank made compensatory
our suppliers, which promote timely z Managing supplier relationships at payments to contractors,
deliveries, particularly in cases of the Bank is a collaborative effort, even under such challenging
urgent supply requirements. with both parties sharing product circumstances. The Bank is
Our approach to supply chain or service responsibilities while committed to maintaining strong
management results in both efficient adhering to quality and compliance business partner relationships and
INFORMATION
SUPPLEMENTARY
and cost-effective procurement, standards. does not allow such constraints to

as well as positive and enduring be a hindrance to their continued
supplier relations. maintenance.
z The Association of Banking Sector

Risk Professionals – Sri Lanka
z Chartered Institute of Personnel
High
Material Utility service

Management - Sri Lanka
suppliers providers
z Asia Pacific Rural and Agriculture
Credit Association
z The Association of Compliance
Officers of the Bank, Sri Lanka
INTERACTION
Suppliers of Maintenance
z The Financial Ombudsman Sri Lanka
Medium
outsourced trainers and (Guarantee) Ltd.

employee assets consultants’
suppliers service communication
z Clearing Association of Bankers
z Employers’ Federation of Ceylon
z Association of Primary Dealers
z Sri Lanka FOREX Association
Low
Premises providers
contractors
SUPPLIER ENVIRONMENTAL
ASSESSMENT
The Bank exclusively engages
with suppliers, authorised dealers,
Low Medium High manufacturers, and contractors who
comply with environmental laws,
CRITICALITY
regulations, and rules such as the
National Environment Act, as well as
the Bank's own environmental policy.
BUSINESS PARTNER The Bank has established successful
This policy sets a moral and ethical
RELATIONSHIPS relationships with several foreign
standard that suppliers must meet
lending institutions, which have
We have mutually beneficial during the screening process. Bank’s
provided credit lines in the past.
relationships with banking partners, tender process includes conditions on
These relationships have ceased to
many of which have been built up preventing environmental impact.
yield the desired results at present
over a period spanning several due to the country's sovereign ratings
decades. These partners include 43 downgrade. Nevertheless, the Bank CHILD LABOUR
correspondent Banks and 82 Vostro aims to re-establish these relationships
agents. once the situation improves. As a Government-owned bank, we
are dedicated to fulfilling our social
obligations, with a particular focus on
LENGTH OF RELATIONSHIP MEMBERSHIP IN INDUSTRY safeguarding the rights of the younger
Nos.
ASSOCIATIONS generation. The Bank places great
emphasis on promoting and protecting
50 The Bank has developed and fostered
children's rights, and meticulously
numerous affiliations with associated
screens all contractors, suppliers,
40 organisations. These relationships have
dealers, and manufacturers to
been beneficial in keeping up with
ensure compliance in this regard. We
30 both local and international industry
ensure that all such parties conform
best practices. Such affiliations have
to Sri Lankan laws and regulations
20 enabled the Bank to maintain the
pertaining to child labour. Bank’s
highest industry standards in addition
tender process includes conditions on
10 to fostering networking opportunities.
preventing using child labour.
The Bank holds memberships in the
0 following organisations:
<1 1-5 5-10 10-20 >20
z Institute of Bankers of Sri Lanka
z The Ceylon Chamber of Commerce
Number of correspondent banks
Number of Vostro agents z Sri Lanka Bankers Association
(Banks/Exchange companies) (Guarantee) Ltd.
PEOPLE’S BANK
ABOUT
ETHICAL PRACTICES
Our approach to business partner
relationships adheres to Government
regulations and our own procurement
manual, ensuring compliance with
all requirements. We prioritise
transparency in all procurement
FROM THE TOP

REFLECTIONS
activities, and our process includes
a rigorous supplier evaluation
methodology that takes into account
environmental and social concerns.
We hold our suppliers, contractors,
and consultants to the highest
ethical standards and maintain strict
confidentiality of all information
VALUE CREATION
DRIVING
related to them. Additionally, we aim
to add value by providing constructive
feedback, maintaining high quality
standards, and ensuring timely
payment.
FUTURE OUTLOOK
Amidst the turbulence of the year,
AND ANALYSIS
we were successful in maintaining
relationships with our business
partners. With an improved outlook
anticipated in 2023, we aim to resume
certain activities that were previously
constrained. We intend to capitalise
on established partnerships to bolster
our supply chain and reinforce our
relationships. Needless to say, future
partnerships will undergo the same
rigorous screening process as in the
REPORTS
GOVERNANCE
past. We anticipate further productive
and mutually beneficial relationships,
which will enhance the Bank's value
from its business partners.
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
INVESTOR CAPITAL
The Bank, being an institution with a history of over 60 years, has long been a key contributor to
the coffers of our main shareholder, the Government of Sri Lanka.
OUR APPROACH in infrastructure, technology, MATERIAL THEMES

people development, and process
People’s Bank has consistently reengineering. This has enabled us to z Financial performance
maintained a high level of integrity and retain operational resilience, even in z Operational efficiency
transparency in its entire operations. times of adversity.
We have retained and enhanced z Employee productivity
investor confidence in the Bank by z Responsible lending
communicating an accurate picture KEY HIGHLIGHTS z Brand equity
of the Bank’s financial position
z Customer access
and its operating results to all its
stakeholders in a timely manner. We Return on equity
have maintained a strong capital
adequacy position through our strong
12.2 %
asset base and portfolio quality. This
has enabled us to see through times of
adversity such as the economic crisis
of 2022. We have managed to maintain
sufficient liquidity position, within
the constraints of our liquidity risk
appetite, and along with investments
PEOPLE’S BANK
ABOUT
CHALLENGES
VALUE CREATED
z Turbulent economic conditions
during the year
z Constraints on lending, which
impacted profitability LKR 661 Mn.
paid as special levy and dividends
FROM THE TOP

REFLECTIONS
to shareholders
OPPORTUNITIES
z Improved economic
conditions in 2023 could
result in increased profitability
CAPITAL LINKAGES
and dividend payments
VALUE CREATION
DRIVING
Investments in
digitalisation
and automation
CONTRIBUTION TO UN SDGs mitigates our impact
on the environment
Decent work and
economic growth NATURAL CAPITAL
The financial strength INTELLECTUAL FINANCIAL

and stability of CAPITAL: CAPITAL
AND ANALYSIS
the Bank enables Industry Sustaining
providing secure and leadership in our revenue
well –remunerated digitalisation and increases
employment as and innovation in profits
well as generating contributes enhances
economic growth to increased investor
and job opportunities investor capital capital
through our business
operations
Peace, justice, and

strong institutions
REPORTS
GOVERNANCE
A robust governance MANUFACTURED HUMAN
structure, ethical CAPITAL CAPITAL
practices, and
Investment in plant The skills and
efficient management
and equipment leads competencies of
builds the Bank’s
to value creation the employees lead
reputation which
and increased to increased and
enhances our appeal
investor capital profitable growth
STATEMENTS
FINANCIAL
to investors
INFORMATION
SUPPLEMENTARY
INVESTOR CAPITAL ECONOMIC VALUE ADDED (EVA)

STATISTICS In the year 2022, EVA of the Bank has been affected significantly due to the high
rates of Treasury Bill rates prevailed in the country as a result of increased CBSL
RETURN ON EQUITY policy rates.
%
25 Computation of EVA
For the year ended 31 December 2022 2021 Change
20
LKR '000 LKR '000 %
15 Invested equity
Shareholders’ funds 145,294,131 136,077,096 6.8%
10
Add: Allowance for expected credit losses and
other losses 140,104,909 101,277,028 38.3%
5
Total 285,399,040 237,354,124 20.2%
0
2018 2019 2020 2021 2022 Earnings
Profit after taxation 17,192,058 23,720,143 -27.5%
Add: Impairment charge 33,346,451 14,472,820 130.4%

RETURN ON ASSETS
Less: Loans written-off (271,802) (187,681) 44.8%
%
Total 50,266,707 38,005,282 32.3%
2.0
Cost of Equity (Based on 12 months weighted
1.6 average treasury bill + 2% for risk premium) 27.6% 10.2%
Cost of average equity 72,198,620 21,873,885 230.1%

1.2
Economic value added (21,931,913) 59,879,167 -236.0%
0.8
0.4
0
2018 2019 2020 2021 2022
SHAREHOLDER PROFILE
Our principal shareholder is the
Government of Sri Lanka which holds
92.27% of the equity share capital
while the balance 7.73% is held by
Cooperative Societies.
PEOPLE’S BANK
ABOUT
DIRECT ECONOMIC VALUE GENERATED AND DISTRIBUTED
The direct economic value generated and distributed is an indication of the amount of wealth we have generated for
our shareholders and the allocation of the amount retained by the Bank for its growth.
For the year ended 31 December 2018 2019 2020 2021 2022 Growth %
LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 2022 vs 2021
FROM THE TOP

REFLECTIONS
Sources of income
Interest 166,441,208 186,714,218 179,717,526 197,330,011 321,935,983 63.1
Exchange 6,016,099 800,416 3,311,844 (965,361) 2,740,436 183.9
Commission and fees 6,956,292 7,336,594 6,723,826 8,268,168 16,397,745 98.3
Capital gain 162,923 329,071 336,495 143,459 184,223 28.4
Other 1,707,356 4,548,686 892,017 2,473,543 15,970,222 545.6
Total 181,283,878 199,728,985 190,981,708 207,249,820 357,228,609 72.4
VALUE CREATION
DRIVING
Utilisation of income
To depositors/borrowers as interest 111,034,922 125,507,699 118,783,744 114,869,171 246,177,918 114.3
To employees as emoluments 19,504,835 19,226,233 19,685,506 22,711,335 26,602,748 17.1
To providers of goods and services 12,822,211 12,153,293 11,128,830 12,276,709 15,882,049 29.4
Net impairment loss on financial assets 2,623,970 8,488,026 11,567,174 14,472,820 33,346,451 130.4
To government – taxes, special levy
AND ANALYSIS
and dividend 19,814,596 19,817,027 14,444,917 16,328,960 13,944,390 -14.6
To community 42,288 35,683 28,703 12,665 38,213 201.7
Retained for growth 15,441,056 14,501,024 15,342,833 26,578,159 21,236,840 -20.1
Total 181,283,878 199,728,985 190,981,708 207,249,820 357,228,609 72.4
Note: Above figures have been derived from the Audited Financial statements that were prepared based
on the Sri Lanka Accounting Standards (SLFRS/LKAS).
DIVIDEND PAYMENT AND DIVIDEND POLICY

Our dividend pay-out policy, has been structured so that payments to shareholders are made at regular intervals.
The policy has been crafted to balance both returns to shareholders and the Bank’s long-term growth.
REPORTS
GOVERNANCE
Dividend pay-out for 2022 amounted to LKR 661 Mn.
FUTURE OUTLOOK
In a very turbulent year, the Bank nevertheless achieved very satisfactory results and dividend pay-outs.
With the prospects of improvement in the economy on the horizon, we can look forward to increased profits and
shareholder value in 2023 and the years to come.
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
COMMUNITY CAPITAL
Since its inception over six decades ago, People's Bank has retained its strong bonds with
the community, fulfilling its envisaged role of meeting the needs of the common man, fostering
the development of rural entrepreneurs, and contributing to the overall betterment of society.
Commitment to this goal lies at the heart of the Bank, and impels us to provide support and
assistance to our customers and the wider community, especially in areas where there is the
greatest need for our presence and services.
Many of our CSR programmes are targeted at local communities based on their most urgent needs.
Examples are our nutrition programme which assists identified malnourished children in all districts
and the water and electricity projects which assists very remote rural schools.
OUR APPROACH community service programmes. efforts are geared towards achieving
Our focus is on imparting financial sustainability and environmental
In pursuit of our mission to enhance literacy and business skills to the conservation, ensuring that future
the standard of living and develop public, especially in rural areas, to generations benefit from what we
the infrastructure and amenities of promote entrepreneurship. We also achieve today. Our efforts are geared
the community, we have embarked aim to preserve the cultural traditions, towards achieving sustainability and
on several initiatives, including the arts, and crafts of the community by environmental conservation, ensuring
launch of our CSR initiative, Mahajana encouraging community activities that that future generations benefit from
Mehewara, as a means to extend our promote these skills. In addition, our what we achieve today.
KEY HIGHLIGHTS
Significant Three major national hospitals Underprivileged rural

investments in Colombo were supported schools located in remote
amounting to by LKR 13.5 Mn. in funding areas of the country
LKR 38.2 Mn. for the purchase of essential received assistance of
in community drugs and medical equipment, LKR 6.4 Mn. in the form
development as well as the refurbishment of solar energy systems
across the country. of wards. and clean drinking water.
PEOPLE’S BANK
ABOUT
z Socio-economic impact z Travel restrictions and limited z Further enhance the People’s Bank
z Responsible lending public transport during the first corporate brand by conducting
half of the year more community-based activities
z Rising costs and budgetary under the aegis of Mahajana
constraints prevented the staff Mehewara CSR initiatives.
FROM THE TOP

REFLECTIONS
CONTRIBUTION TO UN SDGs from participating in many
community service projects
No poverty
Increasing financial
inclusiveness, promoting VALUE CREATED
financial literacy, and
creating job opportunities
help eradicate poverty.
VALUE CREATION
DRIVING
LKR 9.6 Bn. worth 22,150 number
of community based development loans
Zero hunger
Providing financing
tailored to the needs
of small scale farmers
sustains agriculture.
CAPITAL LINKAGES
AND ANALYSIS
Good health and The Bank's
wellbeing financial capital
With the introduction of
Providing hospitals has been
self-banking units, the Bank
with essential items and deployed towards
has taken steps to reduce
community
alleviating malnourishment paper consumption by
development
among children. promoting digital transactions,
activities,
which has helped in
including the
conserving natural capital, and
Community extension of
Quality education contributing towards building
outreach community
a sustainable future.
Supporting education by projects development.
conducted NATURAL CAPITAL The investment
donating school books.
REPORTS
GOVERNANCE
under the newly in community
created CSR development
brand Mahajana activities is seen
Mehewara, as a necessary
Clean water and sanitation enhanced the contribution
Proving drinking water to image of the towards the
remote rural schools. Bank among the betterment
people. of society
STATEMENTS
FINANCIAL
INTELLECTUAL FINANCIAL
CAPITAL CAPITAL
Affordable and
clean energy
Providing solar power to
remote rural schools and
converting branches to
solar power.
INFORMATION
SUPPLEMENTARY
The provision of self-banking The Bank recognises the

units has also increased the value of its human capital and
Partnerships for the goals convenience and accessibility encourages staff to volunteer
of banking services for for CSR activities. This creates
Partnering with other
remote communities, thereby social awareness among the
organisations to carry out enhancing the manufactured employees while helping them
community projects. capital of the Bank. to build team spirit.
INVESTMENT IN CSR PROGRAMMES Essentials for Hospitals

Investment in CSR Number of community based Community based Essential medicines and medical
(LKR Mn.) development loans development loans (LKR Mn.) supplies worth LKR 5 Mn. were
donated to both Lady Ridgeway and
2018 2019 2018 2019 2018 2019 Castle Street hospitals, which are
42.3 35.7 42,511 31,686 9,017.6 7,852.4 national hospitals located in Colombo.
We are currently refurbishing the
2020 2021 2020 2021 2020 2021
28.7 12.7 37,064 32,260 22,967.2 16,544.9 wards of the De Soysa Maternity
Home through the Mahajana
2022 2022 2022 Mehewara initiative.
38.2 22,150 9,568.10
Our structured CSR programmes focus approach would not have been
on strengthening and promoting health appropriate. These community-driven
and other social activities, education, initiatives, which addressed pressing
arts and culture, and protecting the social concerns, also bolstered the
environment. As such, our funding, Bank's corporate brand in a more
investments, and financial solutions subtle manner that was appropriate
benefit diverse communal groups and for the times.
individuals. The table below highlights
our spending in these key areas.
HEALTH AND OTHER SOCIAL
ACTIVITIES
CATEGORY WISE
INVESTMENT IN CSR Birth of Freedom
PROJECTS – 2022 The Bank celebrated Sri Lanka’s
74th Independence Day with a
Category Amount continuation of the Birth of Freedom
LKR ’000
programme this year. People’s Bank
Art and culture 5,800
gifted LKR 2,000 worth of Isuru
Udana Gift Certificates to every baby
Education 5,050
born between the 1 and 7 February
Environment 6,435 2022. Bank officials made a token
Health 14,637 presentation of Isuru Udana vouchers
and other gift items to the Directors
Other 6,291
of the Castle Street Maternity Hospital
TOTAL 38,213 and the De Soysa Hospital for Women.
Meanwhile People's Bank branches all
over the island celebrated the event in
OUR COMMUNITY PROJECTS similar style.
During the course of the year, the
Bank’s Corporate Social Responsibility
(CSR) programme Mahajana
Mehewara, gained prominence through
various community service initiatives,
with the health and education sectors
being primary beneficiaries. The Bank
has been consistent in its commitment
to helping the underprivileged
segments in keeping with its core
values. However, in 2022, the Bank
took an additional step of integrating
its social awareness into its corporate
brand. This was a decision that is sure
to resonate well with many individuals,
given the current economic climate,
where an overly aggressive marketing
PEOPLE’S BANK
ABOUT
Feed-a-Child Programme Environment School Book Project
With the low nutrition levels of Three schools located in remote and The Buddhist Society of the People’s
children becoming a topic of concern, under-resourced areas were each Bank took another step in its annual
People’s Bank has stepped in to provided with a 3kv solar-powered Book Donation Project in November
donate LKR 1 Mn. to the Feed-a-Child inverter system, water pump, and 2022. This was carried out under
programme launched jointly by the water tank. the Bank’s Mahajana Mehewara
Sri Lanka College of Paediatricians Programme and took place at
FROM THE TOP

REFLECTIONS
z Galamuduna Junior School
and Manusath Derana charitable in Meemure Vihara Maha Devi Balika Vidyalaya,
organisation. Malnourished children Colombo 10. School books and other
z Kalukale Vidyalaya in
from all districts are identified by the equipment were distributed to about
Meegahakivula, Badulla
family health officers of the area, and 200 economically disadvantaged
the Feed-a-Child programme will z Dumbara No.02 Tamil Vidyalaya school children.
provide them with essential nutritional in Ayagama, Ratnapura
supplies worth LKR 6,000 every
two weeks for a six month period, The programme will provide free
VALUE CREATION
DRIVING
electricity and running water for both
under the supervision of paediatric
students and teachers of the school.
specialists. The children’s nutritional
It will continue into the following year,
status is monitored by the doctors and expanding the list of schools that will
officials of the area. The programme benefit from it.
has so far been implemented in
the Nuwara Eliya, Monaragala, and
Ratnapura districts.
COMMUNITY-BASED
AND ANALYSIS
DEVELOPMENT LENDING
The Bank's strategy to promote
financial literacy and inclusivity
among underprivileged communities
is primarily focused on community-
Art and Culture based lending. The Bank has launched
several initiatives to facilitate
The Bank has been the main sponsor small-scale entrepreneurship, and
of the annual Esala Perahera, the
Blood Donation Campaign world-renowned pageant in Kandy, as
uplift rural communities. In 2022, the
a means of promoting traditional dance Bank successfully funded 17,100 loans
A blood donation campaign was
and music while preserving our cultural for community-based development,
organised by the People's Bank
REPORTS
GOVERNANCE
heritage. The Bank also participated totalling LKR 7,331.35 Mn. Additionally,
Welfare Department to commemorate
regularly in religious ceremonies and the Bank disbursed 5,050 community
the 61st anniversary of the Bank. charitable acts in Anuradhapura, in development loans, amounting to
Many donors participated, under the order to commemorate Poson Poya. a total of LKR 2,236.75 Mn. through
supervision of the Blood Bank doctors.
refinancing. These loans have been
This is an annual event where a
utilised across various sectors, with
significant amount of blood is donated
the agricultural sector receiving the
to the Blood Bank each year.
largest commitment. The Bank has
STATEMENTS
FINANCIAL
directly financed 9,547 loans worth

LKR 6,282.11 Mn. to the agricultural
sector, while an additional 1,816 loans
amounting to LKR 763.95 Mn. were
granted through refinance loans.
INFORMATION
SUPPLEMENTARY
Community-based loans in 2022

Funded by the Bank Funded through Refinance Schemes
Number of loans Outstanding amount Number of loans Outstanding amount

LKR Mn. LKR Mn.
Agricultural 9,547 6,282.1 1,816 764.0
Commercial 1,218 266.4 1,306 781.0
Consumption 10 5.0 4 0.6
Financial 56 11.4 22 4.5
Housing and property 15 3.7 13 14.3
Industrial 391 47.7 470 157.4
Other economic activity 5,653 614.8 908 83.5
Services 184 48.0 423 214.1
Tourism 26 52.2 88 217.4
TOTAL 17,100 7,331.4 5,050 2,236.8
INDIRECT ECONOMIC FUTURE OUTLOOK

IMPACTS As a Bank that represents the people,
The Bank plays a vital role in our origins and presence have always
creating positive indirect impacts been rooted in the wider community
to the economy in which it operates. throughout the Island. Our actions
People’s Bank as the Banker of the are guided by the well-being of our
nation is involved in providing free customers and society as a whole, and
services like pension payments, we remain committed to prioritising
university payments and teachers’ their welfare in all our endeavours.
salaries. As we continue with our activities,
particularly under the thematic
The Bank has been supporting expression of Mahajana Mehewara, we
“Buddhist welfare fund of the temple will remain dedicated to serving the
of the sacred tooth relic (Sri Dalada greater community and promoting
Maligawa)” by way of keeping tills the betterment of all.
in the branches to collect donations
which will be used for charitable work.
People’s SPARK is another project

which launched to empower
new graduate to transition into
entrepreneurial role. The Bank also
provide additional financial support to
regional credit units to work closely
with the customers to advice on
business strategies, restructuring their
assets and guiding their revival.
NATURAL CAPITAL
PEOPLE’S BANK
ABOUT
Natural Capital is the planet’s limited storehouse of natural resources such as soil, water and air that is
available for the use and well-being of all living creatures including mankind. What we take from it must
be returned, so that we do not damage the fragile ecosystem on which our very existence depends. In
our quest to provide the best possible services to our stakeholders, the Bank does need to utilise some
FROM THE TOP

REFLECTIONS
of these resources, but it takes all measures to reduce, recycle and reuse them in our business activities.
OUR APPROACH
KEY HIGHLIGHTS
Concern for the environment and the
conservation of natural resources is
20 green branches Water consumption
written into our DNA, it is a part of
our policy statement. From the outset
powered by reduced by 3,318 cu.m.
VALUE CREATION
DRIVING
our focus has been directed towards solar energy
industries, businesses and people
who are close to the earth, the fields,
inland waterways and the ocean. Electricity 2.7 million accounts
This mindset has enabled us to make consumption opened digitally
sustainability an integral part of all our reduced by
operations, from lending policies, to 20,344 kWh
administrative decisions, from green
AND ANALYSIS
branches to digital banking solutions.
We continue to strive to reduce our
LKR 551.9 Bn. 101 million ATM’s and
carbon footprint, increase the use of
in digital deposits SBU transactions to the
renewable energy and spread the word
about environmental conservation
value of LKR 1,703 Bn.
to the entire stakeholder community
through our interactions. We have
led the way in the digitalisation of
the industry, and the results have
shown that others are following
our footsteps, paving the way for
a totally new concept in banking
REPORTS
GOVERNANCE
for future generations.
An innovative step was taken

when the Bank launched the
“Mahajana Mehewara” Brand
which encompasses all its CSR
activities. Thus, CSR activities
have become an integral part
STATEMENTS
FINANCIAL
of the People’s Bank Brand.

INFORMATION
SUPPLEMENTARY
Natural capital

z Responsible lending z Transport crisis and fuel shortages z Increased use of digital on boarding
z Environmental impact of resulted in the Bank having to of customers
the business provide transport to employees, z Administration, interviews, meetings
increasing use of fossil fuels (internal and external) conducted
z Delays in the construction of green online due to travel restrictions
branch buildings due to work z Further reduction of internal paper
stoppages and rising costs usage through digitalisation
Clean Water and Sustainable Cities Climate Action

Sanitation and Communities Reduction of climate
Water conservation in Community service effects by monitoring
branch offices projects to provide and limiting the use of
clean drinking air conditioners.
water and solar
energy supplies
to underprivileged
schools in remote
locations.
Affordable and Responsible

Clean Energy Consumption
Greening of bank and Production
branch buildings Reduction of
paper use in bank
operations, and
conservation of
electricity in all
buildings, promoting
digital interactions
with customers
and staff.
Natural capital
PEOPLE’S BANK
ABOUT
VALUE CREATED
Paper recycling increased to 5.9 tonCO2e

GHG emission intensity
5,968 Kg
FROM THE TOP

REFLECTIONS
per employee
Future plans to introduce

solar power to
ISO 14064-1:2018
Certification
VALUE CREATION
DRIVING
50 branches by 2023 for the year 2022.
CAPITAL LINKAGES
AND ANALYSIS
The launching of the
“Mahajana Mehewara”
Brand enhanced the Bank’s
overall Brand image
INTELLECTUAL
CAPITAL
SOCIAL AND RELATIONSHIP FINANCIAL CAPITAL
In a year when lending was The conversion to renewable

restricted due to the liquidity energy across the branches will
problem and high inflation, funding reduce the use of grid electricity.
was available for environmentally Especially in view of the sharp
REPORTS
GOVERNANCE
relevant and sustainable projects increases in charges, the move to
such as the e-ticketing solution solar power should bring financial
jointly undertaken with the Central benefits in the future. Similar
Cultural Fund to issue entry benefits can be expected from
tickets online for tourist the reductions in water and
attractions island wide paper usage
STATEMENTS
FINANCIAL
We are continuing to convert bank Environmentally relevant CSR projects

branches to Green Buildings using are encouraged in all branches and
solar power and LED lighting while regions, so that the staff members
maximising daylight carry the sustainability flag into their
own communities’ island wide
INFORMATION
SUPPLEMENTARY
We are a Platinum Member of the

Green Building Council of Sri Lanka Employees are called upon to manage
(GBCSL), and all new branches are the use of fans, air-conditioning
constructed to meet their Green SL and lighting to minimise electricity
Rating System consumption
Natural capital
PEOPLE’S GREEN PULSE –

THE BANK’S ENVIRONMENTAL
SUSTAINABILITY PROGRAMME Employees
The objectives of the programme

are to monitor the environmental
impact of the Bank's operations. It is
responsible for minimising these effects Society Processes
by educating the staff about the latest
sustainable banking practices. It is also
engaged in creating awareness among
customers and the general public about
these initiatives, thereby spreading
the word about sustainable banking
practices across the wider community.
Sustainability teams have been set Customers Buildings
up in all branches and regions to
participate in the People’s Green
Pulse and drive the environmental
initiatives forward.
Green Buildings Concept
Buildings Processes Customers Employees Society
Green Buildings Policy Paperless operations: Green banking promotion Educate staff on benefits Take our place as the
for all constructions: z ATMs and CDMs for savings: of environmental most sustainable, green
z Selected buildings added z Paperless Express sustainability: Bank in the country:
are certified as z Kiosks for utility Banking account z Encourage staff z Minimise the carbon
carbon neutral bill payments opening to concessionary emissions from the
z 20 buildings solar z E-statements to loans to buy solar Bank’s operations
z Widest ATM network
powered (proposed replace paper power systems, use z Invoke carbon
z Paperless account environment friendly
to install 50 in 2023) z Promotion of SMS and management and
opening and building methods and
z New buildings Internet Banking carbon trading
e-statements electric/hybrid vehicles
to follow LEED/ practices
z Paperless loan
z Debit cards to
GREENSL guidelines
z Bank policy to make z Educate society
processing promote cashless
sure only electric or in environmental
z Building contractors society
z Online and mobile hybrid vehicles are sustainability
to follow LEED/ z Express Banking for
banking systems purchased under staff
GREENSL/ new customers
z Obtain carbon
loan scheme
CIOB Green Mark z Debit and credit cards credits by engaging
z Promotion of ATMs, z Push the staff to
Certification z 24/7 People’s Call in tree planting
CDMs and Kiosk use email and digital
Centre programmes
payments documentation
Green banking promotion

for loans:
z Green Loans to assist
purchase of electric/
hybrid cars, solar
power systems etc.
at lower rates
z Promote environment
friendly power sources
z Promote environment
friendly practices/
processes
Natural capital
PEOPLE’S BANK
ABOUT
GREEN BRANCH BUILDINGS Development Authority Green Building Opening Green Branches
Guidelines, and all our branches
As a Platinum Life Member of the obtain the ISO 14065 and GHG 002-01 Bank currently follows the above
Green Building Council of Sri Lanka accreditation from the Sri Lanka guidelines for the following ongoing
(GBCSL), People’s Bank follows green Accreditation Board (SLAB). This is a flagship branch and regional head
concepts in all construction and testament to the highest efficiencies office buildings in order to obtain
renovation projects of the branch in air quality and water management. a green rated certification for the
network. These projects are certified total building construction and the
FROM THE TOP

REFLECTIONS
We aim to extend our list of green
according to the GreenSL Rating branches in the future, going up to operational maintenance levels.
system of the GBCSL, as well as Urban 50 by the end of 2023.
Building Location Green status Construction status Expected Green

description Certification date
VALUE CREATION
DRIVING
Regional Head Matale Designed and planned according In progress according to the End of 2023
Office and Bank to Green Building concepts Guidelines of GREENSL Rating
Branch Building System of Green Building Council
Regional Head Jaffna Designed and planned according In progress; Structure completed 2024
Office and Bank to Green Building concepts following guidelines of GREENSL
Branch Building Rating System of Green Building
Council.
Remaining construction commenced
AND ANALYSIS
in 2022, proceeding according to
the GREENSL Rating System of Green
Building Council
Regional Head Kegalle Designed and planned according In progress to meet the Green End of 2023
Office and Bank to the guidelines of the Building Rating System of the UDA
Branch Building Environment and Landscape
Division of Urban Development
Authority (UDA)
Office No 374, Dr Colvin Designed and planned according proceeding according to the 2025
Development for R. De Silva Mawatha to Green Building concepts Guidelines of GREEN SL Rating
People’s Bank Colombo 2 System of the Green Building Council
REPORTS
GOVERNANCE
Staff Pasikuda Constructed applying Green Completed In operation
Training and Concepts, using solar energy,
Accommodation energy efficient light fittings and
Centre fixtures, water efficient sanitary
fittings, natural lighting, reuse
of treated waste/sewer water
for landscaping, and rain water
recharging to ground.
STATEMENTS
FINANCIAL
Regional Head Main Street, Galle Designed and planned according On hold –
Office Building to Green Building concepts
Proposed Thambuttegama, Designed and planned according On hold –

Branch Buildings Trincomalee, to Green Building concepts
Baduraliya,
Mankulam,
INFORMATION
SUPPLEMENTARY
Kinniya,
Kalmunai,
Kadawatha,
Medirigiriya
Natural capital
REDUCING OUR CARBON FOOTPRINT

As the first state-owned bank in Asia to be certified Carbon Conscious ® by the Sustainable Future Group (SFG) in 2019
we have increased our energy efficiency, investing in renewable energy, reforestation and the purchase of carbon credits.
Greenhouse Gas (GHG) Inventory Summary 2022

Scope Emission Sources GHG Emission (tonnes) Total Emission
CO2 CH4 N2O tonCO2e
Scope 1 Stationary combustion 44,251 2 0 44

Direct emission Mobile combustion 266,188 14 15 271
Fugitive emissions 58,080 0 0 58
Category 1: Total 369 0 4 373
Scope 2 Purchased electricity 1,124,400 0 0 1,124

Indirect emission Scope 2: Total 1,124 0 0 1,124
Scope 3 Purchased goods 129 0 0 0

Other indirect Business travel - Air 2,206 0 11 5
emission
Employee commuting 931,588 1,384 6,695 2,745
Scope 3: Total 934 39 1,777 2,750
Other indirect Transmission and distribution loss 115,813 0 0 116

emission
Water Supply by NWSDB 2,813 0 0 3
Category 6: Total 119 0 0 119
TOTAL EMISSIONS 2,546 39 1,781 4,366
GHG emission intensity per employee was 5.9 tonCO2e
There has been a significant increase WASTE MANAGEMENT WATER CONSERVATION

in GHG emission for the reporting
year due to the increase in Scope 3 We maximised resource usage During the year, 18,157 cu.m. of water
(employee commuting). while safeguarding the natural has been consumed. Reducing the
environment and its effect on human usage of precious water within the
habitation. The garbage produced Bank network has been a priority at
REDUCING AND by the Bank is categorised, and we the Bank, where we have an acute
RECYCLING PAPER separate it according to which waste awareness of the global water deficit.
can be recycled and which waste We have built a wastewater treatment
By converting several internal and
needs disposal. Our general waste facility to reuse wastewater for flushing
external paper based processes to
management is supported by the toilets, and gardening. The installation
digital channels we have drastically
respective municipal/urban councils of dual flush cisterns, auto flush
reduced the use of paper in our
and Central Environmental Authority- toilets, and automatic faucets in Bank
operations. Our island wide network
approved third party recycling service restrooms are some of the measures
of SBUs, Kiosks, ATMs and CDMs have
providers, while our wastewater is taken, and we intend to eventually roll
shifted many customers from the
discharged in accordance with the out these features across the entire
branch counters to the digital channels,
National Water Supply and Drainage Bank network in future. The staff
reducing paper as well as freeing up
Board's regulations. A transparent members are constantly reminded
the Bank employees to work on more
tendering process is also used to through strategically placed notices,
analytical tasks. Wherever possible
choose the e-waste recycling service to be mindful of their water usage.
we recycle waste paper, shredding it
providers. The practice of repairing The Maintenance and Engineering
first when it is necessary to preserve
and reusing electronic equipment Department continually monitors
confidentiality, and handing it to
was continued in 2022 particularly these procedures, and regularly
external parties. The Bank recycled
due to the restrictions in foreign handles water leaks and other
5,968 kg of paper in 2022.
exchange for imports. associated matters.
Natural capital
PEOPLE’S BANK
ABOUT
ENERGY CONSERVATION Energy Source Energy Type Consumption Level
AND EFFICIENCY
2022 2021
IMPROVEMENT
Energy Conservation Renewable Electricity 5,616.20 (GJ) 5,689.44 (GJ)
and Efficiency Non-renewable Fuel – Diesel 2,900.33 (GJ)
At People’s Bank we make every effort Fuel – Petrol 680.96 (GJ) 3,933.52 (GJ)
FROM THE TOP

REFLECTIONS
to maximise our energy efficiencies Total 9,197.49 (GJ) 9,622.96 (GJ)
in order to improve our sustainability
Energy intensity per employee Diesel (L) 38.6 (MJ per litre)
values. Electricity and transportation
1 kWh = 3.6 MJ
make up the bulk of our energy use, Petrol (L) 34.2 (MJ per litre) 7.64 (GJ)
with the latter cost coming from our
fleet of vehicles and business-related
travel. While logistical issues and fuel FUEL AND EMISSIONS Responsible Finance and
shortages have decreased travel, we MANAGEMENT Green Finance
VALUE CREATION
DRIVING
have continued to invest in electrical
We have taken measures to minimise Recognising that knowledgeable
systems and automobiles with low
the fuel consumption and emissions of employees are essential for good
energy consumption. As a part of
our transport fleet and business travel, financing, we train our staff on
our focus on renewable energy, a
by effective route planning, the use of environmental responsibility,
significant portion of this expenditure
green vehicles, and bulk transportation environmental due diligence in
is concentrated on installing solar PV
of materials. the loan process, and the indirect
systems in bank branches. We are
happy to report that this project has negative effects that may arise from
Bank has obtained the certification a lack of screening while offering
been expanded to branches around
AND ANALYSIS
for meeting the requirement of financial solutions. Additionally,
the nation as of 2022. (Solar was not
ISO 14064-1:2018 by B – Advancy the environmental impact of the
installed in 2022, proposed to install
Certification Lanka Private Limited Bank’s business activities, our clients’
50 in 2023) We use the following
for the year 2022. CEA licences, and other pertinent
procedures that are intended to
achieve our energy conservation goals: environmental rules are evaluated
before approval. Our rigorous controls
z Consider the “Energy Efficiency Reporting period: 1 January 2022
guarantee that we are responsibly
Ratio” of all new machinery and to 31 December 2022
financing customers who will support
electronic equipment to reduce Organisation: our environmental policy. By offering
energy usage People’s Bank, Sri Lanka specific loan programs to ecologically
z Deploy LED bulbs for lighting to Statement Number: friendly initiatives like the purchase of
save energy SL/PB/011020232 solar power systems and the purchase
REPORTS
GOVERNANCE
Date of Issue: of hybrid and electric vehicles, we also
z Purchase IT equipment with an
24 February 2023 support green financing.
energy-efficiency star rating
Level of assurance:
z Install inverter-technology
Reasonable
energy-efficient air conditioners and
perform preventative maintenance Total Emissions:
through on-time servicing and 4,366 tonnes of CO2e
repairs Direct Emissions:
STATEMENTS
FINANCIAL
z Use environmentally friendly 373 tonnes of CO2e

refrigerators Energy Indirect Emissions:
z Install soundproof, low-emission, and 1124 tonnes of CO2e
fuel-efficient generators with remote Other Indirect Emissions:
monitoring capabilities 2869 tonnes of CO2e
Biogenic Emissions: Zero
INFORMATION
SUPPLEMENTARY
Natural capital
ACTIONS FOR CLIMATE

Bank has taken several initiatives to
reduce the impact on climate change.
Below points can be mentioned in the
fight against climate change, meeting
UN sustainable development goals
by the Bank in year under review,
Greening of Bank branch buildings
Water conservation in branch offices
Community service projects to provide
clean drinking water and solar energy
supplies to underprivileged schools in
remote locations.
Reduction of paper use in Bank

operations, and conservation of
electricity in all buildings, promoting
digital interactions with customers and
staff Reduction of climate effects by
monitoring and limiting the use of air
conditioners.
COMPLIANCE
People’s Bank has demonstrated
100% compliance with all environmental
laws and regulations, and has not been
subject to any fines or sanctions during
the year.
FUTURE OUTLOOK
Environmentally conscious, sustainable
practices have been employed right
through the Bank’s operational system
and administration, and interactions
with staff and customers. We realise
that this is a vital facet of the Bank’s
personality and one of its greatest
strengths looking forward to future
developments. In the context of the
past year when financial resources
in general and foreign funds in
particular were in short supply we
saw the advantage of economising
on the use of precious natural capital.
We will continue to build on the
successes we have achieved and
ensure that People’s Bank will truly
be able to achieve the goal as the
most sustainable Bank in the industry.
PEOPLE’S BANK
ABOUT
137
FROM THE TOP

REFLECTIONS
GOVERNANCE
VALUE CREATION
DRIVING
138 / Risk Management Report
168 / Corporate Governance
194 / Board Subcommittee Reports
194 / Board Audit Committee Report (BAC)
AND ANALYSIS
195 / Board Human Resources and
Remuneration Committee Report (BHRRC)
196 / Board Integrated Risk Management
Committee Report (BIRMC)
197 / Board Executive Credit
Committee Report (BECC)
198 / Board Nomination
Committee Report (BNC)
199 / Board Investment Banking
Committee Report (BIBC)
200 / Board Information Technology
REPORTS
GOVERNANCE
Committee Report (BITC)
201 / Board Strategic Planning Review
Committee Report (BSPRC)
202 / Directors’ Statement on Internal
Control over Financial Reporting
204 / Auditor General’s Assurance Report
on Internal Controls
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
RISK MANAGEMENT REPORT
The dynamic changes in the world are the use of advanced technologies, agile The objectives of the Bank’s Integrated
reshaping the risk landscape. While delivery methodologies, and analytical Risk Management Framework are:
financial and non-financial aspects of tools offering a highly customised user z Assess and manage risk exposures
risk continue to shape risk management experience with lower fixed costs has of the Bank appropriately
decision-making, the dramatic effects of the potential to impact revenues and z Develop an effective system to
pandemics, war and conflicts between costs in certain areas of the banking
monitor the Bank’s risk exposures,
countries and international politics test business as well.
linked to the Bank’s capital
the operational resilience and agility
of banks. It has become imperative for As the leading Bank in digitalisation
z Establish a compliance mechanism
banks to re-evaluate their resilience with the largest customer base in to monitor compliance with internal
across all aspects of risk, flex between Sri Lanka, our digital transformation policies, particularly with regard to
physical and virtual footprints, and be and automation journey has proven risk management
adaptive to the changing dynamics. to be highly effective in conducting z Establish an effective
In a more digital world where there our operations and providing an communication mechanism to
is increased reliance on technology- uninterrupted service through the communicate all relevant policies
driven intelligence, cybersecurity and pandemic and economic stressed and procedures across the Bank
the protection of customer data has situation. The Bank’s sound Integrated z Adopt and support strong internal
become more important than ever, Risk Management Framework (IRMF) controls
as the Bank’s reputation depends helps to identify, assess, measure, z Nurture a strong risk culture within
on it. Being attuned to dynamic, mitigate, monitor, and report risks the Bank
predictive models to better understand comprehensively. Our operational
z Maintain risk governance within
customers and the associated risks preparedness and sound early
the best practices of industry
will enable to drive opportunities to warning risk indicators of potential
benchmarks.
create competitive advantage and disruption enabled us to navigate
growth. Furthermore, in a potentially the challenging year-showcase the
challenging economic environment, resilience of our Organisation. We THE BANK’S RISK
banks need to dynamically manage continue to adopt highest standards MANAGEMENT FRAMEWORK
credit portfolios and the risk functions for quality and integrity, which are
need to be closely integrally connected essential to our brand and reputation The Bank has a robust risk
with the entire operations of the Bank. and to make a lasting impact for management framework based on
It is also essential for banks to improve our stakeholders. All risk types are the Three Lines of Defence Model,
data availability and quality across the managed and reported in accordance Define Risk Universe, Risk Appetite
risk function to enable real-time sharing, with the Bank’s Integrated Risk Framework, Risk Governance
discussion, and feedback. Management Framework. All elements Framework and Risk Evaluation models
of our risk management framework and techniques including stress testing
The challenges posed by non-traditional function support prudent and to ensure a structured mechanism
new participants entering certain measured risk-taking, while striking to manage all risk exposures of the
segments of the market, disrupting the an appropriate balance between risk Bank. This is an integrated and holistic
traditional bank operating model with and return. system that manages risks effectively
throughout the Bank.
THREE LINES OF DEFENCE
FIRST LINE OF DEFENCE SECOND LINE OF DEFENCE THIRD LINE OF DEFENCE
BUSINESS LINES/CORPORATE RISK MANAGEMENT AND ASSURANCE

FUNCTION CONTROLS
Risk identification and ownership for Provide direction for risk management Providing independent and objective
the management of risk, ensuring and compliance, maintain an effective assurance on the risk exposure,
risks are within the Bank's accepted risk management policy framework processes and practices in place and
risk appetite and risk management and independent monitoring for ensure highest level of governance
policies. effective implementation of risk and compliance.
z Retail, corporate, and management framework. z Internal audit
enterprise banking z Risk Management Department z External audit
z Treasury z Compliance unit z Regulatory compliance
z Branch operations z Finance
z Information technology z Human resources
Risk Management Report
PEOPLE’S BANK
ABOUT
RISK CATEGORIES
The main risk categories of the Bank are credit risk, market risk, operational risk, liquidity risk, strategic risk,
compliance risk, reputational risk, legal risk, and IT risk including cybersecurity risk.
RISK UNIVERSE OF PEOPLE’S BANK

The risk universe of People’s Bank comprises all risk categories across all its business lines, functions,
FROM THE TOP

REFLECTIONS
geographical locations, and legal entities.
MANAGED BY THE BANK
ACTIVITIES LENDING FUNDING TRADE OPERATE COMPETE REGULATED
VALUE CREATION
DRIVING
RISKS Credit risk Liquidity risk Market risk Operational risk Strategic risk Compliance
risk
z Default risk z Equity risk z Commodity z People risk z Reputational z Legal risk
z Concentration z Interest rate risk z IT risk risk
risk risk z Exchange z Compliance z Business risk
z Rating rate risk risk
migration risk
z Business
AND ANALYSIS
continuity risk
z Cybersecurity
risk
RISKS MONITORED BY THE BANK TO ASSESS IMPACT
GEOPOLITICAL MACROECONOMIC REGULATORY
RISK APPETITE FRAMEWORK
REPORTS
GOVERNANCE
GROUP RISK MANAGEMENT FRAMEWORK
Credit Risk Market Risk Operational Risk Liquidity Risk Compliance Risk
Management Management Management Management Management
Framework Framework Framework Framework Framework
STATEMENTS
FINANCIAL
STRESS AND SCENARIO TESTING FRAMEWORK
CAPITAL MANAGEMENT FRAMEWORK

INFORMATION
SUPPLEMENTARY
Regulatory Capital Economic Capital
Strategic Plan ICAAP Under Basel III Performance Process Quality

Management Management
RISK APPETITE
Risk appetite expresses the aggregate level of risk that the Bank is willing to undertake to achieve its strategic objectives.
This is defined by a set of minimum quantitative metrics and qualitative statements. The risk appetite indicates the
maximum level of risk the Bank can assume before breaching regulatory constraints and its obligations to stakeholders.
This provides a framework for the Bank to drive sustainable performance by evaluating optimal growth options alongside
the risks involved. The risk appetite is reviewed and approved by the Board annually, to ensure alignment with the Bank’s
overall business strategy, business environment, and stakeholder requirements.
The risk profile of People’s Bank as at 31 December 2022 and 31 December 2021, compared to risk appetite, is given below:
Credit risk appetite Position as at
High risk Medium risk Low risk 31 December 31 December

2022 2021
NPL/Total advances (without pawning) (%) >6 3-6 <3.0 4.77 3.47
Overdue (%) >12 6-12 <6 12.87 5.11
Provision cover (%) <60 60-70 >70 79.9 74.8
P & L charge (%) >50 35-50 <35 162.10 49.38
Concentration (HHI Method) >0.25 0.25-0.15 <0.15 0.20 0.16
Recovery (%) <10 10-20 >20 13.44 13.00
TOD excess (%) >20 10-20 <10 11.76 18.45
Overseas exposure (OBU) (%) >5 3-5 <3 1.97 1.29
Operational risk appetite Position as at
High risk Medium risk Low risk 31 December 31 December

2022 2021
Operational losses - Internal frauds >5 1-5 0 4 4
Operational losses - External frauds (Pawning) >300 150-300 <150 194 82
Total operational losses to total operational

expenses (%) >1.0 0.5-1.0 <0.5 0.3 0.54
Systems availability (%)

High critical (%) <97.5 97.5-99.9 >99.9 99.9 99.91
Medium critical (%) <95 95-97.5 >97.5 99.2 99.53
Low critical (%) <87 87-90 >90 100 100
Percentage of branch audits rated less than

average >10 5-10 <5 5.6 9.61
RISK GOVERNANCE
The Bank’s risk management framework is founded on a governance approach that includes a robust committee structure
and a comprehensive set of corporate policies and limits, which are approved by the Board of Directors or its committees.
It also includes specific corporate standards and operating procedures. The Board of Directors hold the apex responsibility
for risk oversight and their priorities include determining risk appetite levels, formulating risk policies, and ensuring the
effective management of risk exposures. The Board is aptly assisted by several subcommittees and executive committees
in the discharge of duties related to risk management. This provides clear segregation of duties between risk origination
and approval of risk exposures whilst ensuring Board level oversight. The Board and the Risk Committees operate under
the directions of their respective charters.
PEOPLE’S BANK
ABOUT
The risk governance framework of People’s Bank is illustrated below:
BOARD OF DIRECTORS
Sets risk appetite
Responsible for limiting and monitoring
FROM THE TOP

REFLECTIONS
risk exposure
BOARD SUBCOMMITTEES
VALUE CREATION
DRIVING
Board Investment Board Integrated Risk Board Executive Board Audit
Banking Committee Management Committee Credit Committee Committee
(BIBC) (BIRMC) (BECC) (BAC)
Approves all Reviews and reports on Approves credit policies Review financial
investment related overall risk profile and procedures reporting process and
decisions and policies
relevant policies Reviews risk Approves large credit
management practices exposures Identify operational risks
AND ANALYSIS
and policies
Monitors and reports on Communicate and
Recommends overall portfolio quality encourage best
risk appetite to the practices and positive
Board quality assurance
throughout the branch
network
CEO/GM
REPORTS
GOVERNANCE
DGM-Risk Chief Information Compliance Chief Internal
Management Security Officer Officer Auditor
Management Committees
Credit Risk
Management
STATEMENTS
FINANCIAL
Asset and Credit Risk Operational Risk Information

Market Risk Liability Management Management Security Steering
Management Committee Committee Committee Committee
(ALCO) (CRMC) (ORMC) (ISSC)
Operational Risk
Management Monitors and Monitors and reviews Monitors and Monitors and
reports on market credit risk issues reviews operational reviews information
and liquidity risks risk issues security issues
INFORMATION
SUPPLEMENTARY
Other Risk Formulate clear

Management Reviews and credit policies
Liquidity recommends
Strategic related policies to
the Board
Reputational
Concentration etc.
FUNCTIONAL STRUCTURE OF THE INTEGRATED RISK MANAGEMENT

FRAMEWORK OF THE BANK
BOARD OF DIRECTORS
Board Integrated Risk Board Executive Credit Board Audit Board Investment
Management Committee Committee Committee Banking Committee
(BIRMC) (BECC) (BAC) (BIBC)
CEO/GENERAL MANAGER
Compliance DGM Chief Information Heads of Business Chief Internal

Officer Risk Management Security Officer Units Auditor
Risk Management Loan Review Unit Departments and

and Credit Control (Post Granted) Branch Network
Department
Credit Risk Market Risk Operational Risk

Management Unit Management Unit Management Unit
(Pre-Review) (TMO)
Regional Risks
Officers Direct reporting lines
Structured reporting lines
RISK CULTURE regularly to enhance their level of risk STRESS TESTING

awareness and provide the necessary
We promote a strong risk culture skills and experience to manage risks Stress testing is a key element of
throughout the Bank, as we believe related to their roles. our risk and capital management
that risk management is the frameworks. It is integrated into our
responsibility of every employee within The principles that underpin the risk enterprise and Group risk appetite
the organisation and institutionalise culture within our Bank include: statements and embedded in our
a positive risk culture within the management processes. To evaluate
Bank embodying values, beliefs,
z Defined risk appetites for risks taken our risks, we regularly test a range of
attitudes, and practices that drive by the Bank. scenarios which vary in frequency,
highly effective risk decisions. All z Every risk to be approved within the severity, and complexity in our
employees are responsible to manage risk management framework and portfolios, businesses, and across
and escalate risk whilst exhibiting adequately compensated. the enterprise.
responsible behaviour that supports a z Continuous monitoring and
strong risk culture. To strengthen the management of risks
risk culture, we train our employees
PEOPLE’S BANK
ABOUT
Stress testing is a simulation technique Stress testing is an integral aspect of Regular reviews are conducted by
adopted to determine how the asset the Bank’s Internal Capital Adequacy the BIRMC on the Bank’s stress testing
and liability portfolios react to different Assessment Process (ICAAP). We outcomes and the major assumptions
financial situations, which vary in assess the potential impact on the that underpin them. The outcomes
frequency, severity, and complexity. Bank’s risk profile and financial position are vital inputs for capital planning
This is conducted periodically, to including the potential impacts on for ICAAP, strategic planning, defining
ensure sufficient buffers of capital earnings, capital, and liquidity due to risk appetites, communicating with
FROM THE TOP

REFLECTIONS
and liquidity are available to meet macroeconomic and market variables. internal and external stakeholders,
unexpected losses and contractual All material risk types are included in and managing risk within defined
obligations. the stress testing exercise. parameters.
Given below is the stress testing process of the Bank.
STRESS TESTING
VALUE CREATION
DRIVING
CREDIT RISK MARKET RISK LIQUIDITY RISK OPERATIONAL RISK
y Deterioration in y Movements in y Effects from ‘hot y Based on the last 3

asset quality market interest rates money’/retail fund years (last 36 months)
y Shifts in stage y Movements in withdrawals average amount of
assets. market exchange y Effects from losses recorded
AND ANALYSIS
y Impact from ECL rates changes to asset • Based on the
elements • Movements in and liability volumes preceding year’s (last
market equity prices • Effect from 12 months) amount of
y Increase in asset losses recorded
quality from top 10 • Sensitivity analysis market value
borrowers. of pawning based on of Government
market gold price. Securities
y Increase in asset
quality from top 3 • Effects from volume
industries. changes to HQLA &
net cash outflow
y Increase in
normalised HHI
REPORTS
GOVERNANCE
MINOR, MODERATE AND MAJOR STRESSED SCENARIOS
Impact on Core Capital, Total Capital and the Capital Adequacy Ratio
Impact on Statutory Liquid Asset Ratio, Liquidity Coverage Ratio
NEW DEVELOPMENTS IN to manage continuous business – Corporate Loan Origination

STATEMENTS
FINANCIAL
RISK MANAGEMENT AT operations in a market wide or bank System

PEOPLE’S BANK specific stress situation z Completed review of Credit
Procedure Manual in line with latest
The following improvements were The Bank’s preparedness was credit risk environment and conduct
instituted to enhance the risk strengthened to deal with emerging awareness sessions for credit line
management framework of the Bank risks, which can surface without staff.
in 2022. warning. The following measures were
z Close monitoring and periodic
taken to deal with such emerging risks.
INFORMATION
SUPPLEMENTARY
z Implementation of Recovery
review of established credit limits
Plans (RCP) constituted by CBSL z Further enhancement and on exposure of State-Owned
Direction No. 09 of 2021 to identify streamlining of digitisation of Enterprises (SOE)
critical functions and critical work process with regard to credit
shared services of the Bank and
z Strengthen of stress testing
evaluation under,
define recovery options for same by covering more areas.
– Retail Loan Origination System
z Strengthen Information Security Standard (Information Security Adherence to the limits imposed for
Unit headed by Chief Information Management System) from 2023. liquidity risk management will continue
Security Officer (CISO). to be monitored. To strengthen the
z Maintenance of ISO 27001:2013 The credit post review function will be management of foreign currency risk,
Standard (Information Security strengthened by relocating credit post- currency-wise and tenor-wise limits
Management System) review unit at the Risk Management which have already been imposed will
and Credit Control Department which be closely monitored.
z Periodic review and assessment
encompass the close monitoring of the
of bank risk appetite statement
process. The Bank will be undertaking high
relevant to all risk dimension and
system availability to ensure an
wider use of same
Will continue close review of uninterrupted customer service and
z Further strengthening of credit concentration of the Bank, enhance customer confidence. Prompt
digitalisation work process and geographical limits, Borrower Risk attention to any adverse comments
customer on boarding Rating based limits, limits on State- about the Bank on social media will be
Owned Enterprises. positively taken care and will be used
to further safeguard the reputation of
FOCUS FOR 2023
Market risk of credit portfolio will be the Bank.
To mitigate the heightened IT risk due managed by imposing floating interest
to increased use of digital channels rates with floor rates on lending whilst On an ongoing basis, we will continue
for banking, we will expand our discouraging the granting of fixed- to identify, manage, and assess the
cybersecurity capabilities to defend interest corporate loan facilities. internal and external risks that could
against potential threats and minimise impede achievement of, or progress
the impact to the business, including We expect to strengthen the Project of, strategic objectives. Amendments
the activities to reinforce the Bank’s Finance and Rehabilitation Unit by to the strategic plan will be taken by
resilience to events caused by factors creating independence from credit the Management after discussion and
out of the Bank’s control. Further, the units to proper management of careful evaluation.
Bank will maintain the ISO 27001: 2022 stressed/sick businesses.
Principal risk How we manage it Key controls Change in risk level Focus for 2023
(Governance Bodies) from 2022 (increase/
decrease/static)
Credit risk (a) Accurate credit evaluations (a) BOD Increased Ensure a quality loan portfolio
including credit risk pre-review (b) BIRMC by strengthening credit
(b) Pre-defined strong credit line evaluation process, quality of
(c) BECC
with delegated credit authorities documentation and Providing
(d) BIBC continuous training for credit
(c) Project Finance and
(e) ECC staff.
Rehabilitation Unit
(f) ALCO Continuing the assignment of
(d) Re-structuring and Re-scheduling
(g) CRMC Regional Risk Officers (RROs)
(e) BRR and periodic review and
to assess credit quality
monitoring established portfolio (h) Risk Management
at branch level and take
limits on BRR. and Credit Control
remedial measures to rectify
Department
(f) Implementation of a comprehensive deficiencies if any.
limit set-up including SOE limits (i) Credit Review Unit
(Post grant) Maintain comprehensive limit
(g) Realisable Securities/Collaterals
set-up to ensure the credit
(h) Existence of an approved Credit risk is within the pre-defined
Procedure Manual (CPM) which had risk appetite level of the Bank.
been updated.
Focus on credit in the areas
(i) Continuous follow-ups (Including post
of transformation requirement
review)
of the country.
(j) Define credit risk appetite statement
of the Bank Proactive measurement
for distress/sick loans by
(k) Continuous staff training and
re-schedule, re-structure
development
and rehabilitation.
PEOPLE’S BANK
ABOUT
decrease/static)
Credit Managing limits relevant (a) BOD Static Manage Sector/Counterparty

concentration to concentration risk (b) BIRMC HHI within the industry
risk - Portfolio wise risk outlook and within
(c) BECC
FROM THE TOP

REFLECTIONS
risk appetite tolerance
- Sector/industry wise
accordingly.
- SBL/MAL
- Measurement of HHI
Market risk (a) Floating rate (a) BOD Increased Managing market risk
(b) NOP limits (b) BIRMC exposure within the set limits
and parameters.
(c) Portfolio limits – Trading/AFS/HTM (c) ALCO
VALUE CREATION
DRIVING
(d) Stress testing (d) BIBC Closely monitor the pricing
of assets and liabilities in line
(e) Monitoring of market risk drivers (e) Treasury Middle
with the market condition.
and triggering events Office (TMO)
(f) Stop loss limits
Interest Limit set-up for interest rate risk (a) BOD Increased Maintaining interest rate risk
rate risk (a) Floating interest rates (b) BIRMC within prudential limits to
maximise benefits in possible
(b) Narrow down maturity mismatches (c) ALCO
interest sensitivity trends.
(c) Deployment of D-Gap Analysis (d) TMO
AND ANALYSIS
and stress testing on interest rate (e) BIBC
Equity risk (a) Portfolio Limit set-up (a) BIRMC Increased More focus on macro-
– Quoted/unquoted (b) BIBC economic factors, share
market movements and
– S&P SL 20/ASPI (c) ALCO
company performances
– Trading/AFS (d) Risk Management to manage investments
(b) Stress testing on equity stocks Department accordingly.
(c) Stop loss limits
Foreign (a) Limit set-up (a) BOD Increased Manage FX position within
exchange set limits and constructively
REPORTS
GOVERNANCE
– NOP limits (b) BIRMC
risk handle the FX liquidity
– Intraday and other limits (c) ALCO
position of the Bank.
– Counterparty limits (d) TMO
– Dealer limits
(b) FX Derivatives
(c) FX Maturity Gap Analysis
(d) VaR computation
STATEMENTS
FINANCIAL
Liquidity (a) Maintain LCR, SLAR with a (a) BOD Increased Ensure maintain of regulatory
risk sufficient buffer (b) BIRMC limits with a sufficient buffer.
(b) Managing SOE exposure (c) BIBC Consider liquidity position
(c) External funding arrangements (d) ALCO when granting credit facilities.
(d) Manage ADR Strengthen local and
(e) Manage maturity Gaps international bilateral
relationships.
INFORMATION
SUPPLEMENTARY
(f) Contingency funding plan

decrease/static)
Operational (a) Regional Risk Officers (RRO) (a) BOD Increased Ensure sufficient amount of
risk (b) Regional Audit Teams (b) BIRMC controls and processes are in
place and relevant business
(c) Risk and Control Self-Assessment (c) BAC
activities are monitored and
(RCSA) (d) ORMC evaluated by independent
(d) Continuous training and (e) Internal Audit authority levels.
developments
(f) Risk Management Strengthen the RROs job
(f) Use of digital workflows Department function.
(g) Monitoring of operational risk limits
Continuous review of
(h) Whistle-blowing policy
policies, procedures on
(i) Maintain and review operational operational risk.
loss database
(j) Sufficient insurance coverage
for operational losses
(k) Sufficient internal controls
(j) Fraud risk policy
People (a) Code of Conduct (a) BOD Increased Maintain HR operational

risk (b) Disciplinary procedure (b) BHRMC excellence and retention
of talents.
(c) Equal opportunities with (c) HR Department
talent mapping Succession planning and
(d) Social protection application of strategic
HRM methods.
(e) Continuous training and development
(f) Use of SHRM methods Implementation of new
HRM system
(g) Succession planning
(h) Performance base evaluations
Information (a) Advanced secured systems (a) BOD Increased Minimise the risk associated
technology/ (b) Implement IS governing policies (b) BIRMC with manual process by
Information improving the digitalisation
(c) DR Plan/DR Centre (c) BITC
security risk process further.
(d) Access controls (d) IT Steering
Committee Proactively identify the
(e) Licensed software
IT/IS risk (if any) to take
(f) Maintain IT credentials/standards (e) IT Department
measure and address them
(g) IS audit (f) ISSC immediately.
(h) Implementation of Information (g) ISOC
Ensure data protection and
Security Unit headed by CISO (h) IS Department securitisation of system
(i) ISC sustainability.
Allocation of sufficient IS staff

for IS Unit, Risk Management
Department and Internal
Audit Department.
Compliance (a) Standards for integrity and ethics (a) BOD Static Ensure compliance with
risk (b) Continuous awareness of staff (b) BIRMC relevant rules and regulations
by strengthening the
(c) AML/KYC/CFT policies (c) BAC
compliance systems of
(d) Review of STR/CTR (d) ORMC the Bank.
(e) Regional Compliance Officer (e) Internal audit
(f) Legal Department
(g) Compliance
Department
(h) Company Secretary
PEOPLE’S BANK
ABOUT
decrease/static)
Strategic (a) Timely implementation of (a) BOD Static Focus on changing

risk the strategic plan (b) BSPRC environments, business
(b) Innovative market presence models and customer
(c) Strategic Planning
FROM THE TOP

REFLECTIONS
behaviour relevant to
(c) Direct the Bank within values Department
financial institutions.
and mission statement
(d) Periodic review of strategic actions Successful implementation
of the new strategic plan.
(f) continuous monitoring of KPIs/
STRACTIONS Prudential strategies to go
with new vision statement
of the Bank
VALUE CREATION
DRIVING
Reputational (a) Continuous local and international (a) BOD Static Improve brand value in line
risk awards for multidimensional aspects (b) BIRMC with customer satisfaction,
(b) Existence of sixty years business dynamics through
(c) Marketing
digital improvements.
(c) State ownership Department
(d) Improvement in KPIs Monitoring of Reputational
risk parameter within
(e) Maintaining largest network
acceptable levels.
(f) Maintain business ethics and
value at all touch points Improve digital on boarding
of customers
AND ANALYSIS
(g) Range of brands
(h) Comply with regulatory
and legal requirements
(i) CSR activities
(j) Efficient complaint management
(k) Incorporation of key
Reputational risk dimensions
parameters to Risk Dashboard.
REPORTS
GOVERNANCE
CREDIT RISK OBJECTIVES OF MANAGING MANAGING THE CREDIT RISK
Credit risk is one of the Group’s CREDIT RISK Credit risk accounts for over 87% of
key risk exposures, stemming from
z Maintain a well-diversified portfolio the Bank’s risk-weighted assets. Hence,
the loans and advances portfolio,
through prudent management of the credit risk management is an ongoing
financial guarantees, letters of credit,
credit portfolio process beyond mere regulatory
and acceptances issued and made
z Achieve an optimal risk-reward pay- compliance, conducted under the
on behalf of the customers. The risk
off through maximised returns credit risk framework approved by
arises due to the potential loss arising
STATEMENTS
FINANCIAL
the Board. The framework includes a

from the failure of a customer or a z Maintain a high portfolio quality and
risk governance structure including
counterparty to meet their contractual minimise Stage 3 classified loans
policies, procedures, segregation
obligations to the Bank. Default risk, z Pre-identification of potential credit of authority, risk ratings, collateral
concentration risk of counterparties,
risk with changing macroeconomic management, and credit review/
Rating migration risk, and business
and industry factors monitoring.
sectors or geographical regions are
the forms of credit risk. In addition,
INFORMATION
SUPPLEMENTARY
the current adverse macroeconomic

factors have been seriously affected on
increase of credit risk.
GOVERNANCE STRUCTURE OF CREDIT RISK
BOARD OF
DIRECTORS
BECC BIRMC BAC
CRMC CEO/GM
Heads of DGM Chief

Business Units Risk Management Internal Auditor
AGM AGM
Risk Management Loan Review Unit
The Board Executive Credit Committee credit policy – which is approved by redelegate approval limits to credit
(BECC) provides oversight to the the Board – defines the Bank’s credit committees and business lines. Each
Bank’s credit risk management. The culture, prudential limits in line with the business line has clearly articulated and
responsibilities of the BECC include: defined risk appetites, and remedial approved multi-level risk acceptance
z Formulating and updating credit and recovery actions. criteria and credit approval authority.
policies in consultation with the All post-disbursement material
BIRMC and business units changes to a credit facility (such
2. Culture of responsible
as revision in tenure, covenants, or
z Establishing credit approval lending collateral structure) need approval.
structures to handle larger and
A culture of risk awareness and Segregation of responsibility for risk
higher risk exposures
responsible lending is nurtured assessment and post-monitoring
z Conducting periodic reviews of across the Bank through a robust facilitate effective implementation
individual credit exposures and the internal communication process of credit appraisal guidelines and
overall portfolio to eliminate undue and staff training programmes. specialisation of skills.
risk concentrations Whilst customers are given adequate
z Effective management of higher risk explanations about the credit on offer, Credit approval authorities are
exposures and ensuring adequacy of a thorough customer credit evaluation assigned to individuals according to
provisions is conducted prior to offering credit their respective grade and periodic
z Developing and maintaining the risk facilities or increasing the credit limit. reviews are carried out.
rating systems The internal credit rating models
represent diverse risk factors and
z Sanctioning or declining credit 4. Risk rating of obligors
predict the probability of default
proposals above a predefined limit and prudential limits
and loss.
The Bank evaluates the
MANAGING CREDIT RISK 3. Segregation of authority
creditworthiness and assign ratings
to borrowers by adopting a range
1. Robust risk policies and The final authority and responsibility of measures including in-house
control framework for all credit risk exposures is vested assessment methodologies, scorecards,
The credit risk framework is reviewed with the Board of Directors. Approval and a nine-points rating scale. Each
and updated regularly by the BECC, for credit authority limits have been category of borrower has different
based on evolving best practices and delegated to the BECC by the Board. risk rating scorecards, which are
emerging risks and opportunities. The The BECC has the authority to periodically reviewed and validated by
the BIRMC.
PEOPLE’S BANK
ABOUT
5. Credit risk mitigating and proposals. The credit officers have CREDIT RISK
collateral management the relevant expertise and experience PERFORMANCE REVIEW
to manage the credit risks of their
Diverse methods are applied to customers. Every credit officer/ Net loans and advances have
mitigate potential credit losses from relationship manager is responsible to downsized by 7.3% YOY basis to
any given account, customer, or monitor the credit of their respective LKR 1,732.15 Bn. at the end of 2022,
portfolio. These include structuring, portfolio of borrowers on an ongoing which represented above 55% of
FROM THE TOP

REFLECTIONS
collateral, netting agreements through basis. Periodic credit review reports the total assets in the Statement of
credit insurance, credit derivatives, and are submitted to BIRMC and CRMC Financial Position at the end of the
guarantees. Collaterals are obtained for further review and monitoring of reporting period. Asset quality of the
according to the Bank’s collateral credit risk. loan portfolio shows deteriorated
policy and the main types of collaterals position from 3.21% to 4.4% by the end
are movable and immovable property of the year. Slow recovery of adverse
mortgages, cash deposits, plant and 7. Impairment economic condition due to negative
machinery, mortgages on stocks, A comprehensive and robust macro variable coupled with dollar and
book debts, corporate, and personal rupee liquidity restrictions contributed
VALUE CREATION
DRIVING
impairment policy is in place to
guarantees. deal with defaulting customers. The to the slow growth of the loan book
provision for loan impairment is and assets quality to be remain
recorded as a reduction of the carrying deteriorated level within the industry.
6. Credit monitoring
and review amount of the loan in the balance
sheet. Provisions for loan impairment
Credit risk positions are actively are made in the income statement
monitored and managed on an and impairment assessments are
ongoing basis. Credit monitoring conducted for all exposures of the
AND ANALYSIS
is conducted by the credit officers Bank. Loan impairments are calculated
attached to business units. Risk and accounted by Finance Department
Management and Credit Control and the verification are done by Risk
Department independently done the Management and Credit Control
pre-review and post-review of credit Department.
RISK PROFILE OF CORPORATE CUSTOMERS
Nos.
125
REPORTS
GOVERNANCE
100
75
50
25
STATEMENTS
FINANCIAL
0
AAA AA A BBB BB B CCC CC C
2020 2021 2022
Maximum credit exposure of People's Bank

INFORMATION
SUPPLEMENTARY
Risk rating AAA AA A BBB BB B CCC CC C
Number of 31 December 22 17 51 87 82 54 34 13 19
Corporate
Customers 31 December 21 11 52 87 95 58 38 19 19
CREDIT MIGRATION RISK DEFAULT RISK Further credit risk is managed by

identifying early warning signals
Migration risk is a credit risk that Default risk is the potential loss of distress business entities prior
occurs due to the deterioration of arising as a result of the borrower to trigger in default position and
the credit rating of a borrower over a or counterparty not fulfilling the such entities are treated with
period, which then triggers the decline contractual obligations on a loan comprehensive restructuring process
of creditworthiness. This is evidenced agreement. which is resulting a smooth pay back
by the down grading of the customer method for the customer to overcome
credit rating. The Bank closely A healthy portfolio was maintained difficult situation. In case the business
observes the credit rating migration through stringent credit evaluations, entity is unable to restructure, the
of corporate customer portfolios in post-disbursement monitoring, and a rehabilitation process will be applied.
periodical manner. The number of high collection ratio. The Bank’s Stage
corporate customers downgraded 3 asset ratio is 12.78% for 2022.
over the last five years is given in the CONCENTRATION RISK
table below:
Managing default risk Concentration risk is the level of
risk in the Bank’s loan and advances
year Number of percentage of All our credit exposures are closely
customers in downgraded
portfolio arising from concentration
monitored on a continuous basis using
transition customers to an individual counterparty, industry
risk management tools such as Stage 3
sectors, or geographic regions. As a
assets/overdue analysis, rating migration
2018 322 19 state-owned bank, People’s Bank has
analysis etc. Robust processes are in
2019 318 20 acquired exposures to State-Owned
place to identify at an early stage, credit
Enterprises (SOEs), pawning, and
2020 320 21 exposures which have high risk of loss.
housing financing aligned to the
2021 321 11
Such exposures are generally placed on
Government’s development agenda.
a watch list and are managed closely to
2022 329 14
maximise recovery.
Concentration of large exposures (over LKR 100 Mn. as at 31 December 2022)

As at 31 December Number of Number of Direct Indirect Total Direct exposure
industry sectors individual exposure exposure as a percentage
customers LKR Mn. LKR Mn. LKR Mn. of balance sheet
With SOE 18 385 977,678 172,114 1,149,792 54.83
Without SOE 17 343 207,997 45,998 253,995 11.66
Position of Bank’s Top 20 customers contingent) based on counterparty

as at 31 December 2022 name and sector. The Bank’s portfolio
is segmented into 17 industry sectors.
Year Top Top Top Top The table below shows the tolerance
3% 5% 10% 20% levels for each degree of concentration.
Further, the Bank has implemented
Including SOE
individual limits for industry/sectors as
2021 60 68 77 83 well as individual limit setup for SOEs to
2022 52 62 71 78 manage concentration risk.
Excluding SOE Metric Low Moderate High

2021 10 14 24 38 concen- concen- concen-
tration tration tration
2022 11 17 29 45
HHI <0.15 0.15 - 0.25 >0.25
Managing concentration risk

The measures adopted to monitor and control concentrations are the single
borrower limit and the Herfindahl-Hirschman Index (HHI). HHI is calculated for all
exposures (the greater of limit or outstanding) above LKR 100 Mn. (Direct and
PEOPLE’S BANK
ABOUT
People’s Bank’s quarterly position for the financial year 2022
31 March 30 June 30 September 31 December
2022 2022 2022 2022
Name concentration (with SOE) 0.14 0.18 0.15 0.15
Name concentration (without SOE) 0.01 0.01 0.01 0.01
FROM THE TOP

REFLECTIONS
Sector concentration (with SOE) 0.17 0.20 0.17 0.17
Sector concentration (without SOE) 0.14 0.14 0.13 0.13
Credit risk stress testing

Credit risk stress testing is conducted to determine how certain scenarios impact the Bank’s capital adequacy levels.
The stress testing report is forwarded to the BIRMC for review.
VALUE CREATION
DRIVING
Minor Moderate Major
Increase in Impairment Impact on CAR – In High-Risk Environment

Transition from Stage 1 bucket to Stage 2 bucket Magnitude of Magnitude of Magnitude of
shock – 5% shock – 10% shock – 15%
Revised core capital ratio 11.74 11.59 11.45
Revised total capital ratio 16.16 16.01 15.87
AND ANALYSIS
Transition from Stage 2 bucket to Stage 3 bucket Magnitude of Magnitude of Magnitude of
Simultaneous Transitions from Stage 1 bucket to Magnitude of Magnitude of Magnitude of

Stage 2 bucket and Stage 2 bucket to Stage 3 bucket shock – 5% shock – 10% shock – 15%
Shock in Probability of Default Magnitude of Magnitude of Magnitude of

REPORTS
GOVERNANCE
Shock in Loss Given Default Magnitude of Magnitude of Magnitude of


STATEMENTS
FINANCIAL
Shock in Probability of Default and Loss Given Default Magnitude of Magnitude of Magnitude of
Defaults by large borrowers Magnitude of Magnitude of Magnitude of

shock – 5% shock – 7.5% shock – 10%
INFORMATION
SUPPLEMENTARY

MARKET RISK Objectives of market risk management

Market risk is the probable loss that z Optimise the risk-reward relationship of business units within
could arise due to movement in market the predefined risk appetite
driven variables such as interest rates, z Avert exposure to unacceptable losses
exchange rates, equity prices, and
z Ensure all operations of the Bank are within the defined risk appetites
commodity prices. The Bank’s key
market risk categories are interest rate
risk, foreign exchange risk, equity risk, Market risk exposure of People’s Bank
and commodity risk.
2022 2021
People’s Bank is exposed to market Trading Book Banking Book Trading Book Banking Book
risk mainly from the interest rate risk LKR Mn. LKR Mn. LKR Mn. LKR Mn.
arising from trading book and banking
book and its exposure to gold prices Assets
through its pawning portfolio. The Treasury Bills 4,443 2,296 273 –
Bank’s exposure to foreign exchange
Treasury Bonds 872 898,577 1,004 573,471
risk is moderate due to proprietary
trading and foreign currency denoted SLDB – – – 2,678
transactions of the Bank. Exposure to GOSL Bonds – 7,689 – 7,689

equity risk is limited due to the low Other investments 242 18,810 282 15,184
trading portfolio.
Liabilities
Debentures – 36,603 – 48,862
GOVERNANCE STRUCTURE OF MARKET RISK
BOARD OF
DIRECTORS
BIBC BIRMC
ALCO CEO/GENERAL
MANAGER
DGM DGM DGM

(Treasury, IB and FI) (International Banking) (Risk Management)
Treasury Front Office including Treasury Back Office Treasury

Primary Dealer Unit and IBU (Settlement Department) Middle Office
At the Board level, the BIRMC has the responsibility to monitor the Bank’s market risk exposure, formulate policies and risk
appetite limits and provide recommendations to the Board on management of market risk.
At executive level, the Asset and Liability Committee (ALCO) is responsible to implement the market risk management
framework and maintain the market risk exposures within the defined risk appetite. The Risk Management Department is
responsible for the daily risk management activities, including market risk assessment, monitoring, and reporting.
PEOPLE’S BANK
ABOUT
The Treasury Middle Office (TMO) Market risk limits and positions as at 31 December 2022
measures and monitors the Bank’s
treasury transactions independently Market risk Market risk appetite
from the Treasury Front Office and Approved limit Year ending
Back Office functions. The TMO 31 December 2022
ensures compliance to risk limits
set by the Board. FX net open position USD+ 30 Mn. Complied
FROM THE TOP

REFLECTIONS
USD - 25 Mn.
Managing market risk Value at Risk (VaR)
(Conf. Level 99%, 1 day) – Currency USD 250,000 Breached*
A combination of policies, risk
assessment measures and risk limits – Interest rate USD 150 Mn Breached*
are used to manage market risk.
Cumulative Losses
– FX trading USD 175,000 Complied
1. Policies
VALUE CREATION
DRIVING
– FIS trading (realised) LKR 25 Mn. Complied
The Bank’s market risk management
– (unrealised) LKR 500 Mn. Complied
policy framework includes several
policies including the asset and Forward FX gap limit USD 600 months millions Complied
liability management policy, treasury GOSL securities – Trading LKR 250 Bn. Complied
management policy, foreign exchange – Investment LKR 1,000 Bn. Complied
risk policy, and stress testing policy.
– AFS LKR 20 Bn. Complied
These policies provide the framework
for risk identification, assessment, International sovereign bond – Trading USD 20 Mn. Complied
AND ANALYSIS
mitigation, monitoring, and reporting – Investment USD 200 Mn. Complied
of all market related risks.
Sri Lanka Development Bonds (SLDB) USD 750 Mn. Complied
Interbank borrowings – Total limit USD 723 Mn. Complied

2. Risk assessment
– Short-term limit USD 181 Mn. Complied
The tools adopted for market risk
Present Value Basis Point (PVBP) Limit LKR 25 Mn. Complied
assessment include value at risk (VaR),
duration gap, sensitivity analysis, and Gilt unit trust LKR 2.5 Bn. Complied
stress testing. The valuation rates Corporate debt limit (Debentures) LKR 15 Bn. Complied
and methodologies are subject to
Reverse REPO limit for Non-Bank PDU LKR 1 Bn.
independent verification.
– Hair cut limit 10% Complied
REPORTS
GOVERNANCE
Limit for swap funds 75% of O/S for a tenor of
3. Market risk limits
less than 3 months Complied
Market risk limits are assessed Interest rate risk
and recommended to ALCO and (D-Gap +VaR on Fwd. FX) LKR 16.5 Bn. Complied
thereafter referred to BIRMC approval.
Investment value of share trading portfolio Port1: LKR 1,000 Mn. Complied
Limits such as open position limits,
counterparty limits, and dealer limits Port2: LKR 1,000 Mn. Complied
are defined based on approved market Stop loss limit (Share trading) 30% Complied
STATEMENTS
FINANCIAL
risk limits. The limits are monitored

Percentage of shares on the S&P SL20 Index Min 25% Complied
based on product, sector, credit rating,
and geography. The TMO monitors *Due to market volatility in exchange rates and interest rates.
performance against the limits and
reports to ALCO on a monthly basis.
4. Action trigger points
These limits are regularly reviewed
by ALCO based on potential market The risk thresholds that trigger specific management action are specified in order
dynamics and if necessary, the limits to ensure market risk exposures are maintained within the levels defined by the
INFORMATION
SUPPLEMENTARY
are revised to narrower bands. risk appetite statement.

MARKET RISK REVIEW overall market risk although the socio- Managing interest rate risk
economic impact of the country has
Market risk, also known as systematic a direct and substantial impact on the The power to approve the risk appetite
risk, refers to the uncertainty Bank’s operations to a certain extent. for interest rate risk and set the overall
associated with any investment The Bank has strictly complied with limits for VaR and earnings at risk
decision and it is not specially the guidelines and directives issued by (EAR) are vested with the Board.
associated only with the company the Government and the Central Bank
or the industry, but on various of Sri Lanka in a professional manner The guidelines for identifying,
macroeconomic variables associated by reviewing the market condition measuring, managing, and reporting
with the financial market, such as regularly. compliance of all interest rate risk
inflation, interest rates, the balance of positions in the banking and trading
payments situation, fiscal deficits and books are provided by the Bank’s
policies and geopolitical factors, etc. Interest rate risk (IRR) market risk policy. The Treasury is
Market risk of the Bank is derived from The Bank’s exposure to interest rate responsible for managing the interest
the supply and demand forces mainly risk arises as a result of the net interest rate risk within the risk appetite whilst
relevant to interest rates, exchange income being impacted by extreme the Middle Office is responsible for
rates and equity prices in the market fluctuations in market interest rates. monitoring the interest rate risk.
and it is having a high sensitivity on This has a potential impact on the
the Bank’s earnings or the economic underlying interest-bearing assets, Techniques such as duration gap
value of its capital to adverse changes interest-bearing liabilities, and analysis, VaR, and Earnings at Risk
in aforementioned key sources. The off-balance sheet items. (EaR) are adopted to measure the
Bank manages and mitigates its market interest rate risk. The duration gap and
risk properly by ensuring stringent Subcategories of interest rate risk: overall exposure to interest rate risk is
policies and procedures which are in ascertained by grouping rate sensitive
z Repricing risk – arises due to the
place to manage various aspects that assets and liabilities based on their
timing difference in repricing Bank
contribute to market risk through a maturity period.
assets and liabilities with varying
well-defined governance structure.
maturities
This has allowed for market risks to ALCO is responsible for making
be identified, assessed, controlled, z Basis risk – arises from the decisions on repricing the Bank’s asset
and reported to ensure that the Bank differences in actual interest margin and liability portfolio and continuously
operates within the allocated risk and expected interest margin of the monitoring the maturity mismatches
appetite levels. The Bank’s Treasury banking book and the implied cost and trends in market interest rates. The
has complied with approved limits in of funds potential impact on Bank’s earnings
place in much extent and approvals z Yield curve risk – arises from and capital due to changing economic
were obtained to manage risks in negative impact on the Bank’s indicators is gauged by regular stress
foreseeable manner, managing the earnings/asset values due to shifts testing on IRR exposures of the
in the yield curve banking and trading books.
Interest rate risk is measured and

Earnings at risk over one year horizon (net impact of 1%) monitored monthly and taken up for
discussion at ALCO meetings.
Up to 1 month 1-3 3-6 6-12
months months months
Net assets (LKR Mn.) 93,263 (1,031) (89,670) (950,681)
Loss for change in 1% (LKR Mn.) 38.33 (1.72) (336) (7,130.11)

PEOPLE’S BANK
ABOUT
ALM mismatches
2022 Up to 1 month 1-3 months 3-6 months 6-12 months 1-3 years 3-5 years Above 5 years
LKR Mn. LKR Mn. LKR Mn. LKR Mn. LKR Mn. LKR Mn. LKR Mn.
Rate sensitive assets 386,829 269,247 434,129 216,713 189,525 293,750 917,701
Rate sensitive liabilities 270,278 523,799 1,167,395 23,453 27,971 128,856 296,031
FROM THE TOP

REFLECTIONS
Period gap 116,551 (254,552) (733,265) 193,261 161,554 164,894 621,670
Cumulative gap 116,551 (138,001) (871,266) (678,005) (516,451) (351,557) 270,113
2021 Up to 1 month 1-3 months 3-6 months 6-12 months 1-3 years 3-5 years Above 5 years
LKR Mn. LKR Mn. LKR Mn. LKR Mn. LKR Mn. LKR Mn. LKR Mn.
Rate sensitive assets 309,297 225,075 323,262 603,621 156,123 191,839 607,587
VALUE CREATION
DRIVING
Rate sensitive liabilities 535,995 347,556 265,952 1,166,484 27,390 52,370 3,232
Period gap (226,698) (122,481) 57,310 (562,863) 128,732 139,469 604,355
Cumulative gap (226,698) (349,179) (291,869) (854,732) (725,999) (586,531) 17,824
IMPACT ON MV OF EQUITY DUE TO 1% ADVERSE INTEREST RATE CHANGE USING DURATION GAP ANALYSIS
LKR Mn.
-10,000
AND ANALYSIS
-13,000
-16,000
-19,000
-22,000
-25,000
Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.
22 22 22 22 22 22 22 22 22 22 22 22
REPORTS
GOVERNANCE
Impact on MV of equity 2022 Limit
IRR stress testing

Magnitude of Magnitude of Magnitude of
shock – 0.25% shock – 0.50% shock – 1.00%
STATEMENTS
FINANCIAL
2022
Impact on earnings (LKR Mn.) 4,327 8,654 13,054
Revised overall CAR (%) 15.86 15.41 14.97
2021
Impact on earnings (LKR Mn.) 3,966 7,932 15,863
INFORMATION
SUPPLEMENTARY

Interest rate risk review Managing foreign the Front, Middle, and Back Office
exchange risk functions of the Treasury Department
Interest rate risk arises from ensure an effective internal control
unanticipated movements/fluctuations Foreign exchange transactions are mechanism. Monitoring of open
in the interest rates due to market governed by a stringent regulatory positions, assets and liability maturities,
conditions and the monetary policy framework. Whilst the CBSL sets the currency exposures, and aggregate
measures undertaken by the Central approval mechanism and limits, the exposures are independently
Bank of Sri Lanka will affect the Bank sets stringent volume limits conducted by the Middle Office.
exposure of the Bank’s financial within the regulatory confines and
condition and future cash flows or fair limits defined by ALCO on open VaR calculations and stress testing are
values of financial instruments. Risk positions for individual currency carried out on portfolios exposed to
arising from movement of interest exposures and aggregate exposures. FOREX risk. Parallel VaR calculations
rates time to time during the period Risks arising from FOREX maturity are conducted by the Bank’s Treasury
was able to manage through timely gaps within the Bank’s risk appetite are Management System (based on
review of changes in the underlying managed through forward maturity Finacle) and the internationally
value of Bank’s assets, liabilities gap limits. The Treasury Department accepted Bloomberg system. The
and off-balance sheet items and its is responsible for the overall potential impact on the Bank’s
economic value and the necessary management of FOREX risk. The profitability and capital adequacy levels
actions were in place at the right time clear segregation of duties between are measured through stress testing.
Accepting interest rate risk is an

integral part of the banking business Position as at 31 December 2022
and may even be an important
Currency Net exposure FC Net exposure Rupee
source of profitability and improve
equivalent (’000) equivalent (’000)
shareholder value if the market
opportunities are captured at right US Dollar 34,594 12,670,112
time. The Bank has taken adequate
Euro (412) (160,866)
measures to identify, monitor, control,
and report interest rate exposures Great Britain Pound (10,812) (4,767,822)
primarily through ensuring compliance Japanese Yen 23,956 66,599
to the prescribed limits. The Bank
Singapore Dollar (596) (162,816)
carries a significant portfolio of
Government Securities and the amount Chinese Yuan renminbi (6) (307)
of risk associated with the same Australian Dollar (10,694) (2,661,361)
depends on how sensitive its prices are Other – 235,340
to interest rate changes in the market.
Supervision and close monitoring are
in place to ensure adherence to all Exchange rate risk stress testing
internal and regulatory risk mitigation
initiatives and trends in market interest Magnitude of Magnitude of Magnitude of
rates, thereby managing the interest shock – 5% shock – 10% shock – 15%
rate risk in a prudent manner.
2022
Impact on earnings (LKR Mn.) 207 414 621
Foreign exchange risk
Foreign exchange (FOREX) risk arises
as a result of the Bank’s earnings 2021
and/or capital being impacted due Impact on earnings (LKR Mn.) 151 301 452
to adverse fluctuations in exchange
rates. The Bank’s exposure to FOREX
risk arises from foreign currency
denominated transactions such
as import/export transactions,
remittances, and proprietary trading.
PEOPLE’S BANK
ABOUT
MONTH END FX NOP AND DAILY VAR DURING 2022
NOP – USD Mn. VaR – USD

60 1,100,000
48 880,000
FROM THE TOP

REFLECTIONS
36 660,000
24 440,000
12 220,000
0 0
Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.
VALUE CREATION
DRIVING
22 22 22 22 22 22 22 22 22 22 22 22
Limit NOP USD Mn. 2022 VaR USD 2022
FOREIGN EXCHANGE EQUITY PRICE RISK Investment Banking Committee (BIBC).

RISK REVIEW The procedures, tools, and techniques
A decline in market value of an equity for managing equity risk – including
Foreign exchange risk is the potential or a share portfolio due to fluctuations volume and stop loss limits- are clearly
loss arising from fluctuations of value in in equity prices gives rise to equity articulated by the Board approved,
AND ANALYSIS
a financial instrument due to changes price risk. The Bank’s exposure to Investment Banking Policy Manual.
in foreign exchange rates which is equity price risk stems from the The movement in share market
also a financial risk that exists when a available-for-sale investment portfolio, prices, performance of entities, and
financial transaction is denominated excluding the strategic investments the macroeconomic conditions are
in a currency other than the domestic in subsidiaries. The Bank’s equity risk regularly monitored by the BIBC.
currency. Due to the lack of liquidity in exposure is relatively limited as a result
the USD interbank foreign exchange of the low investments in equity shares. Independent evaluations on proposed
market and due to the pressure on the equity transactions, impairment
USD/LKR exchange rate, the Bank,
Managing equity risk assessments, and exposures against
industry and the entire country faced limits are carried out by the market
several challenges during the past year The formulation of policies related risk function operating under the
REPORTS
GOVERNANCE
and the critical situations are managed to investments and managing of Bank’s Risk Management Department.
by the Bank with the assistance of investments within the defined risk The Unit also maintains independent
Central Bank of Sri Lanka. Further, appetite is conducted by the Board oversight over the non-traded equity
the Bank Treasury ensured that the risk framework.
adherence to the strict FX limits,
maintains FX net open position as well
as individual currency positions within Stress testing of equity risk
the permitted parameters at all times,
Magnitude of Magnitude of Magnitude of
STATEMENTS
FINANCIAL
and has enabled the Bank to manage

the foreign exchange risk prudently.
Stringent risk tolerance limits are Impact to maximum market value
defined and are independently of equity portfolio (LKR Mn.) 69 138 275
monitored daily. This allows the Impact to fair value of
treasury dealers to operate within strategic equities (LKR Mn.) 19 38 75
these boundaries and mitigate the risk
Total impact (LKR Mn.) 88 175 351
emanating through these exposures by
INFORMATION
SUPPLEMENTARY
ensuring that potential losses arising

out of fluctuations in FX rates are
minimised and maintained within the
Bank’s risk appetite. Further, Treasury
Middle Office independently verify
and monitor the adherence to the FX
position limits as an ongoing basis.
Equity price risk review Managing commodity risk the regulator, the Bank has taken
measures to manage and mitigate
Equity price risk is the possible losses Commodity risk is managed through the inherent risk in pawning through
arising from prices or volatilities in a meticulous process. A series of pre- maintaining a comfortable level of LTV
individual equities. Although the disbursement measures are carried out ratios. In addition, gold market prices
equity market is highly vulnerable, the including determining the gold content are periodically assessed, analysed,
Bank’s equity portfolio is insignificant of the pawned articles, conducting due and monitored by ALCO along with
compared to its overall asset portfolio, diligence of customers, maintaining competitor product features. The Bank
and thus the risk emerging from prudent loan to value ratios, has highly sophisticated equipment in
the equity portfolio is negligible. continuous assessment of gold prices their pawning centres to accurately
Colombo Stock Exchange trading was and competitor offerings, and through assess the gold. Although the Bank
halted several times highlighting the obtaining an insurance cover against staff handling pawning are well
mounting economic crisis prompted by losses arising from stolen articles. experienced and have the relevant
a shortage of dollar positions, surging expertise, regular training is provided
inflation and more over high deposit The post-disbursement measures to such staff to update their awareness
interest rates attracted investors to the include conducting independent on new technology related to pawning
banking system. Despite all continuous valuation of pawned items regularly, activities and the risk areas that
follow up of the economic conditions daily verification of a sample of 5%, require staff concentration. Insurance
of country/globe, market perception and regular auctioning of coverage is in place for the pawning
on equity markets, has helped the IBU unredeemed articles. portfolio. Impairment provisions are
to correctly read the equity market made with market gold value while
and take strategic equity investment
Commodity risk review regular auctions are conducted to
decisions. This, together with ensuring recover the defaulted advanced.
the strict adherence to the limits set Commodity risk is the exposure to Furthermore, the Bank has provided
by the Board of Directors has enabled changes in prices and volatilities the option of a monthly repayment
the Bank to mitigate and manage the of commodities. The Bank has a plan for customers – available via our
equity risk efficiently. negligible exposure to commodity self-banking units as well- to ease their
price risk as the Bank is not engaged financial burden. All these measures
in commodity trading at present have enabled the Bank to manage and
COMMODITY RISK and its only exposure to commodity mitigate its commodity risk associated
People’s Bank’s exposure to risk is associated with the Bank’s with pawning activities prudentially.
commodity risk stems from the pawning business. The Bank has been
pawning portfolio which holds gold a pioneer of pawning activities and its During the year 2022, the market
collateral. The Bank holds a high exposure is backed by gold, which is value of gold is significantly increased
market share in the pawning market. considered readily resalable. Through and the LTV further declined. But
Gold is impacted by fluctuations in assigning risk weights imposed by considering the liquidity position of
gold prices. the market as well as the Bank and
the exchange rate effect on
GOLD PRICE MOVEMENT IN 2022 the gold price, the Bank maintains
a low pawning advanced amount
LKR compared to the market to
177,500 manage commodity price risk.
154,000
130,500
107,000
83,500
60,000
1 January 31 December
2022 2022
Gold price 24k Gold price 22k

PEOPLE’S BANK
ABOUT
LIQUIDITY RISK Liquidity risk management 3. Contingency fund plan
Liquidity risk arises due to the inability
framework The Bank has a comprehensive
to meet contractual obligations The key aspects of the liquidity Contingency Funding Plan (CFP)
without incurring unacceptable losses. management framework are: to provide guidance on managing
This generally occurs due to a loss of liquidity requirements in stressed
capital and/or income when converting conditions. This is to ensure the
a security or hard asset to cash.
1. Measuring liquidity protection of stakeholder interests and
FROM THE TOP

REFLECTIONS
The Bank adopts the dual flow the maintenance of market confidence
approach and the stock approach to in the event of a liquidity crisis. The
Objectives of liquidity
measure liquidity. The mismatches CFP articulates specific trigger points
risk management for activation and will be activated in
of inflows and outflows in different
To enable the Bank to meet its funding time bands are analysed using the the following scenarios:
commitments when they are due, the flow method, based on the maturity z Statutory liquid asset ratio falling
Bank weathers liquidity stresses and of assets and liabilities. The stock below 20% over a month
manages liquidity and funding risks approach measures the liquidity using
VALUE CREATION
DRIVING
z 25% increase in interbank call
within its risk appetite. key ratios such as the loans to deposit
money rates for over seven
ratio, commitments ratio (unutilised
consecutive days
portion of overdrafts/unutilised
Managing liquidity risk z Over 50% increase in Stage 3
interbank lines), statutory liquid asset
A well-articulated liquidity risk ratio, and cumulative mismatches. asset ratio
management framework is in place to z Larger than expected deposit
ensure sufficient liquidity is maintained withdrawals
2. Diversified funding base
to meet its contractual obligations z Consolidated AD ratio exceeding
on time. ALCO ensures compliance The Bank sources liquidity from
AND ANALYSIS
105% for more than 15 days
with internal liquidity targets and multiple sources based on market
z Call facilities being withdrawn by
regulatory liquidity requirements by conditions, regulatory considerations,
market participants or imposing a
providing oversight, managing liquidity and interest rate movement trends.
premium over the market rate for
risks, and continuously monitoring Deposits are the largest funding source
the Bank’s borrowings
the Bank’s liquidity position. The DGM amounting to 78.2% of the Bank’s
Treasury, Investment Banking and total funding base, followed by other z Credit rating downgraded by more
Financial Institutions is responsible borrowings (9.1%) and shareholders’ than two notches
for the daily management of the funds (5.1%). The Bank has a relatively
Bank’s funding and liquidity positions high proportion of savings, which Key Indicators Position as at
within the stipulated risk limits. The is considered a quasi-stable source 31 December
2022 (%)
Bank’s liquidity levels are continually of funds.
REPORTS
GOVERNANCE
monitored independently by the TMO
Loans to deposit ratio
and any breaches are reported. The
performance of key liquidity indicators LKR 74.64
is regularly reviewed by the Board, Foreign currency 123.36

BIRMC, and ALCO to ensure they are
within the defined parameters. Commitments ratio
Statutory liquid
assets ratio
STATEMENTS
FINANCIAL
DBU 21.37
FCBU 20.05
INFORMATION
SUPPLEMENTARY
DBU (LKR Mn.) OBU (USD ’000)
Balance Minor Moderate Major Balance Minor Moderate Major

as at as at
31.12.2022 31.12.2022
Magnitude of shock (%) 5 10 15 5 10 15
Liquid assets 540,471 70,182
Total liabilities 2,529,374 349,997
Scenario I – Increase
in total liabilities
Increase in liabilities 126,469 252,937 379,406 17,499.85 35,000 52,500
Revised total liabilities 2,655,843 2,782,311 2,908,780 367,497 384,997 402,497
Revised liquid assets 540,471 540,471 540,471 70,182 70,182 70,182
Liquid asset ratio after shock (%) 21.37 20.35 19.43 18.58 20.05 19.10 18.23 17.44
Scenario II – Fall in liquid assets

and increase in other assets while
Liabilities remain same
Fall in liquid assets 27,024 54,047 81,071 3,509 7,018 10,527
Scenario III – Fall in total

liabilities and liquid assets
by the same amount
Fall in the liabilities 126,469 252,937 379,406 17,500 35,000 52,500
Liquidity risk review 2022 the Bank has maintained Capital OPERATIONAL RISK
Adequacy Ratios above the regulatory
Liquidity risk is defined as the risk of minimum levels. Further Statutory Operational risk is the direct or indirect
incurring losses resulting from the Liquid Assets Ratios also maintained risk of loss resulting from inadequate
inability to meet payment obligations above the required level. Liquidity or failed internal processes, people,
in a timely manner when they become Coverage Ratio for all currency and and systems or from external events
due or from being unable to do so at local currency were above the required such as natural disasters, social events,
a sustainable cost. The Bank manages regulatory ratios throughout the year. or political events. As per the Basel
liquidity risk, in accordance with II definition, operational risk includes
regulatory guidelines and international Liquidity risk exposure is managed by legal risk but excludes strategic and
best practices. The objective of the Treasury with limits and triggers set to reputation risk. Operational risks
Bank’s liquidity and funding framework ensure that sufficient liquidity surplus exist in the natural course of business
is to ensure that funding commitments and reserves are available to meet daily activities, products, and processes.
and deposit withdrawals can be business requirements and also to deal The Bank is exposed to operational
met when due and market access with a sudden liquidity shock. Treasury risks such as technology risk, people
remains cost effective. Contractual reports the Bank’s overall liquidity risk, and legal risk.
and behavioural maturity of assets position to Management on a daily
and liabilities, key liquidity ratios, basis. The Bank has obtained proactive
monthly liquidity forecasts and gaps measures to manage the assets and
are reviewed at Asset and Liability liabilities mismatches through better
Committee (ALCO) meetings. In liquidity risk management strategies.
PEOPLE’S BANK
ABOUT
Objectives of operational Managing operational risk operational risks at the point
risk management of origination. They report the
As projected by Basel II, operational operational loss events to the Risk
z Avoid potentially large risk losses by risks have been categorised under Management Division which maintains
minimising losses from operational seven broad areas. The policies, a database. The Bank has instituted
failure structures, and processes to structured mechanisms to measure,
managing operational risk exposure is assess, and report operational risks
z Manage risk cost-effectively across
articulated by the Bank’s Operational
FROM THE TOP

REFLECTIONS
the Bank by developing a common within the Bank. The internal audit
Risk Management Framework. The conducts periodic reviews of the
understanding of operational risk
Board is supported by the BIRMC to entire operational risk management
across multiple functions and
formulate policy and implement a process across the network to provide
business units
robust operational risk management assurance to the Board and Senior
z Effectively respond to critical and framework within the Bank. The Management.
catastrophic risks by building and branches and business units form
improving internal capabilities the First Line of Defence to identify
z Realise cost savings through better
VALUE CREATION
DRIVING
management of internal resources
and effective control of Bank
operations
GOVERNANCE STRUCTURE OF OPERATIONAL RISK
BOARD OF
DIRECTORS
AND ANALYSIS
BIRMC CEO/GENERAL BAC
ORMC
MANAGER
DGM – RISK DGM – CHANNEL OTHER CHIEF INTERNAL

MANAGEMENT MANAGEMENT DEPARTMENTS AUDITOR
REPORTS
GOVERNANCE
CHIEF
AGM
INFORMATION
COMPLIANCE
SECURITY OFFICER
OPERATIONAL REGIONAL
BRANCH
STATEMENTS
FINANCIAL
RISK MANAGEMENT RISK

NETWORK
UNIT OFFICERS
Direct reporting lines

Structured reporting lines
INFORMATION
SUPPLEMENTARY
Identification and assessment z Creating a culture of risk awareness operational risk events, losses, and near
of operational risk by providing continuous training misses by the Risk Management and
to staff Credit Control Department. Information
The Risk Management Department of significant loss events, emerging
z Prior to the launch of new products
together with business units identify issues, risk oversight, monitoring, and
and services, conducting a thorough
potential areas of operational risk. All reviewing of risks are reported through
analysis of the potential impact of
staff members are given training on quarterly reports. This information is
operational risk
operational risk exposures and are included in the Risk Committee reports
engaged proactively to identify and which are presented to the BIRMC
assess these risks. Risk reporting and/or Operational Risk Management
Systematic identification of root cause, Committee (ORMC). Based on the
Key business units conduct Risk and potential impact and frequency of the
trends and frequency of risks are
Control Self-Assessments (RCSA) risk, control failures are reported to
facilitated by maintaining a database of
to evaluate exposures according to the ORMC.
defined operational risk parameters.
Along with loss events and near misses
reported by business units, the key
findings of RCSA help to identify and OPERATIONAL LOSSES
devise action plans for potential gaps
LKR Mn.
in risk management. Operational risk is
875
assessed on new products, processes,
and activities on an ongoing basis.
700
Limits and tolerance levels 525
The Board has defined specific limits

350
and tolerance levels for operational
risk indicators in the Bank’s Risk
Appetite Statement. These include the 175
total value of operational losses as a

percentage of operational expenses, 0
2018 2019 2020 2021 2022
the number of internal and external
loss events, and the percentage of
Pawning Normal banking Total operational losses
branch audits rated less than average.
Regular reporting to the BIRMC and
Board helps to ensure corrective
actions are initiated when needed. NUMBER OF OPERATIONAL VALUE OF OPERATIONAL
LOSSES BY EVENT – 2022 LOSSES BY EVENT – 2022
Mitigating operational risk

Risk mitigation policies and
programmes are implemented
to maintain a sound operating
environment within the Bank.
These include:
z Implementing a comprehensive
framework of operational risk
policies and procedures
Internal frauds – 1.08% Internal frauds – 26.14%
z Crisis management procedures
and disaster recovery plans to External frauds – 57.14% External frauds – 20.79%
ensure business continuity Clients, Products and business Clients, Products and business
practices – 0.00% practices – 0.00%
z Segregation of duties Employment practices and Employment practices and
z Transferring of operational losses workplace safety – 0.00% workplace safety – 0.00%
to third party through insurance Damage to physical assets – 1.62% Damage to physical assets – 0.71%
Business disruption and Business disruption and
z Adopting stringent measures system failure – 0.00% system failure – 0.00%
to select and monitor Execution, delivery and Execution, delivery and
outsourced partners process management – 40.16% process management – 52.36%
PEOPLE’S BANK
ABOUT
Loss event 2022 2021
Number Percentage Value Percentage Number Percentage Value Percentage

of total LKR Mn. of total value of total LKR Mn. of total value
Internal frauds 4 1.08 41.59 26.14 4 1.84 52.64 23.48
External frauds 212 57.14 33.07 20.79 100 46.08 121.07 54.00
FROM THE TOP

REFLECTIONS
Employment practice and
workplace safety 0 0.00 0 0.00 0 0.00 0 0.00
Client, product, and business

practices 0 0.00 0 0.00 0 0.00 0 0.00
Damage to physical assets 6 1.62 1.13 0.71 6 2.76 0.37 0.17
Business disruptions and system

failures 0 0.00 0 0.00 4 1.84 0.35 0.16
VALUE CREATION
DRIVING
Execution, delivery, and process
management 149 40.16 83.31 52.36 103 47.47 49.79 22.21
Total 371 100.00 159.1 100.00 217 100.00 224.22 100.00
Operational risk review TECHNOLOGY RISK The Board IT Committee, Information

Security Committee, and Information
The above chart depicts the This is the risk of financial loss,
Security Operations Committee provide
comparison of operational losses in the regulatory sanctions, or reputational
oversight to the Bank’s Technology
past two years under the Basel II loss damage due to breaches of
AND ANALYSIS
Risk Management framework. The
event type, both in terms of number of confidentiality, integrity, or lack of
committee recommends information
events and value. information quality and availability.
security strategies, policies, and
Technology is a key competitive
procedures. They also assess the need
The total losses recorded for the year advantage to achieve operational
for system integrations within the Bank
2022 was LKR 159.1 Mn. The most efficiency, speed, cost savings,
and the use of new and advanced
significant sources of losses (by value) and accuracy. As a leader in
information systems.
for the year 2022 are external frauds, digitalisation, the Bank is inherently
internal frauds and execution, delivery exposed to technology risk given
To ensure the robustness of
and process management of which its high dependence on information
information systems within the
mainly include, technology. The Bank is exposed
Bank, the Information Security
– Correction of the Backlog balances to a range of technology related
Department and the IT Department
REPORTS
GOVERNANCE
amounting LKR 38.1 Mn. in GLs risks including cyber risks such as
regularly monitor key IT risk indicators.
of four branches by Finance hacking and theft of information,
Corresponding risk thresholds have
Department. systems breakdowns and failures,
been defined to direct management
technological obsolescence, technical
– LKR 36.8 Mn. of long outstanding attention for appropriate
control towards physical security, and
amounts from previous years corrective measures.
inadequate infrastructure to support
transferred to operational losses
business volumes.
during the year 2022
STATEMENTS
FINANCIAL
– LKR 0.8 Mn. of operational losses

materialised from credit related
activities, during previous years
Apart from the above, the total

operational losses reported for the
year was only LKR 83.4 Mn.
INFORMATION
SUPPLEMENTARY
IT RISK INDICATORS OF THE BANK IT RISK REVIEW

Category Systems Actual Availability as a percentage z Conduct routine and non-routine
availability of total working hours and risk assessments for all IT related
thresholds processes and follow up the same
through the Information Security
High critical – Central ATM Switch 99.9% >99.9% Green – Low risk
97.5%-99.9% Amber – Moderate risk
Operations Committee
– NOVUS Switch
<97.5% Red – High risk z Periodical review of Bank
– Core banking system/
Information Security Policy
SIBS interface
Procedures and obtaining Board
– SWIFT
approval
– Credit/Debit card
z Reviewing of access logs for critical
management system
systems and critical infrastructure
– SLIPS
z Reviewing the user access rights of
Medium critical – Image capturing and 99.2% >97.5% Green – Low risk
critical systems
presentment system 95%-97.5% Amber – Moderate risk z Conduct code reviews for all critical
– Web remittance <95% Red – High risk systems, developed in house or out-
system sourced.
– Finacle treasury z Conduct internal/external
– ATM (individual) vulnerability assessments for all
– PRIME 4 systems including web based
application and rectification of
– CIB/CMB/ORA
issues in a timely manner.
– RIB/RMB
– Express Banking
– RLOS
PEOPLE RISK
People risk is the potential losses
Low critical – IHRM System 100% > 90% Green – Low risk that could arise due to inappropriate
– People’s Bank website 87%-90% Amber – Moderate risk employee activity, inadequate human
<87% Red – High risk resources, and Bank non-compliance
with employee related regulations.
The Bank has setup comprehensive
A comprehensive information z Maintaining all IT processes in
human resource policies and
security strategy is established compliance with the standard ISO/
processes to manage HR related
across the Bank aligning Bank IEC 27001: 2013 certification (will be
risks, ensure uniformity in employee
vision to mitigate technology risk complied to 27001: 2022 from 2023),
practices across the Bank, adopt
continuously. The information security the world’s highest accreditation for
effective recruitment practices, and
strategy strengthens with Corporate information protection and security,
continuously focus on enhancing
Management and latest technologies from the International Organisation
employee value propositions.
to mitigate evolving threat landscape. for Standardisation (ISO)
The controls are selected in line with z Maintaining a well-established IT Turnover of trained skilled staff
CIS and NISI controls in addition governance structure to prevent risk impacts the competitiveness of the
to baseline security standards. of data loss Bank, leading to deterioration in
Information security risk mitigations
z Installation of fire protection and competency and productivity. Hiring
are as follows:
smoke detectors at the server rooms qualified, competent individuals
and UPS rooms and retaining the high performing
MITIGATING IT RISK z Disaster recovery plan to continue employees through a rewarding work
operations environment is challenging as well.
z Placed all critical, live, and disaster
recovery servers in highly secured z Appointment of Chief Information
and certified data centres Security Officer and providing
z Conducted disaster recovery tests centralised strategic direction to the
for all critical systems at regular Bank as per the global best practices.
intervals
PEOPLE’S BANK
ABOUT
People risk review The negative impact on the Bank’s Objectives of managing
reputation has been low, as People’s compliance risk
People are the most significant asset Bank has maintained an impeccable
in any business as they are the central track record for nearly six decades z Increase Bank’s reputation and
point in the overall performance of as a premier state bank in Sri Lanka. brand value
other assets. Thus, anticipating and Customer confidence is founded on z Enhance customer confidence
efficiently managing people risk is a sound reputation which reflects the and trust
highly important to the success of
FROM THE TOP

REFLECTIONS
integrity of the Bank, the competence
the Bank in the sustainable Business z Facilitate smooth and efficient
of staff, and the high product quality.
Model. The Bank has ongoing HR operations
Development programmes that keep The Bank monitors its reputation risk z Strengthen employee integrity
staff updated with the necessary through early warning indicators. The z Offer products and services of the
knowledge and skills, which help customer complaint-handling unit highest quality
staff enhance customer delivered addresses all customer complaints
value whilst minimising business risks
z Augment the strength and stability
efficiently and effectively. Even as the of the Bank
incurred due to lack of knowledge,
VALUE CREATION
DRIVING
scope of reputation risk has widened
product promotion strategies, etc., z Strengthen the sustainability of
due to social media, the Bank has
thereby increasing Bank reputation the Bank
implemented several measures to
and brand image through customers. enable customers to forward their
Further concerns that are involved grievances. These include the Bank’s Compliance risk governance
when managing people risk are website, Facebook page, the call
reducing disruptions to work, centre, email, and the postal address.
protecting employees and their families Board of Directors
from financial difficulties, minimising Appropriate measures including
staff turnover, and maintaining a
AND ANALYSIS
communication policies, Code of
healthy work environment during Conduct, and Ethics are also in place
the pandemic. to be followed by all employees
across the Bank. The Bank’s active BIRMC
LEGAL RISK engagement in Corporate Social
Responsibility (CSR) activities as part
Legal risk is the risk of loss due to of corporate strategy and the media
non-compliance with applicable presence on social media platforms
regulations leading to the incurring help to drive brand visibility. AGM – Compliance
of penalties, fines, loss of reputation,
and the potential loss to earnings due Reputational risk is assessed through
to non-enforceability of contracts or a comprehensive scorecard developed
REPORTS
GOVERNANCE
documents. The Board holds the highest
by the Bank based on the ICAAP
responsibility to ensure compliance
guidelines.
Legal risk is managed by the Bank’s with relevant external regulations
Legal Department and proper internal and internal guidelines, and is duly
procedures are followed when COMPLIANCE RISK supported by the BIRMC and BAC
entering into contracts with clients. in its compliance functions. The
Compliance risk arises due to non-
The business units are responsible to compliance of the Bank is ensured
compliance with applicable laws,
ensure all legally binding agreements by the dedicated Compliance Unit,
regulations, Codes of Conduct, and
STATEMENTS
FINANCIAL
are duly signed by the compliance and reporting directly to the BIRMC. In
standards of good practice resulting
legal divisions of the Bank. addition to the Risk Management
in financial loss and reputational loss.
Department and the internal audit
Compliance helps to maintain and
function, the Compliance Unit provides
REPUTATIONAL RISK enhance the reputation of the Bank.
assurance to the Board on the Bank’s
Reputational risk is an indirect loss overall level of compliance.
The Bank has established a
arising from an event or incident that compliance function and implemented The Bank’s compliance risk is assessed
adversely affects earnings, assets and
INFORMATION
SUPPLEMENTARY
comprehensive internal policies, through a five-point rating scale

liabilities, and brand value. Reputational procedures, and a sound governance scorecard in relation to internal best
risk is also driven by other risks such as framework to ensure employees practices and external regulations. This
credit, market, operational risk, liquidity comply with the applicable laws, scorecard is submitted to the BIRMC.
risk etc. regulations, and best practices.
The dedicated Chief Compliance z Prepare and submit compliance z Clearly communicate policies on
Officer oversees the compliance reports to the Board Integrated Risk compliance to Management and
status of the Bank through regular Management Committee (BIRMC) staff
assessments and reports the status and the Board Audit Committee z Liaise with the Bank’s internal and
to the BIRMC. (BAC) as and when necessary external audit function to address
z Submit monthly compliance reports compliance issues
The duties entrusted to the to the Board z Follow up on compliance issues
Compliance Department are twofold,
z Establish a Customer Charter based identified through audits
mandatory compliance functions and
on directions issued by the Central z Liaise with the Auditors and conduct
ancillary compliance functions.
Bank of Sri Lanka random compliance audits on
z Prepare, implement, and monitor risk-based assessment
Mandatory compliance the Code of Best Practice on
functions Corporate Governance based
Compliance reporting
z Safeguard the Bank from on the Central Bank Directive on
reputational risk by developing Corporate Governance for Licensed The Compliance Department submits
compliance policies and procedures Commercial Banks monthly compliance reports to the
to eliminate or minimise the risk of z Establish systems and controls Board. These reports include sign-offs
non-compliance with regulatory to monitor transactions and from the Heads of Departments
requirements report suspicious transactions to and branches on statutory and
z Develop a Code of Conduct/Ethics the Financial Intelligence Unit to mandatory requirements, events
for all employees, clearly articulating prevent Money Laundering/Terrorist of non-compliance, and employee
the best practices and monitoring to Financing training and branch assessments.
ensure compliance at all levels Reports are also submitted to the
z Train staff members on compliance
BIRMC and BAC on any special
z Implement an Anti-Money including Anti-Money Laundering
compliance-related matters within
Laundering/Terrorist Financing and develop an e-learning module to
that quarter.
Policy aligned to Know Your facilitate training across the branch
Customer (KYC) regulations, network
to be adhered by all departments Prevention of money
z Prepare policies and implement
of the Bank procedures to minimise compliance
laundering and terrorist
z Maintain regular contact and cordial risk and reputation risk, including financing
relationships with regulators based developing a Code of Conduct Money laundering and terrorist
on clear and timely communication z Maintain updated credit details of financing continues to receive
and mutual understanding customers by liaising with the Credit significant attention as nations
z Nurture a culture of compliance Information Bureau attempt to deal with the harmful legal,
within the Bank economic, and social consequences
z Keep abreast with relevant legal of criminal activities. People’s Bank
Ancillary compliance functions
and regulatory developments and has taken every effort to prevent the
z Provide advisory services to rising prevalence of money laundering
facilitate effective implementation
Management and staff on regulatory, and terrorist financing by having
z Report to the Board all relevant reputational, and ethical matters stringent policies, procedures, and
regulatory developments and
z Promote compliance as a success control standards relating to client
changes in laws that could give rise
enabler identification. This is coupled with
to compliance issues
z Provide input in structuring new due diligence, transaction monitoring,
z Highlight any breaches related payment and name screening,
products and systems compliant
to compliance and work with investigating and reporting of
with local regulatory requirements,
the Management to address and suspicious activity, and an evaluation
internal compliance, and ethical
rectify them within an acceptable of all new products and services
standards
timeframe to prevent and/or detect activities
z Ascertain compliance with
z Submit weekly, monthly, quarterly, that may pose risk to the Bank.
internal and external regulations
and annually compliance reports to All employees are trained through
by conducting assessments and
the Central Bank of Sri Lanka related structured programmes and e-learning
reviews at regular intervals
to compliance with Central Bank modules on areas such as Anti-Money
directives and guidelines, and as z Represent the compliance function Laundering, Know Your Customer,
stipulated by the law in relevant internal and external
committees
PEOPLE’S BANK
ABOUT
and customer due diligence. Unusually The strategic plan is formulated through the following structures and
large and suspicious transactions are following extensive stakeholder mechanisms:
analysed, evaluated, and reported to engagement at multiple levels and z The Group’s risk appetite and
the Financial Intelligence Unit. discussions with business units. In the strategy is formulated at Bank level
event a risk materialises, a series of
z Reporting structures, processes, and
management actions are developed to
Compliance risk review thresholds are determined by the
prevent or mitigate the impact on Bank
Bank’s Board of Directors
FROM THE TOP

REFLECTIONS
Branch assessments are conducted earnings. The business performance
by the Regional Compliance Officers is tracked on a weekly basis by ALCO z Defined key risk indicators, trigger
on a risk-based approach and reviews and the Board. The actual performance levels, and thresholds have been
are conducted on selected branches is assessed against the budgeted established for each group entity in
by the Compliance Department. targets for each business unit. If which the Bank’s exposure exceeds
Head office departments and other needed, the strategies are revised LKR 500 Mn.
related units are assessed by the to suit any changes in the business z Through periodic reviews, the
Compliance Department selecting environment. People’s Bank’s Audit Committee
VALUE CREATION
DRIVING
the Departments/Units on a risk- and Internal Audit Department
based approach. Also, subsidiaries Strategic risk is assessed using a ensures the adequacy of internal
which carry out financial transactions scorecard, by taking into consideration control mechanisms of the
are reviewed quarterly through a a range of factors including the Bank’s subsidiaries
questionnaire in addition to the size, complexity, sophistication of z In certain instances, Directors are
visits conducted by the Compliance operations, environmental analysis nominated to the respective Boards
Department once in every two years. as well as customer profiling. The of the subsidiaries by People’s Bank
scorecard helps to identify areas
z Periodically, the risk profiles of the
Strategic risk that need improvements to mitigate
regulated subsidiaries are reviewed
AND ANALYSIS
strategic risk.
Strategic risk is the potential loss to by People’s Bank’s BIRMC
earnings and viability arising due to z The Bank’s Board of Directors have
adverse business decisions, improper Group risk management access to the Board Minutes of
implementation of decisions, a The Bank’s main subsidiaries, People’s Group companies.
challenging business environment, Leasing & Finance PLC, and People’s
and inadequate response to changes Insurance PLC have structured
in the operating environment. risk management frameworks to
identify, assess, and monitor their risk
Strategic risks are managed through exposures. People’s Bank provides
the Bank’s strategic plan approved by oversight to the risk management
the Board and Executive Management. aspects of the Group entities
REPORTS
GOVERNANCE
The Group’s risk ratings for key categories of risk in 2022
Credit risk Market risk Operational risk Compliance risk Strategic risk Reputation risk
People’s Bank Moderate Moderate Moderate Low Low Low
People’s Leasing & Finance Moderate Moderate Moderate Low Moderate Low
STATEMENTS
FINANCIAL
People’s Insurance Low Low Moderate Low Moderate Low

INFORMATION
SUPPLEMENTARY
CORPORATE GOVERNANCE
CHAIRMAN’S MESSAGE ON
CORPORATE GOVERNANCE
From a macro-economic perspective, and April 2022 but was later mostly
2022 was the culmination of economic filled. At present, there are four (4)
stresses and stress events over the Board positions to be filled which we
last several years. It was a year which reasonably expect that the Ministry
saw the country’s external reserve of Finance will do so in the immediate
position fall to a level previously near term.
unseen, the rupee devalue by close to
80.0%, inflation soar to nearly 70.0%,
policy rates increase in a manner
COMPLIANCE
unprecedented in view of curtaining This report details the “factual finding
inflationary pressures and, all in all, report” set out by the Auditor General
resulting in the country’s credit rating in compliance with the Banking Act
fall to a historic low and the economy Direction No. 11 of 2007 for Licensed
contract by close to 11.0% which is Commercial Banks. It justifies our
deepest seen since independence. approach to governance in practice,
2022 was therefore not a year where operations of the Board in 2021 and
top line or bottom-line was the prime dischargement of its duties during the
focus but safeguarding customer year. It also determines the level of
interests in their absolute time of compliance.
need was, strengthening liquidity
and the overall risk management As leading State Bank in Sri Lanka,
and the governance framework People’s Bank has gone beyond
of the Institution for its long-term regulatory compliance and is guided
sustainability was, and where by voluntary adoption of relevant ESG
improving efficiency and productivity frameworks and standards to ensure
at every instance possible was at the sustainability.
core of all conversations and decisions
taken. All these considered, including
the added burden shouldered as a THE WAY FORWARD
responsible State Institution - we are With every crisis comes an opportunity
pleased with our 2022 results both on and for Sri Lanka, this critical moment
a quantitative and, more importantly, is a chance to reset its development
a qualitative front. model towards green, resilient, and
all-inclusive growth. People’s Bank –
During the year under review being flag bearer when it comes to
there were nineteen (19) Board National interest and being true to
meetings held to ensure stability its ethos of being the Pride of the
and continuity of the Bank during Nation – will continue to play its role as
this complex environment. These the country looks to revives itself and
were in addition to the numerous rebuild the lives and livelihoods of its
other Sub-Committee deliberations. citizens of this country!
During the year under review, the
Board spent considerable time on We look forward!
assessing the implications of the
macro-economic conditions, reviewing
policy frameworks, and strengthening
the overall risk management and
governance framework. Being the
Sujeewa Rajapakse
pioneer, furthering our digitalisation
Chairman
efforts was also a key point of
discussion. Resignations of two Board 2 March 2023
members took place during March Colombo
Corporate Governance
PEOPLE’S BANK
ABOUT
In year 2022, the Bank was able to THE BOARD COMPOSITION
navigate through the challenges of
the unpredictable market conditions Finance and Accounting
GENDER DIVERSITY
effectively and achieve steady growth. 4/6
The Bank emerged more resilient and
reinvigorated, and the confidence in
our capabilities is reflected not only
FROM THE TOP

REFLECTIONS
in our numbers but also in the trust Business Administration
that our customers have placed in 2/6
us. The circumstances have pushed
the Bank to rise above and beyond
our own limitations and to align our
sustainability agenda with our business Audit
and technological transitions and 1/6
Male – 83% Female – 17%
organisational growth.
VALUE CREATION
DRIVING
The Board helped steer the Company's
HR and Management
strategy and improve its risk profile BOARD BALANCE
in several areas in 2022 while 3/6
emphasizing on employees’ safety and
wellbeing, supporting customers, and
being fully committed to the economic
Law
revival plan of the Government.
Giving back to the society has never 2/6
AND ANALYSIS
been more important. In this regard,
the Board also ensured greater
accountability, transparency, good Economics
governance, and sound financial and
risk management to all its stakeholders 3/6
Independent – 42%
in order to maintain sustainable
Non-independent – 8%
operations. Executive – 0%
Non-Executive – 50% Commerce
Effective corporate governance is
1/6
critical to the proper functioning of
the banking sector and the economy
as a whole. The Bank’s Corporate AGE DIVERSITY
REPORTS
GOVERNANCE
Governance Framework defines the International Development
roles, responsibilities, practices, and
1/6
processes used to govern and manage
the Bank. By providing clear and
effective identification and delineation
of powers and decision-making Budgeting
bodies, this framework has enabled
1/6
the Bank to thrive, remain sustainable,
STATEMENTS
FINANCIAL
and operate with integrity and

accountability towards its stakeholders.
>60 – 33%
50-60 – 33%
40-50 – 33%
INFORMATION
SUPPLEMENTARY
GOVERNANCE FRAMEWORK
Regulations Voluntary Standards Internal Framework Internal Mechanisms
z People’s Bank Act No. 29 of z Code of Best Practice on z Board Charter z Risk Management
1961 (as amended) Corporate Governance z Sub- committees and z Strategic and Corporate
z Banking Act No. 30 of 1988 issued by the Chartered management committees Planning
(as amended) Accountants of Sri Lanka terms of references z Budgeting
in December 2017
z CBSL Directives z Code of Business Conduct z Human Resource
z Global Reporting and Ethics for Directors
z Exchange Control Act No. Management
Standards of the Global
24 of 1953 z Comprehensive policies z IT Governance
Reporting Initiative
z Financial Transactions and procedures
z UN Sustainability z Stakeholder engagement
Reporting Act No. 6 of 2006 z Code of Ethics for
Development Goals
z Prevention of Money employees
(SDGs)
Laundering Act No. 5 of z Customer Charter
z The International <IR>
2006 z Internal Audit
Framework issued
z Banking Act Direction by IFRS Foundation z Internal Controls
No.11 of 2007 on Corporate [formerly by the
Governance for Licensed International Integrating
Commercial Banks Reporting Council (IIRC)]
Accountability Transparency Fairness Responsibility
Our corporate values
Continuous
Being the Pride Customer focus Integrity and learning Empowerment
of the Nation and agility accountability culture and and diversity
team spirit
Value creation
Stakeholder value creation Strategic outcomes

PEOPLE’S BANK
ABOUT
CORPORATE GOVERNANCE STRUCTURE
BOARD SUBCOMMITTEE Shareholders

(Government of Sri Lanka
and cooperative Societies)
FROM THE TOP

REFLECTIONS
Board Nomination Committee
(BNC)
Board of Directors Secretary to the Board

Board Human Resources and
Remunerations Committee
(BHRRC)
Board IT Committee (BITC) CEO/General Manager
VALUE CREATION
DRIVING
Board Investment Banking
Committee (BIBC)
Corporate Management Management Committee

Board Executive Credit
Committee (BECC)
Risk Management
Board Integrated Risk
Management Committee
(BIRMC)
AND ANALYSIS
Compliance
Board Audit Committee (BAC)
Internal Audit
Board Strategic Plan Review
Committee (BSPRC)
The Bank’s corporate governance ASSURANCE the Chairman, and Non-Executive

structure consists of two primary Directors. All Directors are eminent
The Auditor General provides
REPORTS
GOVERNANCE
layers. The Board provides oversight professionals of the State and
and deliberates with the Corporate assurance on the Financial Statements private sector. The Chairman is a well
Management about the Bank’s of the Bank and on the Directors’ experienced professional with over
strategic direction, financial goals, Statement on Internal Controls 31 years experience especially in the
resource allocation, and risk appetite. over Financial Reporting which are finance field. The diverse range of skills
The Management is responsible for published on pages 207 to 208 and and experience of the Non-Executive
executing the policies of the Board to 202 and 203 respectively. He also Directors enrich the Bank’s risk
create shared value for all the Bank’s certifies the level of compliance with management and control process.
the Banking Act Direction No. 11 of
STATEMENTS
FINANCIAL
stakeholders. Profiles of the Directors are given on

2007 on Corporate Governance for pages 26 to 27.
Licensed Commercial Banks issued by
KEY FOCUS FOR 2022 the Central Bank of Sri Lanka.
Holding of regular
z Review and approve the Bank’s Board meetings
policies, procedures, key metrics COMPLIANCE WITH THE
(Principle A. 1.1)
where necessary in line with the CODE OF BEST PRACTICE
Bank’s strategic plan. FOR CORPORATE The Board meets at least once a month
INFORMATION
SUPPLEMENTARY
z Adjusting to the changing the GOVERNANCE THE BOARD and additional meetings are convened
macroeconomic conditions. based on necessity. The Board met
(Principle A.1)
19 times during the year 2022, and all
z Effective management of risks.
Board of Directors of People’s Bank Board meetings were characterised by
z Embedding sustainability. is appointed by the Minister of high attendance, active participation
Finance. The current Board comprises and constructive and open discussions.
Directors are required to attend all Board meetings and Committee meetings of which they are members. Instances of
non-attendance at Board meetings were generally due to prior engagements, personal commitments or illness.
In addition, Non-Board members of the Senior Management and the advisory members may, by invitation, attend meetings
to address specific items in the agenda. Members of the Corporate Management and/or external experts are allowed to
make presentations to the Board and subcommittees on a regular basis on matters pertaining to the Bank’s strategy.
The attendance of each Director at Board meetings and respective committee meetings in 2022 are detailed below:
Name of Director Status Board BAC BHRRC BIRMC BECC BNC BIBC BITC BSPRC
meeting
Mr Sujeewa Rajapakse Independent 19/19 – 9/9 – – 6/6 – – 4/4

Non-Executive
Mr Kumar Gunawardana Independent 19/19 – 9/9 – 24/24 4/4 3/3 5/5 –
Non-Executive
Mr Sudarshan Ahangama* Independent 4/4 2/2 – – – 2/2 – – –
Non-Executive
Mr Isuru Balapatabendi Independent 17/19 – – 4/4 – – 3/3 – 4/4
Non-Executive
Mr Keerthi Goonatillake Independent 18/19 5/5 – – 22/24 4/4 – 5/5 2/4
Non-Executive
Mr Manjula Wellalage Independent 17/19 – 9/9 – 19/24 – – – –
Non-Executive
Mr K A Vimalenthirarajah** Non-Independent 1/2 1/2 – – – – – – –
Non-Executive
Ms Bhadranie Non-Independent 3/4 – – – – 2/2 – – –
Jayawardhana*** Non-Executive
Ms Visakha Amarasekere Non-Independent 15/15 3/3 – 4/4 – – 2/2 – –
Non-Executive
Mr Dushmantha Independent 10/10 3/3 – 1/1 – – – – –
Thotawatte Non-Executive
* Mr Sudarshan Ahangama resigned w.e.f 7 April 2022

** Mr K A Vimalenthirarajah resigned w.e.f 2 March 2022
*** Ms Bhadranie Jayawardhana resigned w.e.f 6 May 2022
Role of the Board There is a formal schedule of matters reserved for the Board, which are reviewed
regularly to ensure it remains current. Matters reserved for the Board include the
(Principle A. 1.2)
items summarised in the table below:
The Board is responsible to provide
leadership, oversight, control, Governance Strategy and directions Risk management accountability
development, and ensure long-term and control
success of the Bank. They also
facilitate value creation to shareholders Review of Approval of strategy Approval of financial statements,
governance and annual budgets other updates to market and
in accordance with applicable laws
arrangements recommendations on dividends
and regulations. The Board is also
Authorisation of
responsible for nurturing the right Terms of acquisition and Approval of authority levels, financial,
culture, instilling values and promoting reference for and disposal activity and treasury policies
ethical behaviour throughout the Bank. membership of
Board committees Affirmation of risk Review of internal control and risk
management strategies management
and risk appetite
Approval of health and safety policies
PEOPLE’S BANK
ABOUT
The Board has delegated some of its Company Secretary Dedication of adequate
responsibilities to committees of the (Principle A. 1.4) time and effort by
Board. The scope of work assigned the Directors
to each committee along with the All Directors have access to the Board
Secretary. The Board Secretary is (Principle A. 1.6)
progress made during the year is given
on pages 194 to 201 of this Report. responsible to the Board for ensuring Directors are expected to dedicate
all agreed procedures and applicable sufficient time before a meeting to
FROM THE TOP

REFLECTIONS
Monitoring the effectiveness of the rules and regulations are observed. review Board papers and call for
Bank’s risk management and internal In addition, the Board Secretary additional information and clarification
control systems has been delegated to serves as the Secretary to all Board and to follow-up on issues.
the Board Integrated Risk Management subcommittees and maintains
Committee and the Board Audit the minutes of all Board meetings Directors are also expected to ensure
Committee. The Board retains ultimate and committee meetings. Other sufficient time is dedicated at every
responsibility for determining the responsibilities of the Board Secretary meeting to ensure all responsibilities
Bank’s “risk tolerance”. The Risk include: are discharged satisfactorily.
VALUE CREATION
DRIVING
Management Report is reviewed by the z Coordinating matters pertaining to
Board, and this includes, monitoring, the conduct of Board meetings and
controlling and reporting of identified
Training for Directors
subcommittee meetings
risks, and uncertainties. In addition, (Principle A. 1.7)
z Conducting proceedings in
the Board reviews reports referred by All Directors are entitled to receive
accordance with the People’s Bank
the Chairman of the Risk Management relevant training for continuous
Act and relevant legislation
Committee and the Audit Committee development. To ensure Directors’
pertaining to risk management.
z Facilitating adoption of best practice
on corporate governance including contribution to the Board/committees
assisting the Directors with respect remains relevant, ongoing trainings and
AND ANALYSIS
Compliance with laws of to their duties and responsibilities, in updates are provided for Directors to
the country as applicable compliance with relevant legislation regularly refresh their knowledge, skills
to the business and procedure and best practice and understanding of the business, and
markets in which the Bank operates.
to obtain independent z Acting as the communication liaison
This includes written reports and
professional advice between Non-Executive Directors
presentations by senior executives
(Principle A. 1.3) and Management
or consultants, on Bank’s operations,
z Ensuring appropriate disclosures corporate governance, legal and
The Board of Directors collectively
on related parties and related party regulatory developments.
and severally, is expected to act
transactions in line with regulatory
in accordance with the laws of the
requirements
country, applicable to the business CHAIRMAN AND CEO
REPORTS
GOVERNANCE
conducted by the Bank. Therefore, the z Obtaining legal advice in
consultation with the Board on (Principle A. 2)
Board is responsible for ensuring all
relevant procedures and controls are in the People’s Bank Act and other Whilst the Chairman and Chief
place to maintain compliance with all relevant legislations in ensuring Executive Officer (CEO)/General
applicable laws and regulations. Bank’s compliance with all Manager (GM) are collectively
applicable laws and regulations responsible for the leadership of
The Board acknowledges the need People’s Bank and for promoting
to obtain independent judgement Independent judgement the highest standards of integrity
STATEMENTS
FINANCIAL
from time to time, on certain matters. and probity, there is a clear and
of Directors
Accordingly, Board members effective division of accountability
are entitled to seek independent (Principle A. 1.5)
and responsibility between the
professional advice (including but Directors are required to bring an Chairman and the CEO/GM. Each
not limited to legal, accounting, and independent judgement to bear on plays a distinctive role which
financial advice) at the Bank’s expense decisions of the Bank. As experienced complements each other to ensure
on any matter connected with the professionals, their duties are balance of power and authority and
discharge of his/her duties and performed without any influence from avoid unfettered powers of decision
INFORMATION
SUPPLEMENTARY
responsibilities. other persons. The Board promotes and control for one individual.
dynamic, and constructive contribution
from Non-Executive Directors.
The Chairman is responsible for z Setting the agenda for each Board BOARD BALANCE
leading, directing and managing the meeting, taking cognisance of (Principle A. 5)
Board to ensure effective operations the matters proposed by other
and fully discharging its legal and Directors, members of various The People’s Bank Board is well
regulatory responsibilities. The primary subcommittees or the Board balanced with eight Non-Executive
role of the CEO/GM is to manage the Secretary Directors, of whom six function in
day to day operations of the Bank. z Ensuring the Board members an independent capacity. This is
receive accurate, timely, and clear above the minimum stipulated by
information Code of Best Practice for Corporate
A decision to combine the Governance issued by The Institute of
posts of Chairman and Chief z Ensuring minutes of Board meetings Chartered Accountants of Sri Lanka.
Executive Officer in one are accurately recorded and
person should be justified and circulated among the Directors All Independent Non-Executive
highlighted z Providing leadership and Directors are independent of
(Principle A. 2.1) governance to the Board to create management and free from any
a conducive environment for the business or other affiliations that
The position of the Chairman and Board and individual Directors to could materially interfere with or
the CEO/GM are clearly separated, discuss issues in a timely manner could reasonably be perceived to
preventing unfettered powers for materially interfere with the exercise
z Promoting a culture of transparency
decision-making by one person. of their unfettered and independent
and encouraging Non-Executive
Directors to engage in constructive judgement.
The Chairman and the CEO/GM have
and healthy exchange of views
been identified on pages 26 and 30 of Every Non-Executive Director
pertaining to matters of the Board
the Annual Report. submits a signed declaration of
and thereby facilitating contribution
to the effective functioning of the independence/non-independence
CHAIRMAN’S ROLE Board against the specified criteria and they
are evaluated to ensure compliance
(Principle A. 3) z Ensuring that the Board plays a full
with the criteria for determining
and constructive role in developing
The Chairman is responsible for independence.
and assessing Group’s strategies
ensuring the CEO/GM and the and policies, and ensuring Board
Management effectively implement In the year under review, there were
decisions are taken in the best
the strategies and policies agreed no circumstances that warranted
interest of the Bank and fairly reflect
by the Board. The Chairman also the appointment of Alternate
Board’s consensus
provides stewardship for the adoption Directors. The need to appoint a
z Proving leadership for Senior Independent Director did not
of good governance practices and
self-assessment to generate arise either, due to the segregation
provides oversight to ensure effective
meaningful feedback to further of positions of the Chairman and the
communication with shareholders and
improve the effectiveness of the CEO/GM.
other stakeholders.
Board
Conducting Board SUPPLY OF INFORMATION

proceedings in a proper FINANCIAL ACUMEN
(Principle A. 6)
manner (Principle A. 4)
Board meetings are scheduled well
(Principle A. 3.1) The People’s Bank Board comprises in advance, giving adequate notice
members with sufficient financial to Directors. Prior to every Board
The Chairman is responsible not only
acumen and knowledge. In addition to or committee meeting, the Board
for providing leadership but also for
the Senior Chartered Accountants and Secretary ensures all relevant papers
overseeing the functioning of the
Chartered Management Accountants including the agenda, content
Board to safeguard the best interest
who provide guidance on the financial and a summary of management
of the Bank and its shareholders.
matters, the rest of the Directors have presentations are made available to
Accordingly, the Chairman is
sufficient financial acumen acquired all the Directors seven working days
responsible for:
through their extensive professional prior to the meeting. The Directors
z Ensuring Board meetings are experience. who are unable to attend the meetings
planned and conducted effectively
are updated through the documented
minutes, which are tabled at the
next meeting with the matters to be
followed-up from the minutes.
PEOPLE’S BANK
ABOUT
Monthly accounts for a given month DISCLOSURE OF recommendations to the Board
are prepared and circulated among INFORMATION IN pertaining to the remuneration and
Directors in the following month RESPECT OF DIRECTORS benefits of the CEO/GM and Key
along with key financial performance Management Personnel within agreed
(Principle A. 10)
indicators of each division/subsidiary. terms of reference and in accordance
If the Board feels the information Information specified in the Code in with the remuneration policies of the
provided is insufficient or not clear, relation to Directors is disclosed in this Bank, and the Collective Agreement.
FROM THE TOP

REFLECTIONS
they are entitled to request for further Annual Report as follows: Remuneration is designed to attract,
clarification or additional information. z Name, qualifications, brief profile, retain and motivate high performing,
The respective management personnel and the nature of expertise on pages qualified and experienced employees
can be called for the meetings when 26 and 27. of the Bank. The Board in turn makes
deemed necessary to provide further recommendations to the Minister of
z Number of Board and Committee
details. Finance who is the final authority for
meetings held in year 2022 and
approval of their remuneration under
attendance on page 172.
the collective agreement.
Appointments to the Board Names of committees in which the
VALUE CREATION
DRIVING
z
(Principles A. 7 and A. 8) Director serves as the Chairman or a The BHRRC seeks professional advice
member on page 171. externally, when deemed necessary,
In accordance with the People’s Bank
Act, a maximum of 10 Directors are z Related party transactions on pages in discharging their responsibilities.
appointed by the Minister in charge of 294 to 298. The report of the BHRRC, disclosing
the portfolio of which two Directors the Statement of Remuneration Policy
are nominees of the respective Minister and the names of the Chairman and
APPRAISAL OF THE CEO members of the BHRRC is given on
handling the subject of cooperatives.
Appointments are made for a period of (Principle A. 11) page 195. The aggregate remuneration
AND ANALYSIS
three years subject to a maximum term paid to the Directors is given on
The evaluation of the CEO/GM is one
of nine years and an age limit of up to page 192.
of the most important responsibilities
70 years, whichever comes first in line of the Board. The evaluation process
with the provisions of the Banking Act provides a formal opportunity for Relations with shareholders
Direction No. 11 of 2007. the Board and CEO/GM to have a (Principles C. 1, C. 2)
constructive discussion regarding
All appointments for directorships are the performance and the leadership As a State Bank, with the Government
submitted to the Central Bank of Sri of the CEO/GM. The set of KPIs of Sri Lanka being the main
Lanka for assessment under the Fit and for the CEO/GM formulated under shareholder, People’s Bank comes
Proper Criteria for Directors. Strategic Planning and Performance directly under the purview of the
Management is reviewed quarterly by Ministry of Finance. The Board liaises
with the Ministry to ensure alignment
REPORTS
GOVERNANCE
the panel who submits the review to
APPRAISAL OF BOARD with the socio-economic development
the Board monthly for their review.
PERFORMANCE goals of the country.
These goals are confirmed by the
(Principle A. 9) Board and are used as the basis for the
annual CEO/GM’s appraisal process. The Annual Report is printed in English,
Every member of the Board conducts
Sinhala, and Tamil and is circulated
a self-assessment of his/her own
The CEO/GM is responsible to provide through the Ministry of Finance to
effectiveness as well as the Board as a
the Board with explanations for the Parliament. The Bank liaises with
team annually, incorporating all criteria
STATEMENTS
FINANCIAL
any adverse variances along with the Ministry of Finance for matters
specified in the Board performance
corrective action to be taken. concerning the Ministry.
evaluation checklist of the Code. The
responses are collated by the Board
Secretary and submitted to the Board Directors' and executive Major and material
as a summary report. remuneration procedure transactions
(Principles B. 1. B.1.1, B. 1.2, B. 1.3) (Principle C. 3)
Board remuneration is decided There were no transactions which

INFORMATION
SUPPLEMENTARY
according to guidelines set by the would materially alter the Bank’s or

Ministry of Finance. No Director is Group’s net asset base, other than
involved in determining his/her own those disclosed in the Note 45 to the
remuneration. The BHRRC makes Financial Statements, Related Party
Disclosures on pages 294 to 298.
Financial reporting duties with regard to risk management. adequate considering the evolving
Their roles and responsibilities are business operations of the Bank.
(Principle D. 1)
provided in the Committee Reports The Codes of Business Conduct and
The Annual Report presents a given on page 196. Ethics are in compliance with the
balanced review of the Bank’s requirements of the Schedule I of the
financial position, performance, BIRMC is supported by the Risk Code of Best Practice on Corporate
and prospects. Both narrative and Management Department of the Governance.
visual elements have been used in Bank. A comprehensive report on
presenting the information, to increase the Bank’s risk management process This Corporate Governance Report
comprehension and clarity. We have is included on pages 138 to 167 BAC from pages 168 to 204 complies with
provided a balanced view on our is supported by the internal audit the requirement to disclose the extent
performance in this report and other function of the Bank. The Internal Audit of compliance with the Code of Best
communications presented to relevant Department reviews the adequacy and Practice on Corporate Governance as
authorities including the Ministry of effectiveness of the internal control specified in Principle D 5.
Finance and regulators. The Bank takes systems and reports to the BAC on
every effort to ensure compliance a regular basis. Duties of the BAC
with statutory requirements in the
Shareholder relations
include keeping the scope and results
Annual Report and in the issue of of such audits and its effectiveness (Principles E and F)
interim communications on financial under review. BAC also plays a primary The relevant provisions of the Code
performance. role in liaising with the Auditor General, are not applicable, because the main
who conducts the external audit of shareholder of People’s Bank is the
The following disclosures as the Bank. Government of Sri Lanka.
required by the Code are
included in this Report:
Code of Business Conduct Sustainability report
z Statement of Directors’
and Ethics and Corporate (Principle G)
Responsibility for Financial
Governance Report
Reporting page 206 includes a The Board approved a Sustainability
statement of their responsibilities (Principles D. 4 and D. 5)
Policy for the Bank and has set in place
z Directors’ Statement on Internal The Bank has two Codes of Business a governance structure to ensure its
Control over Financial Reporting on Conduct and Ethics, one applicable philosophy, objectives, and strategic
pages 202 to 203. to the Directors and the other to the goals for social and environmental
z Management Commentary on pages employees. BHRRC is responsible to development are implemented.
40 to 136. regularly review the respective codes Accordingly, triple bottom line values
to ensure they remain relevant and have been embedded throughout the
z Statement of going concern of the
Bank’s operations in all geographic
Company is set out in the Statement
areas. The sustainable business
of Directors’ Responsibility on
initiatives of the Bank are described
page 206.
in line with the Principles of the
z Related Party Transactions are Code, as follows:
disclosed on pages 294 to 298 of
the Directors’ Report and in Note 43 Principle 1 – Economic Sustainability – Head of Finance's Review on pages 68 to 71
in the Financial Statements
Principle 2 – Environment – Natural Capital on pages 129 to 136
Principle 3 – Labour Practices – Human Capital on pages 95 to 107

Internal control and Audit
Committee Principle 4 – Society – Social and Relationship Capital on pages 108 to 136
(Principle D. 2 and D. 3)
Principle 5 – Product Responsibility – Social and Relationship Capital: Customer on
The Board is cognisant of its pages 108 to 114
responsibility for formulating
Principle 6 – Stakeholder identification, engagement and effective communication,
and implementing appropriate
Stakeholder Engagement on pages 47 to 49
and adequate processes for risk
management and sound internal Principle 7 – Sustainable reporting to be formalised as part of the reporting process and
control systems to safeguard to take place regularly – About Our Integrated Report on pages 3 to 6
shareholder interests and assets of the
Bank. BAC assists the Board in relation
to risk management while BIRMC
assists the Board in discharge of its
PEOPLE’S BANK
ABOUT
Section Principle Compliance and implementation Complied
3.1 Responsibilities of the Board
The Board has strengthened the safety and the soundness of the Bank in the
following manner:
FROM THE TOP

REFLECTIONS
a. Setting strategic objectives Board approved Strategic Plan 2022-2024 in place. Complied with
and corporate values
Bank’s strategic objectives have been communicated to
all Business Heads by the Strategic Planning and Research
Department. Further, awareness session on strategic plan
2022-2024 had been conducted for officers in AGM and
above level at the staff training college.
VALUE CREATION
DRIVING
b. Approval of overall Business Strategic Plan includes strategic objectives and overall Complied with
Strategy including Risk Policy business strategy of the Bank.
and Management
Risk Management procedures and mechanisms are in place.
Board has reviewed the Risk Management Policy of the
Bank. The Strategic Plan 2022-2024 includes the overall
business strategy, measurable goals, for at least next three
years including 2022.
c. Risk management Board Integrated Risk Management Committee (BIRMC) Complied with
AND ANALYSIS
takes the initiative in assessing of all risks of the Bank with
the assistance of the DGM (Risk Management) and the
relevant KMPs.
Also, BIRMC discusses new strategies of the Bank, the risks

arising out of new strategies and further the ways and
means to mitigate such risks. Further, Risk Management
Policy of the Bank had been reviewed as mentioned in
(b) above.
d. Communication with The Board has approved and implemented an effective Complied with
all stakeholders Corporate Communication Policy with all stakeholders. The
REPORTS
GOVERNANCE
Board has reviewed Communication Policy at their meetings.
e. Internal Control System and Internal Control Systems and Management Information Complied with
Management Information System have been reviewed by IAD and has been submitted
Systems to the Board Audit Committee. Further, audit of Finance
and Management Accounting Department including
Management Information Department 2021 had been
submitted to the BAC.
STATEMENTS
FINANCIAL
f. Key Management Personnel Board has defined and designated the following categories Complied with
(KMPs) as KMPs CEO, SDGMs, DGMs, AGMs, CRO/DGM (RM), HOF,
CIA, Compliance Officer, Head of Treasury, Head of Legal,
Head of IT and Board Secretary as defined in Banking Act
Determination No. 1 of 2019 and any other officer falling
under the definition of section 3(1) (i) (f) of the banking
act direction No 11 0f 2007.
INFORMATION
SUPPLEMENTARY
Further, KMP performance had been evaluated.

g. Define areas of authority There is a clear segregation of authority and responsibilities Complied with
and key responsibilities for between the Directors and the KMPs. Board members are
Directors and KMP responsible for taking strategic decisions of the Bank. KMPs
are responsible for carrying out the decisions made by the
Board and for operations. Further, Code of Best Practice on
Corporate Governance 1.3 includes the provisions relating to
authority and responsibilities of the CEO. Key responsibilities
of the KMPs are entirely operational based and are
specified in their respective job descriptions. Authority of
key management personnel are defined under delegation
authority limits.
h. Oversight of affairs of Board has exercised appropriate oversight of the affairs of Complied with
the Bank by KMP the Bank through Key Management Personnel.
i. Assess effectiveness of own governance practices
(i) The selection, nomination, In terms of the section 8 of the People’s Bank Act the Complied with
and election of Directors appointment of Directors are being made by the Minister,
and Key Management two of whom shall be nominated by the Minister of the
Personnel; subject of Co-operatives and selection, nomination and
recommendations of all KMPs are been processed by the
BNC and the approval has been obtained from
the Board.
(ii) The management of The Conflicts of Interests have been duly recorded in Complied with
conflicts of interests; and minutes.
(iii) The determination Self evaluation forms of Board of Directors had been Complied with
of weaknesses and obtained and to be submitted to the Board.
implementation of
changes where necessary.
j. Succession plan for KMP Board approved Succession Plan for CEO and KMPs Complied with
are in place.
k. Regular meetings with KMP Key Management Personnel are invited by the Board when Complied with
a need arises to explain matters relating to their area of
functions.
l. Regulatory environment Board has taken measures and processes are in place to Complied with
and maintaining an effective understand the regulatory environment and also the Bank
relationship with regulator maintains a relationship with regulators. On appointment
as Directors, the Board Secretary furnishes them with Code
of Best Practice on Corporate Governance 1.3, details of
existing Directors etc. Draft supervisory concerns raised
at the statutory examination conducted as at 28 February
2022, has been submitted to the Board Meeting held on
22 December 2022.
Attendance of the CEO at CBSL meetings further evidence

the relationship maintained with the regulator.
m. Hiring External Auditors As per Section 34 of People’s Bank Act, the Auditor General Complied with
is the auditor of the Bank.
PEOPLE’S BANK
ABOUT
3.1 (ii) Appointment of Chairman As per Section 10 of People’s Bank Act, Minister appoints Complied with
and CEO and defining and the Chairman of the Board from among the members of the
approving their functions and Board.
responsibilities
Mr Sujeewa Rajapaksha, an Independent, Non-Executive
FROM THE TOP

REFLECTIONS
Director, has been re-appointed as the Chairman of the Bank
by Minister of Finance, Economy and Policy Development
with effect from 21 December 2022.
Acting CEO/GM, Mr Clive Fonseka (appointed by the Board

at Board Meeting held on 23 December 2022 and extended
acting appointment by six months)
VALUE CREATION
DRIVING
Section 2.22 and 2.23 of Code of Best Practice in Corporate
Governance of the Bank defines the Powers and Roles of the
Chairman.
Code of Best Practice in Corporate Governance (CBPCG)

Section 3.9 Annex III of the Bank defines the Roles, Duties
and Responsibilities of the CEO/GM.
3.1 (iii) Regular Board meetings Bank has held 19 meetings during the year 2022. Complied with
AND ANALYSIS
There were 69 circular resolutions passed during the year
2022 and duly ratified at the next board meeting.
3.1 (iv) Arrangements for As a practice, Directors include matters and proposals in the Complied with
Directors to include Agenda for regular meetings.
proposals in the agenda
As per the section 2.16 (b) of Code of Best Practice in
Corporate Governance 1.3, provision is in place to enable all
Directors to include matters and proposals in the Agenda for
regular board meetings where such matters and proposals
relate to the promotion of business and the management of
REPORTS
GOVERNANCE
risks of the Bank.
3.1 (v) Notice of meetings Duties of the Secretary to the Board in the Code of Best Complied with
Practice in Corporate Governance 1.3 includes a provision
that preparing the calendar of regular Board meetings for
each year with the approval from the Board. Board meeting
Calendar for 2022 has been approved at Board Meeting held
on 30 November 2021.
STATEMENTS
FINANCIAL
Further as a practice, notice of at least 7 days is given for

the board to provide all Directors an opportunity to attend
regular meetings.
Further, due notice has been given for the 7 special and
emergency Board meetings held during the year 2022.
3.1 (vi) Directors attendance As per the Board Attendance schedule submitted by the Complied with
INFORMATION
SUPPLEMENTARY
Board Secretary, all Directors have attended two-thirds of

the meetings held during the year 2022. Some Directors
have attended online and none of the directors have not
attended three consecutive meetings.
3.1 (vii) Appointment and setting Board Secretary is an Attorney at Law who satisfies the Complied with
responsibilities of the Board provisions of Section 43 of the Banking Act No. 30 of 1988,
Secretary and section 2.5.i of Board approved SOR.
The Board has promoted Ms Shyama Wijekoon, Acting

Board Secretary as Secretary to the Board of Directors at
the Board Meeting held on 22 December 2022.
3.1 (viii) Directors access to advice and Section 2.25 of the Code of Best Practice in Corporate Complied with
services of Board Secretary Governance has a provision in this regard.
3.1 (ix) Maintenance of Board minutes Duties of the Secretary to the Board (Annex iv) given in Complied with
the Code of Best Practice in Corporate Governance
(version 1.3) approved by the Board includes a provision
in this regard.
Further, all Board members have access to the Board

minuets and Board Sub Committee minutes through
Board Pack.
3.1 (x) Minutes to be of sufficient Detailed minutes are kept covering the given criteria and the Complied with
detail and serve as a reference board minutes evidence that they contain the required details
for regulators and supervisory such as individual views of the members, ultimate decision
authorities of the Board, whether complies with strategies and policies
of the Bank etc. Further reports and information used by the
Board members in arriving at the decisions are mentioned.
3.1 (xi) Directors ability to seek Board approved policy is in place to seek independent Complied with
independent professional professional advice in appropriate circumstances, at the
advice Bank’s expense.
3.1 (xii) Dealing with conflicts of People’s Bank Act No.29 of 1961 Section 11 speaks on the Complied with
interest conflicts of interest of the Board of Directors. This procedure
further evidence that a Director is to abstain from voting on
any board resolution in relation to which he/she or any of
his/her close relation or a concern in which a Director has
substantial interest and he/she has not been counted in the
quorum.
Section 2.13 of Code of Best Practice of the Bank approved

by the Board also has a provision in this regard.
3.1 (xiii) Formal schedule of matters Section 2.28 of Board Charter included in Code of Best Complied with
reserved for Board decision Practice of the Bank approved by the Board defines the
Powers Reserved for the Board.
3.1 (xiv) Inform Central Bank if there Board is aware the necessity of informing Director of Bank Complied with
are solvency issues Supervision of the situation of the Bank prior to taking any
decision or action, if it considers that the procedures to
identify when the Bank is, or is likely to be, unable to meet
its obligations.
3.1 (xv) Capital adequacy Board has capitalised the Bank at levels required by Complied with
the Monetary Board. This has been addressed through
the Monthly Compliance Certificate submitted by the
Compliance Officer.
PEOPLE’S BANK
ABOUT
3.1 (xvi) Publish Corporate Governance The Board has published its Corporate Governance Report Complied with
Report in Annual Report on compliance with section 3 of this direction has been
published in the Annual Report 2022 on page 177 to 193.
3.1 (xvii) Self-assessment of Directors Board Secretary annually obtains the evaluation forms Complied with
FROM THE TOP

REFLECTIONS
from all the Directors.
The evaluation forms of all directors are available for the

year 2022, to be submitted to the Board.
3.2 The Boards composition
3.2 (i) Number of Directors The Board is comprised of not less than seven (7) directors Complied with
VALUE CREATION
DRIVING
during the year 2022.
The names of directors who have held directorships up to

31 December 2022 are as follows.
Mr Sujeewa Rajapakse
Mr Kumar Gunawardana
Mr Sudarshan Ahangama (resigned w.e.f. 7 April 2022)
Mr Isuru Balapatabendi
AND ANALYSIS
Mr K A Vimalenthirarajah (resigned w.e.f. 2 March 2022)
Mr Keerthi Goonatillake
Mr Manjula Wellalage
Ms Badrani Jayawardena (resigned w.e.f. 6 May 2022)
Ms Visakha Amarasekere (appointed w.e.f. 2 March 2022)
Mr Dhushmantha Thotawatte (appointed w.e.f. 8 July 2022)
3.2 (ii) (a) Period of service of a Director None of the directors of the Board has exceed the service Complied with
and (b) period of nine years.
N/A
REPORTS
GOVERNANCE
3.2 (iii) Board balance There are no Executive Directors in Complied with
the People’s Bank Board.
3.2 (iv) Independent Non-Executive During the year, the Board comprised of adequate number Complied with
Directors of independent non-executive Directors to comply with the
direction.
Independent ,Non-executive Directors during year 2022 are,

STATEMENTS
FINANCIAL
Mr Sudarshan Ahangama
Mr Isuru Balapatabendi
Mr Keerthi Goonatillake
Mr Manjula Wellalage
INFORMATION
SUPPLEMENTARY
Mr Dhushmantha Thotawatte
3.2 (v) Alternate Independent There are no provisions in the People’s Bank Act to appoint Complied with
Directors alternate Directors and as such, such a situation has not
arisen during the year.
3.2 (vi) Criteria for Non-Executive The appointments to the Board are made by the Minister Complied with
Directors in Charge of the Finance, under Section 8 of the People’s
Bank Act No. 29 of 1961 and representative from the Minister
of Finance and the Ministry of Trade are non- independent
directors where as other directors are independent.
3.2 (vii) More than half the quorum All Directors of the Bank are non- executive and as per Complied with
to comprise Non-Executive section 2.3 of Code of Best Practice of the Bank the
Directors stipulated quorum of the Board is five.
As per the Attendance submitted by the Board Secretary

for the financial year 2022 the required quorum has been
complied with at all Board meetings.
3.2 (viii) Identify Independent Composition of the Board, including the names of Chairman, Complied with
Non-Executive Directors in Non-Executive Directors, and Independent Directors have
communications and disclose been disclosed in the Annual Report 2022 on page 172.
categories of Directors in
Annual Report
3.2 (ix) Formal and transparent The appointments to the Board are made by the Minister of Complied with
procedure for appointments Finance, Economy and Policy Development, under Section 8
to the Board of the People’s Bank Act No. 29 of 1961.
3.2 (x) Re-election of Directors filling Such a situation does not arise since the Minister in Charge Complied with
casual vacancies of the subject appoints them.
3.2 (xi) Communication of reasons Section 8 (4) of People’s Bank Act, provides provisions for Complied with
for removal or resignation a Director to resign by writing a letter to the Minister of the
of Director subject. Further the Minister can also remove a Director by
publishing a Gazette notification.
Directors’ resignation and the reason for such resignation

are duly informed to Central Bank of Sri Lanka (CBSL).
3.2 (xii) Prohibition of Directors Annual declarations have been obtained from the directors. Complied with
or employees of a Bank
becoming a Director at Further, updates on the related party transactions of the
another bank directors have been circulated on quarterly basis.
3.3 Criteria to assess fitness and propriety of Directors
3.3 (i) Age of Director should not Provisions available under section 2.1 of Code of Best Complied with
exceed 70 years Practices. None of the persons who serve as Directors have
not exceeded 70 years during the year 2022.
The transitional provisions
3.3 (ii) Directors should not be As per the affidavits of Directors, none of the Directors Complied with
Directors of more than 20 hold directorships of more than 20 companies/entities/
companies and not more than institutions inclusive of subsidiaries or associate companies
10 companies classified as of the Bank during the year.
specified business entities
PEOPLE’S BANK
ABOUT
3.3 (iii) Director or CEO shall not be As per the confirmation submitted by the Board Secretary, Complied with
appointed as a Director or a Directors or CEO have not been appointed from another
CEO of another Licensed Bank bank during the year 2022.
operating in Sri Lanka prior to
FROM THE TOP

REFLECTIONS
expiry of 6 months cooling-off
period from the date of
cessation of his/her office
at a Licensed Bank
3.4 Management functions delegated by the Board
3.4 (i) Understand and study The Board is empowered by Section 32 of the People’s Bank Complied with
delegation arrangements Act to delegate its powers to any officer of the Bank and
VALUE CREATION
DRIVING
may revoke either wholly or in part as the case may be.
3.4 (ii) Extent of delegation should Complied with
not hinder Board ability to
discharge its functions
3.4 (iii) Review delegation The delegated powers are reviewed periodically by the Complied with
arrangements periodically Board to ensure that they remain relevant to the needs of
to ensure relevance to the Bank. Further a methodology has been prepared and
operations of the Bank submitted to the Board on 15 June 2022 for evaluating Both
AND ANALYSIS
subcommittees.
3.5 The Chairman and Chief Executive Officer
3.5 (i) Separation of roles Roles of Chairman and CEO are held by two individuals Complied with
appointed by the respective Minister in Charge and Board
of Directors.
3.5 (ii) Non-Executive Chairman Mr Sujeewa Rajapakse, who has been re-appointed as the Complied with
and appointment of a Senior Chairman of the Bank with effect from 21 December 2022 is
Independent Directors an independent, non-executive Director.
REPORTS
GOVERNANCE
As such a requirement does not arise to appoint a senior
independent director.
3.5 (iii) Disclosure of identity of All transactions with the Board members and with KMP and Complied with
Chairman and CEO and any their CFM has been disclosed and quarterly submitted to the
relationships with the Board BIRMC.
members
3.5 (iv) Self Evaluation Process of Board Secretary annually obtains the self-evaluation Complied with
STATEMENTS
FINANCIAL
the Board forms from all the Directors and self-evaluation forms
include these criteria.
3.(5) (v) Responsibility for agenda lies Agenda for Board meeting is drawn up by the Board Complied with
with Chairman but may be Secretary in consultation with the Chairman.
delegated to Board Secretary
INFORMATION
SUPPLEMENTARY
3.5 (vi) Ensure that Directors are The Chairman ensures, that all Directors are properly briefed Complied with
properly briefed and provided on issues arising at Board Meetings. Agenda and Board
adequate information Papers are circulated to the Directors giving adequate time
for them to go through the papers.
Minutes of previous month’s Board Meeting are distributed

to the Board members and tabled at the subsequent Board
Meeting for ratification/approval.
3.5 (vii) Encourage active participation Board Secretary annually obtains the evaluation forms from Complied with
by all Directors and lead all the Directors.
in acting in the interests of
the Bank The evaluation forms of all directors are available for the
year 2022, to be submitted to the Board.
3.5 (viii) Encourage participation of Board Secretary annually obtains the self-evaluation Complied with
Non-Executive Directors forms from all the Directors and since all Directors are
and relationships between non-executive separate sections had not been included in
Non-Executive and Executive the self-evaluation form.
Directors
3.5 (ix) Refrain from direct supervision Chairman does not directly get involved in the supervision of Complied with
of KMP and executive duties key management personnel or any other executive duties.
3.5 (x) Ensure effective Board maintains effective communication with the Complied with
communication with Government of Sri Lanka who is the main shareholder of the
shareholders Bank. Further, treasury representative represents the Board
and accordingly views of shareholder are communicated to
the Board.
3.5 (xi) CEO functions as the apex As per section 2.22 of Annex iii of Code of Best Practices Complied with
executive in charge of the day (functions & responsibilities of the CEO), he is the apex
to day operations executive-in charge of the day-to-day management of the
Bank’s operations and business.
3.6 Board Appointed Committees
3.6 (i) Establishing Board The Bank has established four Board Committees namely, Complied with
Committees, their functions, Audit Committee, Human Resources and Remuneration
and reporting Committee, Nomination Committee and Integrated Risk
Management Committee. Other than the above minimum
requirement, the bank has established 4 additional Board
sub committees.
Reports/Minutes of such committees are submitted and

tabled at the main board for the information and review by
the Board.
The Annual Report 2022 includes individual reports of each

Board sub committees and such report includes a summary
of its duties, roles and performance of each committee from
page 194 to 201.
PEOPLE’S BANK
ABOUT
3.6 (ii) Audit Committee
a. Chairman to be an Mr Dushmantha Thotawatte was appointed to the Board Complied with

Independent Non-Executive of Directors with effect from 8 July 2022. Mr Thotawatte is
Director with qualifications a fellow member of the Institute of Chartered Accountants
FROM THE TOP

REFLECTIONS
and experience in of Sri Lanka with a Bachelor of Commerce (Special Degree)
accountancy and/or audit from the University of Sri Jayawardhanepura & a Master in
Financial Economics from the University of Colombo. He is an
accomplished leader who has extensive experience in the field
of Financial Management, Corporate Governance, Strategic
Management and Public Relations, together a successful track
record as Chief Executive Officer, Chief Financial Officer and
Chief Internal Auditor in many state owned enterprises and
VALUE CREATION
DRIVING
private organisations and counts over 38 years of experience.
b. Committee to comprise solely All members of the committee are non- executive Directors. Complied with
of Non-Executive Directors
c. Audit Committee functions
(i) The appointment of the The Auditor General is the External Auditor of the Bank as Complied with
External Auditor for audit provided in the Constitution of the country. Therefore, the
services to be provided Committee has no role to play in the engagement of the
AND ANALYSIS
in compliance with the External Auditor.
relevant statutes;
Committee has made recommendations on matters in
(ii) The implementation of connection with the implementation of the Central Bank Complied with
the CBSL guidelines guidelines issued to auditors from time to time.
issued to Auditors from
time to time; Committee has reviewed and discussed the relevant
accounting standards as and when required.
(iii) The application of the Complied with
relevant accounting The Auditor General is the External Auditor of
standards; and the Bank as provided in the Constitution of the country.
REPORTS
GOVERNANCE
(iv) The service period, audit Complied with
fee and any resignation or
dismissal of the Auditor
d. Review and monitor External This is not relevant since the auditor of Complied with
Auditor’s independence the Bank is Auditor General.
and objectivity and the
effectiveness of the audit
STATEMENTS
FINANCIAL
processes
e. Provision of non-audit services This is not relevant since the auditor of the Bank is Complied with
by an External Auditor Auditor General.
f. Determines scope of audit Committee has discussed and finalised the nature and Complied with
scope of the audit with the external auditors in accordance
with SLAS before the audit commenced at the BAC Meeting
INFORMATION
SUPPLEMENTARY
held on 16 November 2022.

g. Review financial information Committee has a process to review financial information of Complied with
of the Bank the Bank when the quarterly and annual financial statements
and the reports prepared for disclosure are presented to the
committee by the Head of Finance.
Head of Finance has presented the quarterly financial

statements and key financial ratios and dashboard for the
year 2022. The committee has recommended the same for
submission to the Board.
h. Discussions with External Committee has held a confidential discussion with the Complied with
Auditor on interim and final representative of Auditor General.
audits
i. Review of Management Letter Committee reviews the management letter and the Complied with
and Bank’s response responses thereto and for the year 2021 to be submitted
to the BAC.
j. Review of internal audit

function
(i) The adequacy of the scope, Committee has discussed the Scope and functions of the Complied with
functions and resources of Internal Audit Department along with the audit plan.
the IAD and satisfy itself
on necessary authority to
carry out its work;
(ii) Internal audit programme IAGM-Audit has presented the Audit Plan 2023 to the Complied with
and results of the internal Board Audit Committee on 16 November 2022 and BAC
audit process has discussed the progress of achieving the audit plan,
status of CBSL statutory examination reports, audit
queries raised by National Audit Office, achievement
of other KPIs etc.
The Committee has reviewed the Audit Plan for 2022 at

the Meeting held on 25 February 2022.The Committee has
reviewed the progress of achieving the Audit Plan 2022
at the Meeting held on 16 September 2022. Further, BAC
ensures the actions taken on the recommendations of
internal audit department.
(iii) Any appraisal or Performance appraisal of Mr M M A Rizan Complied with

assessment of the (Chief Manager-Audit) submitted to the Board Audit
performance of the head Committee held on 25 February 2022. Performance
and senior staff members appraisal of Mr.E A M Dissanayake (AGM-Audit) submitted
of IAD to the Board Audit Committee held on 16 September 2022.
Performance appraisal of Ms G S Galapaththi (AGM-Audit)
submitted to the Board Audit committee meeting
held on 16 September 2022. Performance appraisal of
Mr M H M Rizan (CM-Audit) submitted to the Board Audit
Committee held on 16 November 2022.
PEOPLE’S BANK
ABOUT
(iv) Recommend any N/A Complied with

appointment or
termination of the head,
senior staff members,
FROM THE TOP

REFLECTIONS
and outsourced service
providers
(v) The Committee is N/A Complied with

appraised of resignations
of senior staff members
of IAD including the Chief
Internal Auditor and
any outsourced service
VALUE CREATION
DRIVING
providers, and to provide
an opportunity to the
resigning senior staff
members and outsourced
service providers to
submit reasons for
resigning;
(vi) The internal audit function Confirmation of the Internal Audit Activity 2022 has Complied with
AND ANALYSIS
is independent of the been submitted to the Board Audit Committee held on
activities it audits and 16 September 2022.
that it is performed with
impartiality, proficiency,
and due professional care.
k. Internal investigations Progress of Internal Investigations handled by Investigations Complied with

and Inquiries Department as at 20 June 2022 submitted to
the Board Audit Committee held on 16 September 2022.
l. Attendees at Audit This is not relevant since there are no Executive Directors in Complied with
Committee meetings the Board of People’s Bank.
REPORTS
GOVERNANCE
m. Explicit authority, resources, Board approved Code of Best Practice in Corporate Complied with
and access to information Governance 1.3 Section 6.1.7 speaks of the rights of
the Board Audit Committee and ensures that the committee
has such authority.
TOR of the BAC has been further reviewed by the

committee at their meetings held on 16 September 2022 and
STATEMENTS
FINANCIAL
recommended the same for the approval of the Board.
n. Regular meetings BAC has held five (5) meetings during the year 2022 and Complied with
minutes of such meetings are maintained by the Board
secretary.
o. Disclosure in Annual Report Details of the activities of the Audit Committee has been Complied with
disclosed in the Annual Report 2022 on page no 194
INFORMATION
SUPPLEMENTARY
Number of meetings and attendance of each individual

Director have been disclosed in the Annual Report 2022
on page No. 172
p. Maintain minutes of meetings The Board secretary has been appointed as the Secretary Complied with
of Board Audit Committee and keeps detailed minutes of
the meetings.
q. Whistle-blowing policy and Board approved Whistle Blowing Policy had been Complied with
relationship with External communicated to the staff by the staff circular and
Auditor amendment to the policy had been made by the BAC
and has been submitted to the Board
3.6 (iii) Human Resources and Remuneration Committee
(a) Remuneration policy relating Remuneration of the Directors is decided by the guidelines Complied with
to Directors, CEO/GM and Key set up by the Ministry of Finance.
Management Personnel of As per Secretary to the Board, the Board has reviewed
the Bank. the Terms of reference of Board Subcommittees and
implemented a Compensation/Remuneration Policy to
determine the remuneration (salaries, allowances and other
financial payments) relating to CEO and KMPs.
However, the Collective Agreement of the Bank has been

submitted to the Board in order to obtain the approval.
(b) Set goals and targets for the Goals and targets of CEO and KMPs are documented for Complied with
Directors, CEO/GM, and the the year 2022 through Board strategic plan review
Key Management Personnel committee on 2 March 2022. The nature of all directors
of the Board is “Non-Executive”. Therefore, goals and
targets has not been assigned.
(c ) Evaluating the performance A new performance evaluation template for the corporate Complied with
of the CEO and Key and executive management of the Bank has been
Management Personnel developed.
As per the Secretary to the Board, BHRRC reviewed the

performance appraisal of CEO/GM and all KMPs.
(d) The CEO shall be present at Reviewed Terms of Reference of Board Sub Committees’ Complied with
all meetings of the Committee, and meeting held on 30 September 2019 evidence that
except when matters the CEO/GM should be present at all meetings of the
relating to the CEO committee, except when matters relating to the CEO/GM
are being discussed. are being discussed.
3.6 (iv) Nomination Committee
a. Appointment of Directors, Directors are appointed by the Minister in charge of the Complied with
CEO and KMP subject as per the provision of the People’s Bank Act.
Succession Plan approved by the Board Paper

dated 8 September 2022. SOR had been prepared
for management trainee and above level. However,
qualifications and experience relevant for KMP
specifically not available in the above SOR.
PEOPLE’S BANK
ABOUT
b. Re-election of Directors This requirement does not arise since Directors are Complied with
appointed by the Minister in charge of the subject as
per the provision of the People’s Bank Act.
c. Eligibility criteria for Board has approved the selection criteria such as Complied with
FROM THE TOP

REFLECTIONS
appointments to key qualifications, experience and key attributes required
managerial positions for eligibility to be considered for appointment or promotion
including CEO to the post of CEO, DGMs and AGMs who are considered
as the key management personnel and has included in their
job descriptions.
The Committee has granted approval for the evaluation

criteria for the selection and appointment of KMPs in the
VALUE CREATION
DRIVING
Bank. Selection, nomination and recommendations of all
KMPs are been processed by the BNC and the approval
has been obtained from the Board.
Further the scheme of recruitment has been

submitted to the BHRRC.
d. Fit and proper persons The Annual declarations of the Directors for the year 2022 Complied with
has been obtained from the directors and sent to the CBSL.
AND ANALYSIS
e. Succession Plan and new Boards of Directors are appointed by the Complied with
expertise Minister of Finance, Economy and Policy Development.
Board approved Succession Plan for CEO and

Key Management Personnel is in place.
f Committee Chairman and Committee is Chaired by Mr Sujeewa Rajapakse who is an Complied with
preferably majority of independent director re-appointed on 21 December 2022.
Directors be Independent. Other members were Mr Kumar Gunawardana, Mr Keerthi
The CEO may be present Goonatillake as at 26 December 2022.
at meetings by invitation.
CEO participates at the BNC meetings by invitation.
REPORTS
GOVERNANCE
3.6 (v) Integrated Risk Management Committee/Board Risk Management Committee
a. Composition of BIRMC Committee consists of three Non-Executive Directors, Complied with

CEO/GM, DGM – Risk Management and any others on
invitation (including officer In charge of Compliance).
Non-Executive Directors of the Committee were

Ms Visakha Amarasekere (Chairperson of BIRMC),
STATEMENTS
FINANCIAL
Mr Isuru Balapatabendi, Mr Dushmantha Thotawatte,

Mr Ranjith Kodituwakku and on invitation Ms Roshini
Wijerathna – DGM (Risk Management), Ms Samanthi
Senanayake-AGM (Compliance) and Mr E A M Dissanayake –
Chief Internal Auditor are attending to the Committee.
INFORMATION
SUPPLEMENTARY
b. Risk assessment BIRMC has implemented a procedure to assess risks such Complied with
as credit, market, strategic, operational and liquidity risks of
the Bank through relevant risk indicators and management
information and such risks are reported to BIRMC through
Quarterly Risk Report and Risk Matrix table.
c. Review of management level Committee has evaluated the adequacy and effectiveness Complied with
committees on risk of all managerial level committees against their current
Terms of References (TOR).
d. Corrective action to mitigate Committee has reviewed and considered risk indicators Complied with
risks exceeding prudential which have gone beyond the specified quantitative and
levels qualitative risk limits.
e. Frequency of meetings BIRMC has held four (04) meetings during the Complied with
financial year 2022.
f. Actions against officers As per the board secretary’s confirmation this is handled by Complied with
responsible for failure to a separate Board subcommittee named BHRRC.
identify specific risks or
implement corrective action
g. Risk assessment report Committee submits Risk Minutes to the Board for Complied with
to Board their review.
h Compliance function Committee has established a compliance function to assess Complied with
the bank’s compliance with laws, regulations, and regulatory
guidelines. Compliance Officer who has been designated as
a KMP submits monthly reports on statutory and mandatory
requirements/regulations and the status of compliance to the
Board and Report on Compliance Risk to the BIRMC.
Further, Compliance officer submits a monthly compliance

report on Regulations issued to the Board for their awareness.
Compliance function annually obtains a confirmation from

all dept. heads to ensure Bank’s compliance with internal
controls and approved policies on all areas of business
operations of the Bank.
3.7 Related Party Transactions
3.7 (i) Avoid conflict of interest Section 2.14 of Code of Best Practice of the Bank approved Complied with
by the Board on 30.09.2011 includes a documented Related
Party Policy which speaks on categories of related parties,
and for the Bank to avoid any conflicts of interest that may
arise from any transaction of the bank with them. KMP and
their close relations had not been mentioned as related
parties in the above code of best practice.
However, Head of Finance has submitted a Related Party

Transaction Policy dated 16.03.2018 which has been
recommended by the BAC and approved by the Board.
Related party transactions including KMP are quarterly

submitted to BIRMC.
PEOPLE’S BANK
ABOUT
3.7 (ii) Related party transactions Section 2.14 of Board approved Code of Best Practice of Complied with
covered by direction the Bank includes a documented policy which identifies
types of related party transactions and for the Bank to
avoid any conflicts of interest that may arise from any
FROM THE TOP

REFLECTIONS
transaction with related parties.
3.7 (iii) Prohibited transactions As per Section 2.14 of the Board approved Code of Best Complied with
Practice of the Bank there is a documented Policy which
identifies types of related party transactions and to ensure
that the Bank does not engage in such transactions in a
manner that would grant such parties “more favorable
treatment” than that accorded to other constituents of
the Bank carrying on the same transaction with the Bank.
VALUE CREATION
DRIVING
Based on the declarations and information received from
Directors and KMP, Bank identifies related party transactions
via NIC and CIF from the system and submits a report to
BIRMC on quarterly basis.
A process established to forward proposals for

Accommodations to Compliance Dept. to ensure that
the proposals are in compliance with CBSL guidelines.
AND ANALYSIS
This ensures that the Bank would not offer any “favorable
treatment” to related parties than that accorded to other
constituents of the Bank carrying on the same business.
3.7 (iv) Granting accommodation As per Section 2.14.D of the Board approved Code of Complied with
to a Director or close Best Practice, there is a documented Policy which
relation to a Director speaks on granting accommodation to any of its Directors
or to a (close relation), and that such accommodation is
sanctioned at a meeting of its Board of Directors, with not
less than two-thirds of the number of Directors other than the
Director concerned, voting in favor of such accommodation
REPORTS
GOVERNANCE
and that this accommodation be secured by such security as
may from time to time be determined by the Monetary board.
However, above code of practice does not include

provisions regarding the KMPs accommodation.
Deviations have not taken place during 2022.
3.7 (v) Accommodations granted Section 2.14.E of Board approved Code of Best Practice Complied with
STATEMENTS
FINANCIAL
to persons, or concerns of of the Bank, includes a documented Policy as required by

persons, or close relations of point No. 3 (7) (v).
persons, who subsequently
are appointed as Directors Deviations have not taken place during 2022.
of the Bank
3.(7) (vi) Favourable treatment or Transactions with Key management Personnel (KMP) and Complied with
INFORMATION
SUPPLEMENTARY
accommodation to Bank their Close Family members (CFM) submitted to the BIRMC.
employees or their close
relations
3.7 (vii) Remittance of As per Section 2.14.f of the Board approved Code of Best Complied with
accommodations subject to Practice there is a process in place at the Bank in this regard.
Monetary Board approval
Deviations have not taken place during 2022
3.8 Disclosures
3.8 (i) Publish annual and quarterly Bank prepares and publishes Annual/Quarterly Financial Complied with
financial statements Statements in accordance with CBSL prescribed formats
and applicable accounting standards.
All Quarterly/Annual Financial Statements are prepared and

published in the newspapers in three languages.
3.8 (ii) Disclosures in Annual Report
a. A statement to the effect The statement to this effect is included in the Directors’ Complied with
that the annual audited Responsibility for Financial Reporting on page 206 of the
financial statements have Annual Report 2022.
been prepared in line with
applicable accounting
standards and regulatory
requirements, inclusive of
specific disclosures.
b. The report by the Board on Report by the Board on the Bank’s internal control Complied with
the Bank’s internal control mechanism has been disclosed in the “Directors’ Statement
mechanism on Internal Control” in the Annual Report 2022 on page 203.
c External Auditor’s certification “Auditor General’s Assurance Report” on Internal Controls Complied with
on the effectiveness of the disclosed on page no 204 in the Annual Report 2022.
internal control mechanism
d Details of Directors, Details of Directors including names, qualifications and Complied with
including names, fitness experience disclosed under profiles of Directors on
and propriety, transactions pages 26 to 27 in the Annual Report 2022.
with the Bank, and the total
of fees/remuneration paid Directors’ Emoluments have been disclosed under Note. 13
by the Bank to the Financial Statements on page 239.
Aggregate value of Remuneration and transactions with

Directors 2022
LKR ’000
Short term employee benefits 6,405.0
Post employment pension –
Termination benefits –
Share based payments –
Other long term benefits –
Loans & Advances including credit cards 26,832.4
Deposits 74,313.0
Investments –
PEOPLE’S BANK
ABOUT
e. Total accommodations Total accommodation granted to related parties 2022. Complied with
granted to each category
of related parties and as a Aggregate value of remuneration and transactions with
percentage of the Bank’s KMP 2022.
FROM THE TOP

REFLECTIONS
regulatory capital
LKR ’000 Percentage of
Bank’s Regulatory
Capital (%)
Directors 26,832.4 0.02
Closed Family Members

of the Directors – –
Key Management
VALUE CREATION
DRIVING
Personnel (KMP) 202,511.9 0.17
Closed Family Members

of the KMP 21,161.0 0.02
Subsidiaries 54,671.1 0.05
Sub Subsidiaries 392,519.7 0.34
Government and
Government Related Entities 856,610,615.6 736.56
AND ANALYSIS
Concern in which any of
the Bank's Director or close
family member of any of
the Bank's Director has
substantial interest 10,177.0 0.01
f. Aggregate values of Aggregate value of Remuneration and transactions Complied with

remuneration to, and with KPM 2022
transactions with KMP
LKR ’000
Short term employee benefits 526,381.3
REPORTS
GOVERNANCE
Post employment pension 56,409.6
Termination benefits –
Share based payments –
Other long term benefits –
Loans and Advances including credit cards 202,511.9
Deposits 486,200.4
STATEMENTS
FINANCIAL
Investments –
g. External Auditors certification Board has obtained the Auditor General’s Factual Complied with
of compliance Findings Report on Corporate Governance. All findings
of the Auditors have been incorporated in this Corporate
Governance Report.
INFORMATION
SUPPLEMENTARY
h. Report confirming compliance This has been disclosed in “Directors’ Responsibility Complied with
with prudential requirements, for Financial Reporting” on page 206 of the
regulations, laws, and internal Annual Report 2022.
controls
i. Non-Compliance Report None Complied with

BOARD SUBCOMMITTEE REPORTS

BOARD AUDIT COMMITTEE
REPORT (BAC)
COMPOSITION the charter adopted by the Board of observed. The minutes of the BAC
Directors for the functioning of the meetings are reported to the Board
The committee comprises of three Committee. for information.
Non-Executive Independent Directors
as at the end of the year. The BAC in particular: The BAC also followed up on
z Reviews the financial reporting corrective measures taken by the
Chairman process to ensure the compliance management during the year 2022
with financial reporting requirements on matters raised by CBSL Statutory
Mr Dushmantha Thotawatta Examination Reports.
under the statute.
z Examines the system of internal
Other members control and management of
The BAC ensured the provision
of all information and documents
Mr Dushmantha Thotawatta business risks.
required by the Auditor General for
Mrs Visakha Amarasekere z Reviews the audit processes, both the purpose of audit and compliance
Mr Keerthi Goonatillake external and internal. with Sri Lanka Accounting Standards
z Reviews the procedures in place in preparation and presentation of
for monitoring compliance with Financial Statements. The BAC is of
REGULAR ATTENDEES BY laws and regulations and in the view that adequate controls and
INVITATION particular the guidelines of the procedures are in place and Charter
Chief Internal Auditor, Deputy General Central Bank of Sri Lanka. of the BAC were complied with all
Manager (Risk Management), Head material aspects.
of Finance and Assistant General ACTIVITIES IN 2022
Manager (Compliance) attend the FUTURE FOCUS
BAC meetings on invitation. The The Committee during the year under
Superintendent of the Government review attended to the following: The Board Audit Committee will
Audit also attends these meetings. z Reviewed quarterly financial commit to achieve the objective of the
performance of the Bank for the charter and promote effective internal
year 2022 and recommended to control mechanism.
SECRETARY TO THE
submit the same to the Board.
COMMITTEE
z Reviewed and discussed issues
The Actg. Board Secretary functions raised at CBSL Limited Scope
as the Secretary to the BAC Statutory Examination as at
30.11.2020 and monitored the
progress of rectification. Mr Dushmantha Thotawatta
MEETINGS
z Periodic review of internal audit Chairman of the Audit committee
Five (05) meetings were held reports and the performance of
during the financial year ended 27 February 2023
the Internal Audit Department.
31 December 2022.
z Reviewed Information System
Procedures and recommended
QUORUM appropriate changes and
monitored the progress of their
The quorum for a BAC meeting is two
implementation.
(02) members.
z Reviewed the special reports
such as Root Cause Analysis over
ROLE OF THE COMMITTEE deficiencies of Branch Operations.
The Board Audit Committee (BAC)
The BAC considered the internal audit
of the Bank was constituted in
reports, the deficiencies observed
accordance with the provisions of
therein, responses given by the
Banking Act Direction No. 11 of 2007,
respective DGMM/Heads of the
Corporate Governance for Licensed
Departments and monitored corrective
Commercial Banks in Sri Lanka.
actions taken to rectify deficiencies
Proceedings of BAC were based on
BOARD HUMAN RESOURCES AND
PEOPLE’S BANK
ABOUT
REMUNERATION COMMITTEE REPORT (BHRRC)
COMPOSITION ROLE OF THE COMMITTEE
The committee comprises of not z The BHRRC is responsible for
fewer than 2 and not more than 3 formulating human resource and
FROM THE TOP

REFLECTIONS
Non-Executive Independent Directors remuneration policies and initiating
as at the end of the year and the CEO/ strategies in relation to human
General Manager is required to be resource management.
present at each meeting.
z The Committee plays a key role in
recruitment and determining salaries
Chairman and other employee benefits.
Mr Sujeewa Rajapakse z The Committee review employment
contracts of the members of
VALUE CREATION
DRIVING
the Corporate and Executive
Other members Management as well setting goals
Mr Isuru Balapatabendi – Director and targets for the CEO/General
Manager and Key Management
Mr Manjula Wellalage – Director
Personnel.
Mr Clive Fonseka – CEO/
z Evaluating the performance of the
General Manager (Actg.)
CEO/General Manager and KMPs
(w.e.f. 27 February 2023)
against the set goals and targets
AND ANALYSIS
periodically and determining the
REGULAR ATTENDEES BY basis for revising remuneration and
INVITATION benefits, etc.
DGM (Human Resources) attends

meetings on invitation and any other FUTURE FOCUS
officer of the Bank may be present at
The Board Human Resources and
meetings on invitation.
Remuneration Committee will
ensure all the Human Resource and
SECRETARY TO THE Remuneration arrangements support
COMMITTEE the strategic aims of the Bank.
REPORTS
GOVERNANCE
The Board Secretary functions as the
Secretary to the BHRRC.
MEETINGS
Nine (09) meetings were held
Chairman of the Board Human
during the financial year ended
Resources and Remuneration
31 December 2022.
STATEMENTS
FINANCIAL
Committee
27 February 2023
QUORUM
The quorum for a BHRRC meeting is
two Directors of the Board and the
CEO/General Manager.
INFORMATION
SUPPLEMENTARY
BOARD INTEGRATED RISK MANAGEMENT

COMMITTEE REPORT (BIRMC)
The committee comprises of three z The Committee is responsible for
Non-Executive Independent Directors, reviewing the risk profile of the
CEO/General Manager, DGM (Risk Bank within the risk parameters
Management) and any other officer of determined by the Board.
the Bank may be present on invitation.
z The Committee is responsible for the
assessment of all risks pertaining to
Chairman credit, market, liquidity, operational,
information technology, and
Ms Visakha Amarasekere
strategic risks, using appropriate
risk indicators and management
Other members information.
Mr Dushmantha Thotawatta – Director z Among other responsibilities
related to risk management,
Mr Isuru Balapatabendi – Director
the Committee monitors risk
Mr Clive Fonseka – CEO/ oversight, implementation and risk
General Manager (Actg.) management in relation to credit,
Ms Roshini Wijerathna – DGM finance, operations and legal/
(Risk Management) compliance.
z Reviewing the adequate and
REGULAR ATTENDEES BY effectiveness of all management
level committees such as credit
INVITATION
committee and Asset-Liability
Any other officer of the Bank may Committee to address specific risks
be present at meetings on invitation. and to manage those risks within
quantitative and qualitative risk
limits as specified by the Committee.
SECRETARY TO THE
COMMITTEE
FUTURE FOCUS
Secretary to the BIRMC The Board Integrated Risk
Management Committee will be
focused to ensure the adequacy and
MEETINGS effectiveness of the risk management
Four (04) meetings were held during framework of the Bank.
the financial year ended 31 December
2022.
QUORUM
The quorum for a BIRMC meeting is
two Directors of the Board and the
CEO/General Manager.
Chairman of the Board Integrated
Risk Management Committee
27 February 2023
BOARD EXECUTIVE CREDIT

COMMITTEE REPORT (BECC)
PEOPLE’S BANK
ABOUT
COMPOSITION z Approving all credits in excess of
the limits delegated to CEO/General
The committee comprises of at least Manager and imposing additional
two Non-Executive Independent covenants, conditions when deemed
Directors of the Board and the CEO/ appropriate.
General Manager, as at the end of the
year (i.e – 26 December 2022)
z Approving rescheduling, lump sum
FROM THE TOP

REFLECTIONS
settlement and interest concessions
proposals, in excess of authority
Chairman given to CEO/General Manager.
Mr Kumar Gunawardana z Reviewing credit related systems,
their implementation, monitoring
and managing portfolio level risks
Other members to improve portfolio quality.
Mr Keerthi Goonatillake – Director z Recommending prudential measures
VALUE CREATION
DRIVING
Mr Manjula Wellalage – Director of control credit risk.
Mr Ranjith Kodituwakku –
CEO/General Manager FUTURE FOCUS
(as at 26 December 2022)
The Board Executive Credit Committee
will commit to ensure effective credit
REGULAR ATTENDEES BY risk management of the Bank.
INVITATION
AND ANALYSIS
Any other credit line officer of the
Bank attends the BECC meetings on
invitation.
SECRETARY TO THE
COMMITTEE
Chairman of the Board Executive
Board Secretary functions as the Credit Committee
Secretary to the BECC.
27 February 2023
MEETINGS
REPORTS
GOVERNANCE
Twenty Four (24) meetings were
held during the financial year ended
31 December 2022.
QUORUM
The quorum for a BECC meeting is
STATEMENTS
FINANCIAL
three members including two Directors

of the Board.
ROLE OF THE COMMITTEE

z Approving Bank’s Credit
Management Structure and
establishing credit approval
INFORMATION
SUPPLEMENTARY
authorities including the level of

delegation.
BOARD NOMINATION
COMMITTEE REPORT(BNC)
The committee comprises of three z The main responsibility is to
Non-Executive Independent Directors implement a procedure to select/
as at the end of the year appoint a CEO/General Manager and
Key Management Personnel. The
Chairman Committee sets the eligibility criteria
for appointment or promotion to the
Mr Sujeewa Rajapakse post of CEO/General Manager and
the Key Management Positions.
Other members z The Committee is also responsible
for consideration of the requirement
Mr A M P M B Atapattu – Director
for additional/new expertise and the
Mr Manjula Wellalage – Director succession arrangements for retiring
(w.e.f. 27 February 2023) Key Management Personnel.
z To set the criteria such as
REGULAR ATTENDEES BY qualifications, experience and key
attributes required for eligibility to
INVITATION
be considered for appointment of
Actg. CEO/General Manager attends promotion to the post of CEO/GM
the meetings on invitation. and Senior Management Positions.
SECRETARY TO THE FUTURE FOCUS

COMMITTEE
The Board Nomination Committee
The Board Secretary functions as the will commit to ensure standard
Secretary to the BNC appointments in corporate and
executive management in line with
the stranded direction for the Bank.
MEETINGS
Six (6) meetings were held during the
financial year ended 31 December 2022.
QUORUM
The quorum for a BNC meeting is three Chairman of the Board
(3) members. Nomination Committee
27 February 2023
BOARD INVESTMENT BANKING

COMMITTEE REPORT (BIBC)
PEOPLE’S BANK
ABOUT
The committee comprises of at least z Regular review of Investment
two Directors of the Board, CEO/ Banking model of the Bank.
General Manager, Head of Treasury,
z Review of the operations of IBU.
DGM (Risk Management) and any
other officer on invitation. z Name clearance of the potential
FROM THE TOP

REFLECTIONS
clients.
z To obtain approval in the case of
Chairman
jointly managing issues.
Mr Kumar Gunawardana z Approval for management fee/
brokerage sharing basis.
Other members z Review of new investment and
banking product inclusions and
Ms Visakha Amarasekere – Director
introduction.
VALUE CREATION
DRIVING
Mr Ranjith Kodituwakku –
CEO/General Manager FUTURE FOCUS
Ms Roshini Wijerathna – The Board Investment Banking
DGM (Risk Management) Committee will focus to ensure
Mr Clive Fonseka – effective investments for the Bank.
CEO/General Manager (Actg.)
(as at 26 December 2022)
AND ANALYSIS
REGULAR ATTENDEES BY
INVITATION
Any other officer of the Bank may Mr Kumar Gunawardana
attend the meetings on invitation. Chairman of the Board Investment
Banking committee
SECRETARY TO THE 27 February 2023
COMMITTEE
REPORTS
GOVERNANCE
Secretary to the BIBC.
MEETINGS
Three (03) meetings were held during
2022.
STATEMENTS
FINANCIAL
QUORUM
The quorum for a BIBC meeting is
three members including two Directors
of the Board.
INFORMATION
SUPPLEMENTARY
BOARD INFORMATION TECHNOLOGY

COMMITTEE REPORT (BITC)
The committee comprises of at least The Committee will be empowered to:
two Directors of the Board, Chief z Review the overall progress of IT
Information Officer, DGM (Channel
z Recommend the adequacy and
Management). Members of the
allocation of IT resources in terms of
Committee are appointed by Board
funding, personnel and equipment.
on recommendation of the Board
Nomination Committee. z Make recommendations to the
Board for initiatives taken by IT for
Bank wide IT strategies, investments
Chairman and projects.
Mr Keerthi Goonatillake z Make recommendations to the
Board for IT policies and funding
priorities which are initiated by IT.
Other members
Mr Kumar Gunawardana –
Director FUTURE FOCUS
Mr Dhammika Dasa – The Board Information Technology
Chief Information Officer Committee will ensure that the IT
DGM (Channel Management) services and operations will be aligned
with Bank's strategies.
REGULAR ATTENDEES BY
INVITATION
Any other officer shall attend the
meeting on invitation.
SECRETARY TO THE Mr Keerthi Goonatillake

COMMITTEE Chairman of the Board IT Committee
The Board Secretary functions as the 27 February 2023
Secretary to the BITC
MEETINGS
Five (5) meetings were held
during the financial year ended
31 December 2022.
QUORUM
The quorum for a BITC meeting
is three members including Chief
Information Officer.
BOARD STRATEGIC PLANNING REVIEW

COMMITTEE REPORT (BSPRC)
PEOPLE’S BANK
ABOUT
The committee comprises of Chairman, z To review the key points highlighted
two Non-Executive Independent and discussed at Strategic Planning
Directors and CEO/General Manager monthly progress review meetings
as at the end of the year. and to recommend corrective
measures.
FROM THE TOP

REFLECTIONS
Chairman z To develop policies based on
recommendations.
z To provide guidance and direction
for Strategic Plan implementation
Other members process.
Ms Visakha Amarasekere – Director FUTURE FOCUS
VALUE CREATION
DRIVING
Mr Clive Fonseka – CEO/
The Board Strategic Planning
General Manager (Actg. )
Review Committee will focus to
(w.e.f. 27 February 2023)
assist the Board in fulfilling its
fiduciary responsibility in order to
REGULAR ATTENDEES BY accomplish the Bank’s vision.
INVITATION
DGM (Strategic Planning, Performance
AND ANALYSIS
Management & Research) and any
other officer of the Bank may be
present at meetings by invitation.
Chairman of the Board Strategic Plan
SECRETARY TO THE Review Committee
COMMITTEE 27 February 2023
Secretary to the BSPRC.
MEETINGS
REPORTS
GOVERNANCE
Four (04) meetings were held during
2022.
QUORUM
The quorum for a BSPRC meeting is
STATEMENTS
FINANCIAL
three (03) members.

INFORMATION
SUPPLEMENTARY
DIRECTORS’ STATEMENT ON INTERNAL CONTROL

OVER FINANCIAL REPORTING
RESPONSIBILITY The Board is of the view that the in respect of any non-compliance.
system of internal controls over Internal audit assignments are
In line with the Banking Act Direction financial reporting in place is sound carried out on all units and
No. 11 of 2007, Section 3 (8) (ii) (b), and adequate to provide reasonable branches, the frequency of which
the Board of Directors presents this assurance regarding the reliability of is determined by the level of risk
Report on Internal Controls over financial reporting and the preparation assessed to provide an independent
Financial Reporting of the People’s of Financial Statements for external and objective report. The annual
Bank (“The Bank”). purposes is in accordance with audit plan is reviewed and approved
relevant accounting principles and by the Board Audit Committee.
The Board of Directors (“Board”) is regulatory requirements. Findings of the Internal Audit
responsible for the adequacy and Department are submitted to the
effectiveness of the internal control The Management assists the Board Board Audit Committee (BAC) for
mechanism in place at the Bank. in the implementation of the Board’s review at their periodic meetings.
In considering such adequacy and policies and procedures on risk and
effectiveness, the Board recognises z The BAC of the Bank reviews
control by identifying and assessing
that the business of banking requires internal control issues identified
the risks faced, and in the design,
reward to be balanced with risk on by the Internal Audit Department,
operation and monitoring of suitable
a managed basis and as such the regulatory authorities and
internal controls to mitigate and
internal control systems are primarily management, and evaluates the
control these risks.
designed with a view to highlighting adequacy and effectiveness of
any deviations from the limits and the risk management and internal
indicators which comprise the risk KEY FEATURES OF THE control systems. They also review
appetite of the Bank. PROCESS ADOPTED IN the internal audit functions with
APPLYING IN REVIEWING particular emphasis on the scope
In the light of foregoing, the THE DESIGN AND of audits and quality of same.
system of internal controls can The minutes of the BAC meetings
EFFECTIVENESS OF THE
only provide reasonable, and not are tabled at the meetings of the
INTERNAL CONTROL SYSTEM Board of Directors of the Bank
absolute assurance, against material
OVER FINANCIAL REPORTING on a periodic basis. Details of the
misstatement of financial information
and records or against financial losses The key processes that have been activities undertaken by the BAC
or frauds. established in reviewing the adequacy of the Bank are set out in the
and integrity of the system of internal Board Audit Committee Report
The Board has established an ongoing controls with respect to financial (refer page 194).
process for identifying, evaluating and reporting include the following: z In assessing the internal control
managing the significant risks faced
z Establishment of Board system, identified officers of the
by the Bank and this process includes
subcommittees to assist the Board Bank continued to review and
enhancing the system of internal
in ensuring the effectiveness of the update all procedures and controls
control over financial reporting as and
Bank’s daily operations and, that the that are connected with significant
when there are changes to business
Bank’s operations are in accordance accounts and disclosures of the
environment or regulatory guidelines.
with the corporate objectives, Financial Statements of the Bank.
The process is regularly reviewed by
strategies and the annual budget The Internal Audit Department
the Board and in accordance with the
as well as the policies and business of the Bank continued to verify
“Guidance for Directors of Banks on
directions that have been approved. the suitability of design and
the Directors Statement on Internal
effectiveness of these procedures
Control” issued by The Institute of z The Internal Audit Department of and controls on an ongoing basis.
Chartered Accountants of Sri Lanka. the Bank checks for compliance with
The Board has assessed the internal policies and procedures and the z In adopting Sri Lanka Accounting
control over financial reporting effectiveness of the internal control Standards comprising LKAS and
taking into account, principles for the systems on an ongoing basis using SLFRS progressive improvements
assessment of internal control system samples and rotational procedures on processes to comply with
as given in that guidance. and highlights significant findings requirements of recognition,
DIRECTORS’ STATEMENT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
PEOPLE’S BANK
ABOUT
measurement, classification and CONFIRMATION
disclosure are being made whilst
further strengthening of processes Based on the above processes, the
will take place pertaining to Board confirms that the financial
impairment of loans and advances, reporting system of the Bank has been
credit card operations, management designed to provide a reasonable
information system and financial assurance regarding the reliability of
FROM THE TOP

REFLECTIONS
statement disclosures related to risk financial reporting and the preparation
management and related parties. of Financial Statements for external
The assessment was not included in purposes and has been done in
the subsidiaries of the Bank. accordance with Sri Lanka Accounting
Standards and regulatory requirements
z The Board took necessary steps of Central Bank of Sri Lanka.
to implement requirements of the
Sri Lanka Accounting Standard – For and on behalf of the Board,
VALUE CREATION
DRIVING
SLFRS 9 (Financial Instruments)
in 2018. The required models have
been implemented and processes
and controls have been designed.
The Board will continuously
strengthen the processes and
controls over management
information system and reports Dushmantha Thotawatta
required for validation and Chairman
AND ANALYSIS
compliance in line with SLFRS 9. Board Audit Committee
z The Internal Audit Department

carried out data analysis on certain
selected processes of the Bank using
computer aided audit techniques/
tools covering the entire branch
network. All significant findings
identified by the Internal Audit
Department were submitted to the
Board Audit Committee for review
at their periodic meetings.
Director
REPORTS
GOVERNANCE
z The comments made by the
2 March 2023
External Auditors in connection
with the internal control system
during the financial year 2021 were
taken into consideration and steps
have been taken to incorporate
them where appropriate. Further
appropriate measures have been
STATEMENTS
FINANCIAL
initiated to develop procedures to

improve the controls documentation
on identification of related party
transactions in the ensuing year.
INFORMATION
SUPPLEMENTARY
AUDITOR GENERAL’S ASSURANCE REPORT ON

INTERNAL CONTROLS
ASSURANCE REPORT OF THE AUDITOR GENERAL TO THE BOARD OF DIRECTORS

ON THE DIRECTORS’ STATEMENT ON INTERNAL CONTROL OF PEOPLE’S BANK
Introduction 3050 (Revised), Assurance Report and control procedures. SLSAE 3050
for Banks on Directors’ Statement on (Revised) also does not
This report is to provide assurance on Internal Control, issued by the Institute require me to consider whether the
the Directors’ Statement on Internal of Chartered Accountants of Sri Lanka. processes described to deal with
Control over Financial Reporting This Standard required that I plan and material internal control aspects of
(“Statement”) of People’s Bank perform procedures to obtain limited any significant problems disclosed
included in the annual report for assurance about whether Management in the annual report will, in fact,
the year ended 31 December 2022. has prepared, in all material respects, remedy the problems.
the Statement on Internal Control. For
Management’s Responsibility purpose of this engagement, I am not The procedures selected depend
responsible for updating or reissuing on my judgement, having regard to
Management is responsible for the any reports, nor have I, in the course of my understanding of the nature of
preparation and presentation of the this engagement, performed an audit the Bank, the event or transaction
Statement in accordance with the or review of the financial information. in respect of which the Statement
“Guidance for Directors of Banks on has been prepared. I believe that the
the Directors’ Statement on Internal evidence I have obtained is sufficient
Control” issued in compliance with the Summary of Work Performed
and appropriate to provide a basis for
Section 3 (8) (ii) (b) of the Banking I conducted my engagement to assess my conclusion.
Act Direction No. 11 of 2007, by the whether the Statement is supported by
Institute of Chartered Accountants the documentation prepared by or for
of Sri Lanka. Conclusion
Directors; and appropriately reflected
the process the Directors have Based on the procedures performed,
My Responsibility and adopted in reviewing the system nothing has come to my attention
Compliance with SLSAE of internal control over financial that causes me to believe that the
3050 (Revised) reporting of the Bank. Statement included in the Annual
Report is inconsistent with my
My responsibility is to assess whether The procedures performed were understanding of the process the
the Statement is both supported by limited primarily to inquiries of Bank Board of Directors has adopted in the
the documentation prepared by or for personnel and the existence of review of the design and effectiveness
directors and appropriately reflects documentation on a sample basis of internal control system over the
the process the directors have that supported the process adopted financial reporting of the Bank.
adopted in reviewing the design by the Board of Directors.
and effectiveness of the internal
control of the People’s Bank. SLSAE 3050 (Revised) does not
require me to consider whether
I conducted my engagement in the Statement covers all risk and W P C Wickramaratne
accordance with Sri Lanka Standard controls, or to form an opinion on Auditor General
on Assurance Engagements (SLSAE) the effectiveness of the Bank’s risk
20 March 2023
PEOPLE’S BANK
ABOUT
205
FROM THE TOP

REFLECTIONS
FINANCIAL
VALUE CREATION
DRIVING
STATEMENTS
AND ANALYSIS
206 / Directors’ Responsibilities for Financial Reporting
207 / Auditor General’s Report on Financial Statements
209 / Income Statement
210 / Statement of Comprehensive Income
211 / Statement of Financial Position
212 / Statement of Changes in Equity – Bank
214 / Statement of Changes in Equity – Group
216 / Statement of Cash Flows
217 / Notes to the Financial Statements
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
DIRECTORS’ RESPONSIBILITIES FOR

FINANCIAL REPORTING
The responsibility of the Directors in of banking in an orderly manner, requirements of Sri Lanka Accounting
relation to the Financial Statements safeguard its assets and secure as Standards and the Banking Act No.
of the People’s Bank is set out in the far as practicable the accuracy and 30 of 1988, the amendments thereto.
following statement to distinguish reliability of the records. Board of The Financial Statements reflect a true
the responsibility of Directors and Directors has the responsibility for and fair view of the state of affairs of
Auditors. the oversight of risk, determining the Bank and as at that date as per the
risk appetite levels, formulating risk External Auditors’ Report. Accordingly,
policies and ensuring the effectiveness the Directors are of the view that they
FINANCIAL STATEMENTS of the risk management processes have discharged their responsibilities
The Board of Directors of the Bank and procedures in place. The BIRMC as set out in this statement.
has responsibility for ensuring that (Board Integrated Risk Management
the Bank keeps proper books of Committee) assists the Board in the
accounts of all the transactions and discharge of its risk-related duties and
prepares Financial Statements that provides independent oversight of all
give a true and fair view of the state risk related aspects by ensuring the
of affairs and of the profit/loss for adequacy and effectiveness of the
Shyama Wijekoon
the year. Accordingly, the Board of implementation of risk governance
structures, policy frameworks, Secretary to the Board
Directors oversees the Managements’
responsibilities for financial reporting standards and processes. BIRMC 27 February 2023
through their regular meeting reviews Report is given on page 196. The Board
and via the Board Audit Committee. of Directors ensure the compliance
The Board Audit Committee Report is with prudential requirements,
given on page 194. regulations, laws and internal controls,
and measures have been taken to
Directors consider that they adopted rectify any material non-compliances.
appropriate accounting policies on
a consistent basis and supported by
AUDIT REPORT
reasonable and prudent judgement
and estimates in preparing the Auditor General is the Auditor of
Financial Statements for the year 2022 the Bank in pursuant to provisions
exhibited on pages 209 to 324. of Article 154 of the Constitution of
the Democratic Socialist Republic of
Sri Lanka and issues the final opinion
GOING CONCERN on the Financial Statements of the
Directors have adopted the going Bank, assurance on the Directors’
concern basis in preparation of the Statement on Internal Controls
Financial Statements with the view that over Financial Reporting which are
the Bank has adequate resources to published on pages 202 and 203
continue its business for a foreseeable respectively. He also certifies the level
future. of compliance with the Banking Act
Direction No. 11 of 2007 on Corporate
Governance for Licensed Commercial
INTERNAL CONTROLS, Banks issued by the Central Bank of
RISK MANAGEMENT AND Sri Lanka.
COMPLIANCE
The Board of Directors has instituted COMPLIANCE
effective and comprehensive system
of Internal Control. This comprises The Bank’s Financial Statements
internal checks, internal audit and the for the year ended 31 December
whole system of financial and other 2021 prepared and presented in this
controls required to carry on business Report are in conformity with the
AUDITOR GENERAL’S REPORT ON

FINANCIAL STATEMENTS
PEOPLE’S BANK
ABOUT
FROM THE TOP
REFLECTIONS
Report of the Auditor General on the Financial Statements and Other Legal and Regulatory
Requirements of the People’s Bank and its Subsidiaries for the year ended 31 December 2022 in
terms of Section 12 of the National Audit Act, No. 19 of 2018.
1. FINANCIAL STATEMENTS and their cash flows for the year then materially inconsistent with the
VALUE CREATION
DRIVING
ended in accordance with Sri Lanka financial statements or my knowledge
1.1 Opinion Accounting Standards. obtained in the audit or otherwise
The audit of the financial statements appears to be materially misstated.
of the People’s Bank (the “Bank”)
and the Consolidated Financial
1.2 Basis for opinion When I read the Bank’s 2022 Annual
Statements of the Bank and its I conducted my audit in accordance Report, if I conclude that are material
Subsidiaries (the “Group”) for the with Sri Lanka Auditing Standards misstatements therein, I am required
year ended 31 December 2022 (SLAuSs). My responsibilities, under to communicate that matter to
comprising the statement of financial those standards are further described those charged with governance
AND ANALYSIS
position as at 31 December 2022 and in the Auditor’s Responsibilities for for correction. If further material
the income statement, statement of the Audit of the Financial Statements uncorrected misstatements are existed
comprehensive income, statement of section of my report. I believe that those will be included in my report to
changes in equity and statement of the audit evidence I have obtained is Parliament in pursuance of provisions
cash flows for the year then ended, sufficient and appropriate to provide a in Article 154 (6) of the Constitution
and notes to the financial statements, basis for my opinion. that will be tabled in due course.
including a summary of significant
accounting policies, was carried out 1.4 Responsibilities of
under my direction in pursuance 1.3 Other information included
of provisions in Article 154 (1) of in the Bank’s 2022 Annual Management and those
the Constitution of the Democratic Report charged with governance for
Socialist Republic of Sri Lanka read The other information comprises the the Financial Statements
in conjunction with provisions of the information included in the Bank’s
REPORTS
GOVERNANCE
Management is responsible for the
National Audit Act No. 19 of 2018. 2022 Annual Report but does not preparation of financial statements
include the financial statements and that give a true and fair view in
The Bank has been exempted from my auditor’s report thereon, which is accordance with Sri Lanka Accounting
the provisions of Part II of the Finance expected to be made available to me Standards, and for such internal
Act, No. 38 of 1971 by an Order of after the date of this auditor’s report. control as management determine is
then Minister of Finance published in Management is responsible for the necessary to enable the preparation of
the Government Gazette No. 715 of 14 other information. financial statements that are free from
May 1992 by virtue of powers vested
material misstatement, whether due to
in him by Section 5 (1) of the said
STATEMENTS
FINANCIAL
My opinion on the financial statements fraud or error.

Finance Act. My report to Parliament in does not cover the other information
pursuance of provisions in Article 154 and I do not express any form of In preparing the financial statements,
(6) of the Constitution will be tabled in assurance conclusion thereon. management is responsible for
due course.
assessing the Group’s ability to
In connection with my audit of the continue as a going concern,
In my opinion, the accompanying financial statements, my responsibility disclosing, as applicable, matters
financial statements give a true and is to read the other information related to going concern and using
fair view of the financial position of the identified above when it becomes
INFORMATION
SUPPLEMENTARY
the going concern basis of accounting

Bank and the Group as at 31 December available and, in doing so, consider unless management either intends
2022 and of their financial performance whether the other information is to liquidate the Group or to cease
Auditor General’s Report on Financial Statements
operations, or has no realistic appropriate in the circumstances, accounting records have been kept
alternative but to do so. but not for the purpose of by the Bank as per the requirement
expressing an opinion on the of Section 12 (a) of the National Audit
Those charged with governance are effectiveness of the Group’s internal Act, No. 19 of 2018.
responsible for overseeing the Bank’s control.
and the Group’s financial reporting z Evaluate the appropriateness of 2.1.2 The financial statements
process. accounting policies used and the presented is consistent with the
reasonableness of accounting preceding year as per the requirement
As per Section 16 (1) of the National estimates and related disclosures of Section 6 (1) (d) (iii) of the National
Audit Act No. 19 of 2018, the Group is made by the management. Audit Act, No. 19 of 2018.
required to maintain proper books and
z Conclude on the appropriateness 2.1.3 The financial statements
records of all its income, expenditure,
of the management’s use of the presented includes all the
assets and liabilities, to enable annual
going concern basis of accounting recommendations made by me in the
and periodic financial statements to be
and based on the audit evidence previous year as per the requirement
prepared of the Group.
obtained, whether a material of Section 6 (1) (d) (iv) of the National
uncertainty exists related to Audit Act, No. 19 of 2018.
1.5 Auditor’s Responsibilities events or conditions that may cast
for the Audit of the Financial significant doubt on the Group’s 2.2 Based on the procedures
ability to continue as a going performed and evidence obtained
Statements concern. If I conclude that a material
My objective is to obtain reasonable were limited to matters that are
uncertainty exists, I am required
assurance about whether the financial material, nothing has come to my
to draw attention in my auditor’s
statements as a whole are free from report to the related disclosures attention;
material misstatement, whether due to in the financial statements or, if
fraud or error, and to issue an auditor’s such disclosures are inadequate, to
2.2.1 to state that any member of
report that includes my opinion. modify my opinion. My conclusions the governing body of the Bank has
Reasonable assurance is a high level are based on the audit evidence any direct or indirect interest in any
of assurance, but is not a guarantee obtained up to the date of my contract entered into by the Bank
that an audit conducted in accordance auditor’s report. However, future which are out of the normal course
with Sri Lanka Auditing Standards will events or conditions may cause the of business as per the requirement of
always detect a material misstatement Group to cease to continue as a Section 12 (d) of the National Audit
when it exists. Misstatements can arise going concern. Act, No. 19 of 2018;
from fraud or error and are considered z Evaluate the overall presentation,
material if, individually or in the 2.2.2 to state that the Bank has not
structure and content of the
aggregate, they could reasonably be
financial statements, including complied with any applicable written
expected to influence the economic
the disclosures, and whether the law, general and special directions
decisions of users taken on the basis of
financial statements represent the issued by the governing body of the
these financial statements.
underlying transactions and events Bank as per the requirement of Section
in a manner that achieves fair 12 (f) of the National Audit Act, No. 19
As part of an audit in accordance
presentation.
with Sri Lanka Auditing Standards, of 2018;
I exercise professional judgement
I communicate with those charged 2.2.3 to state that the Bank has not
and maintain professional skepticism
with governance regarding, among
throughout the audit. I also: performed according to its powers,
other matters, significant audit
z Identify and assess the risks of findings, including any significant functions and duties as per the
material misstatement of the deficiencies in internal control that I requirement of section 12 (g) of the
financial statements, whether due to identify during my audit. National Audit Act, No. 19 of 2018;
fraud or error, design and perform
audit procedures responsive 2.2.4 to state that the resources of
to those risks, and obtain audit 2. REPORT ON OTHER the Bank had not been procured and
evidence that is sufficient and LEGAL AND REGULATORY utilised economically, efficiently and
appropriate to provide a basis for effectively within the time frames and in
REQUIREMENTS
my opinion. The risk of not detecting compliance with the applicable laws as
a material misstatement resulting 2.1 National Audit Act, per the requirement of Section 12 (h) of
from fraud is higher than for one
resulting from error, as fraud may
No. 19 of 2018 includes the National Audit Act, No. 19 of 2018.
involve collusion, forgery, intentional specific provisions for
omissions, misrepresentations, or the following requirements.
override of internal control.
z Obtain an understanding of internal
2.1.1 I have obtained all the
information and explanation that
control relevant to the audit in order
required for the audit and as far as W.P.C. Wickramaratne
to design audit procedures that are
appears from my examination, proper Auditor General
INCOME STATEMENT
PEOPLE’S BANK
ABOUT
Bank Group
For the year ended 31 December 2022 2021 Change 2022 2021 Change
Note LKR ’000 LKR ’000 % LKR ’000 LKR ’000 %
Gross income 6 357,228,609 207,249,820 72.4 391,204,198 236,795,041 65.2
Interest income 321,935,983 197,330,011 63.1 351,386,736 222,362,450 58.0
Interest expenses (246,177,918) (114,869,171) 114.3 (260,351,661) (125,487,671) 107.5
FROM THE TOP

REFLECTIONS
Net interest income 7 75,758,065 82,460,840 -8.1 91,035,075 96,874,779 -6.0
Fee and commission income 16,397,745 8,268,168 98.3 17,213,747 9,645,136 78.5
Fee and commission expense (828,675) (597,786) 38.6 (828,675) (597,786) 38.6
Net fee and commission income 8 15,569,070 7,670,382 103.0 16,385,072 9,047,350 81.1
Net gain/(loss) from trading 9 17,026,226 (1,345,029) -1365.9 17,019,836 (1,207,608) -1509.4
Other operating income (net) 10 1,868,655 2,996,670 -37.6 5,583,879 5,995,063 -6.9
VALUE CREATION
DRIVING
Total operating income 110,222,016 91,782,863 20.1 130,023,862 110,709,584 17.4
Impairment charge 11 (33,346,451) (14,472,820) 130.4 (34,352,837) (14,485,458) 137.2
Net operating income 76,875,565 77,310,043 -0.6 95,671,025 96,224,126 -0.6
Personnel expenses 12 (26,602,748) (22,771,935) 16.8 (32,200,568) (27,743,883) 16.1
Other expenses 13 (20,738,787) (17,289,578) 19.9 (26,787,783) (22,771,171) 17.6
Operating Profit Before Taxes on

financial services 29,534,030 37,248,530 -20.7 36,682,674 45,709,072 -19.7
AND ANALYSIS
Taxes on financial services (8,195,633) (6,861,930) 19.4 (9,992,022) (8,473,708) 17.9
Operating Profit After Taxes on

financial services 21,338,397 30,386,600 -29.8 26,690,652 37,235,364 -28.3
Share of profits/(loss) of associates

(net of tax) – – – 10,893 -100.0
Profit before tax 21,338,397 30,386,600 -29.8 26,690,652 37,246,257 -28.3
Income tax expenses 14 (4,146,339) (6,666,457) -37.8 (6,165,213) (9,158,609) -32.7
Profit for the year 17,192,058 23,720,143 -27.5 20,525,439 28,087,648 -26.9
Profit attributable to:

Equity holders of the Bank 17,192,058 23,720,143 -27.5 19,571,989 26,350,975 -25.7
REPORTS
GOVERNANCE
Non-controlling interests – – 953,450 1,736,673 -45.1
17,192,058 23,720,143 -27.5 20,525,439 28,087,648 -26.9
Earnings per share 15
Basic earnings per ordinary share (LKR) 15.1 17,192 23,720 -27.5 19,572 26,351 -25.7
Diluted earnings per ordinary share (LKR) 15.2 70 97 -27.5 80 108 -25.7
STATEMENTS
FINANCIAL
The Notes appearing on pages 217 to 324 form an integral part of these Financial Statements.
INFORMATION
SUPPLEMENTARY
STATEMENT OF PROFIT OR LOSS AND

OTHER COMPREHENSIVE INCOME
Bank Group
For the year ended 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Profit for the year 17,192,058 23,720,143 20,525,439 28,087,648
Other comprehensive income/(expense)

Other comprehensive income that will not be reclassified to
the income statement
Net gains/(losses) on equity instruments at fair value
through OCI 52,869 (316,074) (121,202) (312,977)
Net actuarial gains/(losses) on defined benefit plans (3,304,393) 12,959,137 (3,177,074) 12,943,725
Deferred tax effect of gains/(losses) on defined benefit plans 991,318 (3,110,193) 953,496 (3,106,359)
Gains on revaluation of land and buildings 3,507,183 3,672,851 4,379,820 3,822,851
Deferred tax effect on revaluation of land and buildings (1,052,155) (881,484) (1,313,946) (917,484)
Deferred tax effect on change in income tax rate on the

opening balance (2,056,688) 245,293 (2,056,688) 245,293
(1,861,866) 12,569,530 (1,335,594) 12,675,049
Other comprehensive income that will be reclassified to the

income statement
Net gains/(losses)(including change in ECL) on debt instruments
at fair value through OCI (12,354) 713 (299,989) (92,557)
Deferred tax effect on above – – 137,822 30,075
Net gains/(losses) on translating the Financial Statements

of foreign operation – – 1,458,432 174,124
(12,354) 713 1,296,265 111,642
Other comprehensive income for the year, net of taxes (1,874,220) 12,570,243 (39,329) 12,786,691
Total comprehensive income for the year 15,317,838 36,290,386 20,486,110 40,874,339
Attributable to:
Equity holders of the Bank 15,317,838 36,290,386 18,561,941 39,105,903
Non-controlling interests – – 1,924,169 1,768,436
15,317,838 36,290,386 20,486,110 40,874,339
STATEMENT OF FINANCIAL POSITION
PEOPLE’S BANK
ABOUT
Bank Group
As at 31 December 2022 2021 Change 2022 2021 Change

Note LKR ’000 LKR ’000 % LKR ’000 LKR ’000 %
Assets
Cash and cash equivalents 17 66,842,171 57,538,351 16.2 68,077,027 58,836,831 15.7
Balances with Central Bank of Sri Lanka 18 67,602,313 56,717,820 19.2 67,602,313 56,717,820 19.2
Placements with banks 19 – – – 3,028,550 3,325,726 -8.9
FROM THE TOP

REFLECTIONS
Derivative financial instruments 20 14,882,584 441,877 3268.0 14,882,584 441,877 3268.0
Financial assets – at fair value through profit or loss 21 5,556,754 1,558,850 256.5 5,915,926 2,553,546 131.7
Financial assets – at amortised cost
Loans and advances to banks 22 7,689,150 10,131,952 -24.1 7,689,150 13,398,055 -42.6
Loans and advances to other customers 23 1,783,106,693 1,835,697,108 -2.9 1,915,771,684 1,990,689,061 -3.8
Debt instruments measured at amortised cost 24 913,099,927 587,320,182 55.5 928,885,518 600,079,625 54.8
Financial assets – at fair value through other
comprehensive income (OCI)
VALUE CREATION
DRIVING
Equity instruments at fair value through OCI 25 1,661,656 1,621,375 2.5 1,844,574 1,889,144 -2.4
Debt instruments at fair value through OCI 26 10,378,370 9,399,272 10.4 11,428,832 10,596,723 7.9
Investments in subsidiaries 27 4,280,522 3,572,824 19.8 – – –
Property, plant and equipment and right-of-use-assets 28 49,330,080 46,761,157 5.5 59,780,131 56,432,293 5.9
Intangible assets and goodwill 29 1,719,177 2,077,544 -17.2 1,859,475 2,252,557 -17.5
Other assets 30 45,879,055 34,802,224 31.8 46,368,814 35,396,730 31.0
Total assets 2,972,028,452 2,647,640,536 12.3 3,133,134,578 2,832,609,988 10.6
Liabilities
Due to banks 31 111,452,491 107,745,916 3.4 122,696,978 122,397,825 0.2
AND ANALYSIS
Derivative financial instruments 20 1,888,478 1,761,220 7.2 1,888,478 1,761,220 7.2
Due to other customers 32 2,371,518,898 2,071,532,612 14.5 2,450,079,037 2,168,674,742 13.0
Other borrowings 33 191,527,573 241,419,125 -20.7 191,527,573 241,419,125 -20.7
Current tax liabilities 6,372,157 6,452,823 -1.3 8,297,080 8,512,150 -2.5
Net deferred tax liabilities 34 606,207 2,687,330 -77.4 570,529 3,194,714 -82.1
Other liabilities 35 106,765,050 31,102,734 243.3 115,961,714 43,451,531 166.9
Subordinated term debts 36 36,603,467 48,861,680 -25.1 52,781,563 65,560,465 -19.5
Total liabilities 2,826,734,321 2,511,563,440 12.5 2,943,802,952 2,654,971,772 10.9
Equity
Stated capital/assigned capital 37 12,201,998 12,201,998 – 12,201,998 12,201,998 –
Statutory reserve fund 38 10,070,131 9,210,528 9.3 10,070,131 9,210,528 9.3
Other reserves 39 38,397,830 35,902,287 7.0 41,452,506 38,160,081 8.6
REPORTS
GOVERNANCE
Retained earnings 40 84,624,172 78,762,283 7.4 111,194,555 104,755,265 6.1
Total shareholders’ equity 145,294,131 136,077,096 6.8 174,919,190 164,327,872 6.4
Non-controlling interests – – – 14,412,436 13,310,344 8.3
Total equity 145,294,131 136,077,096 6.8 189,331,626 177,638,216 6.6
Total equity and liabilities 2,972,028,452 2,647,640,536 12.3 3,133,134,578 2,832,609,988 10.6
Contingent liabilities and commitments 41 370,648,773 428,771,195 -13.6 375,288,336 443,842,195 -15.4
Certification
STATEMENTS
FINANCIAL
These Financial Statements give a true and fair view of the state of affairs of the Bank and its subsidiaries
as at 31 December 2022 and the profit for the year then ended.
Azzam A Ahamat
Head of Finance
The Board of Directors is responsible for the preparation and presentation of these Financial Statements.
INFORMATION
SUPPLEMENTARY
These Financial Statements were approved by the Board of Directors and signed on their behalf:
Sujeewa Rajapakse Dushmantha Thotawatte Clive Fonseka

Chairman Director Chief Executive Officer/General Manager (Actg.)
2 March 2023
Colombo
STATEMENT OF
CHANGES IN EQUITY – BANK
Stated capital/Assigned capital
Ordinary Assigned
shares capital
LKR ’000 LKR ’000
Balance as at 1 January 2021 49,998 12,152,000
Total comprehensive income for the year

Profit for the year – –
Other comprehensive income/(expense) (net of taxes) – –
Total comprehensive income/(expense) – –
Transactions with equity holders, recognised directly in equity

Transfer to reserve during the year – –
Special levy to treasury/dividend – –
Total transactions with equity holders – –
Balance as at 31 December 2021 49,998 12,152,000
Adjustment: Surcharge tax levied under Surcharge Tax Act No. 14 of 2022 (Note 14.5)

Other comprehensive income/(expense) (net of taxes)


Transfer to reserve during the year (Note 38) – –
Special levy to treasury/dividend (Note 39.6) – –

Statement of changes in equity – bank
PEOPLE’S BANK
ABOUT
Reserves
Statutory Revaluation Other Financial assets Retained Total

reserve fund reserve reserves at FVOCI reserve earnings
LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000
8,024,521 18,748,933 13,574,329 535,975 48,897,842 101,983,598
FROM THE TOP

REFLECTIONS
– – – 23,720,143 23,720,143
– 2,791,367 – (315,361) 10,094,237 12,570,243
– 2,791,367 – (315,361) 33,814,380 36,290,386
1,186,007 – 567,044 (1,753,051) –
VALUE CREATION
DRIVING
– – – (2,196,888) (2,196,888)
1,186,007 – 567,044 – (3,949,939) (2,196,888)
9,210,528 21,540,300 14,141,373 220,614 78,762,283 136,077,096
(5,439,713) (5,439,713)
9,210,528 21,540,300 14,141,373 220,614 73,322,570 130,637,383
– – – – 17,192,058 17,192,058
AND ANALYSIS
2,455,028 40,515 (4,369,763) (1,874,220)
– 2,455,028 – 40,515 12,822,295 15,317,838
859,603 – – – (859,603) –
– – – – (661,090) (661,090)
859,603 – – – (1,520,693) (661,090)
10,070,131 23,995,328 14,141,373 261,129 84,624,172 145,294,131
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
STATEMENT OF
CHANGES IN EQUITY – GROUP
Stated capital/Assigned capital
Ordinary Assigned
shares capital
LKR ’000 LKR ’000

Profit for the year

Transfer to Reserve during the period
Special levy to treasury/dividend
Dividends paid
Adjustment: Surcharge tax levied under Surcharge Tax Act No. 14 of 2022 (Note 14.5)



Transfer to reserve during the year (Note 38) – –
Special levy to treasury/dividend (Note 39.6) – –
Dividends paid – –
Total Transactions with equity holders – –

Statement of changes in equity – Group
PEOPLE’S BANK
ABOUT
Reserves
Statutory Revaluation Other Financial assets Retained Total Non-controlling Total equity
reserve fund reserve reserves at FVOCI reserve earnings interest
LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000
8,024,521 20,587,993 13,842,861 492,808 72,268,676 127,418,857 11,691,908 139,110,765
FROM THE TOP

REFLECTIONS
26,350,975 26,350,975 1,736,673 28,087,648
2,876,867 130,593 (338,085) 10,085,553 12,754,928 31,763 12,786,691
– 2,876,867 130,593 (338,085) 36,436,528 39,105,903 1,768,436 40,874,339
1,186,007 567,044 (1,753,051) – –
(2,196,888) (2,196,888) – (2,196,888)
VALUE CREATION
DRIVING
– (150,000) (150,000)
1,186,007 – 567,044 – (3,949,939) (2,196,888) (150,000) (2,346,888)
9,210,528 23,464,860 14,540,498 154,723 104,755,265 164,327,872 13,310,344 177,638,216
(7,309,533) (7,309,533) (623,273) (7,932,806)
9,210,528 23,464,860 14,540,498 154,723 97,445,732 157,018,339 12,687,071 169,705,410
AND ANALYSIS
– – – – 19,571,989 19,571,989 953,450 20,525,439
2,929,733 565,090 (202,398) (4,302,473) (1,010,048) 970,719 (39,329)
– 2,929,733 565,090 (202,398) 15,269,516 18,561,941 1,924,169 20,486,110
859,603 – – – (859,603) – – –
– – – – (661,090) (661,090) – (661,090)
– – – – – – (198,804) (198,804)
859,603 – – – (1,520,693) (661,090) (198,804) (859,894)
10,070,131 26,394,593 15,105,588 (47,675) 111,194,555 174,919,190 14,412,436 189,331,626
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
STATEMENT OF CASH FLOWS
Bank Group

Note LKR ’000 LKR ’000 LKR ’000 LKR ’000
Cash flows from operating activities

Profit before tax 21,338,397 30,386,600 26,690,652 37,246,257
Adjustment for
Non-cash items included in profits before tax 46 26,915,055 21,016,209 29,402,338 23,549,038
Changes in operating assets 47 (5,472,100) (206,371,943) 19,946,214 (218,238,165)
Changes in operating liabilities 48 324,168,512 382,453,165 300,749,935 388,521,877
Dividend income from subsidiaries and others (908,626) (1,802,759) (207,360) (174,065)
Interest expense on subordinated debt 5,503,630 5,103,325 7,060,585 6,966,957
Contributions to defined benefit plans/gratuity 2,742,148 955,663 2,844,351 1,081,522
Tax paid (13,865,366) (7,185,466) (19,216,590) (9,544,600)
Net cash generated from operating activities 360,421,650 224,554,791 367,270,125 229,408,820
Cash flows from investing activities

Purchase of property, plant and equipment (1,974,640) (1,527,988) (2,526,931) (1,997,410)
Proceeds from the sale of property, plant and equipment 174,560 79,213 237,350 143,299
Purchase of financial investments (329,002,099) (232,273,659) (332,028,247) (236,240,351)
Net purchase of intangible assets (293,921) (2,013,497) (305,693) (2,025,351)
Dividends received from investment in subsidiaries

and others 908,626 1,802,759 207,360 174,065
Net cash (used in) from investing activities (330,187,474) (233,933,172) (334,416,161) (239,945,748)
Cash flows from financing activities

Proceed received from subordinated debt 36.1 – 5,000,000 – 15,000,000
Repayment of subordinated debt 36.1 (12,500,000) – (12,500,000) (7,230,443)
Interest paid on subordinated debt 36.1 (5,261,843) (4,799,341) (7,339,487) (6,044,084)
Repayment of lease liabilities 35.4 (2,507,423) (2,548,281) (2,914,389) (2,904,035)
Dividend paid to non-controlling interest – – (198,804) (150,000)
Dividend/Levy paid to holders of other equity instruments (661,090) (2,196,888) (661,090) (2,196,888)
Net cash from financial activities (20,930,356) (4,544,510) (23,613,770) (3,525,450)
Net increase/(decrease) in cash and cash equivalents 9,303,820 (13,922,891) 9,240,196 (14,062,377)
Cash and cash equivalents at the beginning of the year 57,538,351 71,461,242 58,836,831 72,899,208
Cash and cash equivalents at the end of the year 66,842,171 57,538,351 68,077,027 58,836,831
NOTES TO THE FINANCIAL STATEMENTS
PEOPLE’S BANK
ABOUT
1. REPORTING ENTITY Sub subsidiaries 2.2 Directors responsibility for
The principal activities of the Bank’s
financial statements
1.1 Corporate information
sub subsidiaries are as follows: The Board of Directors is responsible
People’s Bank (“The Bank”) is a for the Consolidated and Separate
Name of company Principal activities
Government-owned bank, established Financial Statements in compliance
under People’s Bank Act No. 29 of with the requirements of the People’s
People’s Fleet management,
1961 on 1 July 1961 and is domiciled in
FROM THE TOP

REFLECTIONS
Leasing Fleet vehicle valuation, sale Bank Act No. 29 of 1961, Banking Act
Sri Lanka. The registered office of the Management of vehicles, insurance No. 30 of 1988 and its amendments,
Bank is at No. 75, Sir Chittampalam A Limited assessment, and and Sri Lanka Accounting Standards
Gardiner Mawatha, Colombo 02. The vehicle repairing.
(LKAS and SLFRS). These SLFRSs and
Consolidated Financial Statements LKASs are available at the website of
People’s Carrying out a
of the Bank for the year ended Leasing mixed development CA Sri Lanka www.casrilanka.com.
31 December 2022, comprises the Bank Property projects and property
and its subsidiaries (together referred Development development activities.
These Financial Statements include
Limited
to as the “Group”). the following components:
VALUE CREATION
DRIVING
People’s Carrying out general
People’s Bank is the ultimate parent of Insurance PLC insurance business. Income Providing information
Statement and on the financial
the Group. People’s Micro Providing non-bank Statement of performance of the
– Commerce financial services to Profit or Loss Bank and the Group
Limited low income earners and Other for the year under
1.2 Principal activities and micro enterprises. Comprehensive review
Bank People’s Construct and operate Income
Leasing an office complex.
The Bank’s business comprises, Havelock Statement Providing the
of Financial information on the
AND ANALYSIS
accepting deposits, granting Properties
Limited Position financial position of
credit facilities, personal banking, the Bank & the Group
development banking, pawn brokering, Lankan Alliance Providing leasing as at the year-end
international trade, dealing in Finance Limited of movable and
immovable properties Statement Depicting all changes
Government Securities, credit card and to provide loans. of Changes in shareholders’
operations, investment banking, and in Equity equity during the
offshore banking unit for foreign year under review.
currency banking, inter alia.
2. BASIS OF ACCOUNTING Statement Providing the
of Cash Flows information to the
2.1 Statement of compliance users, on the ability
Subsidiaries of the Bank and Group
The Consolidated Financial Statements to generate cash and
The principal activities of the Bank’s cash equivalents and
REPORTS
GOVERNANCE
of the Group and the Separate
subsidiaries are as follows: the utilisation of those
Financial Statements of the Bank have
cash flows
Name of Principal activities been prepared in accordance with
company Sri Lanka Accounting Standards (LKAS Notes to the Comprising significant
Financial accounting policies
and SLFRS) as issued by The Institute Statements and other explanatory
People’s The principal business
Leasing & activities are providing
of Chartered Accountants of Sri Lanka. information
Finance finance leases, hire-purchase The preparation and presentation
PLC assets financing, term loans, of these Financial Statements are in
STATEMENTS
FINANCIAL
Islamic finance, margin compliance with the requirements 2.3 Approval of financial
trading, share trading,
of the People’s Bank Act No. 29 of statements
issue of debt instruments,
factoring, gold loans and 1961. The presentation of the Financial
mobilisation of public Statements is also in compliance with The Consolidated and Separate
deposits. the requirements of the Banking Act Financial Statements for the year
No. 30 of 1988. ended 31 December 2022, were
People’s Arrangement of tours and
Travels air ticketing (travel agent). authorised for issue on 2 March 2023
(Private) by the Board of Directors.
INFORMATION
SUPPLEMENTARY
Limited
Notes to the Financial Statements
3. BASIS OF MEASUREMENT Information about judgements,

assumptions and estimates made
The Financial Statements have been prepared on the historical cost basis and in applying accounting policies that
applied consistently with no adjustments being made for inflationary factors have the most significant effects
affecting the Financial Statements, except for the following items in the on the amounts recognised in the
Statement of Financial Position: Consolidated and Separate Financial
Statements are set out below.
Item Basis of measurement Note
Derivative financial instruments At Fair Value 20 4.1 Going concern

Financial instruments measured The Directors have made an
at fair value through profit or loss At Fair Value 21
assessment of the Group’s ability
Financial instruments measured to continue as a going concern and
at fair value through OCI At Fair Value 25 & 26
is satisfied that it has the resources
Land and Buildings Measured at cost at the time of 28 to continue in business for the
acquisition and subsequently at foreseeable future. Furthermore,
revalued amounts which are the fair
Management is not aware of any
values at the date of revaluation
material uncertainties that may cast
Defined benefit obligations Actuarially valued and recognised 35 significant doubt upon the Bank’s
as the present value of the defined
benefit obligation less the net total
ability to continue as a going concern.
fair value of the plan assets Therefore, the Financial Statements
continue to be prepared on the going
concern basis.
3.1 Functional and term, highly liquid investments that

presentation currency are readily convertible to known 4.2 Defined benefit
amounts of cash and are subject to an obligations
The Consolidated and Separate insignificant risk of changes in value.
Financial Statements are presented in The value of the defined benefit
The cash and cash equivalent include
Sri Lanka Rupees, which is the Bank’s obligations are determined using
cash in hand, balances with banks and,
functional currency. The financial actuarial valuation technique. The
money at call and short notice.
information presented in Sri Lanka actuarial valuation involves making
Rupees has been rounded to the assumptions on discount rates,
nearest thousand unless indicated 3.4 Comparative information expected rates of return on assets,
otherwise. future salary increases, and mortality
The comparative information is
rates. All assumptions are reviewed
reclassified wherever necessary
at each reporting date. Due to the
3.2 Materiality and to conform with the current year’s
long-term nature of these plans, such
aggregation presentation in order to provide a
estimates are subject to significant
better presentation.
As per Sri Lanka Accounting Standards uncertainty. See Note 35.1.5 and 35.2.5
– LKAS 1 – “Presentation of Financial for the assumptions used.
Statements”, each material class of 4. SIGNIFICANT ACCOUNTING
similar item is presented separately JUDGEMENTS, ESTIMATES 4.3 Fair value of property,
in the Financial Statements. Items AND ASSUMPTIONS plant and equipment
of dissimilar nature or function are
In the process of applying the Group’s The freehold land and buildings
presented separately unless they are
accounting policies, Management has and the buildings on leasehold land
immaterial.
exercised judgement and estimates of the Group are reflected at fair
and assumptions in determining the value at the date of revaluation less
3.3 Cash flow statement amounts recognised in the Financial any accumulated depreciation and
Statements. Actual results may differ impairment losses. The Group engaged
The Cash Flow Statement has
from these estimates. independent valuation specialists to
been prepared using the “Indirect
Method” of preparing cash flows determine fair value of such properties.
Estimates and underlying assumptions When current market prices of similar
in accordance with the Sri Lanka
are reviewed on an ongoing basis. assets are available, such evidences are
Accounting Standard – LKAS 7 –
Revisions to accounting estimates are considered in estimating fair value of
“Statement of Cash Flows”. Cash and
recognised in the period in which the these assets.
cash equivalents comprise short-
estimate is revised and in any future
periods affected.
PEOPLE’S BANK
ABOUT
4.4 Useful life time of providing services or for administrative Fair value for a net open position
property, plant and equipment purposes and which do not directly that is a financial liability quoted in an
generate cash flows as a standalone active market is the current offer price,
The Group reviews the residual asset are accounted for as property, and for a financial asset the bid price,
values, useful lives and methods of plant and equipment. The Group multiplied by the number of units of
depreciation of property, plant and assesses on an annual basis the the instrument held or issued.
equipment at each reporting date. accounting classification of its
FROM THE TOP

REFLECTIONS
Judgement of the Management is properties taking into consideration Where no active market exists for a
exercised in the estimation of these the current use of such properties. particular asset or liability, the Bank
values, rates, methods and hence they uses a valuation technique to arrive
are subject to uncertainty. at the fair value, including the use of
4.7 Critical accounting
transaction prices obtained in recent
The Group is subject to income tax and assumptions and estimates arm’s length transactions, discounted
judgement is required to determine Assumptions made at each reporting cash flow analysis, option pricing
the total provision for current, date are based on best estimates models and other valuation techniques,
deferred, and other taxes due to the
VALUE CREATION
DRIVING
at that date. Although the Bank has based on market conditions and risks
uncertainties that exist with respect internal control systems in place to existing at reporting date. In doing so,
to the interpretation of the applicable ensure that estimates are reliably fair value is estimated using a valuation
tax laws, at the time of preparation of measured, actual amounts may differ technique that makes maximum use of
these Financial Statements. from those estimates. Estimates and observable market inputs and places
underlying assumptions are reviewed minimal reliance upon entity-specific
4.5 Commitments and on an ongoing basis. Revisions to inputs.
contingencies accounting estimates are recognised
in the period in which the estimates The best evidence of the fair value
AND ANALYSIS
All discernible risks are accounted for are revised and in any future periods of a financial instrument at initial
in determining the amount of all known affected. recognition is the transaction price
liabilities. Contingent liabilities are (i.e. the fair value of the consideration
possible obligations whose existence The accounting policies which are given or received) unless the fair value
will be confirmed only by uncertain most sensitive to the use of judgement, of that instrument is evidenced by
future events or present obligations estimates, and assumptions are comparison with other observable
where the transfer of economic benefit specified below: current market transactions in
is not probable or cannot be reliably the same instrument (i.e. without
measured. Contingent liabilities are (i) Fair value measurement modification or repackaging) or
not recognised in the Statement of A significant portion of financial based on a valuation technique
Financial Position but are disclosed instruments are carried at fair value as whose variables include only data
unless they are remote. Details of from observable markets. When such
of the financial reporting date.
REPORTS
GOVERNANCE
commitments and contingencies are evidence exists, the Bank recognises
given in Note 41. the difference between the transaction
Fair value is the price that would
price and the fair value in profit or loss
be received to sell an asset or paid
on initial recognition (i.e. on day one).
4.6 Classification of to transfer a liability in an orderly
investment properties transaction between market
(ii) Impairment charges on
participants at the measurement date.
Management requires using its loans and advances
judgement to determine whether a Where the classification of a financial Judgment is required by management
STATEMENTS
FINANCIAL
property qualifies as an, investment asset or liability results in it being in the estimation of the amount and
property. The Group has exercised its measured at fair value, wherever timing of future cash flows when
judgement consistently to recognise possible, the fair value is determined determining an impairment loss for
a property that is held to earn rentals by reference to the quoted bid or loans and advances. In estimating
or for capital appreciation or both and offer price in the most advantageous these cash flows, the Bank makes
which generates cash flows largely active market to which the Bank has judgments mainly about the borrower’s
independently of the other assets immediate access. An adjustment for financial situation and the net realisable
held by the Group are accounted
INFORMATION
SUPPLEMENTARY
credit risk is also incorporated into the value of the collateral. These estimates
for as investment properties. On the fair value as appropriate. are based on assumptions about a
other hand, a property that is used number of factors and actual results
for operations or in the process of may differ, resulting in future changes
to the impairment allowance.
A collective assessment of impairment acquisition date. If the contingent Consolidated Financial Statements.
takes into account data from the consideration is classified as equity, Unrealised losses are eliminated in the
loan portfolio (such as credit quality/ then it is not remeasured and same way as unrealised gains, but only
levels of arrears, credit utilisation, settlement is accounted for within to the extent that there is no evidence
etc.), and concentrations of risk and equity. Otherwise, subsequent changes of impairment.
economic data (including levels of in the fair value of the contingent
unemployment, Inflation, GDP Growth consideration are recognised in
5.2 Foreign currency
Rate etc.). Income Statement.
translation
Transactions in foreign currencies
5. SIGNIFICANT 5.1.2 Non-controlling
are initially recorded at the spot
ACCOUNTING POLICIES interests (“NCI”)
rate of exchange ruling on the date
Group has consistently applied the NCI are measured at their of the transaction. Monetary assets
accounting policies as set out from proportionate share of the acquirer’s and liabilities denominated in foreign
Note 5.1 to Note 5.23 to all periods identifiable net assets at the acquisition currencies are retranslated at the spot
presented in these Consolidated and date. Changes in the Group’s interest in rate of exchange on the reporting date.
Separate Financial Statements. a subsidiary that do not result in a loss
of control are accounted for as equity Non-monetary items that are
transactions. measured in terms of historical cost in
5.1 Basis of consolidation a foreign currency are translated using
The Financial Statements of the the spot exchange rates as at the date
5.1.3 Subsidiaries
Bank and the Group comprise the of recognition. Non-monetary items
Financial Statements of the Bank and “Subsidiaries” are investees controlled measured at fair value in a foreign
its Subsidiaries for the year ended by the Group. The Group “controls” currency are translated using the spot
31 December 2022. The Financial an investee if it is exposed to, or exchange rates at the date when the
Statements of the Bank’s subsidiaries has rights to, variable returns from fair value was determined.
for the purpose of consolidation are its involvement with the investee
prepared for the same reporting and has the ability to affect those
5.3 Financial instruments –
year as that of People’s Bank, using returns through its power over the
investee. The Financial Statements
Initial recognition
consistent accounting policies.
of subsidiaries are included in the 5.3.1 Date of recognition
Consolidated Financial Statements
5.1.1 Business combinations from the date on which control A financial asset or financial liability
commences until the date when is recognised in the Statement of
Business combinations are accounted
control ceases. Financial Position when the Bank
for using the acquisition method as
becomes a party to the contractual
at the acquisition date – i.e. when
provisions of the instrument, which
control is transferred to the Group. 5.1.4 Loss of control is generally on trade date. Loans
The consideration transferred in the
When the Group loses control over a and receivables are recognised when
acquisition is generally measured at fair
subsidiary, it de-recognises the assets cash is advanced (or settled) to the
value, as are the identifiable net assets
and liabilities of the subsidiary, and borrowers.
acquired. Any goodwill that arises
is tested annually for impairment. any related NCI and other components
of equity. Any resulting gain or loss Financial assets at fair value through
Any gain on a bargain purchase is
is recognised in Income Statement. profit or loss are recognised initially at
recognised in Income Statement
Any interest retained in the former fair value. All other financial assets are
immediately. Transaction costs are
subsidiary, is measured at fair value recognised initially at fair value plus
expensed as incurred, except if they
when control is lost. directly attributable transaction costs.
are related to the issue of debt or
equity securities.
Non-regular purchases of financial
5.1.5 Transactions eliminated assets and liabilities are recognised
The consideration transferred does
on consolidation on the trade date, i.e., the date
not include amounts related to the
that the Bank becomes a party to
settlement of pre-existing relationships. Intra-group balances and transactions,
the contractual provisions of the
Such amounts are generally recognised and any unrealised income and
instrument.
in profit or loss. expenses (except for foreign currency
transaction gains or losses) arising
Any contingent consideration payable from intra-group transactions,
is measured at fair value at the are eliminated in preparing the
PEOPLE’S BANK
ABOUT
A regular purchase is a purchase of a aggregated portfolios and is based on principal amount may change over the
financial asset under a contract whose observable factors such as: life of the financial asset.
terms require delivery of the assets z How the performance of a business
within the time frame established For this purpose “Interest” consist of
model and the financial assets
generally by a regulation or convention consideration for the time value of
held within that business model
in the market place concerned. money, for the credit risk associated
are evaluated and reported to the
with the principal amount outstanding
Group’s Key Management Personnel;
FROM THE TOP

REFLECTIONS
during a particular period of time and
5.3.2 “Day 1” difference z The risk that affect the performance for other basic lending risks and costs,
for staff loans of the business model (and the as well as profit margin. Group applies
financial assets held within the judgement and considers relevant
All staff loans are granted at below
business model) and, in particular, factors such as the currency in which
market interest rates and were
the way in which those risks are the financial asset is denominated, and
recognised at fair value. The difference
managed; the period for which the interest rate
between the fair value and the amount
disbursed were treated as day one
z How managers of the business is set.
are compensated (whether the
VALUE CREATION
DRIVING
difference and amortised as staff cost
in the Income Statement over the loan compensation is based on the
5.5 Measurement categories of
period by using the effective interest fair value of the assets managed
or on the contractual cash flows
financial assets and liabilities
rate. This amount is shown as interest
income as well. Hence the net effect on collected). All financial assets, except equity
the Income Statement is zero. instruments and derivatives, to be
The business model assessment assessed based on a combination
is based on reasonably expected of the entity’s business model
5.4 Initial measurement of scenarios without taking “worst case” for managing the assets and the
financial instruments
AND ANALYSIS
or “stress case” scenarios into account. instruments’ contractual cash flow
If cash flows are realised in a way that characteristics measured at either –
The classification of financial
is different from the Group’s original
instruments at initial recognition z Amortised cost (Note 5.5.1)
expectations, that neither give a rise
depends on their contractual terms z Fair value through other
to a prior period error nor change the
and the business model for managing comprehensive income (Note 5.5.2)
classification of the remaining financial
the instruments, as described in
assets held in that business model. z Fair value through profit or loss
Notes 5.4.1 and 5.4.2 below. Financial
However, when the Group assesses the (Note 5.5.3)
instruments are initially measured at
business model for newly originated
their fair value except in the case of
or newly purchased financial assets, it
financial assets and financial liabilities 5.5.1 Financial instruments
considers information about how cash
recorded at fair value through profit or measured at amortised cost
flows were realised in the past, along
loss, transaction costs are added to, or
REPORTS
GOVERNANCE
subtracted from, this amount.
with all other relevant information. Debt instruments
Investments in debt instruments are
5.4.1 Business model 5.4.2 Contractual cash flow measured at amortised cost where
assessment assessment – Solely Payments they have:
of Principal and Interest z Contractual terms that give rise
The Group`s business model is (SPPI test) to cash flows on specified dates,
determined at a level that reflects that represent solely payments
The Group assesses contractual cash
STATEMENTS
FINANCIAL
how groups of financial assets are of principal and interest on the

managed together to achieve a flows of the basic lending arrangement
principal amount outstanding; and
particular business objective. The to identify whether they meet SPPI
Group’s business model does not test. That is whether they are solely z Are held within a business model
depend on management’s intention for payments of principal and interest on whose objective is achieved by
an individual instruments. Accordingly the principal amount outstanding. holding to collect contractual cash
the Group’s Business model is not an flows.
For this purpose “Principal” is defined
instrument-by-instrument approach to
as the fair value of the financial asset These debt instruments are initially
INFORMATION
SUPPLEMENTARY
classification, but at a higher level of

at initial recognition. However, that recognised at fair value plus directly
attributable transaction costs and
subsequently measured at amortised Impairment losses or reversals, interest with transaction costs recognised in
cost. The measurement of credit revenue and foreign exchange gains the Income Statement as incurred.
impairment is based on the three-stage and losses are recognised in profit and Subsequently, they are measured at
expected credit loss model described loss. Upon disposal, the cumulative fair value and any gains or losses are
below in Note 5.6 Impairment of gain or loss previously recognised recognised in the Income Statement
financial assets. in other comprehensive income is as they arise.
reclassified from equity to the income
statement. Where a financial asset is measured
Loans and advances to banks,
at fair value, a credit valuation
loans and advances The measurement of credit impairment adjustment is included to reflect the
to other customers is based on the three-stage expected credit worthiness of the counterparty,
The Group measures loans and credit loss model as applied to financial representing the movement in fair
advances to banks and loans and assets at amortised cost. The expected value attributable to changes in
advances to other customers including credit loss model is described below in credit risk.
leases and hire purchase contracts Note 5.6 Impairment of financial assets.
(a) Financial instruments
at amortised cost since both of the
held for trading
following conditions are met: Equity instruments
z The financial asset is held within a A financial instrument is classified
Investment in equity instruments as held for trading if it is acquired or
business model with the objective
that are neither held for trading nor incurred principally for the purpose
to hold financial assets in order to
contingent consideration recognised of selling or repurchasing in the near
collect contractual cash flows.
by the Bank in a business combination term, or forms part of a portfolio of
z The contractual terms of the to which SLFRS 3 “Business financial instruments that are managed
financial asset give rise on specified Combination” applies, are measured at together and for which there is
dates to cash flows that are solely fair value through other comprehensive evidence of short-term profit taking,
payments of principal and interest income, where an irrevocable election or it is a derivative not in a qualifying
(SPPI) on the principal amount has been made by Management. For hedge relationship.
outstanding. portfolios where Management does
not consider an irrevocable election Trading derivatives and trading
5.5.2 Financial assets of adopting fair value through other securities are classified as held for
measured at fair value through comprehensive income, by default trading and recognised at fair value.
other comprehensive income such investments shall be measured at
fair value through profit and loss.
Debt instruments (b) Financial instruments
Amounts presented in other designated as measured at fair
Investments in debt instruments are value through profit or loss
comprehensive income are not
measured at fair value through other
subsequently transferred to profit or Upon initial recognition, financial
comprehensive income where they
loss. Dividends on such investments instruments may be designated as
have:
are recognised in profit or loss. measured at fair value through profit
z contractual terms that give rise
or loss. A financial asset may only
to cash flows on specified dates,
5.5.3 Financial assets at fair be designated at fair value through
that represent solely payments
value through profit or loss profit or loss if doing so eliminates or
of principal and interest on the
significantly reduces measurement
principal amount outstanding; and Items at fair value through profit or or recognition inconsistencies (i.e.
z are held within a business model loss comprise: eliminates an accounting mismatch)
whose objective is achieved by both (a) Items held for trading; that would otherwise arise from
collecting contractual cash flows measuring financial assets or liabilities
(b) Items specifically designated as fair
and selling financial assets. on a different basis.
value through profit or loss on initial
recognition; and
These debt instruments are initially A financial liability may be designated
recognised at fair value plus directly (c) Debt instruments with contractual
at fair value through profit or loss if it
attributable transaction costs and terms that do not represent solely
eliminates or significantly reduces an
subsequently measured at fair payments of principal and interest.
accounting mismatch or:
value. Gains and losses arising from
Financial instruments held at fair
z If a host contract contains one or
changes in fair value are included in
value through profit or loss are more embedded derivatives; or
other comprehensive income within
a separate component of equity. initially recognised at fair value,
PEOPLE’S BANK
ABOUT
z If financial assets and liabilities 5.6 Impairment of financial Bank also have considered all
are both managed and their assets restructured loans, which are
performance evaluated on a fair restructured up to two times, other
value basis in accordance with a The Bank/Group applies a three-stage than credit facilities/exposures
documented risk management or approach to measuring expected upgraded credit facilities from a higher
investment strategy. credit losses (ECLs) for the following stage to a lower stage consider under
categories of financial assets that are Stage 2 as per the guidance issued by
FROM THE TOP

REFLECTIONS
Where a financial liability is designated not measured at fair value through the Central Bank of Sri Lanka (CBSL).
at fair value through profit or loss, the profit or loss:
movement in fair value attributable z Debt instruments measured at
Stage 3: Lifetime ECL –
to changes in the Bank’s own credit amortised cost and fair value through
quality is calculated by determining other comprehensive income;
credit impaired
the changes in credit spreads above z Loan commitments; and Exposures are assessed as credit
observable market interest rates impaired when one or more events
z Financial guarantee contracts.
and is presented separately in other that have a detrimental impact on the
VALUE CREATION
DRIVING
comprehensive income. estimated future cash flows of that
No ECL is recognised on equity
asset have occurred. For exposures
investments.
that have become credit impaired, a
5.5.4 Derivative financial
lifetime ECL is recognised and interest
instruments and hedge Financial assets migrate through
revenue is calculated by applying the
accounting the following three stages based on
effective interest rate to the amortised
the change in credit risk since initial
Derivative financial instruments are cost (net of provision) rather than the
recognition:
contracts whose value is derived from gross carrying amount.
one or more underlying price, index or
AND ANALYSIS
other variable, and typically comprise Stage 1: 12 months ECL Bank determines credit facilities where
of instruments such as swaps, forward contractual payments of a customer
For exposures where there has not
rate agreements, futures and options. are more than 90 days past due
been a significant increase in credit
which are subject to the rebuttable
risk since initial recognition and
All derivatives are recognised in the presumption as stated in SLFRS 9
that are not credit impaired upon
Statement of Financial Position at together with all NPL classifications as
origination, the portion of the lifetime
fair value and are classified as trading per Central Bank (CBSL) classification,
ECL associated with the probability
except where they are designated as a All restructured loans which are
of default events occurring within the
part of an effective hedge relationship restructured more than twice and all
next 12 months is recognised.
and classified as hedging derivatives. rescheduled loans other than credit
The carrying value of a derivative is facilities/exposures upgraded credit
Bank determines 12 month ECL from
re measured at fair value throughout facilities from a higher stage to a lower
REPORTS
GOVERNANCE
customers whom are not significantly
the life of the contract. Derivatives are stage and all credit facilities/customers
credit deteriorated (i.e. less than 30
carried as assets when the fair value is classified as non-performing as per
days past due)
positive and as liabilities when the fair CBSL Directions under Stage 3.
value is negative.
Stage 2: Lifetime ECL – Purchased or Originated credit
not credit impaired impaired (POCI) Financial Assets:
5.5.5 Reclassification of Financial Assets which are credit
financial assets and liabilities For exposures where there has been a
impaired on initial recognition are
STATEMENTS
FINANCIAL
significant increase in credit risk since

With the adoption of SLFRS 9, the categorised within stage 3. The Group
initial recognition but are not credit
Bank reclassifies its financial assets does not have POCI loans as at the
impaired, a lifetime ECL (i.e. reflecting
subsequent to the initial recognition reporting date.
the remaining lifetime of the financial
when an only when the business asset is recognised.
model for managing such financial 5.6.1 Determining the stage
asset is changed. Such reclassification In consistent with the policies of for impairment
is applied prospectively from the the Bank, significant deterioration
INFORMATION
SUPPLEMENTARY
reclassification date. Financial liabilities At each reporting date, the Bank

is measured through the rebuttable
are never reclassified. assesses whether there has been a
presumption of 30 days past due other
significant increase in credit risk for
than the credit facilities categorised
exposures since initial recognition
under Stage 3, in line with the
by comparing the risk of default
requirements of the standard.
occurring over the expected life
between the reporting date and the case when the Bank determines that ECLs are recognised using a provision
date of initial recognition. The Bank the borrower does not have assets for doubtful debts account in
considers reasonable and supportable or sources of income that could profit and loss. In the case of debt
information that is relevant and generate sufficient cash flows to instruments measured at fair value
available without undue cost or repay the amounts subject to the through other comprehensive income,
effort for this purpose. This includes write-off provided that the particular the measurement of ECLs is based on
quantitative and qualitative information facility transfer to the non-performing the three-stage approach as applied
and also, forward-looking analysis. category before 2 years (i.e.,2 years to financial assets at amortised cost.
prior to the written-off considering The Bank recognises the provision
An exposure will migrate through the year that bank normally consider charge in profit and loss, with the
the ECL stages as asset quality the 30 June of every year) and no corresponding amount recognised in
deteriorates. If, in a subsequent payments received during the said other comprehensive income, with no
period, asset quality improves and 2-year period. However, financial reduction in the carrying amount of
also reverses any previously assessed assets that are written off could the asset in the Statement of Financial
significant increase in credit risk since still be subject to enforcement Position.
origination, then the provision for activities in order to comply with the
doubtful debts reverts from lifetime Bank’s procedures for recovery of
5.7 De-recognition of financial
ECL to 12-months ECL. Exposures that amounts due.
have not deteriorated significantly
assets and financial liabilities
since origination, or where the 5.7.1 Financial assets
5.6.3 Measurement of ECLs
deterioration remains within the
Bank’s investment grade criteria, or ECLs are derived from unbiased and The Bank de-recognises a financial
which are less than 30 days past due, probability-weighted estimates of asset when the contractual cash flows
are considered to have a low credit expected loss, and are measured as from the asset expire or it transfers its
risk. The provision for doubtful debts follows: rights to receive contractual cash flows
for these financial assets is based on on the financial asset in a transaction
z Financial assets that are not credit-
a 12-months ECL. When an asset is in which substantially all the risks and
impaired at the reporting date:
uncollectible, it is written off against rewards of ownership are transferred.
as the present value of all cash
the related provision. Such assets Any interest in transferred financial
shortfalls over the expected life of
are written off after all the necessary assets that is created or retained by
the financial asset discounted by
procedures have been completed the Bank is recognised as a separate
the effective interest rate. The cash
and the amount of the loss has been asset or liability.
shortfall is the difference between
determined. Subsequent recoveries of the cash flows due to the Bank in
amounts previously written off reduce accordance with the contract and 5.7.2 Financial liabilities
the amount of the expense in the the cash flows that the Bank expects
income statement. A financial liability is de-recognised
to receive.
from the Statement of Financial
z Financial assets that are credit- Position when the Bank has discharged
The Bank assesses whether the credit
impaired at the reporting date: as its obligation or the contract is
risk on an exposure has increased
the difference between the gross cancelled or expires.
significantly on an individual or
carrying amount and the present
collective basis. For the purposes of
value of estimated future cash flows
a collective evaluation of impairment,
discounted by the effective interest 5.7.3 Offsetting financial
financial instruments are grouped instruments
rate.
on the basis of shared credit risk
characteristics, taking into account z Undrawn loan commitments: as Financial assets and liabilities are offset
instrument type, credit risk ratings, the present value of the difference and the net amount is presented in the
date of initial recognition, remaining between the contractual cash flows Statement of Financial Position when
term to maturity, industry and other that are due to the Bank if the the Bank has a legal right to offset the
relevant factors. commitment is drawn down and the amounts and intends to settle on a net
cash flows that the Bank expects to basis or to realise the asset and settle
receive. the liability simultaneously.
5.6.2 Write-off of
z Financial guarantee contracts: as
financial assets
the expected payments to reimburse
Loans and debt securities are written the holder less any amounts that the
off annually (either partially or in full) Bank expects to recover.
when there is no realistic prospect
of recovery. This is generally the
PEOPLE’S BANK
ABOUT
5.8 Leases borrowing rate. Generally, the Group 5.11.1 Basis of recognition
uses its incremental borrowing rate as
5.8.1 Finance lease income the discount rate. The lease liability is Investment property is recognised if
subsequently measured at amortised it is probable that future economic
Assets leased to customers to whom
cost using the effective interest benefits that are associated with the
the Group transfers substantially
method. It is remeasured when there is investment property will flow to the
all the risks and rewards associated
a change in the future lease payments. Group and cost of the investment
with ownership other than the legal
property can be reliably measured.
FROM THE TOP

REFLECTIONS
title are classified as finance leases.
Amounts receivable under finance Additionally, the Bank/Group applied
leases are included under “Lease the following practical expedients 5.11.2 Measurement
Rental Receivable”. Leasing balances permitted by SLFRS 16 to leases
previously classified as operating An investment property is measured
are stated in the Statement of Financial
leases under LKAS 17: initially at its cost. The cost of a
Position after deduction of initial
purchased investment property
rentals received. z Applied a single discount rate to a comprises its purchase price and any
portfolio of leases with reasonably directly attributable expenditure. The
VALUE CREATION
DRIVING
The excess of aggregate rentals similar characteristics. cost of a self-constructed investment
receivable over the cost of the leased z Excluded the initial direct costs property is its cost at the date when
assets constitutes the total unearned from the measurement of the right- the construction or development is
income. The unearned income is taken of-use assets at the date of initial complete.
into revenue over the term of the lease, application.
commencing from the month in which
The Group applies the cost model for
the lease is executed in proportion to The Group presents right of use assets investment properties in accordance
the remaining receivable balance of under Note 28 to these financial with Sri Lanka Accounting Standard
the lease. statements while the corresponding 40 (LKAS 40) “Investment Property”.
AND ANALYSIS
lease liability is presented in Note 35, Accordingly, land classified as
5.8.2 SLFRS 16 – Leases “Other Liabilities”. investment properties are stated at
cost less any accumulated impairment
SLFRS 16 (Leases) sets out the
5.9 Cash and cash equivalents losses and buildings classified as
principles for the recognition,
investment properties are stated at
measurement, presentation, and Cash and short term funds include cost less any accumulated depreciation
disclosure of leases. cash in hand, balances with banks, and any accumulated impairment
placements with banks and money at losses.
The Group recognises the right of use call and at short notice. Details of the
assets and lease liabilities at the lease cash and short-term funds are given in
commencement date. The right-of- Note 17 to the Financial Statements.
5.12 Intangible assets
use asset is initially measured at cost, and goodwill
REPORTS
GOVERNANCE
which comprises the initial amount
of the lease liability adjusted for any 5.10. Derivatives held for risk 5.12.1 Goodwill
lease payments made on or before the management purposes Goodwill represents the excess of the
commencement date. The right-of- cost of acquisition over the fair value
Derivatives held for risk management
use asset is subsequently depreciated of Group’s share of the net identifiable
purposes include all derivative assets
using the straight-line method from assets of the acquired subsidiary
and liabilities that are not classified as
the commencement date to the end at the date of acquisition. Goodwill
trading assets or liabilities. Derivatives
of the lease term. In addition, the right acquired in a business combination
STATEMENTS
FINANCIAL
held for risk management purposes are

of use asset is periodically reduced by is tested annually for impairment or
measured at fair value in the Statement
impairment losses, if any, and adjusted more frequently if events or changes
of Financial Position.
for certain remeasurements of the in circumstance indicate that it might
lease liability. be impaired and carried at cost less
5.11 Investment properties accumulated impairment losses.
The lease liability is initially measured Impairment losses on goodwill are not
Investment properties are properties
at the present value of the lease reversed.
held either to earn rental income or for
INFORMATION
SUPPLEMENTARY
payments that are not paid at the capital appreciation or both but not for
commencement date, discounted sale in the ordinary course of business,
using the interest rate implicit in the used in the production or supply of
lease or, if that rate cannot be readily goods or services or for administrative
determined, the Groups’ incremental purposes.
5.12.2 Software recoverable amount is the higher of goodwill acquired in a business

an asset’s or Cash Generating Unit’s combination is, from the acquisition
Software acquired by the Group is
(CGU) fair value less costs to sell and date, allocated to each of the Bank’s
measured at cost less accumulated
its value in use. Where the carrying CGUs or group of CGUs, which are
amortisation and any accumulated
amount of an asset or CGU exceeds expected to benefit from the synergies
impairment losses.
its recoverable amount, the asset is of the combination, irrespective of
Expenditure on internally developed considered impaired and is written whether other assets or liabilities of
software is recognised as an asset down to its recoverable amount. In the acquire are assigned to those units.
when the Group is able to demonstrate assessing value in use, the estimated Each unit to which the goodwill is
its intention and ability to complete future cash flows are discounted to allocated represents the lowest level
the development and use the software their present value using a pre–tax within the Bank at which the goodwill
in a manner that will generate future discount rate that reflects current is monitored for internal management
economic benefits, and can reliably market assessments of the time value purposes, and is not larger than an
measure the costs to complete the of money and the risks specific to the operating segment in accordance with
development. The capitalised costs asset. In determining fair value less SLFRS 8 “Operating Segments”.
of internally developed software costs to sell, an appropriate valuation
include all costs directly attributable model is used. These calculations are Where goodwill forms part of a CGU
to developing the software and corroborated by valuation multiples, (or group of CGUs) and part of the
capitalised borrowing costs, and are quoted share prices for publicly traded operation within that unit is disposed
amortised over its useful life. Internally subsidiaries or other available fair value of, the goodwill associated with the
developed software is stated at indicators. operation disposed of is included in
capitalised cost less accumulated the carrying amount of the operation
amortisation and any impairment. when determining the gain or loss on
5.13.2 Measurement
disposal of the operation. Goodwill
Subsequent expenditure on software For assets excluding goodwill, an disposed of in this circumstance is
assets is capitalised only when it assessment is made at each reporting measured based on the relative values
increases the future economic benefits date as to whether there is any of the operation disposed of and the
embodied in the specific asset to indication that previously recognised portion of the CGU retained.
which it relates. All other expenditure is impairment losses may no longer
expensed as incurred. exist or may have decreased. If such When subsidiaries are sold, the
indication exists, the Bank estimates difference between the selling price
5.12.3 Amortisation the asset’s or CGU’s recoverable and the net assets plus cumulative
amount. A previously recognised translation differences and goodwill is
Software is amortised on a straight-
impairment loss is reversed only recognised in the Income Statement.
line basis in Income Statement over
if there has been a change in the
its estimated useful life, from the date
assumptions used to determine the 5.14 Pension benefits
on which it is available for use. The
asset’s recoverable amount since the
estimated useful life of software for the 5.14.1 Defined benefit
last impairment loss was recognised.
current and comparative periods is five pension plans
The reversal is limited so that the
years. 5.14.1.1 Pre-1996 – Pension
carrying amount of the asset does
not exceed its recoverable amount, Trust Fund
Amortisation methods, useful lives
nor exceeds the carrying amount that The Bank operates a defined benefit
and residual values are reviewed at
would have been determined, net of pension plan, for the permanent
each reporting date and adjusted if
depreciation, had no impairment loss staff members who have joined the
appropriate.
been recognised for the asset in prior Bank prior to 1 January 1996, which
years. Such reversal is recognised in requires contributions to be made to
5.13 Impairment of non- the Income Statement. a separately administered fund. The
financial assets cost of providing benefits under the
Impairment losses relating to goodwill defined benefit plan is determined
5.13.1 Basis of recognition are not reversed in future periods. separately using the projected unit
The Bank assesses at each reporting credit method.
date whether there is an indication Goodwill is reviewed for impairment
that an asset may be impaired. If annually, or more frequently, if events or The defined benefit asset or liability
any indication exists, or when annual changes in circumstances indicate that comprises the present value of the
impairment testing for an asset is the carrying value may be impaired. defined benefit obligation less past
required, the Bank estimates the For the purpose of impairment testing, service costs not yet recognised and
asset’s recoverable amount. An asset’s
PEOPLE’S BANK
ABOUT
less the fair value of plan assets out of 5.14.1.2 Post-1996 – the Statement of Financial Position of
which the obligations are to be settled Pension Fund the Bank, the Bank made a provision
directly, less actuarial losses not yet based on the Actuarial Valuation.
recognised. The value of any asset is As approved by the Ministry of However as per Sri Lanka Accounting
restricted to the sum of any actuarial Finance the Bank has almost Standards the Bank has provided for
losses and past service cost not yet finalised a new pension fund for gratuity liability based on an Actuary
recognised and the present value of any permanent employees who joined Valuation.
FROM THE TOP

REFLECTIONS
economic benefits available in the form the Bank post 1 January 1996. Since
of refunds from the plan or reductions the Bank has concluded this as a The subsidiary and associate
in the future contributions to the plan. define benefit plan, the surplus/ companies of the Bank provide for
deficit has been recorded as per gratuity under the Payment of Gratuity
The latest actuarial valuation was LKAS 19. Act No. 12 of 1983. Provision for
carried out as of 31 December Gratuity has been made for employees
2022, by Mr Piyal S Gunatilleke The latest actuarial valuation was who have completed one year of
F.S.A. (USA), Member of the carried out as of 31 December service with the companies. These
2022, by Mr Piyal S Gunatilleke
VALUE CREATION
DRIVING
American Academy of Actuaries and liabilities are not externally funded.
Consulting Actuary. F.S.A. (USA), Member of the
American Academy of Actuaries and
Consulting Actuaries. 5.14.2 Defined
The Bank provides a pension to retiring
staff on the following basis: Staff are
contribution plans
eligible to draw a pension after 10 years 5.14.1.3 Gratuity The Bank also operates a defined
of service and after reaching normal contribution plan. The contribution
age of retirement of 55 years. The Employees who joined the Bank on payable to a defined contribution
quantum of pension paid is dependent or after 1 January 1996 will be eligible plan is in proportion to the services
for gratuity under the Payment of
AND ANALYSIS
on the length of service as follows: rendered to the Bank by the
Gratuity Act No. 12 of 1983, or if employees and is recorded as an
opted can join the proposed new expense under “Personnel expenses”.
Length of service Quantum of pension
post 1996 pension fund and if so Unpaid contributions are recorded as
i. 10 to 20 years 80% of last drawn such employees will forfeit their right a liability.
gross salary to gratuity.
ii. 21 to 29 years 80% plus 1% for each The Bank contributes to the following
additional year in Other employees whose services are Schemes:
excess of 20 years terminated other than by retirement
of last drawn gross are eligible to receive terminal gratuity
salary
5.14.2.1 Employees’
under the Payment of Gratuity Act
Provident Fund
iii. 30 years and 90% of last drawn No. 12 of 1983 at the rate of one half
REPORTS
GOVERNANCE
above gross salary of Gross Salary applicable to the The Bank and employees contribute
last month of the financial year in 12% and 8% respectively of the
The Financial Statements of the which employment is terminated, employee’s monthly gross salary
Pension Trust Fund are maintained for each year of continuous service, (excluding overtime) to the Provident
separately and are subject to annual for those who have served in excess Fund. The Bank’s Provident Fund is an
audit by Independent External of five years. approved fund under the Employees’
Auditors. The Financial Statements as Provident Fund Act and is maintained
well as the Auditors Report are tabled If a participant who has completed five internally.
STATEMENTS
FINANCIAL
and reviewed by the Board of Trustees. years of services becomes totally and
These Financial Statements and permanently disabled, he is eligible
Auditor’s Report are also submitted for
5.14.2.2 Employees’ Trust Fund
for disability gratuity. Further if an
review of the disclosure of the Bank, as active participant with minimum of five The Bank contributes 3% of the
the Bank has an obligation of ensuring years of service, dies while in service, a employee’s monthly gross salary
that funding is made at required levels. gratuity benefit will be paid to his heirs. excluding overtime to the Employees’
Pension is payable monthly as long as Trust Fund maintained by the
the participant is alive. The Bank makes a monthly provision Employees' Trust Fund Board.
INFORMATION
SUPPLEMENTARY
towards such Gratuity Payment

Liabilities and this value is reflected in
5.15 Widow’s/Widowers’ Financial Position but are disclosed z In respect of taxable temporary
and Orphans Pension Plan unless they are remote. differences associated with
(Pre-1996/Post-1996) investments in subsidiaries where
the timing of the reversal of the
A separate fund is maintained in 5.17.2 Measurement
temporary differences can be
order to meet future obligations Any increase in the commitment controlled and it is probable that the
under the scheme, based on the relating to financial guarantees is temporary differences will reverse in
advice of a qualified actuary. Further recorded in the Statement of Financial the foreseeable future.
this fund is solely funded through Position. The premium received is
the contributions of participants/ recognised in the Income Statement
employees. 5.18.2.2 Deferred tax assets
in “Net fees and commission income”
on a straight line basis over the life of Deferred tax assets are recognised
5.16 Provision the guarantee. for all deductible differences. Carry
forward of unused tax credits and
Provisions are recognised when unused tax losses, to the extent that it
the Bank has a present obligation 5.18 Taxes
is probable that taxable profits will be
(legal or constructive) as a result of 5.18.1 Current taxation available against which the deductible
a past event, and it is probable that temporary differences and the carry
Current tax assets and liabilities consist
an outflow of resources embodying forward of unused tax credits and
of amounts expected to be recovered
economic benefits will be required unused tax losses can be utilised,
from or paid to the Commissioner
to settle the obligation and a reliable except:
General of Inland Revenue in respect of
estimate can be made of the amount
the current as well as prior years. The z Where deferred tax assets relating
of the obligation. The expense
tax rates and tax laws used to compute to the deductible temporary
relating to any provision is presented
the amount are those that are enacted differences arise from the initial
in the Income Statement net of any
or subsequently enacted by the recognition of an asset or liability in
reimbursement.
Statement of Financial Position date. a transaction that is not a business
Accordingly, provision for taxation is combination and at the time of
5.17 Commitments and made on the basis of the profit for the the transaction, affects neither the
contingencies year as adjusted for taxation purpose accounting profit nor the taxable
in accordance with the provisions of profit or losses; and
All discernible risks are accounted
the Inland Revenue Act No. 24 of 2017 z In respect of deductible temporary
for in determining the amount of all
at the rates specified in Note 14 to the differences associated with
known liabilities. The Bank’s share
Financial Statements. investments in subsidiaries, deferred
of any contingencies and capital
tax assets are recognised only to
commitments of a subsidiary or
5.18.2 Deferred taxation the extent it is probable that the
associate for which the Bank is also
temporary differences will reverse in
liable severally or otherwise are also
Deferred tax is provided using the foreseeable future and taxable
included with appropriate disclosures.
the liability method on temporary profit will be available against
differences at the Statement of which temporary differences can be
5.17.1 Basis of recognition financial position date between the utilised.
tax bases of assets and liabilities and
In the ordinary course of business,
their carrying amounts for financial The carrying amount of a deferred tax
the Bank gives financial guarantees,
reporting purpose. asset is reviewed at each Statement of
consisting of letters of credit,
Financial Position date and reduced to
guarantees and acceptances. Financial
5.18.2.1 Deferred tax liability the extent it is no longer probable that
guarantees are initially recognised in
sufficient taxable profit will be available
the financial under commitments at
Deferred tax liabilities are recognised to allow all or part of the deferred
facility value.
for all temporary differences, except: tax asset to be utilised. Unrecognised
z Where the deferred tax liability deferred tax asset are reassessed at
Contingent liabilities are possible
arises from the initial recognition of each Statement of Financial Position
obligations whose existence will be
goodwill or of an asset or liability in date and are recognised to the extent
confirmed only by uncertain future
a transaction that is not a business that it is probable that future taxable
events or present obligations where
combination and at the time of profit will allow the deferred tax asset
the transfer of economic benefit
transaction, affects neither the to be recovered.
is not probable or cannot be reliably
measured. Contingent liabilities are accounting profit nor the taxable
not recognised in the Statement of profit or loss; and
PEOPLE’S BANK
ABOUT
Deferred tax assets and liabilities are 5.18.7. Surcharge Tax specific recognition criteria for
measured at the tax rate that are each type of income are given
expected to apply in the year when Inland Revenue Department (IRD) has in Notes 6 to 10.
the assets are realised or the liabilities issued a notice to taxpayers dated
are settled, based on tax rates and 8 April 2022 on the implementation
of the Surcharge Tax Act No 14 of 5.19.1 Income from
tax laws that have been enacted or
subsequently enacted at the Statement 2022. The surcharge tax is a one-off Government Securities and
tax at a rate of 25% that is imposed securities purchased under
FROM THE TOP

REFLECTIONS
of Financial Position date.
on any individual, partnership, or resale agreements
company with taxable income
5.18.3 Value Added Tax on exceeding LKR 2 billion for the year Discounts/premium on Treasury Bills
Financial Services (FSVAT) of assessment 2020/2021. The act and Treasury Bonds are amortised
clarifies that in the case of companies, over the period to reflect a constant
Bank’s total value addition was periodic rate of return. The coupon
the surcharge tax is imposed on:
subjected to a 18% Value Added interest on Treasury Bonds is
Tax as per Section 25A of the Value z A company where taxable income recognised on an accrual basis.
VALUE CREATION
DRIVING
Added Tax Act No. 14 of 2002 and of the company individually exceeds The interest income on securities
amendments thereto with effect from LKR 2 billion; and purchased under resale agreements is
1 January 2022. z Every company in a group of recognised in the Income Statement
companies where the aggregate on Effective Interest rate [EIR] over
5.18.4 Value Added Tax (VAT) taxable income of all subsidiaries the period of the agreement.
and the holding company in that
Value Added Tax is calculated in group exceeds LKR 2 billion.
accordance with Value Added Tax 5.19.2 Rental income
Act No. 14 of 2002 and subsequent The notice further clarifies that holding Rental income arising on operating
AND ANALYSIS
amendments thereto. VAT is payable companies should exclude gains leases is accounted for on a straight-
at the rate of 8% from 1 December and profits from dividends received line basis over the lease terms on
2019 to 31 May 2022 and at the rate from its subsidiaries in calculating the ongoing leases and is recorded in
of 12% from 1 June 2022 to 31 August surcharge tax liability. It is also clarified the Income Statement in ”other
2022 and at the rate of 15% from that in calculating the aggregate operating income”.
1 September 2022 onwards. taxable income, where any subsidiary
or holding company has a nil amount 5.20 Segmental reporting
5.18.5 Withholding Tax of taxable income due to losses or
unrelieved losses, such losses or nil The Bank’s segmental reporting is
on Dividends (WHT)
amount should be disregarded. based on the following operating
Dividend distributed out of taxable segments: Retail Banking, Corporate
profit of the local Subsidiaries Banking, and Treasury and Primary
REPORTS
GOVERNANCE
attracts a 14%, deduction at source 5.18.8. Social Security dealer unit, Leasing, Insurance
and is final tax liability for of the Contribution Levy Finance and Travels. Information
Bank. Withholding tax on dividends Under the Social Security Contribution relating to above is disclosed in
has been abolished with effect from Levy Act (SSCL) No. 25 of 2022 with Note 45.
1 January 2019. effect from 1 October 2022, a social
security tax of 2.5% has been imposed 5.21 Deposit insurance scheme
5.18.5 Crop Insurance on those who annual taxable turnover
In terms of the Banking Act Direction
STATEMENTS
FINANCIAL
Levy (CIL) exceeds LKR 120 million. Accordingly,

bank is liable for SSCL with effect from No. 5 of 2010 “Insurance of Deposit
As per the provision of the Section 1 October 2022. Liabilities” issued on 27 September
14 of the Finance Act No. 12 of 2013, 2010 and subsequent amendments
the Crop Insurance Levy (CIL) was there to, all Licensed Commercial
introduced with effect from 1 April 5.19 Recognition of income Banks are required to insure their
2013. Accordingly, Bank is required and expenses deposit liabilities in the Deposit
to pay 1% of the profit after tax for a Revenue is recognised to the extent Insurance Scheme operated by the
INFORMATION
SUPPLEMENTARY
year of assessment to the National that it is probable that the economic Monetary Board in terms of Sri Lanka
Insurance Trust Fund. benefits will flow to the Bank and the Deposit Insurance and Liquidity
revenue can be reliably measured. The Support Scheme Regulations No. 1
of 2010 issued under Sections 32A
to 32E of the Monetary Law Act with
effect from 1 October 2010. Deposits 5.23 Policies specific to Additional qualitative judgement is
to be insured include demand, time insurance sector used to assess the extent to which past
and savings deposit liabilities and trends may not apply in future, (for
exclude the following: 5.23.1 Significant accounting example to reflect one-off occurrences,
z Deposit liabilities to member estimates and assumptions changes in external or market factors
institutions such as public attitudes to claiming,
Non-life insurance contract
economic conditions, levels of claims
z Deposit liabilities to Government liabilities inflation, judicial decisions and
of Sri Lanka
For non-life insurance contracts, legislation, as well as internal factors
z Deposit liabilities to Directors, estimates have to be made both for such as portfolio mix, policy features
Key Management Personnel and the expected ultimate cost of claims and claims handling procedures)
other related parties as defined reported at the reporting date and for in order to arrive at the estimated
in Banking Act Direction No. 11 of the expected ultimate cost of claims ultimate cost of claims that present
2007 on Corporate Governance of incurred but not yet reported at the the likely outcome from the range of
Licensed Commercial Banks reporting date (IBNR). It can take a possible outcomes, taking account of
z Deposit liabilities held as collateral significant period of time before the all the uncertainties involved.
against any accommodation granted ultimate claims cost can be established
z Deposit liabilities falling within the with certainty and for some type of Similar judgements, estimates and
meaning of abandoned property policies, IBNR claims form the majority assumptions are employed in the
in terms of the Banking Act and of the liability in the Statement of assessment of adequacy of provisions
dormant deposits in terms of the Financial Position. for unearned premium. Judgement is
Finance Companies Act funds of also required in determining whether
which have been transferred to The ultimate cost of outstanding the pattern of insurance service
Central Bank of Sri Lanka. claims is estimated by using a range provided by a contract requires
of standard actuarial claims projection amortisation of unearned premium on
Licensed Commercial Banks are techniques, such as Chain Ladder and a basis other than time apportionment.
required to pay a premium of 0.10% Bornheutter-Ferguson methods and
on eligible deposit liabilities if the Bank frequency/severity method. 5.23.2 Revenue recognition
maintains a capital adequacy ratio
(CAR) of 14% or above as at the end The main assumption underlying Gross written premium
of the immediately preceding financial these techniques is that a company’s
Non-life insurance gross written
year and a premium of 0.125% on past claims development experience
premium comprises the total premium
eligible deposit liabilities for all other can be used to project future claims
receivable for the whole period of
Licensed Commercial Banks (with CAR development and hence ultimate
cover provided by contracts entered
below 14%) calculated on the total claims costs. As such, these methods
into during the accounting period and
amount of eligible deposits as at the extrapolate the development of paid
are recognised on the date on which
end of the quarter payable within a and incurred losses, average costs per
the policy commences.
period of 15 days from the end of the claim and claim numbers based on the
quarter. observed development of earlier years
and expected loss ratios. Historical Reinsurance premium
claims development is mainly analysed
5.22 Subsequent events by accident years, but can also be
Non-life gross reinsurance premium
written comprises the total premium
Events occurring after the reporting further analysed by geographical area,
payable for the whole cover provided
date are those events, favourable and as well as by significant business lines
by contracts entered into the period
unfavourable, that occur between the and claim types. Large claims are
and is recognised on the date on
reporting date and the date of the usually separately addressed, either
which the policy incepts. Premium
Financial Statements are authorised by being reserved at the face value of
includes any adjustments arising in
for issue. loss adjuster estimates or separately
the accounting period in respect of
projected in order to reflect their future
reinsurance contracts incepting in prior
All material and important events development. In most cases, no explicit
accounting periods.
which occur after reporting date assumptions are made regarding
have been considered and disclosed in future rates of claims inflation or loss
Note 42 to the Financial Statements as ratios. Instead, the assumptions used
adjusted as applicable. are those implicit in the historical
claims development data on which the
projections are based.
PEOPLE’S BANK
ABOUT
Unearned reinsurance premium is z Amendments to LKAS 1:
the proportion of premium written in Classification of Liabilities as
a year that relates to periods of risk Current or Non-current.
after the reporting date. Unearned The amendment specifies the
reinsurance premium is deferred over requirements for classifying liabilities
the term of the underlying direct as current or noncurrent. The
insurance policies. amendments clarify what is meant
FROM THE TOP

REFLECTIONS
by a right to defer settlement,
that a right to defer must exist at
5.24 Standards issued
the end of the reporting period,
but not yet effective that classification is unaffected by
The new and amended standards that the likelihood that an entity will
are issued, but not yet effective to exercise its deferral right, that only
the date of issuance of these financial if an embedded derivative in a
statements are disclosed below: convertible liability is itself an equity
VALUE CREATION
DRIVING
z Sri Lanka Accounting Standard - instrument would the terms of
SLFRS 17 - Insurance Contracts liability not impact its classification
SLFRS 17 is a comprehensive new and disclosures.
accounting standard for insurance
contracts covering recognition and
measurement, presentation and
disclosure.
z Amendments to LKAS 12
Income Taxes
AND ANALYSIS
The amendments clarify that where
payments that settle a liability
are deductible for tax purposes,
it is a matter of judgment (having
considered the applicable tax
law) whether such deductions are
attributable for tax purposes to the
liability recognised in the financial
statements or to the related asset
component (and interest expense).
This judgment is important
REPORTS
GOVERNANCE
in determining whether any
temporary differences exist on initial
recognition of the asset and liability.
z Amendments to LKAS 8 –
Accounting policies, changes in
accounting estimates and errors.
The amendments clarify the
STATEMENTS
FINANCIAL
distinction between changes in

accounting estimates and changes
in accounting policies and the
correction of errors. Also, they clarify
how entities use measurement
techniques and inputs to develop
accounting estimates. The amended
standard clarifies that the effects
INFORMATION
SUPPLEMENTARY
on an accounting estimate of a
change in input or a change in a
measurement technique are changes
in accounting estimates if they do
not result from the correction of
prior period errors.
6. GROSS INCOME
Accounting policy
Revenue is recognised to the extent that it is probable that the economic benefit(s) will flow to the Bank/Group and
the revenue can be reliably measured. The specific recognition criteria for each type of income are more fully set out in
respective Income Notes.
Bank Group

Interest income 7.1 321,935,983 197,330,011 351,386,736 222,362,450

Fee and commission income 8.1 16,397,745 8,268,168 17,213,747 9,645,136
Net gain/(loss) from trading 9 17,026,226 (1,345,029) 17,019,836 (1,207,608)
Other operating income (Net) 10 1,868,655 2,996,670 5,583,879 5,995,063
357,228,609 207,249,820 391,204,198 236,795,041
7. NET INTEREST INCOME
Accounting policy
The Bank/Group calculates interest income/expense by applying the Effective Interest Rate (EIR) to the amortised cost
of Financial Assets/Liability other than credit impaired assets.
The effective interest rate method

Under SLFRS 9, interest income is recorded using the effective interest rate (EIR) method for all financial instruments
measured at amortised cost, financial instruments designated at FVPL and interest bearing financial assets measured at
FVOCI. Interest expense is recorded using the effective interest rate (EIR) method for liabilities recorded such as due to
banks, due to other customers and other borrowings.
EIR is the rate that exactly discounts estimated future cash payments or receipts over the expected life of the financial
instrument or a shorter period, where appropriate, to the net carrying amount of the financial asset or financial liability.
The calculation takes into account all contractual terms of the said financial instrument and includes any fees or
incremental costs that are directly attributable to the instrument which are an integral part of the EIR, but excludes
future credit losses.
Once the recorded value of a financial asset or a group of similar financial assets has been reduced due to an impairment
loss, interest income continues to be recognised using the rate of interest used to discount the future cash flows for the
purpose of measuring the impairment loss.
7.1 Interest income

Bank Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Cash and cash equivalents 9,830 240,498 15,263 285,264

Placements with banks 926,746 2,419,823 1,486,976 2,525,712
Loans and advances – to banks 892,160 1,206,812 926,734 1,274,194
Financial assets – at fair value through profit or loss 921,043 768,284 921,043 768,284
Loans and advances to other customers 232,797,261 153,693,234 258,849,618 177,714,884
Debt instruments measured at amortised cost 84,305,541 37,343,071 86,999,376 38,075,269
Debt instruments at fair value through OCI 1,246,709 704,633 1,351,033 765,187
Day one difference on staff loans 836,693 953,656 836,693 953,656
Total interest income 321,935,983 197,330,011 351,386,736 222,362,450
PEOPLE’S BANK
ABOUT
7.2 Interest expenses
Bank Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Due to banks 6,633,232 8,114,157 8,624,421 8,982,646
Due to other customers 199,571,363 97,603,454 210,041,439 105,318,788
FROM THE TOP

REFLECTIONS
Other borrowings 33,861,939 3,465,215 33,842,362 3,451,678
Debt securities issued 5,503,630 5,103,325 7,060,585 6,966,957
Interest on lease liabilities 607,754 583,020 782,854 767,602
Total interest expenses 246,177,918 114,869,171 260,351,661 125,487,671
Net interest income 75,758,065 82,460,840 91,035,075 96,874,779
VALUE CREATION
DRIVING
8. NET FEE AND COMMISSION INCOME
Accounting policy
The Bank/Group earns fee and commission income from a diverse range of services it provides to its customers. Fee
and commission income are recognised when the service is performed. Fees earned for the provision of services over a
period of time are accrued over that period.
AND ANALYSIS
8.1 Fee and commission income
Bank Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Loans 655,326 1,271,909 655,326 1,271,909
Cards 2,349,323 1,600,975 2,349,323 1,600,975
Trade and remittances 8,320,217 1,361,782 8,320,217 1,361,782
Investment banking 43,273 93,339 43,273 93,339
Deposits 4,034,560 2,883,922 4,034,560 2,883,922
REPORTS
GOVERNANCE
Guarantees 719,146 716,185 719,146 716,185
Others 275,900 340,056 1,091,902 1,717,024
Total 16,397,745 8,268,168 17,213,747 9,645,136
8.2 Fee and commission expenses

Bank Group
STATEMENTS
FINANCIAL

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Cards 806,575 333,087 806,575 333,087
Trade and remittances 500 654 500 654
Investment banking 19,934 43,084 19,934 43,084
Guarantees 1,150 1,643 1,150 1,643

INFORMATION
SUPPLEMENTARY
Others 516 219,318 516 219,318
Total 828,675 597,786 828,675 597,786
Net fee and commission income 15,569,070 7,670,382 16,385,072 9,047,350

9. NET GAIN/(LOSS) FROM TRADING
Accounting policy
Net gains/(losses) from trading comprises of foreign exchange gain(s) or losses arising from trading activities, realised
gains or losses from investment in equities and fixed income securities classified as “Financial Assets – At Fair Value
through Profit or Loss” and unrealised gains and losses due to changes in fair value of such instruments.
Gains and losses arising from changes in fair value of the said instruments are recognised in the Income Statement in the
period in which they arise and derivative financial instruments are fair valued at each reporting date.
Bank Group

Net gain/(loss) from trading

Gain from trading 9.1 2,944,849 (830,479) 2,938,459 (693,058)
Net fair value gain/(loss) 9.2 14,081,377 (514,550) 14,081,377 (514,550)
Total 17,026,226 (1,345,029) 17,019,836 (1,207,608)
9.1 Gain/(loss) from trading

Bank Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Foreign exchange 2,740,436 (965,361) 2,740,436 (965,361)
Government Securities (Treasury Bills and Treasury Bonds) 184,223 143,459 184,223 143,459
Equities 20,190 (8,577) 13,800 128,844
Total 2,944,849 (830,479) 2,938,459 (693,058)
9.2 Net fair value gain/(loss) on financial assets at fair value through profit or loss
Bank Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Derivatives 14,313,449 (440,500) 14,313,449 (440,500)
Government Securities
Treasury Bills 1,652 (4,074) 1,652 (4,074)
Treasury Bonds (233,724) (69,976) (233,724) (69,976)
Total 14,081,377 (514,550) 14,081,377 (514,550)

PEOPLE’S BANK
ABOUT
10. OTHER OPERATING INCOME
Accounting policy
Profit/(loss) from sale of property, plant and equipment

Profit/(loss) from sale of property, plant and equipment is recognised as and when the control of the property, plant and
equipment has passed to the other party.
FROM THE TOP

REFLECTIONS
Dividend income from investment
Dividend income is recognised when the Bank’s/Group’s right to receive the payment is established.
Recovery of bad debts written off

Recovery of amounts once written off as bad debts are recognised, as and when such amount has received.
VALUE CREATION
DRIVING
Net earned premium
Net earned premium refers to the gross written premium less premium ceded to reinsurance and net of any unearned
premiums change in reserve unearned, which is more fully described under Note 5.23 to these Financial Statements.
Bank Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Profit from disposals of property, plant and equipment and
AND ANALYSIS
right-of-use assets 174,560 62,744 237,350 126,830
Dividend from investment

Quoted 71,328 24,737 77,760 30,986
Unquoted 129,600 143,079 129,600 143,079
Subsidiaries 707,698 1,634,943 – –
Recovery of bad debts written off 97,430 28,461 97,430 28,461
Net earned premium – – 4,242,248 4,639,833
Others 688,039 1,102,706 799,491 1,025,874
Total 1,868,655 2,996,670 5,583,879 5,995,063
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
11. IMPAIRMENT CHARGE
Accounting policy
The Bank/Group recognises impairment losses on financial assets by applying the three-stage approach to measure
expected credit losses (ECL’s) under Sri Lanka Accounting Standard – SLFRS 9 – “Financial Instruments” of which details
are more fully given under Note 5.6 – Impairment of financial assets.
Further, the Bank/Group recognises an impairment loss when the carrying amount of a non-financial asset exceeds the
estimated recoverable amount of such asset through use or sale, as per Sri Lanka Accounting Standard – LKAS 36 –
“Impairment of Assets”. Details relating hereto are more fully given under Note 5.13 to these Financial Statements.
Bank (Note 11.1) Group (Note 11.2)

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Loans and advances to other customers 28,366,700 13,282,540 29,374,441 12,863,972
Other financial assets 5,031,360 1,169,644 5,031,360 1,169,644
Contingent liabilities and commitments (51,609) 20,636 (51,609) 20,636
Others – – (1,355) 431,206
Total impairment charge 33,346,451 14,472,820 34,352,837 14,485,458
11.1 Bank
For the year ended 31 December 2022
Stage 1 Stage 2 Stage 3 Total

Cash and cash equivalents 17.4 734 16,373 – 17,107

Loans and advances to banks 22.2 (235,379) – – (235,379)
Loans and advances to other customers 23.2.1 (1,815,409) 9,215,436 20,966,673 28,366,700
Debt instruments measured at amortised cost 24.2 – 5,249,114 – 5,249,114
Debt instruments at fair value through OCI 26.2 518 – – 518
Contingent liabilities and commitments 41.3 (22,024) 106,725 (136,310) (51,609)
Total impairment charge on financial assets (2,071,560) 14,587,648 20,830,363 33,346,451
Total impairment charge 33,346,451

Cash and cash equivalents 17.4 (703) 5,102 – 4,399

Placements with banks 19.2 (31,033) – – (31,033)
Loans and advances to banks 22.2 133,705 – – 133,705
Loans and advances to other customers 23.2.1 1,637,097 6,457,732 5,187,711 13,282,540
Debt instruments measured at amortised cost 24.2 1,061,847 – – 1,061,847
Contingent liabilities and commitments 41.3 750 206,330 (186,444) 20,636
Total impairment charge on financial assets 2,802,389 6,669,164 5,001,267 14,472,820
Others –
PEOPLE’S BANK
ABOUT
11.2 Group

FROM THE TOP

REFLECTIONS
Loans and advances to banks 22.2 (235,379) – – (235,379)
Loans and advances to other customers 23.2.1 (1,669,045) 9,107,554 21,935,932 29,374,441
Debt instruments measured at amortised cost 24.2 – 5,249,114 – 5,249,114
Contingent liabilities and commitments 41.3 (22,024) 106,725 (136,310) (51,609)
Total impairment charge on financial assets (1,925,196) 14,479,766 21,799,622 34,354,192
VALUE CREATION
DRIVING
Others
Loss on disposal of collaterals including write-offs (32,966)
Impairment charges for goodwill 29.2 31,611
AND ANALYSIS
Cash and cash equivalents 17.4 (703) 5,102 – 4,399
Placements with banks 19.2 (31,033) – – (31,033)
Loans and advances to banks 22.2 133,705 – – 133,705
Loans and advances to other customers 23.2.1 2,006,360 6,212,795 4,644,817 12,863,972
Debt instruments measured at amortised cost 24.2 1,061,847 – – 1,061,847
Contingent liabilities and commitments 41.3 750 206,330 (186,444) 20,636
REPORTS
GOVERNANCE
Total impairment charge on financial assets 3,171,652 6,424,227 4,458,373 14,054,252
Others
Loss on disposal of collaterals including write-offs 304,997
Impairment charges for goodwill 29.2 126,209
Total impairment charge 14,485,458 STATEMENTS

FINANCIAL
INFORMATION
SUPPLEMENTARY
12. PERSONNEL EXPENSES
Accounting policy
Personnel expenses include staff salaries, bonus, contribution to defined contribution/benefit plans and other staff
related expenses. Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as
the related service is provided. A liability is recognised for the amount expected to be paid under short-term cash bonus
in the event the Bank/the Group has a present legal or constructive obligation to pay this amount as a result of past
service provided by the employee and the obligation can be estimated reliably.
Bank Group

Salaries, bonus and related expenses 20,364,710 18,603,077 25,860,327 23,449,166
Contribution to defined benefit plan – pension funds 12.1 2,697,765 783,921 2,697,765 783,921
Contribution to defined benefit plan – gratuity 12.2 44,383 171,742 146,586 297,601
Amortisation of prepaid staff cost 836,693 953,656 836,693 953,656
Others 2,659,197 2,259,539 2,659,197 2,259,539
Total 26,602,748 22,771,935 32,200,568 27,743,883
12.1 Contribution to defined benefit plan – Pension funds

The Bank operates two defined benefit pension plans, for the permanent staff members who have joined the Bank prior to
1 January 1996 and after 1 January 1996, which requires contributions to be made to a separately administered funds. The
Bank recognises all actuarial gains and losses arising from these pension funds in the Other Comprehensive Income (OCI)
and the expenses related to these funds recorded under personnel expenses in the income Statement. Details of these
defined benefit plans are given in “Employee retirement benefit plans” (Note 35.1 & Note 35.2).
Bank Group

Net expense recognised in the income statement
Defined benefit plan – pre 1996 pension trust fund 35.1.3 2,257,664 1,219,509 2,257,664 1,219,509
Defined benefit plan – post 1996 pension fund 35.2.3 440,101 (435,588) 440,101 (435,588)
2,697,765 783,921 2,697,765 783,921
12.2 Contribution to defined benefit plan – Gratuity (Note 35.3)

Bank Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Net expense recognised in the income statement

Past service cost (126,496) 79,085 (126,496) 79,085
Current service cost 72,839 34,426 123,941 97,356
Interest cost 98,039 58,231 149,141 121,160
Net expense 44,383 171,742 146,586 297,601

PEOPLE’S BANK
ABOUT
13. OTHER EXPENSES
Accounting policy
Other expenses have been recognised in the Income Statement as they are incurred in the period to which they relate.
All expenditure incurred in running of the business and maintaining the property, plant & equipment in a state of
efficiency has been charged to the income statement in arriving at the profit of the year.
FROM THE TOP

REFLECTIONS
Depreciation & amortisation methods and rates are as stipulated in the Note 28 (property plant and equipment & right of
use assets)
Bank Group

Directors’ emoluments 7,127 7,436 22,031 15,355
VALUE CREATION
DRIVING
Auditors’ remunerations 7,850 12,940 23,224 26,261
Non-audit fees to auditors – – 2,566 2,216
Professional and legal expenses 179,198 133,435 219,667 163,716
Depreciation and amortisation 13.1 4,705,872 5,054,904 5,366,761 5,711,558
Office administration and establishment expenses 10,400,862 7,620,394 12,060,569 9,270,988
Benefits, claims, and underwriting expenditure – – 3,480,043 2,951,534
AND ANALYSIS
Deposit insurance premium 2,253,144 1,992,415 2,402,371 2,139,069
Others 3,184,734 2,468,054 3,210,551 2,490,474
Total 20,738,787 17,289,578 26,787,783 22,771,171
13.1 Depreciation and amortisation

Bank Group

Depreciation of property, plant and equipment 28 2,035,637 2,308,320 2,321,035 2,605,467
REPORTS
GOVERNANCE
Amortisation of right-of-use asset 28 2,017,947 2,106,844 2,378,562 2,450,170
Depreciation of investment property – 1,606 – 1,606
Amortisation of intangible assets 29 652,288 638,134 667,164 654,315
Total 4,705,872 5,054,904 5,366,761 5,711,558
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
14. INCOME TAX EXPENSES
Accounting policy
Current taxation
As per Sri Lanka Accounting Standard – LKAS 12 – “Income Taxes”, tax expense is the aggregate amount included
in determination of profit or loss for the period in respect of current and deferred taxes. Income tax expense
is recognised in the Income Statement, except to the extent it relates to items recognised directly in Other
Comprehensive Income (OCI), in which case it is recognised in OCI.
Accordingly, the provision for taxation is made on the basis of the profit for the year as adjusted for taxation purpose
in accordance with the provision of the Inland Revenue Act No. 24 of 2017 and its amendment Act No. 10 of 2021.
Detailed disclosure of accounting policies are given in Note 5.18 to these Financial Statements.
Deferred taxation
Deferred tax is provisioned for using the liability method on temporary differences at reporting date between the
tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Detailed disclosure of
accounting policies and estimate of deferred tax is more fully available in Note 5.18.2 to the Financial Statements.
Bank Group

Current year tax expense

Income tax expense 14.1 8,450,869 6,855,681 11,027,952 10,178,826
Prior years’ (over)/under provision (105,881) 174,406 (105,881) 174,406
Deferred tax charge/(credit) 14.2 (2,813,793) (708,270) (3,372,002) (1,539,263)
Deferred tax charge/(credit) on income tax rate change (1,384,856) 344,640 (1,384,856) 344,640
Total tax expense 4,146,339 6,666,457 6,165,213 9,158,609
Effective tax rate (%) 19.4% 21.9% 23.1% 24.6%
14.1 Reconciliation of tax expenses

Bank Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Profit before tax for the year 21,338,397 30,386,600 26,690,652 37,246,257
Income tax for the period (accounting profit at applicable tax rate) 5,761,367 7,292,784 6,405,756 8,939,102
Add:
Tax effect of expenses that are not deductible for tax purposes 13,874,938 7,665,037 15,287,710 10,292,851
(Less):
Tax effect of expenses that are deductible for tax purposes (11,185,437) (8,102,140) (10,665,515) (9,053,127)
Income tax expense for the period 8,450,868 6,855,681 11,027,952 10,178,826
PEOPLE’S BANK
ABOUT
14.2 The deferred tax charge/(credit) in the Income Statement comprise the following:
Bank Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Deferred tax assets 513,878 (1,580,036) 611,847 (2,638,261)
FROM THE TOP

REFLECTIONS
Deferred tax liabilities (4,712,527) 1,216,406 (5,368,705) 1,443,638
Deferred tax (credit)/charge to profit/(loss) (4,198,649) (363,630) (4,756,858) (1,194,623)
14.3 The deferred tax charge/(credit) in other comprehensive income comprise the following:
Bank Group
VALUE CREATION
DRIVING
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Retirement benefit (991,318) 3,110,193 (953,496) 3,106,359
Revaluation of land and buildings 1,052,155 881,484 1,313,946 917,484
Gain/(loss) from instruments at FVOCI – – (137,822) (30,075)
Deferred tax effect on change in income tax rate on the

opening balance 2,056,688 (245,293) 2,056,688 (245,293)
Deferred tax charge/(credit) to OCI 2,117,525 3,746,384 2,279,316 3,748,475
AND ANALYSIS
Net deferred tax for the year (2,081,124) 3,382,754 (2,477,542) 2,553,852
14.4 Applicable rates on income tax
2022 2021
% %
Domestic operation of the Bank 30 24
On-shore banking operations of the Off-Shore Banking Unit 30 24
Off-shore banking operations of the Off-Shore Banking Unit 30 24
REPORTS
GOVERNANCE
People’s Leasing and Finance PLC 30 24
People’s Travels (Pvt) Ltd. 30 24
People’s Micro Finance Limited 30 24
People’s Fleet Management Limited 30 24

STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
14.5 Surcharge tax

As per the Surcharge Tax Act No. 14 of 2022, the Bank is liable for a surcharge tax of LKR 5.4 Bn. pertaining to the year
of assessment 2020/2021. In accordance with the said Act, the said tax shall be deemed as an expense in the financial
year beginning on 1 January 2020. Since the Act supersedes the requirements of the Sri Lanka Accounting Standards,
this surcharge tax expense has been accounted as permitted under the Statement of Alternative Treatment (SoAT) on
Accounting for Surcharge Tax as issued by the Institute of Chartered Accountant of Sri Lanka. Accordingly, the Bank has
recognised the total liability to surcharge tax as an adjustment to the opening retained earnings as of 1 January 2022.
Bank Group
Surcharge tax 5,439,713 7,932,806
15. EARNINGS PER SHARE

15.1 Basic earnings per share
As per Sri Lanka Accounting Standard – LKAS 33 “Earnings per Share”, the calculation of basic earnings per share has
been based on the following profit attributable to ordinary shareholders and weighted-average number of ordinary shares
outstanding during the year:
Bank Group
Net profit attributable to ordinary equity holders (LKR ’000) 17,192,058 23,720,143 19,571,989 26,350,975
Weighted-average number of ordinary shares in issue (’000) 1,000 1,000 1,000 1,000
Basic earnings per share (LKR) 17,192 23,720 19,572 26,351
15.2 Diluted earnings per share

As per Sri Lanka Accounting Standard – LKAS 33 “Earnings per Share”, the calculation of diluted earnings per share has
been based on the following profit attributable to ordinary shareholders and weighted-average number of ordinary shares
outstanding during the year, after adjustment for the effects of all dilutive potential ordinary shares.
Bank Group
Net profit attributable to ordinary equity holders (LKR ’000) 17,192,058 23,720,143 19,571,989 26,350,975
Weighted-average number of ordinary shares in issue (’000) 1,000 1,000 1,000 1,000
Number of ordinary shares in capital pending allotment (’000) 243,040 243,040 243,040 243,040
Total number of shares in issue and pending allotment (’000) 244,040 244,040 244,040 244,040
Diluted earnings per share (LKR) 70 97 80 108

PEOPLE’S BANK
ABOUT
16. MEASUREMENT OF FINANCIAL INSTRUMENTS
The following table analyses the carrying amounts of the financial instruments by category as defined under Sri Lanka
Accounting Standard – SLFRS 9 – “Financial Instruments” under the headings of the Statement of Financial Position:
16.1 Bank – 31 December 2022
FROM THE TOP

REFLECTIONS
2022
FVTPL 1
FVOCI2 AC3 Total
Assets
Cash and cash equivalents – – 66,842,171 66,842,171
Balances with central banks – – 67,602,313 67,602,313
Placements with banks – – – –
VALUE CREATION
DRIVING
Derivative financial instruments 14,882,584 – – 14,882,584
Financial assets – at fair value through profit or loss 5,556,754 – – 5,556,754
Loans and advances to banks – – 7,689,150 7,689,150
Loans and advances to other customers – – 1,783,106,693 1,783,106,693
Debt instruments measured at amortised cost 913,099,927 913,099,927
Financial assets – at fair value through OCI
AND ANALYSIS
Equity instruments at fair value through OCI – 1,661,656 – 1,661,656
Debt instruments at fair value through OCI – 10,378,370 – 10,378,370
Total financial assets 20,439,338 12,040,026 2,838,340,254 2,870,819,618
FVTPL1 FVOCI2 AC3 Total
Liabilities
Due to banks – – 111,452,491 111,452,491
REPORTS
GOVERNANCE
Due to other customers – – 2,371,518,898 2,371,518,898
Other borrowings – – 191,527,573 191,527,573
Subordinated term debts – – 36,603,467 36,603,467
Total financial liabilities 1,888,478 – 2,711,102,429 2,712,990,907
1
Fair Value through Profit or Loss 2
Fair Value through Other Comprehensive Income 3
Amortised Cost STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
Bank – 31 December 2021

2021
FVTPL 1
FVOCI 2
AC3 Total
Assets

Placements with banks – – – –
Derivative financial instruments 441,877 – – 441,877
Financial assets – at fair value through profit or loss 1,558,850 – – 1,558,850

Financial assets – at fair value through OCI –
Equity instruments at fair value through OCI 1,621,375 1,621,375

Debt instruments at fair value through OCI 9,399,272 9,399,272
Liabilities
Due to banks – – 107,745,916 107,745,916
1
Fair Value through Profit or Loss 2
Fair Value through Other Comprehensive Income 3
Amortised Cost
PEOPLE’S BANK
ABOUT
16.2 Group – 31 December 2022
2022
FVTPL 1
FVOCI2 AC3 Total
Assets
FROM THE TOP

REFLECTIONS
Placements with banks – – 3,028,550 3,028,550
Derivative financial instruments 14,882,584 – 14,882,584
Financial assets – at fair value through profit or loss 5,915,926 5,915,926

VALUE CREATION
DRIVING
Financial assets – at fair value through OCI

AND ANALYSIS
Liabilities
Due to banks – – 122,696,978 122,696,978
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
Group – 31 December 2021

2021
FVTPL 1
FVOCI 2
AC3 Total
Assets
Placements with banks – – 3,325,726 3,325,726
Derivative financial instruments 441,877 – 441,877
Financial assets – at amortised cost –
Financial assets at fair value through OCI

FVTPL1 AC3 Total
Liabilities
Due to banks – – 122,397,825 122,397,825
1
Fair value through Profit or Loss 2
Fair value through Other Comprehensive Income 3
Amortised Cost
17. CASH AND CASH EQUIVALENTS
Accounting policy
Cash and cash equivalents include cash in hand, balances with banks, money at call and at short notice and Standing
Lending Facility of the Central Bank of Sri Lanka. Cash and cash equivalents are carried at amortised cost in the
Statement of Financial Position.
PEOPLE’S BANK
ABOUT
17.1 Cash Bank Group
As at 31 December 2022 2021 2022 2021

Cash in hand 55,289,725 54,347,698 56,352,806 55,406,177
55,289,725 54,347,698 56,352,806 55,406,177
FROM THE TOP

REFLECTIONS
17.2 Cash equivalents
Cash at banks 11,577,656 3,198,756 11,749,431 3,438,757
Gross cash equivalents 11,577,656 3,198,756 11,749,431 3,438,757
Less: Allowance for expected credit losses 17.4 (25,210) (8,103) (25,210) (8,103)
Net cash equivalents 11,552,446 3,190,653 11,724,221 3,430,654
VALUE CREATION
DRIVING
Total cash and cash equivalents (Net) 66,842,171 57,538,351 68,077,027 58,836,831
17.3 Analysis of cash equivalents based on exposure to credit risk
Bank
As at 31 December 2022
AND ANALYSIS
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Cash at banks 11,408,630 169,026 – 11,577,656
Total 11,408,630 169,026 – 11,577,656

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Cash at banks 2,920,762 277,994 – 3,198,756
Total 2,920,762 277,994 – 3,198,756
REPORTS
GOVERNANCE
Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
STATEMENTS
FINANCIAL
Cash at banks 11,580,405 169,026 – 11,749,431
Total 11,580,405 169,026 – 11,749,431

LKR ’000 LKR ’000 LKR ’000 LKR ’000
INFORMATION
SUPPLEMENTARY
Cash at banks 3,160,763 277,994 – 3,438,757
Total 3,160,763 277,994 – 3,438,757

17.4 Allowance for expected credit losses – Cash equivalents
Bank and Group


LKR ’000 LKR ’000 LKR ’000 LKR ’000
ECL allowance as at 1 January 184 7,918 – 8,103
Gross charge/(reversal) for the year 734 16,373 – 17,107
ECL allowance as at 31 December 918 24,292 – 25,210
2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Gross charge/(reversal) for the year (703) 5,102 4,399
ECL allowance as at 31 December 184 7,918 – 8,103
18. BALANCES WITH CENTRAL BANK OF SRI LANKA
Accounting policy
The balance with the Central Bank of Sri Lanka in the Statutory Cash Reserve is 4.0% (4.0% in 2021) of rupee
denominated deposit liabilities. This is a non-interest-bearing balance. A similar reserve is not required in respect of
foreign currency denominated deposits liabilities in the Domestic Banking Unit and deposit liabilities in the Off-Shore
Banking Unit.
This balance is carried at amortised cost in the Statement of Financial Position.
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Statutory balances with Central Bank of Sri Lanka (Stage 1) 67,602,313 56,717,820 67,602,313 56,717,820
67,602,313 56,717,820 67,602,313 56,717,820

PEOPLE’S BANK
ABOUT
19. PLACEMENTS WITH BANKS
Accounting policy
Placements with banks include Money Market placements and fixed deposits that are subject to an insignificant risk of
changes in the fair value and are used by the Bank/Group in managing its short-term commitments. These balances are
carried at amortised cost in the Statement of Financial Position.
FROM THE TOP

REFLECTIONS
Bank Group
As at 31 December 2022 2021 2022 2021

Placements – – – –
Fixed deposits – – 3,028,550 3,325,726
Gross placements with Banks – – 3,028,550 3,325,726
VALUE CREATION
DRIVING
Less: Allowance for expected credit losses 19.2 – – – –
Net placements with Banks – – 3,028,550 3,325,726
19.1 Analysis of placements with banks based on exposure to credit risk
Group
AND ANALYSIS

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Fixed deposits 3,028,550 – – 3,028,550
Total 3,028,550 – – 3,028,550
REPORTS
GOVERNANCE
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Fixed deposits 3,325,726 – – 3,325,726
Total 3,325,726 – – 3,325,726

STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
19.2 Allowance for expected credit losses – Placements with banks

Bank and Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
ECL allowance as at 1 January – – – –
Gross charge/(reversal) for the year – –
ECL allowance as at 31 December – – – –
2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
ECL allowance as at 1 January 31,033 – – 31,033
Gross charge/(reversal) for the year (31,033) (31,033)
20. DERIVATIVE FINANCIAL INSTRUMENTS
Accounting policy
Derivative financial instruments are contracts whose value is derived from one or more underlying price, index or other
variable, and typically comprises instruments such as swaps, forward rate agreements, futures, and options.
All derivatives are recognised in the Statement of Financial Position at fair value and are classified as fair value through
profit or loss except where they have been designated as a part of an effective hedge relationship and classified as
hedging derivatives. The carrying value of a derivative is remeasured at fair value throughout the life of the contract.
Derivatives are carried as assets when the fair value is positive and as liabilities when the fair value is negative.
The table below depicts the fair values of derivative financial instruments of the Bank/Group, recorded as assets or
liabilities, together with their notional amounts.
20.1 Foreign currency derivatives – Assets

Bank Group
2022 2021 2022 2021
Assets Notional Assets Notional Assets Notional Assets Notional

amount amount amount amount
Currency swaps
Sales 26,800 11,034,300 201,323 13,289,436 26,800 11,034,300 201,323 13,289,436
Purchases 14,855,784 17,839,343 240,502 25,012,263 14,855,784 17,839,343 240,502 25,012,263
Forward foreign exchange contracts

Sales – – 1 3,490 – – 1 3,490
Purchases – – 51 44,608 – – 51 44,608
Total 14,882,584 28,873,643 441,877 38,349,797 14,882,584 28,873,643 441,877 38,349,797

PEOPLE’S BANK
ABOUT
20.2 Foreign currency derivatives – Liabilities
Bank Group
2022 2021 2022 2021
Liability Notional Liability Notional Liability Notional Liability Notional

amount amount amount amount
FROM THE TOP

REFLECTIONS
Currency swaps
Sales 1,888,105 107,206,938 1,759,061 68,743,157 1,888,105 107,206,938 1,759,061 68,743,157
Purchases – – 1,395 1,166,559 – – 1,395 1,166,559
Forward foreign exchange contracts

Sales 87 27,742 693 263,697 87 27,742 693 263,697
Purchases 286 117,347 71 122,759 286 117,347 71 122,759
VALUE CREATION
DRIVING
Total 1,888,478 107,352,027 1,761,220 70,296,172 1,888,478 107,352,027 1,761,220 70,296,172
21. FINANCIAL ASSETS – AT FAIR VALUE THROUGH PROFIT OR LOSS
Accounting policy
Financial assets – At fair value through profit or loss include debt securities and equities that have been acquired
principally for the purpose of trading and are measured at fair value. Details are more fully given in Note 5.5.3. to these
AND ANALYSIS
Financial Statements.
Bank Group
As at 31 December 2022 2021 2022 2021

Sri Lanka Government Securities 21.1 5,314,829 1,276,679 5,314,829 1,276,679
Equity securities – Quoted 21.2 220,663 253,517 579,835 389,158
Unit trusts 21.3 – – – 859,055
Debt securities 21,262 28,654 21,262 28,654
REPORTS
GOVERNANCE
Total 5,556,754 1,558,850 5,915,926 2,553,546
21.1 Sri Lanka Government Securities

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
STATEMENTS
FINANCIAL
Treasury Bills 4,442,690 272,649 4,442,690 272,649
Treasury Bonds 872,139 1,004,030 872,139 1,004,030
Total 5,314,829 1,276,679 5,314,829 1,276,679

INFORMATION
SUPPLEMENTARY
21.2 Equity securities
21.2.1 Equity securities – Bank

Number of Cost Market value as Number of Cost Market value as
shares 2022 at 31 December shares 2021 at 31 December
2022 2021
LKR '000 LKR ‘000 LKR '000 LKR ‘000
Food and beverage

Nestle Lanka PLC 25,000 30,520 22,625 16,000 20,000 19,448
Distilleries Company of Sri Lanka

PLC 1,700,000 29,550 22,440 1,200,000 21,000 20,400
Ceylon Tobacco Company PLC 25,000 16,800 15,625 10,000 9,000 8,780
Capital goods
ACL Cables PLC – – – – – –
Access Engineering PLC 393,940 9,401 4,215 393,940 9,401 12,567
Hemas Holdings PLC 755,504 56,093 42,610 755,504 56,093 50,543
Transportation
EXPO Lanka Holdings PLC 70,000 16,499 12,758 – – –
Software and Services

Hsenid Business Solutions PLC 1,000,000 17,000 17,000 – – –
Telecommunication services
Dialog Axiata PLC – – – 1,000,000 10,850 10,900
Retailing
John Keells Holdings PLC 92,806 11,044 12,552 200,000 28,688 30,000
Materials
Chevron Lubricants Lanka PLC 281,564 31,755 27,171 225,000 25,625 25,425
Utilities
Windforce PLC 1,100,000 20,020 16,390 1,100,000 20,020 20,020
Vallibel Power Erathna PLC 998,142 7,386 6,288 998,142 7,386 8,584
LVL Energy Fund PLC 1,700,000 19,490 10,200 – – –
Consumer Durable
Teejay Lanka PLC 299,813 9,594 9,504 250,000 7,467 11,100
Health care
Asiri Hospital Holdings PLC 50,000 1,014 1,285 1,100,000 22,311 35,750
Total value of the quoted

equity securities 276,165 220,663 237,839 253,517
PEOPLE’S BANK
ABOUT
21.2.2 Equity securities – Group
2022 2021
LKR '000 LKR ‘000 LKR '000 LKR ‘000
Food and beverage
FROM THE TOP

REFLECTIONS
Nestle Lanka PLC 25,000 30,520 22,625 16,000 20,000 19,448
Distilleries Company of Sri Lanka

PLC 1,700,000 29,550 22,440 1,200,000 21,000 20,400
Ceylon Tobacco Company PLC 25,000 16,800 15,625 10,000 9,000 8,780
Capital goods
Hayleys PLC – – – 200,000 14,157 13,380
Access Engineering PLC 393,940 9,401 4,215 393,940 9,401 12,567
VALUE CREATION
DRIVING
Hemas Holdings PLC 955,504 70,250 53,890 755,504 56,093 50,543
Transportiaion
EXPO Lanka Holdings PLC 70,000 16,499 12,758 – – –
Software & Services

Hsenid Business Solutions PLC 1,000,000 17,000 17,000 – – –
Telecommunication services
Dialog Axiata PLC – – – 1,000,000 10,850 10,900
AND ANALYSIS
Retailing
John Keells Holdings PLC 1,456,914 199,338 197,048 200,000 28,688 30,000
Materials
Chevron Lubricants Lanka PLC 281,564 31,755 27,171 225,000 25,625 25,425
Utilities
Windforce PLC 1,100,000.00 20,020.00 16,390.00 1,100,000 20,020 20,020
Vallibel Power Erathna PLC 998,142.00 7,386.25 6,288.29 998,142.00 7,386.25 8,584.02
LVL Energy Fund PLC 1,700,000.00 19,490.00 10,200.00 – – –
REPORTS
GOVERNANCE
Consumer Durable
Teejay Lanka PLC 299,813 9,594 9,504 250,000 7,467 11,100
Health care
Asiri Hospital Holdings PLC 50,000 1,014 1,285 1,100,000 22,311 35,750
Shares Listed In Bangladesh

British American Tobacco
Bangladesh Ltd. 10,000 23,059 18,259 9,000 13,908 13,375
Berger Paints 999 6,310 6,058 2,000 8,416 8,258

STATEMENTS
FINANCIAL
Beximco Pharma 12,000 8,285 6,176 – – –
BRAC Bank 30,000 5,251 4,066 – – –
City Bank 112,500 10,269 8,633 100,000 6,821 6,383
Dutch-Bangla Bank 55,000 14,469 12,120 50,000 9,611 9,131
Eastern Bank 35,000 4,229 3,918 50,000 4,583 4,501
Grameenphone 28,000 33,898 28,249 17,300 15,303 14,138

INFORMATION
SUPPLEMENTARY
Marico 1,000 8,729 8,524 3,350 18,541 18,024
Reckitt Benckiser 390 7,119 6,313 195 2,657 2,613
Square Pharma 30,000 24,967 22,156 30,000 16,584 15,032
Summit Power 150,000 25,318 17,953 150,000 16,818 13,643


2022 2021
LKR '000 LKR ‘000 LKR '000 LKR ‘000
Global Islami Bank 413,291 14,549 13,094 – – –
Islami Commercial Insurance 8,798 310 870 – – –
Linde (BD) Ltd. – – – 400 1,460 1,478
Renata Ltd. – – – 4,240 13,797 13,805
Walton Hi-Tech Industries 1,900 7,380 7,007 700 1,950 1,880
Total value of quoted equity

securities 672,759 579,835 382,445 389,158
21.3 Unit trust - Group

2022 2021
LKR '000 LKR ‘000 LKR '000 LKR ‘000
NDB Wealth Money Market Plus

Fund – – – 6,027,382 2,826,228 149,361
CAL Investment – – – 16,805,463 1,980,197 355,856
JB Vantage Money Market Fund – – – 12,041,494 990,074 353,838
Total value of the unit trusts – – 5,796,499 859,055
22. LOANS AND ADVANCES TO BANKS
Accounting policy
Loans and advances to banks include Sri Lanka Development Bonds, Restructuring Bonds, and Securities purchased
under resale agreements.
The Group measures loans and advances to banks at amortised cost since the said instruments qualify both
contractual cash flow assessment and business model assessment which has been described in Note 5.5.1 to these
Financial Statements.
Bank Group
As at 31 December 2022 2021 2022 2021

Sri Lanka Development Bonds – 2,678,181 – 2,678,181
Restructuring Bond 22.3 7,689,150 7,689,150 7,689,150 7,689,150
Securities purchased under resale agreements – – – 3,266,103
Total 7,689,150 10,367,331 7,689,150 13,633,434
Less: Allowance for expected credit losses 22.2 – (235,379) – (235,379)
Net loans and advances to banks 7,689,150 10,131,952 7,689,150 13,398,055

PEOPLE’S BANK
ABOUT
22.1 Analysis of loans and advances to banks based on exposure to credit risk
Bank

LKR ’000 LKR ’000 LKR ’000 LKR ’000
FROM THE TOP

REFLECTIONS
Sri Lanka Development Bonds – – – –
Restructuring Bond 7,689,150 – – 7,689,150
Total 7,689,150 – – 7,689,150
VALUE CREATION
DRIVING
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Sri Lanka Development Bonds 2,678,181 – – 2,678,181
Securities purchased under resale agreements – – – –
Total 10,367,331 – – 10,367,331
Group
AND ANALYSIS

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Sri Lanka Development Bonds – – – –
Securities purchased under resale agreements – – – –
Total 7,689,150 – – 7,689,150
REPORTS
GOVERNANCE
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Sri Lanka Development Bonds 2,678,181 – – 2,678,181
Securities purchased under resale agreements 3,266,103 – – 3,266,103
Total 13,633,434 – – 13,633,434

STATEMENTS
FINANCIAL
22.2 Allowance for expected credit losses/impairment losses – Loans and advances to banks
Bank and Group


INFORMATION
SUPPLEMENTARY
LKR ’000 LKR ’000 LKR ’000 LKR ’000
ECL allowance as at 1 January 235,379 – 235,379

Gross charge/(reversal) for the year (235,379) – – (235,379)

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Gross charge/(reversal) for the year 133,705 – – 133,705
ECL allowance as at 31 December 235,379 – – 235,379
22.3 Government of Sri Lanka Restructuring Bonds
22.3.a In April 1993, the Bank received restructuring bonds amounting to LKR 10,541 Mn., from the Government of
Sri Lanka (GOSL) for the following purposes:
LKR Mn.
(i) 1,152.00 To achieve the capital adequacy requirement in accordance with CBSL Guidelines
(ii) 1,700.50 To write-off loans granted to Sri Lanka State Plantations Corporation and Paddy Marketing Board for
LKR 1,467 Mn. and LKR 233.5 Mn. respectively
(iii) 4,355.00 To finance pension liabilities
(iv) 3,231.00 To provide for loan loss provision
(v) 102.50 For loans to be transferred to Special Recovery Unit (RACA)
10,541.00
22.3.b The above value of Bonds granted by GOSL effectively relates to accounting entries that were booked to clear
carrying values of advances granted under State recommendation, which were deemed as irrecoverable.
22.3.c The agreement underlying the granting of these Bonds, stipulates the following:
a. A tenor of 30 years, where the Bonds could be redeemed through the recovery of any of the specific loan losses for
which the Bonds were issued.
As at statement of financial position date, no recoveries have been made of those specific loan losses.
b. As per the initial agreement an interest rate of 12% p.a. would apply, with half yearly payment of interest.
c. A value of 25% of income derived from (b) above would be refunded to the GOSL annually.
22.3.d As indicated in 22.3.a., a sum of LKR 4,355 Mn. of this tranche of Bonds was assigned to the Pension
Fund (LKR 3,218 Mn.) and to the W & OP Fund (LKR 1,137 Mn.).
Accordingly, the carrying balance of Bonds reflected on the Statement of Financial Position does not include the value
assigned to the Pension Fund, which is managed as an independent Trust Fund.
22.3.e The financial implications of these Bonds in year 2022 are as follows:
a. A value of LKR 7,689 Mn. is reflected on the Statement of Financial Position as loans and advances to Banks.
b. A value of LKR 879 Mn. is received during the year as income and is reflected under Interest Income.
PEOPLE’S BANK
ABOUT
23. LOANS AND ADVANCES TO OTHER CUSTOMERS
Accounting policy
Loans and advances to other customers include non-derivative financial assets with fixed or determinable payments that
are not quoted in an active market, other than:
FROM THE TOP

REFLECTIONS
z The Bank intends to sell immediately or in the near term and those that the Bank, upon initial recognition, designates
as at fair value through profit or loss
z Those that the Bank, upon initial recognition, designates as fair value through Other Comprehensive Income (OCI)
z Those for which the Bank may not recover substantially all of its initial investment, other than because of credit
deterioration
The Bank/Group measures loans and advances to other customers at amortised cost since both of the following
conditions are met:
VALUE CREATION
DRIVING
z The financial asset is held within a business model with the objective to hold financial assets in order to collect
contractual cash flows
z The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of
principal and interest (SPPI) on the principal amount outstanding.
Bank Group
As at 31 December 2022 2021 2022 2021

AND ANALYSIS
Gross loans and advances to other customers 23.1 1,915,788,623 1,936,974,136 2,061,137,431 2,103,642,165
Stage 1 1,306,117,973 1,575,824,249 1,405,038,439 1,685,039,591
Stage 2 276,876,667 207,799,398 297,410,610 235,433,619
Stage 3 332,793,983 153,350,489 358,688,382 183,168,955
Less:
Allowance for expected credit losses 23.2 (132,681,930) (101,277,028) (145,365,747) (112,953,104)
Stage 1 (6,241,576) (8,056,985) (7,647,149) (9,316,194)
Stage 2 (19,206,289) (9,990,853) (20,570,351) (11,462,797)
Stage 3 (107,234,065) (83,229,190) (117,148,247) (92,174,113)
REPORTS
GOVERNANCE
Net loans and advances to other customers 1,783,106,693 1,835,697,108 1,915,771,684 1,990,689,061
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
23.1 Analysis of gross loans and advances to other customers

Bank Group
As at 31 December 2022 2021 2022 2021

By product
Bills of exchange 1,829,878 2,213,763 1,829,878 2,213,763
Overdrafts 111,280,950 392,876,794 110,921,942 392,420,308
Trade finance 422,614,740 298,738,212 422,614,740 298,738,212
Credit cards 5,539,640 4,303,245 5,539,640 4,303,245
Pawning 184,777,612 194,769,226 184,777,612 194,769,226
Staff loans 23.1.1 23,847,736 24,983,498 24,672,335 25,646,690
Short-term loans 196,871,457 180,408,077 196,871,457 180,408,077
Long-term loans 895,426,576 838,279,957 968,753,125 911,439,456
Lease rental receivable – – 64,175,371 79,230,187
Others 73,600,034 401,364 80,981,331 14,473,001
Gross total 1,915,788,623 1,936,974,136 2,061,137,431 2,103,642,165
By currency
Sri Lankan rupee 1,332,939,065 1,556,592,444 1,467,886,835 1,717,816,147
United States dollar 578,280,418 377,230,239 578,280,418 377,230,239
Great Britain pound – 36,523 – 36,523
Others 4,569,140 3,114,929 14,970,178 8,559,255
Gross total 1,915,788,623 1,936,974,136 2,061,137,431 2,103,642,165
By industry
Agriculture, forestry and fishing 134,358,173 161,150,394 163,635,263 192,922,106
Manufacturing 46,358,536 35,205,619 56,990,560 44,932,244
Tourism 71,719,408 34,571,031 74,644,839 37,919,275
Transport and storage 86,439,525 43,326,667 114,759,034 77,759,704
Construction 585,059,012 407,612,306 594,802,432 419,942,260
Infrastructure development 512,720,027 404,241,424 512,720,027 404,241,424
Wholesale and retail trade 146,766,764 154,280,036 163,682,531 174,047,763
Professional, scientific, and technical activities 36,004,654 52,075,671 36,004,654 52,075,671
Financial services 20,768,596 25,136,683 32,558,503 40,045,319
Consumption 164,721,672 169,404,131 173,004,031 194,735,322
Others 110,872,256 449,970,174 138,335,556 465,021,077
Gross total 1,915,788,623 1,936,974,136 2,061,137,431 2,103,642,165

PEOPLE’S BANK
ABOUT
23.1.1 Staff loans (net)
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Staff loans 34,364,136 35,678,083 35,188,735 36,341,275
FROM THE TOP

REFLECTIONS
(Less): Allowance for day one difference (10,516,400) (10,694,585) (10,516,400) (10,694,585)
Net staff loans 23,847,736 24,983,498 24,672,335 25,646,690
23.2 Movement in total impairment allowance for loans and advances to other customers
Bank Group
As at 31 December 2022 2021 2022 2021
VALUE CREATION
DRIVING
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Opening balance as at 1 January 101,277,028 87,886,600 112,953,104 99,981,244
Net charge for the year 28,366,700 13,282,540 29,374,441 12,863,972
Write-off during the year (271,801) (187,681) (271,801) (187,681)
Exchange rate variance on foreign currency provisions 3,310,003 295,569 3,310,003 295,569
Closing balance as at 31 December 132,681,930 101,277,028 145,365,747 112,953,104
AND ANALYSIS
23.2.1 Movement in allowance for expected credit loss (ECL) based on exposure to credit risk
Bank
2022

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Net charge/(reversal) for the year (1,815,409) 9,215,436 20,966,673 28,366,700
Amounts written off – – (271,801) (271,801)
REPORTS
GOVERNANCE
Exchange rate variance on foreign currency impairment – – 3,310,003 3,310,003
2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
STATEMENTS
FINANCIAL
Net charge/(reversal) for the year 1,637,097 6,457,732 5,187,711 13,282,540
Exchange rate variance on foreign currency impairment – – 295,569 295,569

INFORMATION
SUPPLEMENTARY
Group
2022

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Net charge/(reversal) for the year (1,669,045) 9,107,554 21,935,932 29,374,441
Exchange rate variance on foreign currency impairment – – 3,310,003 3,310,003
2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Net charge/(reversal) for the year 2,006,360 6,212,795 4,644,817 12,863,972
Exchange rate variance on foreign currency Impairment – – 295,569 295,569
24. DEBT INSTRUMENTS MEASURED AT AMORTISED COST
Accounting policy
Investments in debt instruments are measured at amortised cost where they have:
z Contractual terms that give rise to cash flows on pre-specified dates, that represent solely payments of principal and/
or interest on the principal amount outstanding; and
z Are held within a business model whose objective is achieved by holding such assets to collect contractual cash
flows.
Bank Group
As at 31 December 2022 2021 2022 2021

Sri Lanka Government Securities

Treasury Bills 2,296,206 – 12,609,969 9,940,432
Treasury Bonds 898,577,069 573,470,829 900,775,195 575,643,705
International Sovereign Bonds 18,810,234 15,183,821 18,810,234 15,183,821
Investments in unqoted preference shares – – 707,656 646,135
Investments in debentures – – 2,566,046 –
Total 919,683,509 588,654,650 935,469,100 601,414,093
Less: Allowance for expected credit losses 24.2 (6,583,582) (1,334,468) (6,583,582) (1,334,468)
Total (Net) 913,099,927 587,320,182 928,885,518 600,079,625
PEOPLE’S BANK
ABOUT
24.1 Analysis of debt instruments measured at amortised cost based
on exposure to credit risk
Bank
FROM THE TOP

REFLECTIONS
LKR ’000 LKR ’000 LKR ’000 LKR ’000

Treasury Bonds 2,296,206 – – 2,296,206
Treasury Bonds 898,577,069 – 898,577,069
International Sovereign Bonds – 18,810,234 – 18,810,234
Total 900,873,275 18,810,234 – 919,683,509
VALUE CREATION
DRIVING

LKR ’000 LKR ’000 LKR ’000 LKR ’000

Treasury Bonds 573,470,829 – – 573,470,829
International Sovereign Bonds 15,183,821 – – 15,183,821
AND ANALYSIS
Total 588,654,650 – – 588,654,650
Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000

Treasury Bonds 12,609,969 – – 12,609,969
Treasury Bonds 900,775,195 – – 900,775,195
REPORTS
GOVERNANCE
International Sovereign Bonds – 18,810,234 – 18,810,234
Investments in preference shares 707,656 – – 707,656
Investments in debenture 2,566,046 – – 2,566,046
Total 916,658,866 18,810,234 – 935,469,100
STATEMENTS
FINANCIAL

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Treasury Bonds 9,940,432 – – 9,940,432

Treasury Bonds 575,643,705 – – 575,643,705
INFORMATION
SUPPLEMENTARY
International Sovereign Bonds 15,183,821 – – 15,183,821

Investments in preference shares 646,135 – – 646,135
Total 601,414,093 – – 601,414,093
24.2 Allowance for expected credit losses/impairment losses –

Debt instruments measured at amortised cost
Bank and Group

2022

LKR ’000 LKR ’000 LKR ’000 LKR ’000
ECL allowance as at 1 January 1,334,468 – – 1,334,468
Transfer from Stage 1 to Stage 2 (1,334,468) 1,334,468 –
Gross charge/(reversal) for the year 5,249,114 – 5,249,114
ECL allowance as at 31 December – 6,583,582 – 6,583,582
2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Gross charge/(reversal) for the year 1,061,847 – – 1,061,847
ECL allowance as at 31 December 1,334,468 – 1,334,468
25. EQUITY INSTRUMENTS AT FAIR VALUE THROUGH OCI
Accounting policy
Investment in equity instruments that are neither held for trading nor contingent consideration recognised by the Group
in a business combination to which Sri Lanka Accounting Standard – SLFRS 3 – “Business Combinations” applies, are
measured at fair value through other comprehensive income. Detailed accounting policies are more fully set out in Note
5.5.2 to these Financial Statements.
Bank Group
As at 31 December 2022 2021 2022 2021

Equity securities – Unquoted 25.1 377,106 403,168 377,116 403,178
Equity securities – Quoted 25.2 1,284,550 1,218,207 1,467,458 1,485,966
Total 1,661,656 1,621,375 1,844,574 1,889,144

PEOPLE’S BANK
ABOUT
25.1 Equity securities – Unquoted
25.1.1 Bank
Name Number Fair value as at Cost as at Number Fair value as at Cost as at
of shares 31.12.2022 31.12.2022 of shares 31.12.2021 31.12.2021
31.12.2022 LKR ’000 LKR ’000 31.12.2021 LKR ’000 LKR ’000
FROM THE TOP

REFLECTIONS
Credit Information Bureau of
Sri Lanka 47,400 – 50,715 47,400 – 50,715
Society for Worldwide

Inter Bank Financial
Telecommunication 14 1,168 1,168 14 1,168 1,168
Regional Development Bank 16,448,448 171,689 162,300 16,448,448 162,064 162,300
Lanka Financial Services Bureau 500,000 – 5,000 500,000 – 5,000
VALUE CREATION
DRIVING
Fitch Rating Lanka Ltd. 62,500 625 625 62,500 625 625
Lanka Clear (Pvt) Ltd. 2,126,213 25,620 25,620 2,126,213 25,620 25,620
People’s Merchant Finance

PLC – Preference Shares 1,000,000 10,000 10,000 1,000,000 10,000 10,000
National Equity Fund 5,112,735 168,004 177,259 5,112,735 203,691 175,469
Total 377,106 432,686 403,168 430,897
AND ANALYSIS
25.1.2 Group
Name Number of Fair value as at Cost as at Number of Fair value as at Cost as at
shares 31.12.2022 31.12.2022 shares 31.12.2021 31.12.2021
31.12.2022 LKR ’000 LKR ’000 31.12.2021 LKR ’000 LKR ’000
Credit Information Bureau of

Sri Lanka 47,500 10 50,725 47,500 10 50,725
Society for Worldwide

Inter Bank Financial
Telecommunication 14 1,168 1,168 14 1,168 1,168
Regional Development Bank 16,448,448 171,689 162,300 16,448,448 162,064 162,300
REPORTS
GOVERNANCE
Lanka Financial Services Bureau 500,000 – 5,000 500,000 – 5,000
Fitch Rating Lanka Ltd. 62,500 625 625 62,500 625 625
Lanka Clear (Pvt) Ltd. 2,126,213 25,620 25,620 2,126,213 25,620 25,620

PLC – Preference Shares 1,000,000 10,000 10,000 1,000,000 10,000 10,000
National Equity Fund 5,112,735 168,004 175,469 5,112,735 203,691 175,469
Total 377,116 430,907 403,178 430,907

STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
25.2 Equity securities – Quoted
25.2.1 Bank
shares 31.12.2022 31.12.2022 shares 31.12.2021 31.12.2021
31.12.2022 LKR ’000 LKR ’000 31.12.2021 LKR ’000 LKR ’000
Overseas Reality (Ceylon) PLC 30,538,203 455,019 622,979 30,538,203 586,333 518,963
The Finance PLC 2,080,400 – 10,818 2,080,400 – 83,400

PLC – Ordinary Shares 33,856,246 128,654 311,477 33,856,246 230,222 311,477
The Lanka Hospitals Corporation

PLC 7,316,042 700,877 307,274 7,316,042 401,652 307,274
Total 1,284,550 1,252,549 1,218,207 1,221,114
25.2.2 Group

shares 31.12.2022 31.12.2022 shares 31.12.2021 31.12.2021
31.12.2022 LKR ’000 LKR ’000 31.12.2021 LKR ’000 LKR ’000
Overseas Reality (Ceylon) PLC 30,538,203 455,019 518,963 30,538,203 586,333 518,963
The Finance PLC 2,080,400 – 83,400 2,080,400 – 83,400
Sanasa Development Bank PLC 2,271,260 48,605 203,382 2,271,260 97,664 203,382
The Lanka Hospitals Corporation

PLC 7,316,042 700,877 307,274 7,316,042 401,652 307,274
People`s Merchant Finance PLC

– Ordinary Shares 58,870,248 223,707 – 58,870,248 400,317 423,866
Asiri Hospital Holdings PLC 500,000 12,850 20,730 – – –
LB Finance PLC 5,000,000 11,500 50,000 – – –
Windforce PLC 1,000,000 14,900 18,489 – – –
Total 1,467,458 1,202,238 1,485,966 1,536,885
26. DEBT INSTRUMENTS AT FAIR VALUE THROUGH OCI
Accounting policy
Investments in debt instruments are measured at fair value through Other Comprehensive Income (OCI) where they
have:
z Contractual terms that give rise to cash flows on specified dates, that represent solely payments of principal and
interest on the principal amount outstanding; and
zAre held within a business model whose objective is achieved by both collecting contractual cash flows and selling
financial assets.
Detailed policies are given under Note 5.5.2 to these Financial Statements
PEOPLE’S BANK
ABOUT
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Sri Lanka Government Securities 701,468 – 965,695 303,426
Debt securities 9,676,902 9,399,272 10,463,137 10,293,297
Total 10,378,370 9,399,272 11,428,832 10,596,723
FROM THE TOP

REFLECTIONS
26.1 Analysis of debt instruments at fair value through OCI based on exposure to credit risk
Bank
VALUE CREATION
DRIVING
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Sri Lanka Government Securities 701,468 – – 701,468
Debt securities 9,380,893 296,009 – 9,676,902
Total 10,082,361 296,009 – 10,378,370
AND ANALYSIS
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Debt securities 9,103,263 296,009 – 9,399,272
Total 9,103,263 296,009 – 9,399,272
Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
REPORTS
GOVERNANCE
Debt securities 10,167,128 296,009 – 10,463,137
Total 11,132,823 296,009 – 11,428,832

STATEMENTS
FINANCIAL
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Debt securities 9,997,288 296,009 – 10,293,297
Total 10,300,714 296,009 – 10,596,723

INFORMATION
SUPPLEMENTARY
26.2 Allowance for expected credit losses – Debt instruments at fair value through OCI
Bank and Group


LKR ’000 LKR ’000 LKR ’000 LKR ’000
ECL allowance as at 1 January 1,053 296,009 – 297,062
Gross charge/(reversal) for the year 518 – – 518
ECL allowance as at 31 December 1,571 296,009 297,580

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Gross charge/(reversal) for the year 726 – – 726
ECL allowance as at 31 December 1,053 296,009 – 297,062
27. INVESTMENTS IN SUBSIDIARIES
Accounting policy
Subsidiaries are entities that are controlled by the Group. Control as referred to here is achieved when the Group is
exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect the returns
of those investees through its power over such investee. Specifically, the Group controls an investee if, and only if, the
Group has:
z power over the investee

z exposure or rights to variable returns from its involvement with the investee
z the ability to use its power over the investee to affect its returns
The Financial Statements of subsidiaries are included in the Consolidated Financial Statements from the date that
control commences, until the date that control ceases. Where subsidiaries have been sold or acquired during the year,
assets, liabilities, income and expenses of the said subsidiary are included in the Consolidated Financial Statements,
from the date the Group gains control until the date the Group ceases to control the subsidiary.
When necessary, adjustments are made to the Financial Statements of subsidiaries to bring their accounting policies in
line with the Group’s accounting policies. All intra-group assets and liabilities, equity, income, expenses, and cash flows
relating to transactions between members of the Group are eliminated in full on consolidation.
Non-controlling interests represent the portion of profit or loss and net assets of the subsidiaries, not owned directly
or indirectly by the Bank. The non-controlling interest is presented in the Consolidated Statement of Financial Position
within equity, separately from the equity attributable to the equity holders of the Bank. Non-controlling interests in the
profit or loss of the Group, is disclosed separately in the Consolidated Statement of Profit or Loss.
A change in the ownership interest of a subsidiary without a loss of control, is accounted for as an equity transaction.
Upon the loss of control, the Group derecognises the assets (including goodwill) and liabilities of the subsidiary, any
non-controlling interests and the other components of equity related to the subsidiary. Any surplus or deficit arising on
the loss of control, is recognised in the Statement of Changes in Equity. If the Group retains any interest in the previous
subsidiary, then such interest is measured at fair value at the date that control is lost. Subsequently, it is accounted for as
an equity-accounted investee or in accordance with the Group’s accounting policy for financial instruments depending
on the level of influence retained.
The Bank’s investments in subsidiaries are carried at cost in the Separate Financial Statements.
PEOPLE’S BANK
ABOUT
Bank Group
As at 31 December 2022 2021 2022 2021

Investment in quoted subsidiaries 27.1 4,275,572 3,567,874 – –
Investment in unquoted subsidiaries 27.2 4,950 4,950 – –
Total 4,280,522 3,572,824 – –
FROM THE TOP

REFLECTIONS
27.1 Investment in quoted subsidiaries
Number of Holding as at Cost Number of Holding as at Cost
shares 31.12.2022 2022 shares 31.12.2021 2021
% LKR ’000 % LKR ’000
People’s Leasing & Finance PLC
VALUE CREATION
DRIVING
Ordinary shares 1,184,896,862 75.00 690,958 1,184,896,862 75.00 690,958
Ordinary shares allotted by

scrip dividends 346,515,469 3,584,614 230,499,388 2,876,916
4,275,572 3,567,874
27.2 Investment in unquoted subsidiaries

Number of Holding as at Cost Number of Holding as at Cost
shares 31.12.2021 2021 shares 31.12.2021 2021
AND ANALYSIS
% LKR ’000 % LKR ’000
People's Travels (Private) Ltd. 495,000 99.00 4,950 495,000 99.00 4,950
Total 4,950 4,950
27.3 Investments in subsidiaries

Non-Controlling Interests (NCI)
The following subsidiary has a material NCI:
Name Principal place of business/country of incorporation Operating segment Ownership interest held by NCI
REPORTS
GOVERNANCE
2022 2021
% %
People’s Leasing &

Finance PLC No. 1161, Maradana Road, Colombo 8, Sri Lanka Leasing and finance 25.0% 25.0%
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
27.4 Summarised financial information of subsidiaries

The following are summarised financial information for the People’s Leasing & Finance PLC as prepared in accordance
with LKAS/SLFRS, these have been modified for fair value adjustments on acquisition and for differences in the Group’s
accounting policies. The information is before inter-company eliminations with other companies in the Group.
2022 2021
LKR ’000 LKR ’000
Statement of Comprehensive Income

Revenue 37,880,769 32,384,527
Profit/(loss) after tax 4,096,866 6,123,083
Other comprehensive income 1,767,901 134,032
Total comprehensive income 5,864,767 6,257,115
Statement of Financial Position

Total assets 195,211,042 204,246,451
Total liabilities (146,964,584) (159,172,869)
Net assets 48,246,458 45,073,582
Dividends paid to NCI during the year 198,803 150,000
28. PROPERTY, PLANT AND EQUIPMENT AND RIGHT-OF-USE ASSETS
Accounting policy
Property, plant and equipment

Property, plant and equipment is stated at cost or valuation excluding the costs of day-to-day servicing, less
accumulated depreciation and accumulated impairment in value. Changes in the expected useful life are accounted for
by changing the depreciation period or method, as appropriate, and treated as changes in accounting estimates.
Cost model
Plant and equipment are stated at cost, excluding the cost of day-to-day servicing, less accumulated depreciation and
accumulated impairment in value. Such cost includes the cost of replacing part of the plant and equipment when the
cost is incurred, if the recognition criteria are met.
Revaluation model
The Bank applies the revaluation model for the entire class of freehold land and buildings and leasehold building.
Such properties are carried at a revalued amount, being their fair value at the date of revaluation, less any subsequent
accumulated depreciation and impairment charged subsequent to the date of the revaluation.
Revaluations are performed to ensure that the fair value of a revalued asset does not differ materially from its carrying
amount. Any revaluation surplus is credited to the revaluation reserve included in the equity section of the Statement of
Financial Position, except to the extent that it reverses a revaluation decrease of the same asset previously recognised in
Income Statement, in which case the increase is recognised in profit or loss. A revaluation deficit is recognised in Income
Statement, except that deficit directly offsetting a previous surplus on the same asset is directly offset against the
surplus in the asset revaluation reserve.
Subsequent cost
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item
if it is probable that the future economic benefits embodied within that part will flow into the Group and its cost can be
reliably measured.
PEOPLE’S BANK
ABOUT
Restoration cost
Expenditure incurred on repairs or maintenance of property, plant and equipment in order to restore or maintain future
economic benefits is charged to Statement of Comprehensive Income as incurred.
Capital work-in-progress
These are expenses of a capital nature directly incurred in the construction of building, major plant and machinery and
FROM THE TOP

REFLECTIONS
system development, awaiting capitalisation. These are stated in the Statement of Financial Position at cost.
Depreciation
Depreciation is calculated using the straight-line method to write-down the cost of property and equipment to their
residual values over their estimated useful lives. Leased assets under finance leases are depreciated over the shorter of
either lease term or its useful life, which is limited to maximum tenor of 50 years. Freehold land is not depreciated. The
estimated useful lives are as follows:
Category of asset Period of depreciation*
VALUE CREATION
DRIVING
Freehold buildings Estimated useful life
Leasehold building Shorter of lease term or its useful life, which is limited to maximum tenor of 50 years
Furniture, equipment and machinery 20% p.a.
Freehold and leasehold motor vehicles 25% p.a.
Prepaid leases Over the period of lease
Self-Banking Units (SBU)** Over the period of three years
AND ANALYSIS
* These depreciation rates are applied consistently over the period
** Self-Banking Units (SBU) are classified under machinery and equipment
Derecognition
Property, plant and equipment is de-recognised on disposal or when no future economic benefits are expected from
its use. Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the asset) is recognised in “other operating income” in the Income Statement in
the year the asset is derecognised.
Right-of-use assets
The Group has lease contracts for its branches, service centres, select machinery etc. The Group adopted SLFRS 16
using the modified retrospective approach of adoption with effect from the date of initial application of 1 January 2019.
REPORTS
GOVERNANCE
Under this approach, the standard is applied retrospectively and thereby the comparative figures were not restated
which were reported under LKAS 17. Further, the Bank applied the standard only to contracts that were previously
identified as leases, by applying LKAS 17 at the date of initial application.
Upon adoption of SLFRS 16, the Bank recognised such leases as right-of-use assets and lease liabilities for those leases
previously classified as operating leases. The right-of-use assets were recognised based on the amount equal to the
lease liabilities, adjusted for any related prepaid and accrued lease payments previously recognised. Lease liabilities were
recognised based on the present value of the remaining lease payments, discounted using the incremental borrowing
STATEMENTS
FINANCIAL
rate at the date of initial application.

INFORMATION
SUPPLEMENTARY
28.1 Property, plant and equipment and right-of-use assets – Bank
Freehold Freehold Buildings on Motor Furniture Machinery,

land building leasehold land vehicles equipment and
Self-Banking
Units
Cost/fair value
Balance as at 1 January 22,530,046 6,311,790 2,581,074 1,514,079 614,375 4,772,697
Additions 64,000 18,818 175,087 70,027 355,512
Disposals – – (17,424) (8,257) (10,839)
Transfers/adjustments 25 –
Transfers from investment property –
Revaluation adjustment on accumulated
depreciation – (382,312) (168,648) – – –
Revaluation surplus 1,485,952 1,450,624 570,607 – – –
Balance as at 31 December 24,079,999 7,398,919 3,158,121 1,496,655 676,169 5,117,370
Accumulated depreciation
Balance as at 1 January – – – 1,476,442 422,915 3,595,240
Charge for the year – 382,312 168,648 20,908 75,099 527,811
Disposals – – – (17,421) (4,967) (11,035)
Transfers/adjustments – – – – – –
Revaluation adjustment on
accumulated depreciation (382,312) (168,648) – – –
Balance as at 31 December – – – 1,479,929 493,047 4,112,016
Net book value as at 31 December 2022 24,079,999 7,398,919 3,158,121 16,726 183,123 1,005,354
Capital work-in-progress at cost
Furniture equipment and
machinery at store 7,091 43,518
28.1.1 On 1 July 2020 - the Bank carried out an independent valuation of all it's land and buildings. This valuation was
carried out by Messrs. Prathap Chartered Valuations & Consultancy (Private) Limited together with D Prathapasinghe
[FRICS (UK), Professional Associate Member (IVSL) MBA (UK), BSc. Est. Mgt. & Val. (sp) (Hons) (SJP), PG Dip Eco. Dev.
(Colombo), Dip. Surv. (Reading – UK)], an Independent Valuer, on a fair value basis. Further the Bank carried-out a desktop
basis review of the fair value of properties estimated as of 31 December 2022. Book values of these properties were
adjusted for the revalued amounts and revaluation surplus was credited accordingly to the revaluation reserve.
28.1.2 Property, plant and equipment pledged as security for liabilities

There were no Items of property, plant and equipment pledge as securities for liabilities as at reporting date.
28.1.3 Property, plant and equipment retired from active use

There were no property, plant and equipment retired from active use as at 31 December 2022
28.1.4 Title restriction on property, plant and equipment

There were no restriction on the title of property, plant and equipment as at 31 December 2022
PEOPLE’S BANK
ABOUT
Right-of-use assets Total Total
2022 2021
Computer Total property, Leased Buildings ATM/CDM and Total
plant and lands KIOSK right-of-use
equipment machines assets
FROM THE TOP

REFLECTIONS
7,090,548 45,414,609 1,007,237 4,819,542 10,293,265 16,120,044 61,534,652 50,563,504
458,832 1,142,275 – 1,733,365 402,451 2,135,816 3,278,091 8,509,988
(35,975) (72,496) – (1,690,446) (217,951) (1,908,397) (1,980,893) (1,791,617)
25 – – – – 25 10,511
VALUE CREATION
DRIVING
– – 1,239,931
– (550,960) – – – – (550,960) (670,517)
– 3,507,183 – – – – 3,507,183 3,672,851
7,513,405 49,440,637 1,007,237 4,862,461 10,477,765 16,347,463 65,788,100 61,534,652
5,254,281 10,748,878 624,580 1,604,946 3,721,255 5,950,781 16,699,659 13,659,573
AND ANALYSIS
860,860 2,035,637 16,104 767,902 1,233,941 2,017,947 4,053,584 4,415,164
(35,813) (69,236) (746,028) (167,237) (913,265) (982,501) (717,454)
– – – – – – – 12,891
– (550,960) – – – – (550,960) (670,517)
6,079,328 12,164,320 640,684 1,626,820 4,787,959 7,055,463 19,219,783 16,699,658
1,434,077 37,276,317 366,553 3,235,641 5,689,806 9,292,000 46,568,317 44,834,994
2,549,513 1,747,521
161,641 – – – – 212,250 178,642
REPORTS
GOVERNANCE
49,330,080 46,761,157
28.1.5 Unobservable inputs considered in measuring fair value

On 1 July 2020 – the Bank carried out an independent valuation of all it’s land and buildings. The following table depicts
information about significant unobservable inputs used in measuring fair value of the assets categorised under Level 3 of
the fair value hierarchy.
STATEMENTS
FINANCIAL
2020
Type of Asset Valuation technique Significant unobservable inputs Range of Sensitivity of

estimates for fair value to
unobservable unobservable
inputs inputs
Freehold land Comparison method of valuation Property Transaction evidences, LKR 70,000 – Positively
internal data from previous valuations LKR 35,000,000 correlated
INFORMATION
SUPPLEMENTARY
and asking prices sensitivity

Freehold 1. Depreciated replacement cost method and Estimated cost per square feet, LKR 10,000 – Positively
buildings comparison method of valuation estimated rate of all types of LKR 45,000 correlated
2. Investment method of valuation and depreciations and obsolescence and sensitivity
comparison method of valuation rental evidences
Buildings on Depreciated replacement cost method and Property transaction evidences, internal LKR 250 – Positively
leasehold lands comparison method of valuation data from previous valuations and LKR 8,000 correlated
asking prices sensitivity
28.2 Property, plant and equipment & right-of-use assets – Group
Freehold Freehold Buildings on Motor Furniture Machinery,

land building leasehold land vehicles equipment and
Self-Banking
Units
Cost/valuation
Balance as at 1 January 25,540,222 10,972,450 2,666,837 1,928,742 1,178,200 5,811,061
Additions 64,000 18,818 175,087 14,490 90,401 390,829
Disposals – – – (59,698) (22,363) (37,413)
Transfers/adjustments – – – (7,204) 25 –
Transfers from investment property – – – – – –
Exchange rate variance – – – 6,560 9,929 3,889

depreciation (382,312) (168,648) – – –
Revaluation surplus 2,263,898 1,545,315 570,607 – – –
Balance as at 31 December 27,868,121 12,154,270 3,243,884 1,882,890 1,256,191 6,168,366
Accumulated depreciation
Balance as at 1 January – 63,599 56,576 1,663,832 909,279 4,368,658
Charge for the year – 445,646 168,648 52,197 110,197 593,264
Disposals – – – (23,527) (18,358) (66,049)
Transfers/adjustments – (471) – – – –
Exchange rate variance – – – 2,108 6,581 2,631

depreciation – (382,312) (168,648) – – –
Balance as at 31 December – 126,462 56,576 1,694,609 1,007,699 4,898,504
Net book value as at 31 December 2022 27,868,121 12,027,808 3,187,308 188,281 248,493 1,269,861
Capital work-in-progress at cost

Furniture equipment and machinery
at store 7,091 43,518
PEOPLE’S BANK
ABOUT
Right-of-use assets Total Total
2022 2021
Computer Total property, Leased Buildings ATM/CDM and Total
plant and lands KIOSK right-of-use
equipment machines assets
FROM THE TOP

REFLECTIONS
8,071,663 56,169,175 1,090,099 7,006,607 10,293,265 18,389,971 74,559,146 63,359,901
533,851 1,287,475 – 2,324,797 402,451 2,727,248 4,014,723 9,293,938
(96,267) (215,742) – (1,964,189) (217,951) (2,182,140) (2,397,882) (2,366,595)
– (7,179) – – – – (7,179) (125,631)
VALUE CREATION
DRIVING
– – – – – – – 1,239,931
8,648 29,026 – – – – 29,026 5,268
– (550,960) (550,960) (670,517)
– 4,379,820 – – – – 4,379,820 3,822,851
8,517,895 61,091,617 1,090,099 7,367,215 10,477,765 18,935,079 80,026,696 74,559,146
AND ANALYSIS
6,063,358 13,125,301 667,677 2,538,783 3,721,255 6,927,715 20,053,016 16,759,944
951,084 2,321,035 16,104 1,128,517 1,233,941 2,378,562 4,699,597 5,055,637
(95,507) (203,441) – (841,949) (167,237) (1,009,186) (1,212,627) (1,092,072)
– (471) – – – – (471) –
8,452 19,772 – – – – 19,772 24
– (550,960) – – – – (550,960) (670,517)
6,927,387 14,711,237 683,781 2,825,351 4,787,959 8,297,091 23,008,328 20,053,016
1,590,508 46,380,380 406,318 4,541,864 5,689,806 10,637,988 57,018,368 54,506,130
REPORTS
GOVERNANCE
2,549,513 1,747,521
161,641 212,250 178,642
59,780,131 56,432,293
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
29. INTANGIBLE ASSETS AND GOODWILL
Accounting policy
Intangible assets include all computer software costs incurred, licensed for use by the Group. Software acquired by
the Group is measured at cost less accumulated amortisation and any accumulated impairment losses. Software is
amortised on a straight-line basis in Income Statement over its estimated useful life, from the date on which it is available
for use.
Goodwill represents the excess of the cost of acquisition over the fair value of Group’s share of the net identifiable assets
of the acquired subsidiary at the date of acquisition.
Detailed policies of goodwill and intangible assets are set out in Note 5.12 to these Financial Statements.
29.1 Intangible assets

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Cost
As at beginning of the year 4,192,328 2,178,831 4,437,688 2,412,278
Additions during the year 293,921 2,013,497 305,459 2,025,317
Disposals during the year – – – –
Adjustments during the year – 1,250 93
As at end of the year 4,486,249 4,192,328 4,744,397 4,437,688
Accumulated amortisation
As at beginning of the year 2,114,784 1,476,650 2,325,296 1,670,922
Charge for the year 652,288 638,134 667,164 654,315
Adjustments during the year – – 1,016 59
As at end of the year 2,767,072 2,114,784 2,993,476 2,325,296
Net book value 1,719,177 2,077,544 1,750,921 2,112,392
29.2 Goodwill
As at 31 December 2022 2021
LKR ’000 LKR ’000
Cost
As at beginning of the year 417,099 417,099
Goodwill on acquisition – –
Disposals/reversals during the year – –
As at end of the year 417,099 417,099
As at end of the year
Accumulated impairment
As at beginning of the year 276,934 150,725
Impairment for the year 31,611 126,209
As at end of the year 308,545 276,934
Net book value 108,554 140,165
Total net book value 1,859,475 2,252,557

PEOPLE’S BANK
ABOUT
30. OTHER ASSETS Receivables with the outstanding claims provision
or settled claims associated with
Unamortised day one Receivables predominantly include the the reinsurer’s policies and are
difference on staff loans amount receivable on behalf of the in accordance with the related
senior citizen interest subsidy. reinsurance contract.
All staff loans are granted at below
market interest rates and are initially Insurance and insurance Net employee benefit asset –
recognised at fair value according receivables Post 1996 Pension Fund
FROM THE TOP

REFLECTIONS
to Sri Lanka Accounting Standard
The Group cedes insurance risk to Net employee benefit assets
SLFRS 9 – “Financial Instruments”.
reinsurers in the normal course of represents net benefit assets of
The difference between granted
business. Reinsurance receivables retirement benefit plan for the
amount and its fair value is treated as
represent balances due from employees recruited to the Bank on or
Unamortised day one difference on
reinsurance companies. Amounts after 1 January 1996. For more details
staff loans and amortised over the loan
recoverable from reinsurers are refer Note 35.2.
period.
estimated in a manner consistent
VALUE CREATION
DRIVING
Bank Group
As at 31 December 2022 2021 2022 2021

Deposits and prepayments 3,466,288 1,660,821 3,466,288 1,660,821
Unamortised day one difference on staff loans 10,516,400 10,694,585 10,516,400 10,694,585
Receivables 20,952,657 12,242,022 20,952,657 12,242,022
Insurance and insurance receivables – – 1,078,841 937,273
AND ANALYSIS
Net employee benefit asset – Post – 1996 pension fund 35.2 4,762,504 4,856,219 4,762,504 4,856,219
Others 6,181,206 5,348,577 5,592,124 5,005,810
Total 45,879,055 34,802,224 46,368,814 35,396,730
31. DUE TO BANKS
Accounting policy
Due to banks include money market borrowings and borrowings from banks. These are initially recognised at fair value.
Subsequent to initial recognition, these are measured at their amortised cost using the effective interest rate (EIR)
REPORTS
GOVERNANCE
method. Amortised cost is calculated by taking into account any discount or premium on the issue and costs that are an
integral part of the EIR.
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000 STATEMENTS
FINANCIAL
Money market borrowings 71,691,176 79,531,761 71,691,176 79,531,761
Call money borrowing – 7,899,999 – 7,899,999
Other borrowings 39,761,315 20,314,156 51,005,802 34,966,065
Total 111,452,491 107,745,916 122,696,978 122,397,825

INFORMATION
SUPPLEMENTARY
32. DUE TO OTHER CUSTOMERS
Accounting policy
Due to customers include demand deposits, savings deposits, term deposits including call deposits, certificate of
deposits, and margin deposits.
These deposits are initially recognised at fair value. Subsequent to initial recognition, deposits are measured at their
amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any
discount or premium on the issue and costs that are an integral part of the EIR.
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Total amount due to other customers 2,371,518,898 2,071,532,612 2,450,079,037 2,168,674,742
Total 2,371,518,898 2,071,532,612 2,450,079,037 2,168,674,742
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Analysis
By product
Demand deposits (current accounts) 79,218,921 82,017,571 75,298,448 80,875,217
Savings deposits 659,375,654 765,520,568 663,567,709 771,920,432
Fixed deposits 1,629,227,409 1,220,073,509 1,707,318,257 1,310,277,325
Other products 3,696,914 3,920,964 3,894,623 5,601,768
Total 2,371,518,898 2,071,532,612 2,450,079,037 2,168,674,742
By currency
Sri Lanka rupee 2,072,686,232 1,855,776,571 2,151,246,371 1,952,918,701
United State dollar 272,861,192 199,214,526 272,861,192 199,214,526
Great Britain pound 5,326,011 3,589,704 5,326,011 3,589,704
Others 20,645,463 12,951,811 20,645,463 12,951,811
Total 2,371,518,898 2,071,532,612 2,450,079,037 2,168,674,742
33. OTHER BORROWINGS
Accounting policy
Other borrowings include refinance borrowings form Central Bank and other financial institutions and borrowing under
repurchase agreements.
Subsequent to initial recognition these borrowings are measured at their amortised cost using the effective interest rate
(EIR) method. Amortised cost is calculated by taking into account any discount or premium on the issue and costs that
are an integral part of the EIR.
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Central Bank of Sri Lanka 497,732 2,115,072 497,732 2,115,072
Other financial institutions 5,642,582 5,797,709 5,642,582 5,797,709
Borrowing under repurchase agreement 185,387,259 233,506,344 185,387,259 233,506,344
Total 191,527,573 241,419,125 191,527,573 241,419,125

PEOPLE’S BANK
ABOUT
34. NET DEFERRED TAX LIABILITIES
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Deferred tax liabilities 10,394,689 9,621,453 12,863,963 12,079,557
Deferred tax assets (9,788,482) (6,934,123) (12,293,434) (8,884,843)
FROM THE TOP

REFLECTIONS
Net deferred tax liabilities 606,207 2,687,330 570,529 3,194,714
Bank
Deferred Deferred Statement of Statement of Deferred Deferred Statement of Statement of

tax asset tax liability profit or loss comprehensive tax asset tax liability profit or loss comprehensive
VALUE CREATION
DRIVING
income income
Retirement benefit 3,212,986 1,713,074 (207,690) (213,770) 4,523,533 3,445,081 930,463 3,596,246
Impairment allowance for

loan receivables 6,526,751 – (4,276,497) – 2,250,254 – (956,089) –
Accelerated
depreciation
allowance for tax
purpose – PPE 1,233,759 173,948 – 1,059,811 (360,577) (25,499)
Revaluation of freehold
AND ANALYSIS
land and building 7,447,856 2,331,295 5,116,561 175,637
Right-of-use asset 48,745 111,590 160,336 22,573
9,788,482 10,394,689 (4,198,649) 2,117,525 6,934,123 9,621,453 (363,630) 3,746,384
Group
Deferred Deferred Statement of Statement of Deferred Deferred Statement of Statement of

tax asset tax liability profit or loss comprehensive tax asset tax liability profit or loss comprehensive
income income
REPORTS
GOVERNANCE
Retirement benefit 5,717,938 6,480,582 (301,435) (175,935) 6,474,253 5,215,322 956,073 3,592,412
Carry forward tax losses – – – – – – 3,701 –
Impairment allowance for

loan receivables 6,526,751 (2,235,080) (4,649,145) – 2,250,254 (967,210) (974,035) –
Deferred tax on
transitional adjustment – (295,502) (59,100) – – (214,911) 51,583 –
Accelerated
STATEMENTS
FINANCIAL
depreciation allowance
for tax purpose –
(Lease) – 306,274 (103,663) – – 560,772 (1,003,434) –
Accelerated
depreciation allowance
for tax purpose – (PPE) – 1,240,985 152,220 – – 1,432,955 (217,083) (25,499)
Fair value gain/(loss) –

investment properties – – – – – – – –
INFORMATION
SUPPLEMENTARY
Financial assets at
fair value through OCI (232,405) (137,822)
Revaluation of freehold
land and building 7,619,296 97,969 2,593,073 – 6,108,829 2,844
Right-of-use asset 48,745 (20,187) 106,296 – 160,336 (56,200) (14,272) 181,562
12,293,434 12,863,963 (4,756,858) 2,279,316 8,884,843 12,079,557 (1,194,623) 3,748,475

35. OTHER LIABILITIES

Bank Group
As at 31 December 2022 2021 2022 2021

Deferred income in respect of off-balance sheet items 362,241 444,889 362,241 444,889
Expected credit loss in respect of contingent
liabilities and commitments 516,606 568,215 516,606 568,215
Sundry creditors 5,819,218 3,791,322 5,819,218 3,791,322
Net defined benefit obligation – Pre-1996 Pension
Trust Fund 35.1 4,901,096 4,842,402 4,901,096 4,842,402
Provision for gratuity 35.3 735,160 381,416 1,442,536 1,124,965
Lease liability 35.4 9,330,861 10,244,653 10,726,390 11,572,070

Payable on other expenses 4,828,274 5,365,380 5,275,287 5,687,830
Insurance liabilities and reinsurance payable – – 4,891,896 4,979,084
Other liabilities 80,271,594 5,464,457 82,026,444 10,440,754
Total 106,765,050 31,102,734 115,961,714 43,451,531
35.1 Net defined benefit obligation – Pre-1996 Pension Trust Fund

The Bank operates a defined benefit pension plan, for the permanent staff members who have joined the Bank prior to
1 January 1996, for which an actuarial valuation was carried out using the “Projected Unit Credit Method” in accordance with
the Sri Lanka Accounting Standard – LKAS 19 – “Employee Benefits”. The results of the actuarial valuation of the Pre-1996
Pension Plan is summarised below:
Bank Group
As at 31 December 2022 2021 2022 2021

Fair value of plan assets 35.1.1 (56,390,526) (52,518,847) (56,390,526) (52,518,847)

Present value of obligations 35.1.2 61,291,622 57,361,249 61,291,622 57,361,249
Net defined benefit obligation 4,901,096 4,842,402 4,901,096 4,842,402
35.1.1 Fair value of plan assets

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Plan assets comprise:

Fixed deposits 38,804,750 26,666,000 38,804,750 26,666,000
Government Securities 17,087,176 12,970,962 17,087,176 12,970,962
Debentures – 12,500,000 – 12,500,000
Net current assets 498,600 381,885 498,600 381,885
Total 56,390,526 52,518,847 56,390,526 52,518,847

Actual return on plan assets 6,152,855 3,381,542 6,152,855 3,381,542
PEOPLE’S BANK
ABOUT
Movement in the fair value of plan assets
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Fair value of plan assets as at 1 January 52,518,847 48,662,274 52,518,847 48,662,274
Expected return on plan assets 5,553,265 3,799,741 5,553,265 3,799,741
FROM THE TOP

REFLECTIONS
Benefit paid by the plan (6,460,222) (6,032,549) (6,460,222) (6,032,549)
Actual employer contribution 4,179,047 6,507,580 4,179,047 6,507,580
Actuarial gain/(losses) 599,589 (418,199) 599,589 (418,199)
Fair value of plan assets as at 31 December 56,390,526 52,518,847 56,390,526 52,518,847
35.1.2 Movement in the present value of the defined benefit obligations
VALUE CREATION
DRIVING
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Defined benefit obligations as at 1 January 57,361,249 67,814,044 57,361,249 67,814,044
Benefit paid by the plan (6,460,222) (6,032,549) (6,460,222) (6,032,549)
Interest cost 6,309,737 5,404,779 6,309,737 5,404,779
AND ANALYSIS
Plan amendment1 1,100,448 (1,044,000) 1,100,448 (1,044,000)
Actuarial (gain)/losses 2,579,667 (9,439,495) 2,579,667 (9,439,495)
Present value of defined benefit obligation as at 31 December 61,291,622 57,361,249 61,291,622 57,361,249
35.1.3 Net expenses recognised in income statement

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
REPORTS
GOVERNANCE
Interest cost 6,309,737 5,404,779 6,309,737 5,404,779
Expected return (5,553,265) (3,799,741) (5,553,265) (3,799,741)
Plan amendment1 1,100,448 (1,044,000) 1,100,448 (1,044,000)
Net expenses 2,257,664 1,219,509 2,257,664 1,219,509 STATEMENTS

FINANCIAL
1
The plan was amended to comply with the provisions of staff circular, where all participants’ compulsory Normal Retirement Age is now age 60.
(They have the option of retiring as early as age 55). The change in the PVDBO is recognised immediately in the income statement as this is
considered as a plan amendment.
35.1.4 Actuarial (gains)/losses recognised in other comprehensive income

Bank Group
As at 31 December 2022 2021 2022 2021

INFORMATION
SUPPLEMENTARY
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Amount accumulated in retained earnings as at 1 January (14,995,365) (24,016,661) (14,995,365) (24,016,661)
Recognised during the year (1,980,078) 9,021,296 (1,980,078) 9,021,296
Amount accumulated in retained earnings as at 31 December (16,975,443) (14,995,365) (16,975,443) (14,995,365)

35.1.5 Actuarial assumptions

The following are the principal actuarial assumptions as at the reporting date:
Bank Group
As at 31 December 2022 2021 2022 2021

% % % %
Financial assumptions
Discount rate 18.00 11.00 18.00 11.00
Increase in cost of living allowances 12.50 5.50 5.00 5.50
Future gross salary increase 15.00 9.00 15.00 9.00
Demographic assumptions
Mortality table RP – 2000 RP – 2000 RP – 2000 RP – 2000
35.1.6 Sensitivity of assumptions employed in actuarial valuation

The following table demonstrates the sensitivity to a reasonably possible changes in the key assumptions employed
with all other variables held constant in the employment benefit liability measures. The sensitivity of the Comprehensive
Income Statement and the Statement of Financial Position is the assumed changes in discount rate and salary increment
rate as follows:
Bank Group
As at 31 December 2022 2021 2022 2021
Effect on Effect on Effect on Effect on Effect on Effect on Effect on Effect on

comprehensive employee comprehensive employee comprehensive employee comprehensive employee
Income benefit Income benefit Income benefit Income benefit
Statement obligation Statement obligation Statement obligation Statement obligation
increase/ increase/ increase/ increase/ increase/ increase/ increase/ increase/
(reduction) (reduction) (reduction) (reduction) (reduction) (reduction) (reduction) (reduction)
in the liability in the liability in the liability in the liability
Increase/(decrease)
in discount rate
1% 3,411,129 (3,411,129) 3,651,894 (3,651,894) 3,411,129 (3,411,129) 3,651,894 (3,651,894)
-1% (3,799,039) 3,799,039 (4,131,568) 4,131,568 (3,799,039) 3,799,039 (4,131,568) 4,131,568
Increase/(decrease)
in salary increment
1% (356,732) 356,732 (598,742) 598,742 (356,732) 356,732 (598,742) 598,742
-1% 340,856 (340,856) 564,668 (564,668) 340,856 (340,856) 564,668 (564,668)
35.2 Net defined benefit obligation – Post-1996 Pension Fund

The Board of Directors of the Bank approved this retirement benefit plan for the employees recruited to the Bank on or
after 1 January 1996. An actuarial valuation was carried out using the “Projected Unit Credit Method” in accordance with
the Sri Lanka Accounting Standard – LKAS 19 “Employee Benefits”. The results of the actuarial valuation of the post-1996
employment benefit plan is summarised below:
PEOPLE’S BANK
ABOUT
Bank Group
As at 31 December 2022 2021 2022 2021

Fair value of plan assets 35.2.1 12,565,415 10,038,600 12,565,415 10,038,600
Present value of obligations 35.2.2 (7,802,911) (5,182,381) (7,802,911) (5,182,381)
Net defined benefit asset/(obligation) 4,762,504 4,856,219 4,762,504 4,856,219
FROM THE TOP

REFLECTIONS
35.2.1 Fair value of plan assets
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
VALUE CREATION
DRIVING
Plan assets comprise:
Fixed deposits 11,703,541 9,839,526 11,703,541 9,839,526
Net current assets 861,874 199,074 861,874 199,074
Total 12,565,415 10,038,600 12,565,415 10,038,600
Actual return on plan assets 1,276,635 481,614 1,276,635 481,614
AND ANALYSIS
Movement in the fair value of plan assets
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Fair value of plan assets as at 1 January 10,038,600 8,513,023 10,038,600 8,513,023
Expected return on plan assets 1,141,686 754,766 1,141,686 754,766
Benefit paid by the plan (43,950) (60,001) (43,950) (60,001)
Actual employer contribution 1,294,130 1,103,964 1,294,130 1,103,964
Actuarial gain/(losses) 134,950 (273,152) 134,950 (273,152)
REPORTS
GOVERNANCE
Fair value of plan assets as at 31 December 12,565,415 10,038,600 12,565,415 10,038,600
35.2.2 Movement in the present value of the defined benefit obligations

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
STATEMENTS
FINANCIAL
Defined benefit obligations as at 1 January 5,182,381 8,657,210 5,182,381 8,657,210
Benefit paid by the plan (43,950) (60,001) (43,950) (60,001)
Interest cost 590,791 770,492 590,791 770,492
Plan amendment1 588,198 (1,226,605) 588,198 (1,226,605)

INFORMATION
SUPPLEMENTARY
Actuarial (gain)/losses 1,082,693 (3,734,006) 1,082,693 (3,734,006)
Present value of defined benefit obligation as at 31 December 7,802,911 5,182,381 7,802,911 5,182,381
35.2.3 Net expenses recognised in Income Statement

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Interest cost 590,791 770,492 590,791 770,492
Expected return (1,141,686) (754,766) (1,141,686) (754,766)
Plan amendment1 588,198 (1,226,605) 588,198 (1,226,605)
Net expenses 440,101 (435,588) 440,101 (435,588)
1
The plan was amended to comply with the provisions of the staff circular where all participants’ compulsory Normal Retirement Age is now age
60. (They have the option of retiring as early as age 55). The change in the PVDBO is recognized immediately in the income statement as this is
considered as a plan amendment.
35.2.4 Actuarial (gains)/losses recognised in other comprehensive income

Bank Group
As at 31 December 2021 2021 2021 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Amount accumulated in retained earnings as at 1 January 334,189 (3,126,665) 334,189 (3,126,665)
Recognised during the year (947,743) 3,460,854 (947,743) 3,460,854
Amount accumulated in retained earnings as at 31 December (613,554) 334,189 (613,554) 334,189
35.2.5 Actuarial assumptions

The following are the principal actuarial assumptions as at the reporting date:
Bank Group
As at 31 December 2022 2021 2022 2021

% % % %
Financial assumptions
Discount rate 18.00 11.40 18.00 11.40
Increase in cost of living allowance 12.50 5.50 12.50 5.50
Future gross salary increase 15.00 6.50 15.00 6.50
Demographic assumptions
Mortality table RP – 2000 RP – 2000 RP – 2000 RP - 2000
PEOPLE’S BANK
ABOUT
35.2.6 Sensitivity of assumptions employed in actuarial valuation (Bank and Group)
The following table demonstrates the sensitivity to a reasonably possible changes in the key assumptions employed
with all other variables held constant in the employment benefit liability measures. The sensitivity of the Comprehensive
Income Statement and the Statement of Financial Position is the assumed changes in discount rate and salary increment
rate as follows:
FROM THE TOP

REFLECTIONS
Effect on statement Effect on employee Effect on statement Effect on employee

of comprehensive benefit obligation of comprehensive benefit obligation
income increase/ increase/(reduction) income increase/ increase/(reduction)
(reduction) in the liability (reduction) in the liability
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Increase/(decrease) in discount rate

1% 1,155,342 (1,155,342) 936,395 (936,395)
VALUE CREATION
DRIVING
-1% (1,428,681) 1,428,681 (1,210,579) 1,210,579
Increase/(decrease) in salary increment

1% (1,793,030) 1,793,030 (852,923) 852,923
-1% 1,032,749 (1,032,749) 710,924 (710,924)
35.3 Contribution to defined benefit plan – Gratuity
AND ANALYSIS
Employees who joined the Bank on or after 1 January 1996 will be eligible for gratuity under the Payment of Gratuity Act
No. 12 of 1983, or if opted can join the proposed new post-1996 pension scheme and if so such employees will forfeit their
right to gratuity. An actuarial valuation was carried out using the “Projected Unit Credit Method” in accordance with the
Sri Lanka Accounting Standard – LKAS 19 “Employee Benefits”.
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Balance as at 1 January 381,416 722,474 1,124,965 1,350,596
Past service cost (126,496) 79,085 (126,496) 79,085
REPORTS
GOVERNANCE
Interest cost 98,039 58,231 149,141 121,160
Benefits paid during year (67,211) (35,813) (78,962) (61,657)
Actuarial losses/(gains) on obligations 376,572 (476,987) 249,947 (461,575)
Balance as at 31 December 735,160 381,416 1,442,536 1,124,965

STATEMENTS
FINANCIAL
35.3.1 The Principal financial assumptions used in the valuations are as follows:
Bank
2022 2021
Discount rate 18.0 % p.a 11.5 % p.a
Gross salary increase for all grades 15.0 % p.a 9.0% p.a
INFORMATION
SUPPLEMENTARY
Normal age of retirement 60 years 62 years

35.3.2 Sensitivity of assumptions employed in actuarial valuation

The following table demonstrates the sensitivity to a reasonably possible changes in the key assumptions employed with
all other variables held constant in the employment benefit liability measures. The sensitivity of the Statement of Financial
Position is the assumed changes in discount rate and salary increment rate as follow:
2022 2021
Effect on Effect on Effect on Effect on

statement of employee benefit Statement of employee benefit
comprehensive obligation Increase/ Profit or Loss obligation Increase/
Income Increase/ (reduction) Increase/ (reduction)
(reduction) in the Liability (reduction) in the Liability
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Increase/(decrease) in discount rate

1% 50,705 (50,705) 354,835 (354,835)
-1% (42,465) 42,465 (411,686) 411,686
Increase/(decrease) in salary increment

1% (414,168) 414,168 (414,168) 414,168
-1% 352,282 (352,282) 352,282 (352,282)
35.4 Lease liability

Bank Group
2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Balance as at 1 January 10,244,653 6,017,463 11,572,070 7,415,918
Additions/renewals during the year 2,103,876 7,212,905 2,643,068 7,395,957
Terminations during the year (1,117,999) (1,020,454) (1,357,213) (1,103,372)
Accretion of interest 607,754 583,020 782,854 767,602
Payments during the year (2,507,423) (2,548,281) (2,914,389) (2,904,035)
Balance as at 31 December 9,330,861 10,244,653 10,726,390 11,572,070
35.4.1 Amounts recognised in Income Statement

Bank Group

Interest on lease liabilities 7.2 607,754 583,020 782,854 767,602

Amortisation of right of use asset 13.1 2,017,947 2,106,844 2,378,562 2,450,170
2,625,701 2,689,864 3,161,416 3,217,772
35.4.2 Amounts recognised in the Statement of Cash Flows

Bank Group

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Repayment of lease liabilities 2,507,423 2,548,281 2,914,389 2,904,035
2,507,423 2,548,281 2,914,389 2,904,035

PEOPLE’S BANK
ABOUT
36. SUBORDINATED TERM DEBTS
Accounting policy
Subordinated term debts represent funds borrowed for long term funding purposes which are subordinated to the
other claims. Subsequent to initial recognition, subordinated term debts are measured at their amortised cost using the
Effective Interest Rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on
FROM THE TOP

REFLECTIONS
the issue and costs that are an integral part of the EIR.
Bank Group
As at Interest rate and Issue date Maturity date 2022 2021 2022 2021
31 December repayment terms LKR ’000 LKR ’000 LKR ’000 LKR ’000
Issued by the Bank

30 December 29 December
VALUE CREATION
DRIVING
(i) Tranche 2 13.5% – Biannually 2009 2022 – 2,501,849 – 2,501,849
30 December 29 December
(ii) Tranche 3 13.0% – Biannually 2011 2022 – 5,003,562 – 5,003,562
29 December
(iii) Tranche 4 13.0% – Biannually 15 June 2013 2022 – 5,030,273 – 5,030,273
8 November 8 November
(iv) Type A 12.0% – Annually 2019 2024 6,706,228 6,679,516 6,706,228 6,679,516
8 November 8 November
(v) Type B 12.25% – Annually 2019 2027 3,499,290 3,499,290 3,499,290 3,499,290
AND ANALYSIS
(vi) Type A 9.5% – Annually 27 July 2020 27 July 2025 13,430,490 13,559,773 13,430,490 13,559,773
(vii) Type B 10.25% – Annually 27 July 2020 27 July 2030 7,415,026 7,283,433 7,415,026 7,283,433
Additional Tier 1 Capital Bond

AT I – Bond 13.5% – Annually 29 March 2021 N/A 3,859,877 3,746,582 3,859,877 3,746,582
31.03% –
AT I – Bond Annually 3 August 2021 N/A 1,692,556 1,557,401 1,692,556 1,557,401
Issued by the subsidiary

Senior, unsecured, redeemable, ’AA(-) rated
REPORTS
GOVERNANCE
Type A 12.4% – Annually 23 April 2018 18 April 2022 – – – 762,449
Type B 12.8% – Annually 23 April 2018 18 April 2023 – – 5,631,423 5,628,592
5 August
Type A 8.0% – Annually 5 August 2021 2024 – – 3,030,434 3,028,472
5 August
Type B 8.0% – At Maturity 5 August 2021 2024 – – 2,691,584 2,490,192
5 August
Type C 9.0% – Annually 5 August 2021 2026 4,413,676 4,412,374
STATEMENTS
FINANCIAL
5 August
Type D 9.0% – Annually 5 August 2021 2026 – – 410,779 376,706
Total 36,603,467 48,861,680 52,781,563 65,560,465
Due within 1 year – 12,535,684 5,631,423 13,298,133
Due after 1 year 36,603,467 36,325,996 47,150,140 52,262,332
Total 36,603,467 48,861,680 52,781,563 65,560,465

INFORMATION
SUPPLEMENTARY
36.1 Movement in subordinated term debts

Bank Group
2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Proceed received from subordinated debt – 5,000,000 – 15,000,000
Repayment of subordinated debt (12,500,000) – (12,500,000) (7,230,443)
Interest expense on subordinated debt 5,503,630 5,103,325 7,060,585 6,966,957
Interest paid on subordinated debt (5,261,843) (4,799,341) (7,339,487) (6,044,084)
37. STATED CAPITAL/ASSIGNED CAPITAL

Bank Group
As at 31 December 2022 2021 2022 2021

Stated capital 37.1 49,998 49,998 49,998 49,998
Assigned capital 37.2 12,152,000 12,152,000 12,152,000 12,152,000
12,201,998 12,201,998 12,201,998 12,201,998
37.1 Stated capital

37.1.1 Movement of stated capital
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Authorised
1,000,000,000 ordinary shares of 50/- each 50,000,000 50,000,000 50,000,000 50,000,000
In September 2019, the People`s Bank Act No. 29 of 1961 was amended whereby, amongst other, the Bank's authorised
share capital was increased to Rs. 50.0 Bn. from Rs. 1.0 Bn. previously.
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Fully paid
999,960 ordinary shares of 50/- each 49,998 49,998 49,998 49,998
All issued shares are fully-paid with the exception of 40 shares which yet remain unpaid.
PEOPLE’S BANK
ABOUT
37.1.2 Principal shareholders of the Bank are as follows:
% %
Government of Sri Lanka 92.27 92.27
Cooperative Societies 7.73 7.73
FROM THE TOP

REFLECTIONS
100.00 100.00
37.2 Assigned capital (capital pending allotment)

During the period 2005 and 2008 and in 2017, the General Treasury – Ministry of Finance infused an aggregate of LKR 12,152
Mn. in People’s Bank as new capital. These amounts were held in the Bank’s Capital Pending Allotment/Assigned Capital
account pending conclusion of applicable formalities to issue new shares and to transfer to the Paid in Capital Account.
Upon conclusion thereto, the General Treasury, Ministry of Finance will own 99.97% in People’s Bank whilst the Cooperative
VALUE CREATION
DRIVING
Societies will have 0.03%.
38. Statutory Reserve Fund

The Statutory Reserve Fund is maintained as required by the Banking Act No. 30 of 1988. Accordingly, the Bank should, out
of profits after taxation but before any dividend is declared, transfer to the Statutory Reserve Fund a sum equivalent to not
less than 5% of the Bank’s paid-up capital until the Permanent Reserve is equal to 50% of the paid-up capital and not less
than 2% until the Permanent Reserve equals the paid- up capital. Accordingly, Bank has transferred LKR 860 Mn. for the
current year.
AND ANALYSIS
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Transfer to reserve during the year 859,603 1,186,007 859,603 1,186,007
39. OTHER RESERVES
REPORTS
GOVERNANCE
39.1 Revaluation reserve
This reserve has been created in accordance with Sri Lanka Accounting Standard – LKAS 16 – “Property, Plant and
Equipment”
39.2 Capital reserve

STATEMENTS
FINANCIAL
This reserve has been created in 1987 and increased in 1998, has no transferred to date.
39.3 Special risk reserve

In terms of Central Bank directives, 25% of Primary Dealer Unit (PDU) profit has been transferred to Special Risk Reserve
in order to promote the safety, soundness, and the stability of the Primary Dealer System and to build-up Primary Dealer
Capital Base.
According to Central Bank Direction 08/11/011/0019/001 dated 14 February 2013 Bank is exempted from the requirement of
INFORMATION
SUPPLEMENTARY
maintaining the reserve. Therefore, no transfer is made to the reserve this year based on the direction from the Central Bank
of Sri Lanka.
39.4 General reserve

This reserve has been created under Section 22 (2) of the People’s Bank Act No. 29 of 1961. The General Reserve represents
accumulated unallocated retained profits and losses which are available for distribution and for settlement of debentures
issued.
39.5 Financial assets at FVOCI reserve

This FVOCI reserve comprises the cumulative net change in equity instruments at FVOCI and debt instruments at FVOCI
until such investments are derecognised or impaired.
39.6 Special levy to treasury/dividend

Payment of LKR 219 Mn. was made according to the agreement between the Government of Sri Lanka and the People’s
Bank, the Bank is required to pay back 25% of the Restructuring Bond Interest to the General Treasury as a dividend.
Additional details relating to this expense is reflected in Note 22.3.C.C
LKR 661 Mn. pertains to a dividend/special levy paid to the Consolidated Fund of the Government of Sri Lanka as
determined by the Ministry of Finance.
40. RETAINED EARNINGS

Bank Group
As at 31 December 2022 2021 2022 2021

Surcharge tax levied under surcharge tax

Act No. 14 of 2022 14.5 (5,439,713) – (7,309,533) –
Adjusted balance as at 1 January 73,322,570 48,897,842 97,445,732 72,268,676
Total comprehensive income

Profit for the year 17,192,058 23,720,143 19,571,989 26,350,975
Other comprehensive income (Net of taxes) (4,369,763) 10,094,237 (4,302,473) 10,085,553
Transfer to reserve during the year 38 (859,603) (1,753,051) (859,603) (1,753,051)
Special levy to treasury dividend 39.6 (661,090) (2,196,888) (661,090) (2,196,888)

PEOPLE’S BANK
ABOUT
40.1 Movement in reserves – Bank
Statutory Revaluation Capital Special risk General Financial assets Retained Total
reserve reserve reserve reserve reserve at FVOCI earnings
reserve
Balance as at 1 January 2021 8,024,521 18,748,933 5,663 1,633,710 11,934,956 535,975 48,897,842 89,781,600
FROM THE TOP

REFLECTIONS
Profit for the year – – – – – 23,720,143 23,720,143
Net gains/(losses) on equity
instruments at fair value
through OCI – – – – – (316,074) – (316,074)
Net gains/(losses) on debt
through OCI – – – – – 713 – 713
Net actuarial gains and losses
VALUE CREATION
DRIVING
on defined benefit plans – – – – – 12,959,137 12,959,137
Deferred tax effect on defined

benefit plans – – – – – (3,110,193) (3,110,193)
Deferred Tax Effect on change

in income tax rate on the
opening balance 245,293 245,293
Revaluation surplus of land and

building 3,672,851 – 3,672,851
Deferred tax effect on

revaluation surplus – (881,484) – – – – (881,484)
AND ANALYSIS
Transfer to reserve during
the year 1,186,007 – – – 567,044 (1,753,051) –
Special levy to treasury/dividend – – – – – (2,196,888) (2,196,888)
Balance as at
31 December 2021 9,210,528 21,540,300 5,663 1,633,710 12,502,000 220,614 78,762,283 123,875,098
Surcharge tax levied under

Surcharge Tax Act No. 14 of 2022
(Note 14.5) (5,439,713) (5,439,713)
Balance as at 1 January 2022 9,210,528 21,540,300 5,663 1,633,710 12,502,000 220,614 73,322,570 118,435,385
Profit for the year – – – – – – 17,192,058 17,192,058
REPORTS
GOVERNANCE
Net gains/(losses) on
equity instruments at fair
value through OCI – – – – – 52,869 – 52,869
Net gains/(losses) (including

change in ECL) on debt
through OCI (12,354) (12,354)
Net Defined Benefit obligation – – – – – – (3,304,393) (3,304,393)
Deferred tax effect gain/(losses)

STATEMENTS
FINANCIAL
on defined benefit plans 991,318 991,318
Deferred tax effect on change

in income tax rate on the
opening balance (2,056,688) (2,056,688)
Revaluation surplus of land

and building – 3,507,183 – – – – – 3,507,183
Deferred tax effect on

revaluation surplus (1,052,155) – – – – – (1,052,155)
INFORMATION
SUPPLEMENTARY
Transfer to reserve during

the year (Note 38) 859,603 – – – – – (859,603) –
Special levy to treasury/

dividend (Note 39.6) – – – – – – (661,090) (661,090)
Balance as at 31 December 2022 10,070,131 23,995,328 5,663 1,633,710 12,502,000 261,129 84,624,172 133,092,133
40.2 Movement in reserves – Group

Statutory Revaluation Capital Special risk
reserve reserve reserve reserve
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Balance as at 1 January 2021 8,024,521 20,587,993 5,663 1,633,710

Profit for the year – – – –
Net gains/(losses) on equity instruments at fair value through OCI – – – –
Net gains/(losses) on debt instruments at fair value through OCI – – – –
Deferred tax effect on above
Net gains/(losses) on translating the financial statements of foreign operation – – –
Net actuarial gains and losses on defined benefit plans – – – –
Deferred tax effect on defined benefit plans – – – –
Revaluation surplus on land and building – 3,785,351 – –
Deferred tax effect on revaluation surplus (908,484)
Deferred Tax Effect on change in income tax rate on the opening balance –
Transfer to reserve during the year 1,186,007 – – –
Special levy to treasury/dividend – – – –
Dividend payment – – – –
Balance as at 31 December 2021 9,210,528 23,464,860 5,663 1,633,710
Surcharge tax levied under Surcharge Tax Act No. 14 of 2022 (Note 14.5)
Balance as at 1 January 2022 9,210,528 23,464,860 5,663 1,633,710
Profit for the year – – – –
Net gains/(losses) on equity instruments at fair value through OCI – – – –

Net gains/(losses) (including change in ECL) on debt instruments at fair
value through OCI
Deferred tax effect on above
Net gains/(losses) on translating the financial statements of foreign operation – – – –
Net defined benefit obligation – – – –
Deferred tax effect gain/(losses) on defined benefit plans – – – –
Deferred tax effect on change in income tax rate on the opening balance
Revaluation surplus on land and building – 4,185,333 – –
Deferred tax effect on revaluation surplus – (1,255,600) – –
Transfer to reserve during the year (Note 38) 859,603 – – –
Special levy to treasury/dividend (Note 39.6) – – – –
Dividend payment – – – –
Balance as at 31 December 2022 10,070,131 26,394,593 5,663 1,633,710

PEOPLE’S BANK
ABOUT
General Financial Exchange Retained Total Non- Total
reserve assets at FVOCI equalisation earnings controlling
reserve fund interest
LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000
11,934,956 492,808 268,532 72,268,676 115,216,859 11,691,908 126,908,767
FROM THE TOP

REFLECTIONS
– – 26,350,975 26,350,975 1,736,673 28,087,648
– (291,223) – – (291,223) (21,754) (312,977)
– (69,418) – – (69,418) (23,139) (92,557)
22,556 – – 22,556 7,519 30,075
– 130,593 – 130,593 43,531 174,124
– – 12,947,578 12,947,578 (3,853) 12,943,725
VALUE CREATION
DRIVING
– – (3,107,318) (3,107,318) 959 (3,106,359)
– – – 3,785,351 37,500 3,822,851
(908,484) (9,000) (917,484)
245,293 245,293 – 245,293
567,044 – (1,753,051) – – –
– – (2,196,888) (2,196,888) – (2,196,888)
– – – – – (150,000) (150,000)
AND ANALYSIS
12,502,000 154,723 399,125 104,755,265 152,125,874 13,310,344 165,436,218
(7,309,533) (7,309,533) (623,273) (7,932,806)
12,502,000 154,723 399,125 97,445,732 144,816,341 12,687,071 157,503,412
– 19,571,989 19,571,989 953,450 20,525,439
– (80,773) – – (80,773) (40,429) (121,202)
(224,992) (224,992) (74,997) (299,989)
103,367 103,367 34,455 137,822
– 565,090 – 565,090 893,342 1,458,432
REPORTS
GOVERNANCE
– – (3,208,737) (3,208,737) 31,663 (3,177,074)
– – 962,952 962,952 (9,456) 953,496
(2,056,688) (2,056,688) – (2,056,688)
– – – 4,185,333 194,487 4,379,820
– – (1,255,600) (58,346) (1,313,946)
– – (859,603) – – –
STATEMENTS
FINANCIAL
– – (661,090) (661,090) – (661,090)
– – – – (198,803) (198,803)
12,502,000 (47,675) 964,215 111,194,555 162,717,192 14,412,436 177,129,629

INFORMATION
SUPPLEMENTARY
41. CONTINGENT LIABILITIES AND COMMITMENTS

In the normal course of business, the Bank makes various commitments and incurs contingent liabilities with legal recourse
to its customers. No material losses are anticipated as a result of these transactions.
Bank Group
As at 31 December 2022 2021 2022 2021

Contingent liabilities 41.1 302,336,794 350,270,683 302,740,138 351,023,683
Commitments 41.2 68,828,585 79,068,727 73,064,804 93,386,727
Less: 371,165,379 429,339,410 375,804,942 444,410,410
Allowance for expected credit losses 41.3 (516,606) (568,215) (516,606) (568,215)
370,648,773 428,771,195 375,288,336 443,842,195
41.1 Contingent liabilities

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Acceptances 74,070,645 94,817,795 74,070,645 94,817,795
Documentary credit 22,841,324 73,281,666 22,841,324 73,281,666
Guarantees 68,387,765 74,070,212 68,791,109 74,823,212
Forward exchange contracts 137,037,060 108,101,010 137,037,060 108,101,010
Total 302,336,794 350,270,683 302,740,138 351,023,683
41.2 Commitments Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Undrawn overdrafts and loans 68,828,585 79,068,727 73,064,804 93,386,727
68,828,585 79,068,727 73,064,804 93,386,727
41.3 Movement in allowance for expected credit loss (ECL) based on exposure to credit risk
Bank and Group 2022

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Opening balance as at 1 January 79,236 254,318 234,661 568,215
Net charge/(reversal) for the year (22,024) 106,725 (136,310) (51,609)
Closing balance as at 31 December 57,212 361,043 98,351 516,606
Bank and Group 2021

LKR ‘000 LKR ‘000 LKR ‘000 LKR ‘000
Opening balance as at 1 January 78,486 47,988 421,105 547,579
Net charge/(reversal) for the year 750 206,330 (186,444) 20,636
Closing balance as at 31 December 79,236 254,318 234,661 568,215

PEOPLE’S BANK
ABOUT
41.4 Other capital commitments
Capital expenditure approved by the Board of Directors for which provisions has not been made in theses Financial
Statements amounted to;
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
FROM THE TOP

REFLECTIONS
Approved and contracted for 1,036,951 362,824 1,036,951 362,824
Approved but not contracted for 213,309 398,592 213,309 398,592
1,250,260 761,416 1,250,260 761,416
41.5 Assessment received by the Bank
VALUE CREATION
DRIVING
Following assessments were received by the Bank from the Department of Inland Revenue.
Income tax
Notice of assessment issued for income tax for the years of assessment, 2018/19 LKR 5,646 Mn. (0201819002) and
discussion is going on for full settlement. The following tax assessment is outstanding which, although currently is at a Court
of Appeal stage, is also in the process of settlement:
Period – Tax type Charge number Assessment value Current status
AND ANALYSIS
2010/11 – Income Tax (ITA 13291100319V1) LKR 2,422.29 Mn. Court of Appeal
Please note: For the above purposes, provisions have been constructed based on the likely outcome as advised by the respective Tax Consultant.
Value added Tax

Value added tax on financial services for the years 2012, 2013, 2014, 2015, 2016, 2017, 2018 and 2019 are respectively
LKR 732.3 Mn. (VATFS/BFSU/2015/660), LKR 360.8 Mn. (VATFS/BFSU/2015/661), LKR 405.0 Mn. (VATFS/
BFSU/2017/816), LKR 802.8 Mn. (VATFS/BFSU/2018/894), LKR 1,089.1 Mn. (VATFS/BFSU/2019/1008) LKR 1,083.1 Mn.
(7501718002), LKR 1,309.2 Mn. and (7501920001) LKR 1,099.0 Mn.
REPORTS
GOVERNANCE
41.6 Litigation against the Bank and companies within the Group
In the normal course of business, the Bank is involved in various types of litigation, including litigation with borrowers
who are in default under terms of their loan agreements. In certain circumstances, borrowers have asserted or threatened
counter claims defences. The Bank is also contesting certain Labour Tribunal cases. In the opinion of Management, based on
its assessment and consultation with outside counsel, litigation which is currently pending against the Bank and the Group
will not have a material impact on the financial condition or future operations of the Bank and the Group as a whole. The
total damage claimed of litigation against the Bank amounts to approximately LKR 9.7 Bn., of which details are given below:
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
Zone Region Total

LKR ’000
Western I Gampaha 1,000,000
Western II Kaluthara 31,103,166
Central Kandy 18,085,772
Matale 14,552,000
Nuwara Eliya –
Wayamba Kurunegala 27,619,146
Sabaragamuwa Rathnapura 1,000,000
Eastern Ampara 10,000,000
Batticaloa 500,000
North Central Anuradhapura 8,322,000
Southern Galle 250,000,000
Matara 18,350,000
Uva Badulla 2,000,000
Legal/Special Assets Unit/Corporate Banking Division 9,342,995,717
9,725,527,801
42. SUBSEQUENT EVENTS

No circumstances have arisen since the reporting date which would require adjustments to, or disclosure in the Financial
Statements.
43. RELATED PARTY DISCLOSURES

The Bank has carried out transactions in the ordinary course of business on an arm’s length basis at commercial rates with
parties who are defined as related parties as per the Sri Lanka Accounting Standard – LKAS 24 “Related Party Disclosures”,
except for the transactions that Key Management Personnel (KMPs) have availed under schemes uniformly applicable to
all staff at concessionary rates. Those transactions include lending activities, acceptance of deposits, off-balance sheet
transactions and provision of other banking and finance services.

43.1 Parent and the ultimate controlling party
People’s Bank is a Sri Lankan Government owned Bank.
43.2 Key Management Personnel (KMPs) and their Close Family Members (CFMs)
Key Management Personnel are defined as those persons having authority and responsibility for planning, directing and
controlling the activities of the Bank. Such Key Management Personnel include Chairman, Executive and Non Executive
Directors and Chief Executive Officer/General Manager of the Bank. Close family members of an individual are those family
members who may be expected to influence, or to be influenced by, that individual in their dealings with the entity. They
may include individual’s domestic partner and children, children of the individual’s domestic partner and dependents of the
individual or the individual’s domestic partner.
PEOPLE’S BANK
ABOUT
43.2.1 Compensation of Key Management Personnel (KMPs)
For the year ended 31 December 2022 2021

LKR ’000 LKR ’000
Short-term employee benefits 41,958 38,053
Post-employment pension 2,349 1,390
FROM THE TOP

REFLECTIONS
Termination benefits – –
43.2.2 Transactions with Key Management Personnel (KMPs)

LKR ’000 LKR ’000
VALUE CREATION
DRIVING
a. Items in income statement
Interest income 3,923 108
Interest expenses 14,666 1,849

LKR ’000 LKR ’000
b. Items in statement of financial position
AND ANALYSIS
Term loans 26,832 25,290
Overdrafts – –
Credit cards 2,823 1,599
Deposits 74,313 62,694
43.2.3 Transactions with Close Family Members (CFMs) of the Key Management Personnel (KMP)

LKR ’000 LKR ’000
REPORTS
GOVERNANCE
Interest income 437 –
Interest expenses 38 23

LKR ’000 LKR ’000
STATEMENTS
FINANCIAL

Term loans – –
Overdrafts – –
Deposits 861 575

INFORMATION
SUPPLEMENTARY
43.3 Transactions with Group entities

The Group entities include the subsidiaries and associates of the Bank.
43.3.1 Transactions with subsidiaries, sub-subsidiaries and associate companies of the Bank
The aggregate amount of income and expenses arising from the transactions during the year, amount due to and due from
the relevant related party and total contract sum of off-balance sheet transactions at the year end are summarised below:
Subsidiary companies Sub-subsidiary companies
of the Bank of the Bank

LKR ’000 LKR ’000 LKR ’000 LKR ’000

Interest income 16,691 117,685 33,793 16,885
Interest expense 13,393,139 889,348 252,574 29,173
Dividend income 707,698 1,634,944 – –
Other income 50,776 50,884 84,179 361,017
Other expenses – – 670,613 123,604

As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000

Assets
Investments 4,280,522 3,572,824 – –
Loans – – 69,262 139,245
Overdrafts 34,671 316,103 323,257 140,383
Assets backed securities – 563,525 – –
Other receivables – 20,423 220,691 207,126
4,315,193 4,472,875 613,211 486,754
Liabilities
Deposits 22,930,649 11,164,554 2,000,069 673,225
Securities sold under repurchase agreements 10,333,763 6,247,581 – –
Other payables – – 102,800 76,276
33,264,412 17,412,135 2,102,868 749,501

As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
c. Off-balance sheet items

Guarantees 20,000 10,000 – –
PEOPLE’S BANK
ABOUT
43.4 Transactions with Government of Sri Lanka (GOSL) and State Owned Enterprises (SOEs)
Transactions and arrangements entered into by the Bank with the Government of Sri Lanka and State Owned
Enterprises as follows:

LKR ’000 LKR ’000
FROM THE TOP

REFLECTIONS
Interest income 160,961,076 93,242,042
Other income 168,409 524,197
Interest expenses 36,095,281 12,465,608
Tax payments Inland Revenue Department – VAT 8,195,633 6,861,930
Income tax 4,146,339 6,666,457
Other taxes 1,051,062 603,684
VALUE CREATION
DRIVING
LKR ’000 LKR ’000

Assets
Balances with CBSL 67,602,313 56,717,820
Investment in Government Securities 933,388,956 285,114,839
AND ANALYSIS
Loans and receivables – Term loans 707,565,659 575,064,841
– Overdrafts 61,374,355 352,041,725
– Bills 55,290 8,705
– Default LCs 71,876,916
1,841,863,489 1,268,947,931
Liabilities
CBSL borrowings 176,027,732 2,115,072
Deposits – Demand 33,585,021 31,028,025
– Savings 26,578,383 28,039,434
REPORTS
GOVERNANCE
– Time 182,741,129 165,539,102
418,932,265 226,721,633

LKR ’000 LKR ’000
STATEMENTS
FINANCIAL
c. Items in statement of changes in equity

Dividends paid 219,690 219,690
Special levy 441,400 1,977,198

LKR ’000 LKR ’000
INFORMATION
SUPPLEMENTARY
d. Off-balance sheet items

Acceptances 510,098 83,541,231
Documentary credit 6,626,744 29,527,335
Guarantees 9,407,001 7,594,673
16,543,843 120,663,239
43.5 Transactions with employment benefit plans for Bank’s employees

Transactions and arrangements entered into by the post-employment benefit plans for Bank’s employees are as follows:
43.5.1 Transactions with Pre-1996 Pension Trust Fund

LKR ’000 LKR ’000

Interest income 91,468 0
Other income 3 2,554
Interest expenses 7,245,954 3,934,580
Contribution made 2,257,663 1,219,508

LKR ’000 LKR ’000

Liabilities
Deposits 39,369,185 26,796,188
Securities sold under repurchase agreements 13,869,176 13,467,012
Subordinated term debts – 12,535,685
43.5.2 Transactions with Post-1996 Pension Fund

LKR ’000 LKR ’000

Interest expenses 1,484,460 560,017
Contribution made 356,651 (435,588)

LKR ’000 LKR ’000

Liabilities
Deposits 12,717,355 10,079,128
44. FAIR VALUE OF FINANCIAL INSTRUMENTS
44.1 Fair value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date in the principal or, in its absence, the most advantageous market to which the
Group has access at that date.
PEOPLE’S BANK
ABOUT
Determination of fair value and fair value hierarchy
All assets and liabilities for which fair value is disclosed in the Financial Statements are categorised using the following
hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:
Level 1: Valuation based on quoted market prices
FROM THE TOP

REFLECTIONS
Here the fair value is determined using the quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2: Valuation based on observable inputs

Other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly
or indirectly
Level 3: Valuation based on significant unobservable inputs
VALUE CREATION
DRIVING
Techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable
market data
44.2 Financial instruments recorded at fair value

Following descriptions show how fair values are determined for assets and liabilities that are recorded at fair value using
valuation techniques which incorporates the Bank’s estimate of assumptions that a market participant would make when
valuing the instruments.
AND ANALYSIS
Derivatives
Derivative products valued using a valuation technique with market observable inputs are mainly currency swaps and
forward foreign exchange contracts. The most frequently applied valuation techniques include forward pricing and
swap models, using present value calculations. The models incorporate various inputs including the credit quality of
counterparties, foreign exchange spot and forward rates.
Financial assets – Fair value through profit or loss

Financial instruments are classified as fair value through profit or loss consists of Government Securities, equity securities,
unit trusts, and debt securities. Government Securities are valued using yield curve published by the Central Bank of
REPORTS
GOVERNANCE
Sri Lanka, and the Group uses quoted market prices in the active market for the valuation of quoted equities as at the
reporting date.
Financial assets – Fair value through other comprehensive income

Financial assets – fair value through other comprehensive income are primarily consist of quoted and unquoted equities and
debentures. These assets are valued using models that use both observable data and unobservable data. The unobservable
inputs to the models include assumptions regarding the future financial performance of the investee, its risk profile, and
STATEMENTS
FINANCIAL
economic assumptions.

Free hold lands and buildings and buildings on leasehold lands are carried at revalued amount less any subsequent
accumulated depreciation and impairment losses.
INFORMATION
SUPPLEMENTARY
44.3 Assets measured at fair value – By level of the fair value hierarchy
The following table shows an analysis of financial instruments recorded at fair value by level of the fair value hierarchy:
Bank Group
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

Financial assets
Derivative financial instruments
Forward foreign exchange
contracts and SWAPS – 14,882,584 – 14,882,584 – 14,882,584 – 14,882,584
Financial assets – At fair value

through profit or loss –
Treasury Bills and Bonds 5,314,829 – – 5,314,829 5,314,829 – – 5,314,829
Quoted – Equity securities 220,663 – – 220,663 579,835 – – 579,835
– Debt securities 11,191 10,071 – 21,262 11,191 10,071 – 21,262
– Unit trusts – – – – – – – –
Equity instruments at fair value

through OCI
Unquoted equity securities – – 377,106 377,106 – – 377,116 377,116
Quoted equity securities 1,284,550 – – 1,284,550 1,467,458 – – 1,467,458
Debt instruments at fair value

through OCI
Treasury Bills and Bonds 701,468 701,468 965,695 965,695
Debt securities 9,380,893 296,009 – 9,676,902 10,167,128 296,009 10,463,137
Non-financial assets measured at

fair value – –
Land and building 34,637,038 34,637,038 43,083,236 43,083,236
16,913,594 15,188,664 35,014,144 67,116,402 18,506,136 15,188,664 43,460,352 77,155,152
Financial liabilities
Forward foreign exchange contracts 1,888,478 1,888,478 1,888,478 1,888,478
PEOPLE’S BANK
ABOUT
Bank Group
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

Financial assets
FROM THE TOP

REFLECTIONS
Forward foreign exchange
contracts and SWAPS 441,877 441,877 441,877 441,877
Financial assets –
At fair value through
profit or loss
Treasury Bills and Bonds 1,276,679 – – 1,276,679 1,276,679 1,276,679
Quoted – Equity securities 253,517 – – 253,517 389,158 389,158
VALUE CREATION
DRIVING
– Debt securities 28,654 – – 28,654 28,654 28,654
– Unit trusts – 859,055 859,055
Equity instruments at fair value

through OCI
Unquoted equity securities 403,168 403,168 403,168 403,168
Quoted equity securities 1,218,207 1,218,207 1,485,966 1,485,966
Debt instruments at fair value
AND ANALYSIS
through OCI
Treasury Bills and Bonds – – 303,426 303,426
Debt securities 9,399,272 9,399,272 10,293,297 10,293,297
Non-financial assets measured at

fair value
Land and building 31,422,910 31,422,910 39,059,334 39,059,334
12,176,329 441,877 31,826,078 44,444,284 14,636,235 441,877 39,462,512 54,540,624
Forward foreign exchange contracts 1,761,220 1,761,220 1,761,220 1,761,220
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
44.4 Movements in Level 3 assets measured at fair value

The following table shows a reconciliation of the opening and closing amounts of Level 3 financial assets and liabilities which
are recorded at fair value.
Bank Group
As at Total Total gains/ Purchases/ As at 31 As at Total Total gains/ Purchases/ As at 31

1 January gains/(losses) (losses) (Sales) December 1 January gains/(losses) (losses) (Sales) December
2022 recorded in recorded 2022 2022 recorded in recorded 2022
profit or loss in OCI profit or loss in OCI
LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000
Financial assets
Financial investments
available for sale
Unquoted equity
securities 403,168 – (26,062) 377,106 403,178 – (26,062) – 377,116
Total Level 3
financial assets 403,168 – (26,062) – 377,106 403,178 – (26,062) – 377,116
Financial liabilities – – – – – – – – – –
Total Level 3
financial liabilities – – – – – – – – – –
Total net Level 3

financial assets/
(liabilities) 403,168 – (26,062) – 377,106 403,178 – (26,062) – 377,116
Bank Group
As at Total gains/ Total gains/ Purchases/ As at As at Total gains/ Total gains/ Purchases/ As at
1 January (losses) (losses) (Sales) 31 December 1 January (losses) (losses) (Sales) 31 December
2021 recorded in recorded 2021 2021 recorded in recorded 2021
profit or loss in OCI profit or loss in OCI
LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000
Financial assets
Financial investments
available for sale
Unquoted equity
securities 815,900 – (412,732) 403,168 815,910 – (412,732) – 403,178
Total Level 3
financial assets 815,900 – (412,732) 403,168 815,910 – (412,732) – 403,178
Financial liabilities – – – – – – – – – –
Total Level 3
financial liabilities – – – – – – – – – –
Total net Level 3

financial assets/
(liabilities) 815,900 – (412,732) – 403,168 815,910 – (412,732) – 403,178
44.5 Fair value of assets and liabilities not measured at fair value
The following describes the methodologies and assumptions used to determine fair values for those financial instruments
which are not already recorded at fair value in the Financial Statements.
Assets for which fair value approximates carrying value

For financial assets and financial liabilities that have a short-term maturity (original maturity less than a year), it is assumed
that the carrying amount approximate their fair values. This assumption is also applied to demand deposits, call deposits,
and savings deposits without specific maturity.
PEOPLE’S BANK
ABOUT
Fixed rate financial instruments
Loans and advances with fixed interest rates were fair valued using market rates end of the reporting period and other
variable interest-bearing loans were considered as carrying value equal fair value. Conversely, fixed deposits with original
tenor above one year and interest paid at maturity were discounted using current market rates offered to customers end of
the reporting period.
Set out below is a comparison by class, of the carrying amount and fair values of the Bank’s financial instruments that are
FROM THE TOP

REFLECTIONS
not carried at fair value in the Financial Statements. This table does not include the fair values of non-financial assets and
non-financial liabilities.
Bank Group
2022 2021 2022 2021
Carrying Fair Carrying Fair Carrying Fair Carrying Fair

amount value amount value amount value amount value
VALUE CREATION
DRIVING
Financial assets
Cash and cash equivalents 66,842,171 66,842,171 57,538,351 57,538,351 68,077,027 68,077,027 58,836,831 58,863,831
Balances with central banks 67,602,313 67,602,313 56,717,820 56,717,820 67,602,313 67,602,313 56,717,820 56,717,820
Placements with banks – – – – 3,028,550 3,028,550 3,325,726 3,325,726
Loans and receivables to

banks 7,689,150 7,689,150 10,131,952 10,131,952 7,689,150 7,689,150 13,398,055 13,398,055
Loans and receivables to
AND ANALYSIS
other customers 1,783,106,693 1,781,262,625 1,835,697,108 1,834,826,961 1,915,771,684 1,913,927,416 1,990,689,061 1,989,818,915
Debt instruments measured

at amortised cost 913,099,927 639,329,496 587,320,182 527,600,968 928,885,518 654,318,731 600,076,625 540,360,411
Due to banks 111,452,491 111,452,491 107,745,916 107,745,916 122,696,978 122,696,978 122,397,825 122,397,825
Due to other customers 2,371,518,898 2,334,416,188 2,071,532,612 2,067,513,813 2,450,079,037 2,450,079,037 2,168,674,742 2,164,655,943
Other borrowings 191,527,573 191,527,573 241,419,125 241,419,125 191,527,573 191,527,573 241,419,125 241,419,125
Subordinated term debts 36,603,467 36,603,467 48,861,680 48,861,680 52,781,563 52,781,563 65,560,465 65,560,465
REPORTS
GOVERNANCE
45. FINANCIAL REPORTING BY SEGMENT
Accounting policy
An operating segment is a component of the Group that engages in business activities from which it may earn revenue
and incur expenses, (including revenue and expenses that relate to transactions with other components of the Group)
whose operating results are reviewed regularly by the chief operating decision-maker to make decisions about resources
to be allocated to each segment and assess its performance, and for which discrete financial information is available.
STATEMENTS
FINANCIAL
The Group’s segmental reporting is based on the following operating segments:
z Retail banking
z Corporate banking
z Treasury and Primary Dealer Unit (PDU)
z Leasing
Insurance
INFORMATION
SUPPLEMENTARY
z Finance
z Travels
The following table presents income, profit, total assets, total liabilities of the Group’s operating segments:
Retail banking Corporate banking Treasury and PDU Total Bank
2022 2021 2022 2021 2022 2021 2022 2021

Income from external

customers
Net interest income* 116,900,765 56,157,112 17,207,213 9,865,874 (60,617,165) 16,025,384 73,490,813 82,048,370
Net fee and commission
income 8,277,276 6,134,924 7,641,299 1,531,140 (349,505) 4,318 15,569,070 7,670,382
Net gain (loss) from trading 6,488,818 (1,504,413) 5,408,714 1,304,327 5,128,693 (1,144,943) 17,026,226 (1,345,029)
Others 1,598,297 2,678,707 89,378 106,533 (628,773) (1,535,509) 1,058,902 1,249,731
Total operating income
from external customers 133,265,156 63,466,330 30,346,605 12,807,874 (56,466,750) 13,349,250 107,145,011 89,623,454
Inter-segment revenue
Net interest income 2,267,252 412,470 2,267,252 412,470
Net fee and commission
income – –
Net gain (loss) from trading – –
Others 102,055 111,996 707,698 1,634,943 809,753 1,746,939
Total inter-segment
revenue 102,055 111,996 2,267,252 412,470 707,698 1,634,943 3,077,005 2,159,409
Total operating income 133,367,211 63,578,326 32,613,857 13,220,344 (55,759,052) 14,984,193 110,222,016 91,782,863
Total incurred expenses (88,883,619) (61,396,263)

Share of profits/(loss) of
associates (Net of tax)
Income tax expenses (4,146,339) (6,666,457)
Profit for the year 17,192,058 23,720,143
Non-controlling interest
Profit for equity holders
of the Bank
Other comprehensive
income net of tax
Total comprehensive
income
Non-controlling interest
Profit for the equity
holders of the Bank
Segment assets 1,081,498,611 1,354,278,016 917,405,552 711,968,532 973,124,289 581,393,988 2,972,028,452 2,647,640,536
Total assets 1,081,498,611 1,354,278,016 917,405,552 711,968,532 973,124,289 581,393,988 2,972,028,452 2,647,640,536
Segment liabilities 949,377,538 1,289,615,996 805,911,742 647,074,896 1,071,445,042 574,872,548 2,826,734,321 2,511,563,440
Total liabilities 949,377,538 1,289,615,996 805,911,742 647,074,896 1,071,445,042 574,872,548 2,826,734,321 2,511,563,440
Total equity and liabilities 1,081,498,611 1,354,278,016 917,405,552 711,968,532 973,124,289 581,393,988 2,972,028,452 2,647,640,536
* Interbank segments are subject to internal transfer pricing mechanism.

PEOPLE’S BANK
ABOUT
Leasing Insurance Travels Unallocated Eliminations Group
2022 2021 2022 2021 2022 2021 2021 2021 2022 2021 2022 2021
LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000
FROM THE TOP

REFLECTIONS
16,228,255 14,168,431 1,306,704 651,855 9,303 6,123 91,035,075 96,874,779
816,002 1,376,968 – – 16,385,072 9,047,350

(24,144) 64,169 17,754 73,252 – – 17,019,836 (1,207,608)
71,076 (23,631) 4,514,579 4,881,147 34,013 6,807 (118,991) (94,691) – 5,583,879 5,995,063
17,091,189 15,585,937 5,839,037 5,606,254 43,316 12,930 – (118,991) (94,691) – 130,023,862 110,709,584
VALUE CREATION
DRIVING
(2,262,574) (409,426) (4,678) (3,044) – – – –
– – – –
– – – –
114,211 110,530 556,452 299,713 (1,480,417) (2,157,182) – –
(2,148,363) (298,896) 556,452 299,713 (4,678) (3,044) – – (1,480,417) (2,157,182) – –

14,942,826 15,287,041 6,395,489 5,905,967 38,638 9,886 – (118,991) (1,575,108) (2,157,182) 130,023,862 110,709,584
AND ANALYSIS
(9,796,985) (7,844,943) (5,397,184) (4,732,832) (28,140) (22,420) – – 772,719 522,239 (103,333,210) (73,474,219)
– 10,893
(1,682,964) (2,301,820) (364,317) (190,332) – – 28,407 (6,165,213) (9,158,609)
3,462,877 5,140,278 633,989 982,803 10,498 (12,534) – (118,991) (773,982) (1,634,943) 20,525,439 28,087,648
953,450 1,736,673
19,571,989 26,350,975
(39,329) 12,786,691
REPORTS
GOVERNANCE
20,486,110 40,874,339
1,924,169 1,768,436
18,561,941 39,105,903
181,468,519 191,247,846 11,237,585 11,051,872 95,530 84,441 (31,695,506) (17,414,707) 3,133,134,578 2,832,609,988
181,468,519 191,247,846 11,237,585 11,051,872 95,530 84,441 – – (31,695,506) (17,414,707) 3,133,134,578 2,832,609,988
STATEMENTS
FINANCIAL
137,873,553 151,170,236 6,586,073 6,055,889 23,988 24,092 (27,414,987) (13,841,885) 2,943,802,952 2,654,971,772
137,873,553 151,170,236 6,586,073 6,055,889 23,988 24,092 – – (27,414,987) (13,841,885) 2,943,802,952 2,654,971,772
181,468,519 191,247,846 11,237,585 11,051,872 95,530 84,441 (31,695,506) (17,414,707) 3,133,134,578 2,832,609,988
INFORMATION
SUPPLEMENTARY
46. NON-CASH ITEMS INCLUDED IN PROFIT BEFORE TAX

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Depreciation of property, plant and equipment 2,035,637 2,308,320 2,321,035 2,605,467
Amortisation of right-of-use asset 2,017,947 2,106,844 2,378,562 2,450,170
Amortisation of intangible assets 652,288 638,134 667,164 654,315
Depreciation of investment property – 1,606 – 1,606
Impairment losses on financial assets 33,346,451 14,472,820 34,354,192 14,054,252
Other impairments – – (1,355) 431,206
Profit on sale of fixed assets (174,560) (62,744) (237,350) (126,830)
Changes in derivative financial instruments (14,313,449) 440,500 (14,313,449) 440,500
Changes in fair value of trading securities 228,331 101,474 228,331 101,474
Scrip dividend income (707,698) (1,634,943) – –
Share of (profits)/loss of associates and fair value loss on disposal – – – 108,098
Premium amortisation of held-to-maturity investments 3,222,354 2,061,178 3,222,354 2,061,178
Interest expense on lease liabilities 607,754 583,020 782,854 767,602
Total 26,915,055 21,016,209 29,402,338 23,549,038
47. CHANGES IN OPERATING ASSETS

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Held at fair value through profit or loss (4,226,235) 44,764,703 (3,590,711) 50,073,569
Net increase in balance with Central Bank (10,884,493) (42,521,255) (10,884,493) (42,521,255)
Net increase in placement with Bank – 10,304,422 297,176 10,585,098
Net increase in loans and advances to banks 2,442,802 13,478,149 5,708,905 10,224,645
Net increase in loans and advances to customers 19,243,964 (214,590,585) 40,563,185 (228,511,999)
Net increase/(decrease) in financial investments FVOCI (978,864) (6,765,999) (1,208,730) (7,789,341)
Change in other assets (11,069,274) (11,041,378) (10,939,118) (10,298,882)
Total (5,472,100) (206,371,943) 19,946,214 (218,238,165)
48. CHANGES IN OPERATING LIABILITIES

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Changes in due to banks 3,706,575 (56,743,707) 299,153 (50,041,970)
Change in deposits from banks, customers and debt

securities issued 299,986,286 236,433,156 281,404,295 233,480,702
Change in other borrowings (49,891,552) 205,056,691 (49,891,552) 205,056,691
Change in other liabilities 70,367,203 (2,292,978) 68,938,040 26,453
Total 324,168,512 382,453,165 300,749,935 388,521,877

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ABOUT
49. FINANCIAL RISK MANAGEMENT
Introduction
As a financial intermediary, the Bank is exposed to array of risks through its daily operations. The Bank’s key risk exposures
include credit, market, liquidity and operational risk and information security risk. However, with the rapid technological
innovations/IT based products and solutions introduced by the Bank, due consideration should be given to information
systems risk as well. Proactive identification of such risk exposures is of high importance to ensure the sustainability and
FROM THE TOP

REFLECTIONS
profitability of the Bank. In response to an increasingly dynamic and competitive operating landscape, evolving risks and
significant regulatory developments, there is an ongoing imperative to enhance risk management continuously across the
Bank. A robust integrated risk management framework in place supports the efficient management and mitigation of the
said risk exposure.
Risk management framework

Risk is identified and managed as part of a Group-wide Risk Management Framework. The Group’s Board of Directors has
VALUE CREATION
DRIVING
ultimate responsibility for the oversight of risk, determining risk appetite levels, formulating risk policies and ensuring the
effectiveness of the risk management processes and procedures in place. The Board Integrated Risk Management
Committee (BIRMC) assists the Board in the discharge of its risk related duties and provides independent oversight of
all risk related aspects by ensuring the adequacy and effectiveness of the implementation of risk governance structures,
policy frameworks, standards and processes. Furthermore, the Board Executive Credit Committee (BECC), Board Audit
Committee (BAC) and the Board Investment Banking Committee (BIBC) also support the Board in discharging its
risk related duties. Executive committees namely, the Assets and Liabilities Management Committee (ALCO) and the
Operational Risk Management Committee (ORMC) and the Credit Risk Management Committee (CRMC) play a critical role
in ensuring the effective implementation of the Bank’s risk management processes.
AND ANALYSIS
The People’s Bank Group Risk Management Framework forms the foundation for managing risk, and sets out the Group’s
risk universe, risk parameters and assigns Executive and Board responsibility for the Management and oversight of risk
and ensures that growth and risk considerations are appropriately balanced. Policies and systems associated with the risk
management framework are reviewed on a regular basis to factorise the adversities in market conditions and the changes in
Group’s activities.
The framework is based on the Three Lines of Defence model specifically, the Business Line, Risk Management, and Internal
Audit.
Risk appetite
REPORTS
GOVERNANCE
The term “Risk Appetite” refers to the broad types and quantum of risk the People’s Bank Group is willing to undertake in
implementing its business strategy. It is expressed in the form of tolerance limits and risk trigger points across a range of
variables. The Board of Directors has ultimate responsibility for setting the risk appetite of the Group and ensure that the
exposures and risks are maintained within that approved levels.
Risk mitigation
The Bank carefully analyzes and imposes risk mitigating measurements, Continuous monitoring and reporting to the
STATEMENTS
FINANCIAL
board/management committees, obtains various types of collateral and establishes maximum prudential limits in order to
mitigate various risks.
Risk Management and Credit Control Department

The Risk Management and Credit Control Department (RM and CC) holds overall executive responsibility for the Bank’s risk
management functions. The Department is headed by the DGM-Risk Management who reports directly to the BIRMC and
INFORMATION
SUPPLEMENTARY
operates independently of business units as well as profit and volume targets. The Credit Pre-Review Unit, Credit
Post–Review Unit, Treasury Middle Office and Operational Risk Unit have been established separately under the guidance of
DGM-Risk Management with specific responsibilities to handle credit, market and operational risks.
Credit risk
Credit risk is the risk of potential loss to the Bank, if a borrower or counterparty to a financial instrument fails to meet their
financial or contractual obligations, and arises principally from the Bank’s loans and advances to customers/other banks and
investments in debt securities. In addition to the credit risk from direct funding exposures, the Bank would also be exposed
to indirect liabilities such as letters of credit, guarantees etc., which would carry credit risk. Credit risk is composed of default
risk/settlement risk, concentration risk and counterparty risk.
The Board Executive Credit Committee (BECC) functions as the Steering Committee holding overall responsibility for
implementing the Bank’s credit risk management framework. The Credit Control Unit operates independently from the
business lines and drives all credit risk management efforts. The primary responsibility for managing credit risk lies with the
business units, complemented by independent review by the Credit Control Unit.
Key aspects of the Group’s credit policies include delegated approval authority at multiple levels, a comprehensive credit
appraisal mechanism which includes well-defined credit criteria and prudential limits in line with the defined risk appetite
among others. Borrowers are assessed primarily on repayment capacity and internally developed risk rating scorecards and
a 9-point rating scale is used for evaluating credit worthiness.
Tailor-made scorecards have been developed for assessing corporates, SME borrowers’ financial institutions as well as retail
borrowers. The internal credit rating models in place represent diverse risk factors and are able to predict the probability of
default and loss given default.
Impairment assessment
Definition of default and cure

The Bank considers a financial instrument defaulted and therefore Stage 3 (credit-impaired) for ECL calculations in all cases
when the borrower becomes more than 90 days past or three instalments in arrears due on its contractual payments or
when classified as non-performing loan (NPL) as per directions issued by the Central Bank of Sri Lanka (CBSL). The Bank
considers treasury and interbank balances defaulted and takes immediate action when the required intraday payments are
not settled by the close of business as outlined in the individual agreements.
Individually assessed allowances

The Bank determines the allowances appropriate for each individually significant loan or advance on an individual basis if
there is any objective evidence of a potential loss. The Bank has currently set individually significant threshold at
LKR 25 Mn. and every customer having an aggregate exposure above that limit is individually assessed for objective
evidence of incurred loss. Items considered when determining allowance amounts include the sustainability of the
counterparty’s business plan, its ability to improve performance if it is in a financial difficulty, projected receipts and the
expected payout should bankruptcy arise, the availability of other financial support, the realisable value of collateral and the
timing of the expected cash flows.
Collectively – assessed allowances

Customers that have been assessed individually and found not to be impaired are then assessed collectively together with
the loans below the individual threshold in groups of loans with similar risk characteristics. Customer exposure which are
above the set threshold, but no conditions exists under objective evidence are also considered under collective impairment
assessment. In line with the requirements of the standard, several estimates have been factored in by the Management when
determining the expected credit losses under the general approach.
Stage 1: 12 months ECL

For exposures where there has not been a significant increase in credit risk since initial recognition and that are not credit
impaired upon origination, the portion of the lifetime ECL associated with the probability of default events occurring within
the next 12 months is recognised. Bank determines 12-month ECL for customers who are not significantly credit deteriorated
(i.e. less than or equal to 30 days past due)
PEOPLE’S BANK
ABOUT
Stage 2: Lifetime ECL – Not credit impaired
For exposures where there has been a significant increase in credit risk since initial recognition but are not credit impaired,
a lifetime ECL (i.e. reflecting the remaining lifetime of the financial asset) is recognised. In consistent with the policies of
the Bank, significant deterioration is measured with the rebuttable presumption of 30 days past due other than the credit
facilities categorised under Stage 3, in line with the requirements of the standard. Bank also has considered all restructured
loans, which are restructured up to two times, other than credit facilities/exposures upgraded from a higher stage to a lower
stage under Stage 2 as per the guidance issued by the Central Bank.
FROM THE TOP

REFLECTIONS
Stage 3: Lifetime ECL – Credit impaired
Exposures are assessed as credit impaired when one or more events that have a detrimental impact on the estimated future
cash flows of that asset have occurred. For exposures that have become credit impaired, a lifetime ECL is recognised and
interest revenue is calculated by applying the effective interest rate to the amortised cost (net of provision) rather than
the gross carrying amount. Bank determines credit facilities where contractual payment of customer is more than 90 days
past due subject to the rebuttable presumption as stated in SLFRS 9 together with all NPL classifications as per Central
VALUE CREATION
DRIVING
Bank classification, all restructured loans which are restructured more than twice and all rescheduled loans other than credit
facilities/exposures upgraded from a higher stage to a lower stage.

LKR ’000 LKR ’000
Individually significant impaired loans

Amortised cost 298,784,804 125,004,857
AND ANALYSIS
Allowances for impairment (73,125,073) (64,681,231)
Carrying amount as at 31 December 225,659,731 60,323,626
Collectively assessed loans

Amortised cost 1,617,003,819 1,811,969,279
Allowances for impairment (59,556,857) (36,595,796)
Carrying amount as at 31 December 1,557,446,962 1,775,373,482
PD estimation process
Probability of default is the likelihood of a borrower defaulting on its financial obligations either over the next 12 months
REPORTS
GOVERNANCE
(i.e. 12 month PD) or over the remaining lifetime (i.e. lifetime PD) of the obligation. PD estimates are estimates at a certain
date and days past due (i.e. number of days passed since the due date) is the main determinant of the PD estimation
process. In this process historical information pertaining to five years have been used depending on the nature of the
product. Accordingly, exposures are categorised among five buckets based on the DPD as follows.
z Zero days past due
z 1-30 days past due
STATEMENTS
FINANCIAL

z Above 90 days past due
The exposure at default (EAD)

The exposure at default (EAD) represents the expected exposure in the event of a default. The Bank uses Credit Conversion
Factors (CCF) which explains the historical utilisation of defaulted facilities at the time of default to calculate the EAD of
INFORMATION
SUPPLEMENTARY
revolving facilities in which customers have the ability to increase their exposure. For non-revolving facilities, already utilised
amount plus any undisbursed amount and accrued interest over the same is considered as EAD.
Loss Given Default (LGD)

Loss given default (LGD) is the magnitude of likely loss on exposure, and is expressed as a percentage of exposure. These
LGD rates take into account the expected EAD in comparison to the amount expected to be recovered or realised from
any collateral held. The Bank segments its retail lending products into smaller homogeneous portfolios, based on key
characteristics that are relevant to the estimation of future cash flows. The applied data is based on historically collected
loss data and involves a wider set of transaction characteristics (e.g., product type, wider range of collateral types) as well
as borrower characteristics.
For each year, closed contracts which have crossed the Above 90 days at-least once in their lifetime are considered. LGD
will factor in all cash flows subsequent to the point of default until the full settlement of the loan. Virtually closed contracts
are also considered in computation of LGD. Virtually closed contracts are active loans which have been long outstanding.
A contract is determined to be virtually closed at the point the Bank determines that the cash flows have dried up.
Analysis of the total impairment for expected credit losses
As at 31 December 2022 Stage 1 Stage 2 Stage 3 Total

Loans and receivables to banks 22.2 – – –
Loans and receivables to other customers 23.2.1 6,241,576 19,206,289 107,234,065 132,681,930
Debt instruments at amortised cost 24.2 – 6,583,582 – 6,583,582
Debt instruments at fair value through OCI 26.2 1,571 296,009 – 297,580
Total impairment for expected credit losses 6,244,065 26,110,172 107,234,065 139,588,302
As at 31 December 2021 Stage 1 Stage 2 Stage 3 Total

Loans and receivables to banks 22.2 235,379 – – 235,379
Loans and receivables to other customers 23.2 8,056,985 9,990,853 83,229,190 101,277,028
Debt instruments at amortised cost 24.2 1,334,468 – – 1,334,468
Debt instruments at fair value through OCI 26.2 1,053 296,009 – 297,062
Total impairment for expected credit losses 9,628,069 10,294,780 83,229,190 103,152,039
Forward looking information in the ECL Model under Multiple Economic Scenarios
The Bank incorporates forward looking information in its measurement of expected credit losses under three
main scenarios namely best case, base case and worst case.
Probability weighting for scenarios

% %
Best case 10 20
Base case 10 20
Worst case 80 60
PEOPLE’S BANK
ABOUT
The base case refers to the most likely outcome and is aligned with the information used by the Bank for its other
operational purposes. The key drivers of credit risk both quantitative and qualitative identified in its impairment assessment
are as following. Quantitative economic factors are based on economic data and forecasts published by CBSL and other
reliable sources such as Asian Development Bank, World Bank and etc.
Quantitative drivers of credit risk Qualitative drivers of credit risk
FROM THE TOP

REFLECTIONS
GDP growth Status of Industry business
Inflation Regulatory impact
Interest rate (AWPLR) Government policies
Exchange rate Average loan to value ratio
Unemployment rate
Sensitivity of impairment provision on loans and advances to other customers
VALUE CREATION
DRIVING
The Bank has estimated its provisions on expected credit losses (ECL) to other customers as at 31 December 2022 based
on various assumptions. The changes to such assumptions may lead to changes in the impairment provision recorded in the
statement of financial position.

The following table demonstrates the sensitivity of the provisions on expected credit losses (ECL) to other customers as at
31 December 2022 to possible changes in the PDs, LGDs and forward looking macro economic information.
Sensitivity effect on statement of financial position Sensitivity

[Increase/(decrease) in impairment provision]
AND ANALYSIS
effect on
Stage 1 Stage 2 Stage 3 Total income

LKR ’000 LKR ’000 LKR ’000 LKR ’000 statement
Probability of Default (PD)

PD 1% increase across all age buckets 3,281,672 300,384 – 3,582,056 (3,582,056)
PD 1% decrease across all age buckets (1,092,133) (300,384) – (1,392,517) 1,392,517
Loss Given Default

LGD 5% increase 1,135,407 1,441,201 1,170,733 3,747,341 (3,747,341)
LGD 5% decrease (1,135,407) (1,441,201) (1,170,733) (3,747,341) 3,747,341
REPORTS
GOVERNANCE
Probability weighted forward looking macro
economic indicators
Worst case 10% increase, base case 5% decrease
and best case 5% decrease 106,900 110,149 – 217,049 (217,049)
Worst case 10% decrease, base case 5% increase

and best case 5% increase (106,900) (110,378) – (217,278) 217,278
Reconciliation of changes in credit-impaired (stage 3) loans and advances

STATEMENTS
FINANCIAL
2022
LKR ’000
Stage 3 loans and advances to other customers as at 1 January 153,350,489
Newly classified as impaired loans and advances during the year 158,736,343
Net change in already impaired loans and advances during the year 34,036,335
INFORMATION
SUPPLEMENTARY
Net payment, write off and recoveries and other movements during the year (13,329,184)
Impaired loans and advances to customers as at 31 December 332,793,983

Provision for impairment (ECL) movement

The following table shows reconciliation from the opening to closing balance of the provision
for impairment of loans and advances to other customers.
12 month ECL Lifetime ECL-not Lifetime ECL- Total

credit impaired credit impaired
(Stage 1) (Stage 2) (Stage 3)
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Provision for impairment (ECL) as at 1 January 2022 8,056,985 9,990,853 83,229,190 101,277,028
Transfer to Stage 1 240,401 (175,262) (65,139) –
Transfer to Stage 2 (1,383,973) 1,422,630 (38,656) –
Transfer to Stage 3 (625,452) (2,428,405) 3,053,857 –
Net remeasurement of impairment 101,138 11,314,251 19,155,151 30,570,540
New assets originated or purchased 2,697,396 1,831,007 1,423,477 5,951,880
Financial assets derecognised or repaid (excluding write offs) (2,844,918) (2,748,784) (2,562,017) (8,155,719)
Write offs and recoveries – – (271,802) (271,802)
Foreign exchange adjustments – – 3,310,003 3,310,003
Provision for impairment (ECL) as at 31 December 2022 6,241,576 19,206,289 107,234,065 132,681,930
Collateral and other credit enhancements
Net exposure to credit risk

The amount and type of collateral required depends on an assessment of the credit risk of the counterparty. Guidelines
are in place in the Bank’s Credit Policy Guideline and Credit Procedure Manual covering the acceptability and valuation of
each type of collateral. We adopt a stringent approach towards collateral valuation, and these are regularly reviewed and
updated to ensure that valuations reflect market conditions. Relatively diverse collateral portfolio of the Bank mitigates the
impact of potential price drops in a particular asset class.
The main types of collateral obtained are as follows:

z For commercial lending – charges over real estate properties, movables, trade receivables, debt securities, inventory, cash
deposits, corporate and personal guarantees
z For retail lending – mortgage over residential properties, vehicles, gold, cash deposits and personal guarantees
z For Government and State Owned Enterprises – Government treasury guarantees
PEOPLE’S BANK
ABOUT
The following tables show the maximum exposure and net exposure (net of fair value of any collaterals held)
to credit risk by class of financial asset.
As at 31 December 2022 Maximum Net exposure

exposure to
credit risk
LKR ’000 LKR ’000
FROM THE TOP

REFLECTIONS
Cash and cash equivalents 66,842,171 11,577,656
Derivative financial instruments 14,882,584 14,882,584
Loans and receivables to banks 7,689,150 7,689,150
Loans and receivables to other customers 1,783,106,693 486,927,320
VALUE CREATION
DRIVING
Total 2,803,217,305 1,451,773,417
As at 31 December 2021 Maximum Net exposure

exposure to
credit risk
LKR ’000 LKR ’000
AND ANALYSIS
Cash and cash equivalents 57,538,351 3,198,756
Derivative financial instruments 441,877 441,877
Loans and receivables to banks 10,131,952 10,131,952
Loans and receivables to other customers 1,835,697,108 583,442,642
Total 2,503,708,967 1,197,114,906
REPORTS
GOVERNANCE
Credit quality analysis
Credit indicator 2018 2019 2020 2021 2022

% % % % %
Non-performing ratio NPLs 2.50 3.31 3.25 3.21 4.40
Overdue ratio 11.88 8.64 4.70 5.10 12.87

STATEMENTS
FINANCIAL
Provision coverage 72.30 60.00 64.50 74.79 79.86

INFORMATION
SUPPLEMENTARY
Concentration of credit risk

Concentration risk stems from high lending exposure to a particular sector, product, region or customer/group. The Bank’s
Risk Appetite clearly defines exposure limits for particular sectors and products and such limits are reviewed and modified
in the context of emerging risks and opportunities presented by the operating landscape. In addition to adherence to
the Single Borrower Limit, the Bank also uses Herfindahl-Hirschman Index (HHI) to monitor and control concentrations.
These limits are monitored by the Risk Management Department, BIRMC and Board on a regular basis. The Bank imposed
individual as well as sector-wise maximum facility limits for State Owned Enterprises (SOE) with the objective of managing
concentration risk in the SOE exposure.
An analysis of risk concentration by industry for the financial assets is given below.
As at 31 December 2022 Government Commercial Financial Agricultural
Financial Assets
Cash and cash equivalents – – 66,867,381 –
Balances with Central Bank of Sri Lanka 67,602,313 – – –
Derivative financial instruments – – 14,882,584 –
Financial assets – at fair value through profit and loss 5,314,829 73,242 – 21,262
Loans and receivables to banks 7,689,150 – – –
Loans and receivables to other customers 871,619,489 163,021,413 24,001,868 13,577,587
Debt instruments measured at amortised cost 919,683,509 – – –
Equity instruments at fair value through OCI – 455,019 478,347 –
Debt instruments at fair value through OCI 3,634,648 2,601,855 3,595,532 –
Total 1,875,543,937 166,151,529 109,825,712 13,598,849
As at 31 December 2021 Government Commercial Financial Agricultural
Financial Assets
Cash and cash equivalents – – 57,546,454 –
Balances with Central Bank of Sri Lanka 56,717,820 – – –
Derivative financial instruments – – 441,877 –
Financial assets – at fair value through profit and loss 1,276,679 78,628 – 28,654
Loans and receivables to banks 10,367,331 – – –
Loans and receivables to other customers 937,171,494 139,344,565 22,061,003 12,554,843
Debt instruments measured at amortised cost 588,654,650 – – –
Equity instruments at fair value through OCI – 586,333 605,977 –
Debt instruments at fair value through OCI 2,933,180 2,361,096 3,561,993 –
Total 1,597,121,154 142,370,623 84,217,304 12,583,497

PEOPLE’S BANK
ABOUT
FROM THE TOP
REFLECTIONS
Industrial Tourism Housing and Consumption Services Other ECL Total
property
development
VALUE CREATION
DRIVING
– – – – – – (25,210) 66,842,171
– – – – – – – 67,602,313
– – – – – – – 14,882,584
103,754 – – 9,504 34,163 – – 5,556,754
– – – – – – – 7,689,150
55,874,413 31,011,042 426,841,415 282,618,630 19,292,395 27,930,370 (132,681,930) 1,783,106,693
AND ANALYSIS
– – – – – – (6,583,582) 913,099,927
– – – – 728,291 – – 1,661,657
– – – – 546,336 – – 10,378,370
55,978,167 31,011,042 426,841,415 282,628,134 20,601,184 27,930,370 (139,290,722) 2,870,819,619
Industrial Tourism Housing and Consumption Services Other ECL Total

property
development
REPORTS
GOVERNANCE
– – – – – – (8,103) 57,538,351
– – – – – – – 56,717,820
– – – – – – – 441,877
88,535 – – 11,100 75,254 – – 1,558,850
– – – – – – (235,379) 10,131,952
39,932,024 24,222,254 413,019,029 308,782,555 13,340,652 26,545,718 (101,277,028) 1,835,697,108
– – – – – – (1,334,468) 587,320,182
STATEMENTS
FINANCIAL
– – – – 429,065 – – 1,621,375
– – – – 543,003 – – 9,399,272
40,020,559 24,222,254 413,019,029 308,793,655 14,387,973 26,545,718 (102,854,977) 2,560,426,787

INFORMATION
SUPPLEMENTARY
Liquidity risk
Liquidity risk is the potential loss of earnings/erosion of capital arising from the inability to meet the Bank’s contractual
financial obligations as and when they fall due. Banks are vulnerable to liquidity and solvency problems resulting from asset
and liability mismatches. The management of such risks are a vital element of the Bank’s operations.
The Bank’s liquidity risk management framework aims to assess/quantify and ensure the availability of funds required to
meet Bank’s contractual obligations at appropriate times. This is ensured under both normal and stressed conditions. The
Bank’s treasury is entrusted to manage the liquidity risk and the Risk Management Department ensures same by monitoring
the adherence to set limits/regulatory ratios etc. and performing other related analysis. ALCO on the other hand, oversee
the management of same by continuously monitoring the Bank’s liquidity position to ensure that compliance to internal
targets as well as regulatory requirements is met.
The Bank manages liquidity risk, in accordance with regulatory guidelines and international best practices and measures
liquidity through the dual approaches of flow and stock. The flow method measures liquidity through analysing the mismatch
between inflows and outflows in various time bands based on the maturity of assets and liabilities. The stock method
measures liquidity in terms of a set of key ratios such as loans to deposit ratio, commitments ratio (unutilised portion of
overdrafts/unutilised Inter-bank lines), statutory liquid asset ratio, liquidity coverage ratio and cumulative mismatches.
Maturity profile of assets and liabilities (LKR ’000) as at 31 December 2022

Total
Up to 3 3-12 1-3 3-5 Over 5 2022 2021

months months years years years
Assets
Cash and cash equivalents 66,842,171 – – – – 66,842,171 57,538,351
Balances with Central Bank 12,886,066 27,096,499 5,145,305 6,777,523 15,696,919 67,602,313 56,717,820
Derivative with banks 14,882,584 – – – – 14,882,584 441,877
Financial assets – at fair

value through profit or loss 5,556,754 – – – – 5,556,754 1,558,850
Financial assets –
at amortised cost
Loans and advances to
banks – 7,689,150 – – – 7,689,150 10,131,952
Loans and advances to

other customers 202,069,299 623,286,151 92,728,547 363,291,150 501,731,546 1,783,106,693 1,835,697,108
Debt instruments
measured at amortised
cost 39,833,324 179,078,680 228,380,284 435,148,679 30,658,960 913,099,927 587,320,182
Equity instruments at fair

value through OCI 1,661,656 – – – – 1,661,656 1,621,375
Debt instruments at fair

value through OCI 954,932 1,471,951 1,701,468 3,250,020 3,000,000 10,378,371 9,399,272
Investments in subsidiaries – – – – 4,280,522 4,280,522 3,572,824
Property, plant and

equipment – – – – 49,330,080 49,330,080 46,761,157
Intangible assets and

goodwill – – – – 1,719,177 1,719,177 2,077,544
Other assets 42,010,594 2,361,123 524,855 545,224 437,259 45,879,055 34,802,224
Total assets 2022 386,697,380 840,983,554 328,480,459 809,012,596 606,854,462 2,972,028,453 –
Total assets 2021 407,981,474 531,168,289 179,367,944 190,798,549 1,338,324,279 – 2,647,640,536

PEOPLE’S BANK
ABOUT
Total
Up to 3 3-12 1-3 3-5 Over 5 2022 2021

months months years years years
Liabilities
FROM THE TOP

REFLECTIONS
Due to banks 11,118,846 3,753,348 14,648,535 81,931,762 – 111,452,491 107,745,916
Derivative financial
Instruments 1,888,478 – – – – 1,888,478 1,761,220
Due to other customers 1,179,896,503 1,073,221,764 26,800,242 88,308,263 3,292,125 2,371,518,898 2,071,532,612
Other borrowings 182,117,867 3,269,392 – – 6,140,314 191,527,573 241,419,125
Current tax liabilities 6,372,157 – – – – 6,372,157 6,452,823
Net deferred tax liabilities – – – – 606,207 606,207 2,687,330
VALUE CREATION
DRIVING
Other liabilities 58,403,730 44,285,431 1,672,808 2,403,081 – 106,765,050 31,102,734
Subordinated term debts 26,712 – 20,110,006 3,499,290 12,967,459 36,603,467 48,861,680
Stated capital/
assigned capital – – – – 12,201,998 12,201,998 12,201,998
Statutory reserve fund – – – – 10,070,131 10,070,131 9,210,528
Other reserve – – – – 38,397,830 38,397,830 35,902,287
Retained earnings – – – – 84,624,172 84,624,172 78,762,283
Total liabilities 2022 1,439,824,293 1,124,529,936 63,231,591 176,142,396 168,300,236 2,972,028,453
AND ANALYSIS
Total liabilities 2021 1,692,255,514 684,477,810 45,376,491 23,280,406 202,250,315 2,647,640,536
NET 2022 (1,053,126,913) (283,546,382) 265,248,868 632,870,200 438,554,227 – –
NET 2021 (1,284,274,040) (153,309,521) 133,991,453 167,518,143 1,136,073,964 – –
Total equity and

liabilities 2022 386,697,380 840,983,554 328,480,459 809,012,596 606,854,462 2,972,028,453 –
Total equity and

liabilities 2021 407,981,474 531,168,289 179,367,944 190,798,549 1,338,324,279 – 2,647,640,536
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
Maturity profile of the undiscounted cash flows of financial liabilities as at 31 December 2022
Financial liabilities On demand Less than 3-12 1-5 Over 5 Total

3 months months years years
Due to banks 6,707,600 4,440,786 5,678,409 146,792,379 – 163,619,175
Derivative financial instruments – 104,362,796 2,989,231 – – 107,352,027
Due to other customers 755,708,257 490,503,273 1,153,960,050 184,787,506 4,148,110 2,589,107,197
Other borrowings – 182,676,375 3,649,076 – 6,140,314 192,465,764
Subordinated term debts – 499,212 3,627,293 34,485,490 17,097,100 55,709,095
Total undiscounted
financial liabilities 762,415,857 782,482,442 1,169,904,058 366,065,376 27,385,524 3,108,253,257
Maturity profile of the undiscounted cash flows of financial liabilities as at 31 December 2021
Financial liabilities On demand Less than 3-12 1-5 Over 5 Total

3 months months years years
Due to banks 2,246,656 39,712,142 7,651,084 15,424,225 53,027,813 118,061,920
Derivative financial instruments – 64,832,341 25,347,644 12,508,890 5,957,093 108,645,968
Due to other customers 874,991,271 539,620,591 647,376,012 31,234,687 3,853,191 2,097,075,752
Other borrowings – 258,965,193 6,947,878 7,912,781 273,825,852
Subordinated term debts – 332,500 17,441,843 31,209,750 20,769,033 69,753,125
Total undiscounted
financial liabilities 877,237,927 903,462,767 704,764,461 98,290,333 83,607,130 2,667,362,617
Market risk
Market risk is potential losses arising from changes in earnings, market or future cash flows of a portfolio of financial
instruments resultant from adverse movements in market variables such as interest rates, share prices, foreign exchange
rates and bond and commodity prices. Most of the Bank’s operations are exposed to at least one or more elements of
market risk. The market risk stems primarily from the interest rate risk of its trading and non-trading books and from
exposure to gold prices due to its pawning portfolio.
At Board level, exposure to market risk is monitored by the BIRMC which is also responsible for providing recommendations
to the Board on the Bank’s market risk management framework, policies and risk appetite limits. The ALCO is vested with
the responsibility of implementing the market risk management framework at an executive level and ensures that the
Bank’s market risk exposures are within the defined risk appetite. Policies governing the Bank’s market risk include Treasury
policy and policy on stress testing. These frameworks collectively provide guidance on the systems, procedures, tools and
techniques for the identification, assessment, mitigation, monitoring and reporting on all market related risks. The policies
are reviewed and updated regularly in view of emerging market risks. The management of market risk is entrusted to the
Bank’s Treasury and Risk Management ensures the same through its monitoring and analysis.
The Bank’s market risk exposures are classified into trading and banking book and are managed separately. Sensitivity and
scenario analysis of portfolios are carried out together with mark-to-market valuations and duration analysis that reflects
the portfolio sensitivity to the market volatility. The principal tool used to measure and control market risk exposure within
the Bank’s trading portfolio is Value at Risk (VaR). The VaR of a trading portfolio is the estimated loss that will arise on the
portfolio over a specified period of time (holding period) from an adverse market movement with a specified probability
(confidence level). The VaR model used by the Bank is based on a 99% confidence level and assumes one day holding
period. The VaR model used is based mainly on variance co variance method.
PEOPLE’S BANK
ABOUT
The Bank uses VaR limits to monitor and manage the market risk, specifically foreign exchange and interest rate. The
overall structure of VaR limits is subject to review and approval by BIRMC. VaR limits are allocated to trading portfolios.
VaR is measured and monitored against it’s limits at least daily by the Treasury Middle office, which is attached to the Risk
Management Department.
Interest rate risk
FROM THE TOP

REFLECTIONS
Interest rate risk is the potential loss to earnings and capital resulting from the Bank’s exposure to interest rate sensitive
assets. The market value of such assets fluctuates in line with changes in interest rates and credit spreads. The Bank’s
exposure to interest rate risk arises from its lending portfolio, trading securities and deposit liabilities.
Techniques used to measure interest rate risk include Duration Gap Analysis, VaR and Earnings at Risk. Rate sensitive assets
and liabilities are mapped into time buckets based on their maturity period, in order to ascertain the duration gap and
overall exposure to interest rate risk.
VALUE CREATION
DRIVING
Foreign exchange risk
Foreign exchange risk (FOREX) is the potential impact to earnings and/or capital stemming from adverse fluctuations in
exchange rates. Such exposure of the Bank stems from proprietary trading and from undertaking transactions denominated
in foreign currency namely, import/export transactions and remittances etc. CBSL regulatory limits and board approved
limits are in place on currency positions and are monitored on a daily basis. Hedging strategies are used to ensure positions
are maintained within established limits.
The Bank also conducts VaR calculations and stress testing on the portfolios subject to forex risk. Parallel VaR calculations
AND ANALYSIS
are performed by the Bank’s Treasury Management System (based on Finacle) and the Bloomberg system. Stress testing
is performed by applying rate shocks in order to gauge the potential impact on the Bank’s profitability and capital
adequacy levels.
Equity risk
Equity risk arises from exposures to changes in fluctuations in the value of equity investments held by the Bank. This arises
primarily from its fair value through profit or loss and fair value through OCI investment portfolio and excludes strategic
investments by the Bank in subsidiaries.
The BIBC (Board Investment Banking Committee) is responsible for formulating all investment related policies and ensuring
that the Bank’s investment risks are managed in line with its defined risk appetite. The Board approved Investment Banking
REPORTS
GOVERNANCE
Policy Manual clearly articulates the procedures, tools and techniques for managing equity risk as well as volume and stop
loss limits.
Operational Risk
Operational risk is the risk of losses arising from failed internal processes, systems failure, human error, fraud or external
events. Operational risks exist in the natural course of business activities, products and processes. When controls fail to
perform, operational risks can cause damage to reputation and create legal or regulatory implications, or lead to financial
STATEMENTS
FINANCIAL
losses. Operational Risks cannot be fully eliminated. However Bank objective is to manage operational risk in order to
avoid financial losses and damage to the Bank’s reputation with overall cost effectiveness, innovation and contain it within
acceptable levels as determined by Bank’s Board of Directors.
The Bank’s operational risk management framework clearly articulates the policies, structures and processes in place to
manage the different types of operational risk exposures. The Board of Directors, supported by the BIRMC is responsible
for formulating policy and ensuring the robustness of the operational risk management framework. Loss events are
INFORMATION
SUPPLEMENTARY
recorded and periodically reported through the Risk Management Unit to the Operational Risk Management Committee
(ORMC).Meanwhile, Internal Audit also provides assurance to the Board on the effectiveness on the operational risk
management processes in place.
Capital Adequacy and Internal Capital Adequacy Assessment Process (ICAAP)

Capital adequacy
The capital adequacy is a measurement of a bank's available capital expressed as a percentage of a bank's risk-weighted
assets. The capital adequacy ratio is known as capital-to-risk weighted assets. Sound Capital Adequacy protects rights of
the depositors and ensures the stability and efficiency of the Bank. Two types of capital measurements are imposed by the
CBSL under Basel guidelines which are Tier 1 Capital and Tier 2 Capital requirements which can absorb losses to protect the
rights of depositors and stakeholders.
Internal Capital Adequacy Assessment Process (ICAAP)

Under ICAAP the Bank has in place internal procedures and processes to ensure that it possesses adequate capital
resources in the long term to cover all of its material risks. These processes and procedures are known as the Internal
Capital Adequacy and Assessment Process (ICAAP). ICAAP report is prepared by the Risk Management Department, in
coordination with the Finance and Compliance Departments and has been subject to review by the Bank’s Internal Audit
Department and recommended by the BIRMC for approval of the Board. ICAAP determines the level of capital to be
maintained against all risks and ensure that banks have adequate capital to support all risks and ensure that banks use
ICAAP in more general business decisions and budgets, in more specific decisions such as allocating capital to business
units and when evaluating individual credit decision process. Also the Internal Capital Adequacy Assessment Process
(ICAAP) covers capital planning over the next 5 years.
Recovery Plans (RCP)

As per CBSL Direction No. 13 of 2021 the Bank implement Recovery Plans (RCP) commencing from 2022. The scope of the
Recovery Plans shall identify the full range of recovery options available to a licensed bank to deal with shocks to capital,
liquidity and all other aspects that may arise from bank specific stresses, market wide stresses or a combination of both.
The Recovery Plans include and properly addressed the nature, scales, complexity and interconnectedness of,
Critical functions and critical shares services

z Recovery triggers and indicators
z Recovery options
z Governance framework within the Bank
z Implementation strategies
Bank has appointed DGM Risk Management to oversee RCP process. Further RCP is a dynamic process and be updated
annually and as and when required.
RCP shall be approved by Board of Directors with the recommendation of the BIRMC and RCP assign clear responsibilities
of key management personnel for formulating, maintaining, reviewing, executing and activating the required functionalities.
Capital Management
The Bank’s capital management framework has been designed taking into consideration regulatory requirements on capital
as well as future growth aspirations and funding options available to the Bank.
The Capital Adequacy Ratio (CAR) is calculated based on the CBSL Directions based on the Basel framework. Since 1 July
2017, the Bank is required to comply with Basel III Guidelines. According to Basel III framework the Bank is required to
maintain a CAR of not less than 9.5% with core capital (Tier 1) and a minimum overall CAR of 13.5% as at 31.12.2022.

PEOPLE’S BANK
ABOUT
The details of the computation of the capital and the ratios as at 31 December 2022 and 31 December 2021 are given below
for the Bank and Group:
CAPITAL ADEQUACY – BANK

Computation of risk weighted assets
FROM THE TOP

REFLECTIONS
Balance Risk weight Risk weighted balance
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 % LKR ’000 LKR ’000
Assets
Claims on Government of Sri Lanka and Central
Bank of Sri Lanka 1,557,190,034 1,354,465,725 0-20 104,078,413 35,604,738
Claims on foreign sovereigns and their central
VALUE CREATION
DRIVING
banks – – 0-150 – –
Claims on Public Sector Entities (PSEs) 112,025,739 100,589,395 20-150 34,966,728 53,020,647
Claims on official entities and Multilateral

Development Banks (MDBs) – – 0-150 – –
Claims on banks 11,566,209 3,190,653 20-150 4,949,674 717,677
Claims on financial institutions 6,701,868 5,123,471 20-150 3,604,999 2,941,131
Claims on corporates 176,721,225 157,967,132 20-150 176,709,703 150,152,558
Retail claims 487,235,137 510,921,541 75-100 380,310,299 399,782,395
AND ANALYSIS
Claims secured by gold 183,955,880 194,769,226 20-100 2,922 1,387,067
Claims secured by residential property 59,509,996 61,873,841 50-100 20,828,499 21,655,844
Claims secured by commercial real estate – – 100 – –
Non-Performing Assets (NPAs) 39,155,305 28,758,273 50-150 51,930,634 38,577,961
High risk categories 1,147,268 1,076,316 150-250 2,868,170 2,690,789
Cash items 57,119,603 55,766,424 0-20 365,976 283,745
Property, plant and equipment 40,404,636 46,761,161 100 40,404,636 46,761,161
Other assets 33,643,211 15,025,979 100 33,643,211 15,025,979
Total 2,766,376,111 2,536,289,138 854,663,864 768,601,693
REPORTS
GOVERNANCE
Above risk weighted assets includes the credit equivalent of off balance sheet exposures illustrated below.
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
Off balance sheet exposures

Balance Credit conversion Credit Equivalent
factor
2022 2021 2022 2021

LKR ’000 LKR ’000 % LKR ’000 LKR ’000
Instruments
Direct credit substitutes 18,599,654 24,129,532 100 18,599,654 24,129,532
Transaction-related contingencies 40,145,861 37,801,675 50 20,072,930 18,900,837
Short-term self-liquidating trade-related

contingencies 14,063,936 144,962,298 20 2,812,787 28,992,460
Sale and repurchase agreements and assets sale

with recourse where the credit risk remains with
the Bank – – 100 – –
Obligations under an on-going underwriting

agreement – – 50 – –
Other commitments with an original maturity of

up to one year or which can be unconditionally
cancelled at any time – – 0-20 – –
Commitments with an original maturity up to

one year 56,307,598 62,815,181 20 11,261,520 12,563,036

over one year – – 50 – –
Foreign exchange contracts 152,222,636 111,769,016 0-5 3,044,453 2,235,380
Interest rate contracts – – 0-3 – –
Total 281,339,685 381,477,702 55,791,343 86,821,245
Computation of capital
2022 2021
LKR ’000 LKR ’000
Common equity Tier 1 (CET1) capital 111,298,172 104,747,717
Total Tier 1 capital 116,298,172 109,747,717
Total capital 159,532,587 155,798,954
Computation of ratios
Total risk weighted assets for credit risk 854,663,864 768,601,693
Total risk weighted assets for market risk 22,038,936 9,947,942
Total risk weighted assets for operational risk 101,773,095 95,120,162
Total risk weighted assets 978,475,894 873,669,797
Common equity Tier 1 (CET1) capital ratio (minimum requirement 8.0% – 2022 7.0% – 2021) 11.37 11.99
Total Tier 1 capital (Tier 1) (minimum requirement 9.5% – 2022, 8.5% – 2021 ) 11.89 12.56
Total capital ratio (minimum requirement 13.5% – 2022, 12.5% – 2021) 16.30 17.83
PEOPLE’S BANK
ABOUT
CAPITAL ADEQUACY – GROUP
Computation of risk weighted assets
Balance Risk weight Risk Weighted Balance
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 % LKR ’000 LKR ’000
FROM THE TOP

REFLECTIONS
Assets
Claims on Government of Sri Lanka and
Central Bank of Sri Lanka 1,570,101,439 1,370,148,563 0-20 104,078,413 35,604,738
Claims on foreign sovereigns and their

central banks – – 0–150 – –
Claims on Public Sector Entities (PSEs) 112,025,739 100,311,723 20-150 34,966,728 52,742,976
Claims on official entities and Multilateral

Development Banks (MDBs) – – 0-150 – –
VALUE CREATION
DRIVING
Claims on banks 14,767,304 3,190,653 20-150 7,318,902 717,677
Claims on financial institutions 6,701,868 8,689,199 20-150 3,604,999 6,506,859
Claims on corporates 176,721,225 160,698,092 20-150 176,709,703 152,883,518
Retail claims 618,205,712 663,192,297 75-100 511,280,874 552,053,151
Claims secured by gold 183,955,880 194,769,226 20-100 2,922 1,387,067
Claims secured by residential property 59,509,996 61,873,841 50-100 20,828,499 21,655,844
AND ANALYSIS
Claims secured by commercial real estate – – 100 – –
Non-Performing Assets (NPAs) 40,849,720 31,479,469 50-150 53,625,050 41,299,157
High risk categories 1,487,552 – 150-250 3,718,881 0
Cash items 58,181,917 56,824,902 0-20 365,976 283,745
Property, plant and equipment 50,854,687 56,432,297 100 50,854,687 56,432,297
Other assets 41,682,244 16,266,619 100 41,682,244 16,266,619
Total 2,935,045,283 2,723,876,883 1,009,037,876 937,833,649
Above risk weighted assets includes the credit equivalent of off balance sheet exposures illustrated below.
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
Off balance sheet exposures

Balance Credit conversion Credit Equivalent
factor
Off balance Sheet Exposures 2022 2021 2022 2021

LKR ’000 LKR ’000 % LKR ’000 LKR ’000
Instruments
Direct Credit Substitutes 18,599,654 24,129,532 100 18,599,654 24,129,532
Transaction-related contingencies 40,145,861 37,801,675 50 20,072,930 18,900,837
Short-term self-liquidating trade-related

Contingencies 14,063,936 144,962,298 20 2,812,787 28,992,460
Sale and repurchase agreements and assets sale

with recourse where the credit risk remains with
the bank – – 100 – –
Obligations under an on-going underwriting

Agreement – – 50 – –

up to one year or which can be unconditionally
cancelled at any time – – 0-20 – –
Commitments with an original maturity up to 1

year 56,307,598 76,469,981 20 11,261,520 15,293,996

over one year – – 50 – –
Foreign exchange contracts 152,222,636 111,769,016 0-5 3,044,453 2,235,380
Interest rate contracts – – 0-3 – –
Total 281,339,685 395,132,502 55,791,343 89,552,205
Computation of capital
2022 2021
LKR ’000 LKR ’000
Common equity Tier 1 (CET1) capital 148,454,894 138,667,285
Total Tier 1 capital 153,454,894 143,667,285
Total capital 198,618,984 191,833,922
Computation of ratios
Total risk weighted assets for credit risk 1,009,037,876 937,833,649
Total risk weighted assets for market risk 24,425,006 13,920,731
Total risk weighted assets for operational risk 123,198,293 119,443,032
Total risk weighted assets 1,156,661,175 1,071,197,412
Common equity Tier 1 (CET1) capital ratio (minimum requirement 8.0% – 2022 7.0% – 2021) 12.83 12.95
Total Tier 1 capital (Tier 1) (minimum requirement 9.5% – 2022, 8.5% – 2021 ) 13.27 13.41
Total capital ratio (Minimum requirement 13.5% – 2022, 12.5% – 2021) 17.17 17.91
PEOPLE’S BANK
ABOUT
325
FROM THE TOP

REFLECTIONS
SUPPLEMENTARY
VALUE CREATION
DRIVING
REPORTS
AND ANALYSIS
326 / Income Statement USD
327 / Statement of Financial Position USD
328 / Ten Year Summary – Bank
329 / Ten Year Summary – Group
330 / Basel III – Market Discipline Disclosure Requirement under Pillar III
326 / External Assurance on Sustainability Report
348 / GRI Content Index
353 / Senior Managers
356 / Branch Managers
REPORTS
GOVERNANCE
364 / Glossary of Financial/Banking Terms
368 / Corporate Information
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
INCOME STATEMENT USD
Bank Group
USD ’000 USD ’000 % USD ’000 USD ’000 %
Gross income 975,368 1,032,378 -5.5 1,068,134 1,179,552 -9.4
Interest income 879,006 982,964 -10.6 959,418 1,107,659 -13.4
Interest expenses (672,158) (572,200) 17.5 (710,858) (625,094) 13.7
Net interest income 206,848 410,764 -49.6 248,560 482,564 -48.5
Fee and commission income 44,772 41,186 8.7 47,000 48,046 -2.2
Fee and commission expense (2,263) (2,978) -24.0 (2,263) (2,978) -24.0
Net fee and commission income 42,509 38,209 11.3 44,737 45,068 -0.7
Net gain/(loss) from trading 46,488 (6,700) -793.8 46,471 (6,015) -872.5
Other operating income (net) 5,102 14,927 -65.8 15,246 29,863 -48.9
Total operating income 300,947 457,200 -34.2 355,014 551,480 -35.6
Impairment charge (91,048) (72,094) 26.3 (93,796) (72,157) 30.0
Net operating income 209,899 385,106 -45.5 261,218 479,323 -45.5
Personnel expenses (72,635) (113,434) -36.0 (87,920) (138,201) -36.4
Other expenses (56,625) (86,125) -34.3 (73,141) (113,430) -35.5
Operating profit before Value Added Tax (VAT)

on financial services 80,639 185,547 -56.5 100,157 227,692 -56.0
Value Added Tax (VAT) on Financial Services (22,377) (34,181) -34.5 (27,282) (42,210) -35.4
Operating profit after Value Added Tax (VAT)

on financial services 58,262 151,365 -61.5 72,876 185,481 -60.7
Share of profits/(loss) of associates (net of tax) – – – 54 -100.0
Profit before tax 58,262 151,365 -61.5 72,876 185,536 -60.7
Income tax expenses (11,321) (33,208) -65.9 (16,833) (45,622) -63.1
Profit for the year 46,941 118,158 -60.3 56,042 139,914 -59.9
Profit attributable to:

Equity holders of the Bank 46,941 118,158 -60.3 53,439 131,263 -59.3
Non-controlling interests – – 2,603 8,651 -69.9
46,941 118,158 -60.3 56,042 139,914 -59.9
Exchange Rate: 1 USD was LKR 366.25 as at 31 December 2022 (LKR 200.75 as at 31 December 2021).
The Income Statements and Statement of Financial Position given on pages 209 and 211 are solely for the convenience of
shareholders, investors and other users of Financial Statements.
STATEMENT OF FINANCIAL POSITION USD
PEOPLE’S BANK
ABOUT
Bank Group
USD ’000 USD ’000 % USD ’000 USD ’000 %
Assets
Cash and cash equivalents 182,504 286,617 -36.3 185,876 293,085 -36.6
Balances with Central Bank of Sri Lanka 184,580 282,530 -34.7 184,580 282,530 -34.7
FROM THE TOP

REFLECTIONS
Placements with banks – – – 8,269 16,567 -50.1
Derivative financial instruments 40,635 2,201 1746.1 40,635 2,201 1746.1
Financial assets – at fair value
through profit or loss 15,172 7,765 95.4 16,153 12,720 27.0
Loans and advances to banks 20,994 50,470 -58.4 20,994 66,740 -68.5
Loans and advances to other customers 4,868,551 9,144,195 -46.8 5,230,776 9,916,259 -47.3
VALUE CREATION
DRIVING
Debt instruments measured at amortised cost 2,493,106 2,925,630 -14.8 2,536,206 2,989,189 -15.2
Financial assets – at fair value through
other comprehensive income (OCI)
Equity instruments at fair value through OCI 4,537 8,077 -43.8 5,036 9,410 -46.5
Debt instruments at fair value through OCI 28,337 46,821 -39.5 31,205 52,786 -40.9
Investments in subsidiaries 11,687 17,797 -34.3 – – –
and right-of-use assets 134,690 232,932 -42.2 163,222 281,107 -41.9
AND ANALYSIS
Intangible assets and goodwill 4,694 10,349 -54.6 5,077 11,221 -54.8
Other assets 125,267 173,361 -27.7 126,604 176,323 -28.2
Total assets 8,114,753 13,188,745 -38.5 8,554,634 14,110,137 -39.4
Liabilities
Due to banks 304,307 536,717 -43.3 335,009 609,703 -45.1
Derivative financial instruments 5,156 8,773 -41.2 5,156 8,773 -41.2
Due to other customers 6,475,137 10,318,967 -37.3 6,689,636 10,802,863 -38.1
Other borrowings 522,942 1,202,586 -56.5 522,942 1,202,586 -56.5
Current tax liabilities 17,398 32,144 -45.9 22,654 42,402 -46.6
REPORTS
GOVERNANCE
Net deferred tax liabilities 1,655 13,386 - 1,558 15,914 -90.2
Other liabilities 291,509 154,933 88.2 316,619 216,446 46.3
Subordinated term debts 99,941 243,396 -58.9 144,113 326,579 -55.9
Total liabilities 7,718,046 12,510,901 -38.3 8,037,687 13,225,264 -39.2
Equity
Stated capital/assigned capital 33,316 60,782 -45.2 33,316 60,782 -45.2
STATEMENTS
FINANCIAL
Statutory reserve fund 27,495 45,881 -40.1 27,495 45,881 -40.1

Other reserves 104,840 178,841 -41.4 113,181 190,088 -40.5
Retained earnings 231,056 392,340 -41.1 303,603 521,820 -41.8
Total shareholders' equity 396,707 677,844 -41.5 477,595 818,570 -41.7
Non-controlling interests – – 39,352 66,303 -40.6
Total equity 396,707 677,844 -41.5 516,947 884,873 -41.6
Total equity and liabilities 8,114,753 13,188,745 -38.5 8,554,634 14,110,137 -39.4
INFORMATION
SUPPLEMENTARY
Contingent liabilities and commitments 1,012,010 2,135,847 -52.6 1,024,678 2,210,920 -53.7
Exchange Rate: 1 USD was LKR 366.25 as at 31 December 2022 (LKR 200.75 as at 31 December 2021)
The Income Statements and Statement of Financial Position given on pages 209 and 211 are solely for the convenience of
shareholders, investors and other users of Financial Statements.
TEN YEAR SUMMARY – BANK
(LKR Mn.) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Assets
Cash and short-term funds 59,143 80,940 74,112 127,058 134,647 109,496 89,562 85,658 114,256 134,444
Investments 226,075 290,486 304,519 250,240 269,691 299,160 405,688 443,955 613,604 942,666
Loans and receivables (Net) 619,830 627,209 768,515 890,528 1,012,643 1,265,667 1,310,150 1,635,579 1,835,697 1,783,107
Property, plant, equipment
and right-of-use assets 14,706 14,947 16,304 17,224 25,048 26,260 34,310 38,406 46,761 49,330
Other assets 10,832 13,186 13,146 16,999 25,071 34,120 33,697 26,521 37,322 62,481
Total assets 930,585 1,026,769 1,176,595 1,302,048 1,467,099 1,734,703 1,873,406 2,230,119 2,647,641 2,972,028
Liabilities
Customer deposits 762,249 793,342 899,238 1,077,812 1,244,003 1,422,961 1,491,386 1,835,099 2,071,533 2,371,519
Borrowing from
banks and others 102,148 157,198 192,083 134,109 105,057 173,607 224,809 200,852 349,165 302,980
Other liabilities 14,619 17,727 20,747 17,947 28,051 34,391 39,532 48,626 42,004 115,632
Subordinated term debts 15,033 15,033 15,033 12,532 12,532 12,534 22,714 43,558 48,862 36,603
Total liabilities 894,048 983,299 1,127,100 1,242,400 1,389,642 1,643,493 1,778,442 2,128,135 2,511,563 2,826,734
Total equity 36,537 43,470 49,495 59,649 77,457 91,210 94,964 101,984 136,077 145,294
Total equity and liabilities 930,585 1,026,769 1,176,595 1,302,048 1,467,099 1,734,703 1,873,406 2,230,119 2,647,641 2,972,028
Contingent liabilities
and commitments 197,119 182,573 181,533 226,430 303,344 402,762 363,926 489,939 428,771 370,649
Operating results
Gross income 120,456 96,377 103,649 122,114 160,835 181,284 199,729 190,982 207,250 357,229
Total operating income 46,530 41,894 54,743 55,060 61,856 69,886 73,795 71,715 91,783 110,222
Total operating
expenses (Including VAT) 22,509 26,093 31,483 32,999 34,594 42,855 45,640 38,922 46,923 55,537
Profit before tax 10,304 17,231 19,520 20,814 25,913 24,406 19,666 21,227 30,387 21,338
Income tax 2,816 3,012 6,922 5,819 7,663 7,312 6,741 7,052 6,666 4,146
Profit after tax 7,488 14,219 12,598 14,995 18,250 17,095 12,926 14,175 23,720 17,192
Performance indicators
Number of employees
(permanent) 7,409 8,156 8,368 8,249 8,454 8,093 7,836 7,692 7,568 7,377
Per employee (LKR '000)

Deposits 102,881 97,271 107,462 130,660 147,150 175,826 190,325 238,572 273,723 321,475
Loans and receivables (Net) 83,659 76,902 91,840 107,956 119,783 156,390 167,196 212,634 242,560 241,712
Gross earnings 16,258 11,817 12,386 14,804 19,025 22,400 25,489 24,829 27,385 48,425
Profit after tax 1,011 1,743 1,505 1,818 2,159 2,112 1,650 1,843 3,134 2,330
Per share (LKR)

Profit after tax 7,488 14,219 12,598 14,995 18,250 17,095 12,926 14,175 23,720 17,192
Total assets 930,585 1,026,769 1,176,595 1,302,048 1,467,099 1,734,703 1,873,406 2,230,119 2,647,641 2,972,028
Equity 36,537 43,470 49,495 59,649 77,457 91,210 94,964 101,984 136,077 145,294
Return on assets (%)
(before tax) 1.1 1.8 1.8 1.7 1.9 1.5 1.1 1.0 1.2 0.8
Return on equity (%) 22.8 35.5 27.1 27.5 26.6 20.3 13.9 14.4 19.9 12.2
Cost/income ratio (%) 48.4 62.3 57.5 59.9 55.9 61.3 61.8 54.3 51.1 50.4
Capital adequacy ratio
(CAR) (%) 15.0 14.3 12.6 12.1 13.5 14.5 14.7 15.5 17.8 16.3
Non-performing loan
(NPL) ratio (gross) (%) 5.3 3.2 2.4 1.9 1.9 2.5 3.3 3.2 3.2 –
Impaired (Stage 3) ratio (%) 3.5 4.0 12.8
Impairment (Stage 3)
to Stage 3 loans ratio (%) 54.7 50.2 29.9
TEN YEAR SUMMARY – GROUP
PEOPLE’S BANK
ABOUT
(LKR Mn.) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Assets
Cash and short-term funds 61,174 83,003 76,840 129,458 135,364 110,451 90,453 87,096 115,555 135,679
Investments 229,280 300,366 311,141 258,049 280,357 311,581 419,190 461,373 631,843 958,793
Loans and receivables (Net) 710,074 722,099 869,781 1,013,921 1,143,767 1,415,928 1,460,498 1,776,231 1,990,689 1,915,772
FROM THE TOP

REFLECTIONS
Property, plant, equipment
and right-of-use assets 18,184 19,364 22,696 23,441 33,758 35,434 43,744 48,102 56,432 59,780
Other assets 12,760 14,425 14,279 19,528 25,833 35,147 35,889 27,766 38,091 63,111
Total assets 1,031,473 1,139,258 1,294,737 1,444,398 1,619,079 1,908,540 2,049,775 2,400,567 2,832,610 3,133,135
Liabilities
Customer deposits 789,225 829,019 932,906 1,119,753 1,305,626 1,495,326 1,588,903 1,935,194 2,168,675 2,450,079
Borrowings 140,865 193,825 225,795 172,419 134,263 207,330 235,724 208,802 363,817 314,225
VALUE CREATION
DRIVING
Other liabilities 23,153 27,469 32,328 30,509 40,299 49,285 54,619 60,592 56,920 126,718
Subordinated term debts 23,141 24,883 30,907 36,526 32,448 33,085 40,513 56,868 65,560 52,782
Total liabilities 976,384 1,075,196 1,221,937 1,359,207 1,512,635 1,785,027 1,919,759 2,261,457 2,654,972 2,943,803
Total equity 55,088 64,062 72,801 85,191 106,443 123,513 130,016 139,111 177,638 189,332
Total equity and liabilities 1,031,473 1,139,258 1,294,737 1,444,398 1,619,079 1,908,540 2,049,775 2,400,567 2,832,610 3,133,135
Contingent liabilities
and commitments 197,376 182,597 181,545 226,442 304,102 409,575 370,986 497,690 443,842 375,288
AND ANALYSIS
Operating results
Gross income 139,957 118,641 123,831 144,750 188,854 214,664 238,219 223,898 236,795 391,204
Total operating income 55,576 54,308 67,635 68,429 77,518 89,843 96,475 90,836 110,710 130,024
Total operating
expenses (Including VAT) 27,264 32,779 38,346 41,633 44,600 54,554 59,135 48,623 58,989 68,980
Profit before tax 13,412 21,628 24,121 25,433 29,868 31,162 25,652 24,648 37,246 26,691
Income tax 4,248 4,674 9,053 7,477 9,358 9,669 9,474 8,557 9,159 6,165
Profit after tax 9,164 16,953 15,068 17,956 20,511 21,492 16,178 16,090 28,088 20,525
Performance indicators
Number of employees 9,384 10,331 10,682 10,471 11,396 11,394 11,237 11,051 10,969 10,454
REPORTS
GOVERNANCE
Per employee (LKR '000)
Deposits 84,103 80,246 87,334 106,939 114,569 131,238 141,399 175,115 197,709 234,368
Loans and receivables 75,669 69,896 81,425 96,831 100,366 124,270 129,972 160,730 181,483 183,257
Gross earnings 14,914 11,484 11,592 13,824 16,572 18,840 21,199 20,260 21,588 37,421
Profit after tax 977 1,641 1,411 1,715 1,800 1,886 1,440 1,456 2,561 1,963
Return on assets (%)
STATEMENTS
FINANCIAL
(before tax) 1.3 2.0 2.0 1.9 1.9 1.8 1.3 1.1 1.4 0.9
Return on equity (%) 18.2 28.5 22.0 22.7 21.4 18.7 12.8 12.0 17.7 11.2
Cost/income ratio (%) 49.1 60.4 56.7 60.8 57.5 60.7 61.3 53.5 53.3 53.1
Capital adequacy ratio
(CAR) (%) 15.9 14.9 13.8 13.0 13.7 14.5 14.9 15.6 17.9 17.2
Non-performing loan (NPL)
ratio (gross) (%) 4.9 3.2 2.4 1.9 2.0 2.7 3.7 3.9 3.6 –
INFORMATION
SUPPLEMENTARY
Impaired (Stage 3) ratio (%) 4.2 4.7 12.6

Impairment (Stage 3)
to Stage 3 loans ratio (%) 50.8 46.9 30.5
BASEL III – MARKET DISCIPLINE DISCLOSURE

REQUIREMENT UNDER PILLAR III
CAPITAL ADEQUACY Additional Tier 1 (AT 1) capital includes PILLAR II – SUPERVISORY
capital instruments other than the REVIEW PROCESS (SRP)
Capital adequacy is one of the key instruments included in CET I capital.
financial indicators which illustrate SRP framework assesses the Bank’s
the soundness and the stability of Total capital is comprised of Tier 1 plus capital adequacy and determining
a bank. This measures banks ability other qualifying capital instruments whether Bank is maintaining additional
to withstand in an unexpected loss (i.e. such as subordinated debentures capital to cover its risks. Bank has
scenarios during various activities subject to regulatory deductions, developed an ICAAP (Internal Capital
carried out by the Bank. revaluation reserves on property, Adequacy Assessment Process)
plant and equipment with a cap of framework in this regard, which closely
Basel committee on Bank Supervision up to 50% and allowed impairment indicates risks and capital assessment
(BCBS) has implemented set of provisions. processes to support the Bank’s
stringent measures of capital, liquidity current and projected demand for
and funding reforms. Accordingly Basel III has introduced new capital capital under unexpected and
Basel III accord was issued in December buffers and all banks are required to stressed conditions.
2010 and it has come into force and hold additional capital buffers over and
effect in Sri Lanka on 1 July 2017 based above the minimum CET I and Total
on the Central Bank Direction No. 1 PILLAR III – MARKET
Capital Adequacy levels stipulated
of 2016 on capital requirement under DISCIPLINE
above.
Basel III for licensed commercial banks. Pillar III aims to provide consistent and
This replaces Basel II reforms which
z Capital Conservation Buffer
comprehensive disclosure framework
were in force and effect in Sri Lanka z High Loss Absorbency (HLA)
which enhances the comparability
since 1 January 2008 onwards. requirement on Domestically
between banks. It requires number of
Significant Banks (D-SIBs)
disclosure requirements to give better
Commencing from 1 July 2017, with z Counter Cyclical Buffer understanding of capital adequacy to
the amendment thereto under external shareholders by providing an
Direction No. 11 of 2019 on Domestically Three pillars introduced by Basel II is insight into the internal computation
Systemically Important Banks (D-SIBS) continued to be applied in the Basel III procedures followed by the Bank.
dated 20 December 2019; Bank has framework is mentioned below:
to maintain the Capital in 3 Tiers as Accordingly disclosures required
z Pillar I – Minimum capital
mentioned below. to be published as per the Central
requirements
Pillar II – Supervisory review process
z Bank Direction No. 1 of 2016 are set
Accordingly minimum capital out below:
requirement of the Bank are as follows: z Pillar III – Market discipline

Minimum requirement %
PILLAR I – MINIMUM
Common equity Tier 1 CAPITAL REQUIREMENT
capital ratio (CETI) 8.00
Minimum capital requirement
Total Tier 1 capital ratio shall maintain as a percentage of
(CET I + AT I) 9.50
Risk-Weighted Assets (RWAs) and
Total capital ratio 13.50 bank calculated its RWAs based
on following approaches.
Common Equity Tier 1 (CET I) is mainly z The standardised approach
comprised of equity capital, other for credit risk
capital and retained earnings. CET I is z The standardised measurement
the highest quality capital and effective method for market risk
capital in absorbing losses.
z The basic indicator approach
for operational risk
Basel III – Market Discipline Disclosure Requirement UNDER PILLAR III
PEOPLE’S BANK
ABOUT
TEMPLATE 1: KEY REGULATORY RATIO – CAPITAL AND LIQUIDITY
Bank Group
As at 31 December 2022 2021 2022 2021
Regulatory capital (LKR '000)

Common equity Tier 1 capital 111,298,172 104,747,717 148,454,894 138,667,285
FROM THE TOP

REFLECTIONS
Total Tier 1 capital 116,298,172 109,747,717 153,454,894 143,667,285
Total capital 159,532,587 155,798,954 198,618,984 191,833,922
Regulatory capital ratio (%)

Common equity Tier 1 capital ratio
(Minimum requirement – 2022 – 8.00%, 2021 – 7.00%) 11.37 11.99 12.83 12.95
Total Tier 1 capital

(Minimum requirement – 2022, 9.50%, 2021 – 8.50%) 11.89 12.56 13.27 13.41
VALUE CREATION
DRIVING
Total capital
(Minimum requirement – 2022 – 13.50%, 2021 – 12.50%) 16.30 17.83 17.17 17.91
Regulatory liquidity
Statutory liquid assets – Bank
Domestic Banking Unit (LKR '000) 540,470,751 502,575,831 NA NA
Off-Shore Banking Unit (USD '000) 70,182 239,417 NA NA
Statutory liquid assets – (Minimum requirement 20%)
AND ANALYSIS
Domestic Banking Unit (%) 21.37 23.52 NA NA
Off-Shore Banking Unit (%) 20.05 25.94 NA NA
Liquidity coverage ratio (%) Rupee

(Minimum requirement 2022 – 90%, 2021 – 100%) 213.00 155.83 NA NA
Liquidity coverage ratio (%) all currency

(Minimum requirement 2022 – 90%, 2021 – 100%) 119.47 105.71 NA NA
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
TEMPLATE 2: KEY REGULATORY RATIO – CAPITAL AND LIQUIDITY

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Common equity Tier 1 (CET I) capital after adjustments 111,298,172 104,747,717 148,454,894 138,667,285
Common equity Tier 1 (CET I) capital 121,208,499 114,565,325 155,377,215 146,338,443
Equity/Assigned capital 12,201,998 12,201,998 12,201,998 12,201,998
Reserve fund 10,070,131 9,210,528 9,972,747 9,210,528
Public retained earning/(accumulated retained losses) 84,624,172 78,762,283 113,457,633 104,755,262
Publish accumulated other comprehensive income (OCI) 170,825 249,143 66,665 210,196
General and other disclosed reserves 14,141,373 14,141,373 14,141,373 14,141,373
Unpublished current year's profit/loss and gain reflected in OCI – – – –
Ordinary shares issued by consolidated banking and
financial subsidiaries of the Bank and held by third parties – – 5,536,799 5,819,087
Total adjustments to CETI capital 9,910,326 9,817,608 6,922,321 7,671,158
Goodwill (Net) – – – –
Deferred tax asset (Net) – – – –
Intangible assets (Net) 1,719,177 2,077,544 1,859,475 2,252,557
Other (Investment in the capital of
subsidiaries and other financial institution) 3,428,646 2,883,845 300,343 562,382
Defined benefit asset 4,762,503 4,856,219 4,762,503 4,856,219
Additional Tier 1 (AT I) capital after adjustments 5,000,000 5,000,000 5,000,000 5,000,000
Additional Tier 1 (AT I) capital 5,000,000 5,000,000 5,000,000 5,000,000
Qualifying additional Tier 1 capital instruments 5,000,000 5,000,000 5,000,000 5,000,000
Instrument issued by Consolidated Banking and
Financial Subsidiaries of the Bank and held by third parties
Total adjustments to AT I capital – – – –
Investment in own shares – – – –
Other (specify) – – – –
Tier 2 capital after adjustments 43,234,415 46,051,238 45,164,090 48,166,637
Tier 2 capital 43,234,415 46,051,238 45,164,090 48,166,637
Qualifying Tier 2 capital instruments 23,176,650 27,069,250 23,176,650 27,069,250
Revaluation gains 9,374,467 9,374,467 9,374,467 9,374,467
Loan loss provisions 10,683,298 9,607,521 12,612,973 11,722,921
Instrument issued by Consolidated Banking and
Financial Subsidiaries of the Bank and held by third parties
Total adjustment to Tier 2 – – – –
Investment in own shares – – – –
Other (specify) – – – –
CET capital 111,298,172 104,747,717 148,454,894 138,667,285
Total Tier 1 capital 116,298,172 109,747,717 153,454,894 143,667,285
Total capital 159,532,587 155,798,954 198,618,984 191,833,922
Total Risk-Weighted Assets (RWA) 978,475,894 873,669,797 1,156,661,175 1,071,197,412
RWA for credit risk 854,663,864 768,601,693 1,009,037,876 937,833,649
RWA for market risk 22,038,936 9,947,942 24,425,006 13,920,731
RWA for operational risk 101,773,095 95,120,162 123,198,293 119,443,032
CET I capital Ratio (including Capital Conservation Buffer,
Countercyclical Capital Buffer and Surcharge on D-SIB) (%) 11.37 11.99 12.83 12.95
of which: Capital Conservation Buffer (%) 2.50 1.50 2.50 1.50
of which: Countercyclical Buffer (%) – – – –
of which: Capital surcharge on D-SIBs (%) 1.00 1.00 1.00 1.00
Total Tier 1 capital ratio (%) 11.89 12.56 13.27 13.41
Total capital ratio (including Capital Conservation Buffer,
Countercyclical Capital Buffer and Surcharge on D-SIBs) (%) 16.30 17.83 17.17 17.91
of which: Capital Conservation Buffer (%) 2.50 1.5 2.50 1.5
of which: Countercyclical Buffer (%) – – – –
of which: Capital surcharge on D-SIBs (%) 1.00 1.00 1.00 1.00
PEOPLE’S BANK
ABOUT
TEMPLATE 03: COMPUTATION OF LEVERAGE RATIO
Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
Tier 1 capital 116,298,172 109,747,717 153,454,894 143,667,285
Total exposures 3,037,485,650 2,772,318,458 3,201,579,781 2,962,165,320
FROM THE TOP

REFLECTIONS
On balance sheet items (Excluding derivatives and securities
financing transactions, but including collateral) 2,671,798,878 2,434,881,051 2,835,893,009 2,621,996,953
Derivative exposures 24,523,267 3,466,934 24,523,267 3,466,934
Securities financing transaction exposures 288,416,615 249,384,608 288,416,615 249,384,608
Other off-balance sheet exposures 52,746,891 84,585,865 52,746,891 87,316,825
Basel III leverage ratio (%) (Tier 1/total exposure) 3.83 3.96 4.79 4.85
VALUE CREATION
DRIVING
AND ANALYSIS
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
BASEL III DISCLOSURE REQUIREMENT

TEMPLATE 4: COMPUTATION OF LIQUIDITY COVERAGE RATIO
Total Total Total Total

unweighted weighted unweighted weighted
Value Value Value Value
LKR ’000 LKR ’000 LKR ’000 LKR ’000
Total stock of high-quality liquid assets (HQLA) 505,483,388 502,751,126 372,286,684 367,540,924
Level 1 assets 497,480,281 497,480,281 362,795,163 362,795,163
Level 2A assets 3,626,548 3,082,566 – –
Level 2B assets 4,376,559 2,188,280 9,491,521 4,745,761
Total cash outflows 2,705,630,537 583,061,521 2,449,124,055 518,681,448
Deposits 1,728,355,981 172,835,598 1,465,808,681 146,580,868
Unsecured wholesale funding 655,891,101 307,819,682 632,974,981 314,332,823
Secured funding transactions 5,054,298 – 17,051,850 –
Undrawn portion of committed (Irrevocable)

facilities and other contingent funding obligations 234,679,545 20,756,629 306,123,236 30,602,450
Additional requirements 81,649,612 81,649,612 27,165,307 27,165,307
Total cash inflows 213,285,842 162,260,205 198,896,001 171,005,309
Maturing secured lending transactions backed by collateral 27,071,732 27,071,732 18,124,786 18,124,786
Committed facilities – – – –
Other inflows by counterparty which are maturing within 30 days 92,324,469 53,538,861 149,501,619 126,208,496
Operational deposits 12,240,029 – 4,597,569 –
Other cash inflows 81,649,612 81,649,612 26,672,027 26,672,027
Liquidity coverage ratio (%)

(Stock of high quality liquid assets/Total net cash
outflows over the next calendar days)* 100 – 119.47 – 105.71
PEOPLE’S BANK
ABOUT
TEMPLATE 5: MAIN FEATURES OF REGULATORY CAPITAL INSTRUMENTS
Type A Type B Type A Type B Additional Additional
Debenture Debenture Debenture Debenture Tier 1 Tier 1
issued in issued in issued in issued in Debenture 1 Debenture 2
2019 2019 2020 2020 2021 2021
FROM THE TOP

REFLECTIONS
Must be provided for each type of capital
instrument separately
Description of the capital instrument
Issuer People’s Bank People’s Bank People’s Bank People’s Bank People’s Bank People’s Bank
Unique identifier (e.g. ISIN or Bloomberg

identifier for private placement) A B A B 1 2
Original date of issuance 8 November 8 November 27 July 27 July 29 March 3 August

2019 2019 2020 2020 2021 2021
VALUE CREATION
DRIVING
Par value of instrument (LKR) 6,563,000,000 3,437,000,000 12,900,000,000 7,100,000,000 3,500,000,000 1,500,000,000
Original maturity date, if applicable 8 November 8 November 27 July 27 July

2024 2027 2025 2028 N/A N/A
Amount recognised in regulatory capital

(in LKR '000 as at the reporting date) 3,609,650,000 3,437,000,000 9,030,000,000 7,100,000,000 3,500,000,000 1,500,000,000
Accounting classification (equity/liability) Liability Liability Liability Liability Liability Liability
Issuer call subject to prior
AND ANALYSIS
supervisory approval
Optional call date, contingent call dates
and redemption amount (LKR ’000) N/A N/A N/A N/A N/A N/A
Subsequent call dates, if applicable N/A N/A N/A N/A N/A N/A
Coupons/dividends
Fixed or floating dividend/coupon Fixed rate Fixed rate Fixed rate Fixed rate Fixed rate Fixed rate
Coupon rate and any related index (%) 12.00 12.25 9.50 10.25 9.50 9.50
Non-cumulative or cumulative N/A N/A N/A N/A N/A N/A
Convertible or Non-convertible
REPORTS
GOVERNANCE
If convertible, conversion trigger (s) Non- Non- Non- Non- Non- Non-
convertible convertible convertible convertible convertible convertible
If convertible, fully or partially N/A N/A N/A N/A N/A N/A
If convertible, mandatory or optional N/A N/A N/A N/A N/A N/A
If convertible, conversion rate N/A N/A N/A N/A N/A N/A

STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
TEMPLATE 6: SUMMARY DISCUSSION ON THE ADEQUACY/MEETING CURRENT

AND FUTURE CAPITAL REQUIREMENTS
Overview 2017 2018
In accordance with CBSL stipulations, z Raise LKR 5.0 Bn. in New Capital z The Bank endeavoured to further
the Bank carries out an annual Internal from General Treasury, Ministry of reduce its dividend payout ratio, as
Capital Adequacy Assessment Process. Finance on 21 July 2017. This was measured as a function of dividends
The assessment covers a five (5) year first so received over the last eight over post tax profit, to 20.0% in 2018
time horizon with the last carried out (8) years. from 28.6% in 2017.
for 2019-2023. z Reduce its dividend payout, as z Loan book growth was risk
measured as a function of post tax measured during 2018.
profit, to 28.6% during 2017 from Interim profit certifications were
Material exposures z
54.8% in 2016. carried out for the six months period
At the end of 2022, close 42.6% z Revalued all its land and buildings ended 30 June 2018 in view of
of the Bank’s total loan book was on 1 July 2017. This enabled the Bank ensuring interim regulatory capital
composed of exposures to the State recognise close to LKR 3.6 Bn. requirements were met.
and other state-owned enterprises. in Tier 2 capital with requisite z The process in relation to the
State exposures mostly backed by regulatory clearance. People’s Bank Act amendment
sovereign undertaking(s) by way of
z Ensured new facilities extended continued. This was key to long-
either a Treasury guarantee/indemnity
to state-owned enterprises were term sustainable loan book growth.
and/or another form of Government
backed by the sovereign backed
assurance.
and, in case of other forms of
As a result of all the above, during
government assurances, ensure they
Leaving aside such sovereign backed 2018 - the Bank successfully met
are as a general rule routed through
exposures, the Bank’s single largest all Basel III Risk Control measures
the Monetary Board of the Central
exposure to a non-sovereign does not without any exception or excuse,
Bank of Sri Lanka for prior approval.
account for over 2.0% of the Bank’s be Capital Adequacy Ratio,
total loan book. z Carry-out an interim profit Liquidity Coverage Ratio, Net
certification for the six months Stable Funding and Leverage.
period ended 30 June 2017 in view
Initiatives taken to bolster of ensuring interim regulatory capital
regulatory capital during pressures are managed in order to
2017, 2018, 2019, 2020, support loan book growth.
2021 and 2022 z Undertake efforts necessary to
During 2017 and 2018 2019, 2020, 2021 amend the People’s Bank Act to
and 2022 – the Bank undertook several facilitate the issuance of Debentures
initiatives to bolster its regulatory to enable the Bank conform with
capital and meet all requisite Basel III Basel rules. This process was once
Risk Control measures. From a Capital again revived with the assistance
Adequacy/Solvency perspective, these of the line of Ministry.
included amongst other.
As a result of all the above, during
2017 – the Bank successfully met
all Basel III Risk Control Measures
without any exception or excuse,
be Capital Adequacy Ratio,
Liquidity Coverage Ratio, Net
Stable Funding and Leverage.
PEOPLE’S BANK
ABOUT
2019 2021 2023 plan
z The Bank further reduced its z On 29 March 2021 and 3 August z The Bank is in a constant and
dividend payout ratio to 18.7% in 2021 – as originally planned – the continuous process of undertaking
2019 from 20.0% in 2018. Bank issued LKR 3.5 Bn. and measures reasonably necessary to
FROM THE TOP

REFLECTIONS
z Interim profit certifications were LKR 1.5 Bn. Basel III, Additional bolster its regulatory capital levels
carried during the three months Tier 1 compliant debentures. z Following are slated to be
ended 31 March 2019, six months z The Bank further reduced its undertaken during 2023.
ended 30 June 2019 and the nine dividend payout ratio to 9.2 % z Issue Additional Tier 1 and Tier 2
months ended 30 September 2019 in 2021. Basel III compliant instruments
in view of managing/avoiding z Interim profit certifications were z As originally planned carry-out
interim regulatory capital pressures. carried out for three months ended revaluation of all its land and
z The People’s Bank Act amendments 31 March 2021, Six months ended buildings to bolster Tier 2 capital.
VALUE CREATION
DRIVING
was finalised in September 2019 30 June 2021 and nine months
z Continue to maintain its lower
z On 8 November 2019 – the Bank ended 30 September 2021 in view
dividend/levy payout policy
issued its first Basel III, Tier 2 of managing regulatory capital
during the year.
compliant debenture for value pressure.
z Carry-out an interim profit
LKR 10.0 Bn.
certification in view of avoiding
As a result of all the above, during regulatory capital shortfalls.
As a result of all the above, during 2021 – the Bank successfully met
2019 – the Bank successfully met all Basel III Risk Control Measures
AND ANALYSIS
all Basel III Risk Control Measures without any exception or excuse,
without any exception or excuse, be Capital Adequacy Ratio,
be Capital Adequacy Ratio, Liquidity Coverage Ratio, Net
Liquidity Coverage Ratio, Net Stable Funding and Leverage.
2020 2022
z On 1 July 2020 – as originally z The Bank further reduced its
planned – the Bank revalued all its dividend payout ratio to 3.9%
land and buildings. This resulted in a in 2022.
REPORTS
GOVERNANCE
Tier 2 benefit of close to LKR 2.3 Bn. z Interim Profit Certifications were
The next detailed revaluation is set carried out for Six months ended
to be carried out on 1 July 2023. 30 June 2022 in view of managing
z On 27 July 2020 – the Bank issued regulatory capital pressure.
LKR 20.0 Bn. in Basel III, Tier 2
debentures which was the single As a result of all the above, during
largest issuance for any Bank/ 2022 – the Bank successfully met
STATEMENTS
FINANCIAL
Financial Services Provider to date all Basel III Risk Control Measures
in the country. without any exception or excuse,
As a result of all the above, during Liquidity Coverage Ratio, Net
2020 – the Bank successfully met Stable Funding and Leverage.
all Basel III Risk Control Measures
without any exception or excuse,
INFORMATION
SUPPLEMENTARY
Liquidity Coverage Ratio, Net

TEMPLATE 07: CREDIT RISK UNDER STANDARDISED APPROACH

Credit risk exposures and credit risk mitigation effects (Bank)
Exposures before CCF and CRM Exposures after CCF and CRM
Item Exposures Exposures Total Exposures Exposures Total Risk- RWA

on-balance off-balance on-balance off-balance weighted density
sheet sheet sheet sheet assets (%)
Total risk-weighted
amount for credit risk 2,924,017,324 312,280,311 3,236,297,635 2,710,584,767 55,791,343 2,766,376,111 854,663,864 31
Claims on Central
Government and Central
Bank of Sri Lanka 1,557,154,500 12,520,987 1,569,675,487 1,557,154,500 35,534 1,557,190,034 104,078,413 7
Claims on public sector

entities (PSEs) 287,952,805 26,176,785 314,129,591 110,058,417 1,967,321 112,025,739 34,966,728 31
Claims on banks exposures 11,566,209 – 11,566,209 11,566,209 – 11,566,209 4,949,674 43
Claims on financial
institutions 6,701,868 – 6,701,868 6,701,868 – 6,701,868 3,604,999 54
Claims on corporates 132,329,105 227,145,432 359,474,537 132,220,158 44,501,067 176,721,225 176,709,703 100
Retail claims 513,376,937 46,437,106 559,814,043 477,947,715 9,287,421 487,235,137 380,310,299 78
Claims secured by gold 183,955,880 – 183,955,880 183,955,880 – 183,955,880 2,922 –
Claims secured by
residential property 59,509,996 – 59,509,996 59,509,996 – 59,509,996 20,828,499 35
Non-performing
assets (NPAs) 39,155,305 – 39,155,305 39,155,305 – 39,155,305 51,930,634 133
Higher-risk categories 1,147,268 – 1,147,268 1,147,268 – 1,147,268 2,868,170 250
Cash items 57,119,603 – 57,119,603 57,119,603 – 57,119,603 365,976 1
Other assets 74,047,847 – 74,047,847 74,047,847 – 74,047,847 74,047,847 100

PEOPLE’S BANK
ABOUT
TEMPLATE 07: CREDIT RISK UNDER STANDARDISED APPROACH
Credit risk exposures and credit risk mitigation effects (Group)
Exposures before CCF and CRM Exposures after CCF and CRM
Item Exposures Exposures Total Exposures Exposures Total Risk- RWA

on-balance off-balance on-balance off-balance weighted density
sheet sheet sheet sheet assets (%)
FROM THE TOP

REFLECTIONS
Total risk-weighted
amount for credit risk 3,092,686,496 312,280,311 3,404,966,807 2,879,253,940 55,791,343 2,935,045,283 1,009,037,876 34
Claims on Central
Government and Central
Bank of Sri Lanka 1,570,065,905 12,520,987 1,582,586,892 1,570,065,905 35,534 1,570,101,439 104,078,413 7
Claims on public sector

entities (PSEs) 287,952,805 26,176,785 314,129,591 110,058,417 1,967,321 112,025,739 34,966,728 31
VALUE CREATION
DRIVING
Claims on banks exposures 14,767,304 – 14,767,304 14,767,304 – 14,767,304 7,318,902 50
Claims on financial
institutions 6,701,868 – 6,701,868 6,701,868 – 6,701,868 3,604,999 54
Claims on corporates 132,329,105 227,145,432 359,474,537 132,220,158 44,501,067 176,721,225 176,709,703 100
Retail claims 644,347,513 46,437,106 690,784,619 608,918,291 9,287,421 618,205,712 511,280,874 83
Claims secured by gold 183,955,880 – 183,955,880 183,955,880 – 183,955,880 2,922 –
Claims secured by
AND ANALYSIS
residential property 59,509,996 – 59,509,996 59,509,996 – 59,509,996 20,828,499 35
Non-performing
assets (NPAs) 40,849,720 – 40,849,720 40,849,720 – 40,849,720 53,625,050 131
Higher-risk categories 1,487,552 – 1,487,552 1,487,552 – 1,487,552 3,718,881 250
Cash items 58,181,917 – 58,181,917 58,181,917 – 58,181,917 365,976 1
Other assets 92,536,931 – 92,536,931 92,536,931 – 92,536,931 92,536,931 100
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
TEMPLATE 8: CREDIT RISK UNDER STANDARDISED APPROACH:

EXPOSURES BY ASSET CLASSES AND RISK WEIGHTS – BANK
Description Amount (LKR ’000) as at 31 December 2017 (Post CCF and CRM)
Risk weight 0% 20% 50% 60%
Asset classes
Claims on Central Government and Central Bank of Sri Lanka 1,036,797,969 520,392,066 –
Claims on public sector entities – 96,323,763 –
Claims on banks exposures – 8,080,959 423,018
Claims on financial institutions – – 6,193,738
Claims on corporates – – 23,044
SME exposures – – – 1,595,021
Retail claims 183,941,269 14,611 –
Claims secured by residential property – – 59,509,996
Non-performing assets (NPAs) – – 6,309
Higher-risk categories – – –
Cash items and other assets 55,289,725 1,829,878 –
Total 1,276,028,962 626,641,277 66,156,105 1,595,021
TEMPLATE 8: CREDIT RISK UNDER STANDARDISED APPROACH:

EXPOSURES BY ASSET CLASSES AND RISK WEIGHTS – GROUP
Description Amount (LKR ’000) as at 31 December 2017 (Post CCF and CRM)
Risk weight 0% 20% 50% 60%
Asset classes
Claims on Central Government and Central Bank of Sri Lanka 1,049,709,374 520,392,066 – –
Claims on public sector entities – 96,323,763 – –
Claims on banks exposures – 9,120,793 423,018 –
Claims on financial institutions – – 6,193,738 –
Claims on corporates – – 23,044 –
SME exposures – – – 1,595,021
Retail claims 183,941,269 14,611 – –
Claims secured by residential property – – 59,509,996 –
Non-performing assets (NPAs) – – 6,309 –
Higher-risk categories – – – –
Cash items and other assets 56,352,039 1,829,878 – –
Total 1,290,002,681 627,681,111 66,156,105 1,595,021

PEOPLE’S BANK
ABOUT
Amount (LKR ’000) as at 31 December 2017 (Post CCF and CRM)
75% 100% 150% >150% Total Credit

exposures
amount
FROM THE TOP

REFLECTIONS
– – – – 1,557,190,034
– 15,701,975 – – 112,025,739
– 2,942,750 119,482 – 11,566,209
– 508,130 – – 6,701,868
– 176,698,181 – – 176,721,225
– – – – 1,595,021
VALUE CREATION
DRIVING
425,147,318 60,492,797 – – 669,595,995
– – – – 59,509,996
– 13,592,029 25,556,967 – 39,155,305
– – – 1,147,268 1,147,268
– 74,047,847 – – 131,167,451
425,147,318 343,983,709 25,676,449 1,147,268 2,766,376,111
AND ANALYSIS
Amount (LKR ’000) as at 31 December 2017 (Post CCF and CRM)
75% 100% 150% >150% Total Credit

Exposures
Amount
– – – – 1,570,101,439
– 15,701,975 – – 112,025,739
– 5,104,011 119,482 – 14,767,304
REPORTS
GOVERNANCE
– 508,130 – – 6,701,868
– 176,698,181 – – 176,721,225
– – – – 1,595,021
425,147,318 191,463,372 – – 800,566,571
– – – – 59,509,996
– 15,286,444 25,556,967 – 40,849,720

STATEMENTS
FINANCIAL
– – – 1,487,552 1,487,552
– 92,536,931 – – 150,718,848
425,147,318 497,299,045 25,676,449 1,487,552 2,935,045,283

INFORMATION
SUPPLEMENTARY
TEMPLATE 9: MARKET RISK UNDER STANDARDISED MEASUREMENT METHOD

Bank Group
As at 31 December 2022 2021 2022 2021

LKR ’000 LKR ’000 LKR ’000 LKR ’000
(a) RWA for interest rate risk 703,158 748,043 703,158 748,043
General interest rate risk 343,458 387,643 343,458 387,643
(i) Net long or short position 343,458 387,643 343,458 387,643
(ii) Horizontal disallowance – – – –
(iii) Vertical disallowance – – – –
(iv) Options – – – –
Specific interest rate risk 359,700 360,400 359,700 360,400
(b) RWA for equity 424,187 363,033 746,306 859,631
(i) General equity risk 213,567 184,076 374,627 432,375
(ii) Specific equity risk 210,620 178,957 371,679 427,256
(c) RWA for foreign exchange and gold 1,847,912 132,417 1,847,912 132,417
(d) Capital charge for market risk (a)+(b)+(c) 2,975,256 1,243,493 3,297,376 1,740,091
RWA for market risk (d) *100/13.5 (2022), *100/12.5 (2021) 22,038,936 9,947,944 24,425,006 13,920,728
TEMPLATE 10: OPERATIONAL RISK UNDER BASIC INDICATOR APPROACH

Bank Group
Gross Income Gross Income
1st year 2nd year 3rd year Average 1st year 2nd year 3rd year Average
The basic indicator

approach 71,822,080 92,273,369 110,691,908 91,595,786 90,942,446 111,199,190 130,493,754 110,878,463
Capital charges for

operational risk (LKR ’000)
The basic indicator
approach 15% 10,773,312 13,841,005 16,603,786 13,739,368 13,641,367 16,679,879 19,574,063 16,631,770
Risk-weighted amount for

operational risk (LKR ’000)
The basic indicator
approach 7.4 79,802,311 102,525,966 122,991,009 101,773,095 101,047,162 123,554,656 144,993,060 123,198,293
PEOPLE’S BANK
ABOUT
TEMPLATE 11: DIFFERENCES BETWEEN ACCOUNTING AND REGULATORY
SCOPES AND MAPPING OF FINANCIAL STATEMENT CATEGORIES WITH
REGULATORY RISK CATEGORIES – BANK ONLY
Carrying value Carrying value Subject to Subject to Not Subject to
as reported under scope credit risk market risk capital requirement
in published of regulatory framework framework or subject to
FROM THE TOP

REFLECTIONS
Financial reporting deduction
Statements from capital
LKR ’000 LKR ’000 LKR ’000 LKR ’000 LKR ’000
Assets
Assets 2,972,028,452 2,972,028,452 2,933,869,731 6,918,067 31,240,654
Cash and cash equivalents 66,842,171 66,842,171 66,842,171 – –
Balances with Central Bank of Sri Lanka 67,602,313 67,602,313 67,602,313 – –
Placements with Banks – – – – –
VALUE CREATION
DRIVING
Derivative financial instruments 14,882,584 14,882,584 12,994,106 – 1,888,478
Financial assets – At fair value
through profit or loss 5,556,754 5,556,754 – 5,556,754 –
Financial assets – At amortised cost
Loans and receivables to banks 7,689,150 7,689,150 7,689,150 – –
Loans and receivables to other customers 1,783,106,693 1,783,106,693 1,783,106,693 – –
Debt instruments measured at amortised cost 913,099,927 913,099,927 913,099,927 – –
Financial Assets - At fair value through
other comprehensive income (OCI)
AND ANALYSIS
Equity instruments at fair value through OCI 1,661,656 1,661,656 1,361,313 300,343
Debt instruments at fair value through OCI 10,378,370 10,378,370 10,378,370 – –
Investments in subsidiaries 4,280,522 4,280,522 1,152,218 – 3,128,304
Investments in associates – – – – –
Goodwill and intangible assets 1,719,177 1,719,177 – – 19,441,849
Property, plant and equipment 49,330,080 49,330,080 29,888,231 – –
Other assets 45,879,055 45,879,055 41,116,552 – 4,762,503
Liabilities 2,826,734,321 2,826,734,321 – – –

Due to banks 111,452,491 111,452,491 – – –
Derivative financial instruments 1,888,478 1,888,478 – – –
REPORTS
GOVERNANCE
Due to other customers 2,371,518,898 2,371,518,898 – – –
Other borrowings 191,527,573 191,527,573 – – –
Current tax liabilities 6,372,157 6,372,157 – – –
Net deferred tax liabilities 606,207 606,207 – – –
Other liabilities 106,765,050 106,765,050 – – –
Subordinated term debts 36,603,467 36,603,467 – – –
STATEMENTS
FINANCIAL
Shareholders' equity 145,294,131 145,294,131 – – –

Stated capital/Assigned capital 12,201,998 12,201,998 – – –
Statutory reserve fund 10,070,131 10,070,131 – – –
Other reserves 38,397,830 38,397,830 – – –
Retained earnings 84,624,172 84,624,172 – – –
Total equity and liabilities 2,972,028,452 2,972,028,452 – – –
Off-balance sheet liabilities 370,648,773 370,648,773 370,648,773 – –

INFORMATION
SUPPLEMENTARY
Acceptance 74,070,645 74,070,645 74,070,645 – –

Guarantees 22,841,324 22,841,324 22,841,324 – –
Letter of credit 68,387,765 68,387,765 68,387,765 – –
Other contingent items 137,037,060 137,037,060 137,037,060 – –
Undrawn loan commitments 68,828,585 68,828,585 68,828,585 – –
(-) Allowance for ECL/impairment losses (516,606) (516,606) (516,606) – –
TEMPLATE 12: GROUP ASSESSMENT OF DOMESTIC SYSTEMICALLY IMPORTANT BANKS

(D-SIBS) AS AT 31 DECEMBER 2022
Group
LKR ’000
Size Indicator
Section 1 – Total Exposures
Total exposures measure 3,201,579,781
Interconnectedness Indicators
Section 2 – Intra-financial System Assets
a. Funds deposited with or lent to other financial institutions (including unused portion of committed lines extended) 25,119,194
(i) Funds deposited 14,767,304
(ii) Lending 10,351,890
b. Holdings of securities issued by other financial institutions 914,913
c. Net positive current exposure of securities financing transactions (SFTs) with other financial institutions 12,962,606
d. Over-the-counter (OTC) derivatives with other financial institutions that have a net positive mark to market value 16,324,642
Intra-financial system assets 55,321,355
Section 3 – Intra-financial System Liabilities

a. Funds deposited by or borrowed from other financial institutions (including unused portion of committed lines obtained) 150,023,562
(i) Funds deposited 24,659,596
(ii) Borrowings 125,363,966
b. Net negative current exposure of securities financing transactions with other financial institutions –
c. Over-the-counter derivatives with other financial institutions that have a net negative mark to market value 2,815,352
Intra-financial system liabilities 152,838,914
Section 4 – Securities Outstanding

Securities outstanding 52,781,563
Substitutability/Financial Institution Infrastructure Indicators

Section 5 – Payments made in the Reporting Year (excluding intra-group payments)
Payments activity 3,837,588,965
Section 6 – Assets Under Custody

Assets under custody –
Section 7 – Underwritten Transactions in Debt and Equity Markets

Underwriting activity –
Section 8 – Trading Volume

a. Number of shares or securities 11,141
b. Value of the transactions 202,578
PEOPLE’S BANK
ABOUT
Group
LKR ’000
Complexity indicators
FROM THE TOP

REFLECTIONS
Section 9 – Notional amount of Over-the-Counter (OTC) derivatives
OTC derivatives 152,222,636
Section 10 – Level 2 Assets

Level 2 assets 8,003,107
Section 11 – Trading and Available-for-Sale (AFS) securities

a. Debt instruments 10,484,399
2,424,409
VALUE CREATION
DRIVING
b. Equity instruments
c. Government Securities 6,280,524
d. Derivatives 14,882,584
Section 12 – Cross-jurisdictional Liabilities

Cross-jurisdictional liabilities (excluding derivatives and intra-group liabilities) 159,319,755
Section 13 – Cross-jurisdictional Claims

Cross-jurisdictional claims (excluding derivatives and intra-group claims) 24,683,406
AND ANALYSIS
REPORTS
GOVERNANCE
STATEMENTS
FINANCIAL
INFORMATION
SUPPLEMENTARY
EXTERNAL ASSURANCE ON SUSTAINABILITY REPORT
Ernst & Young Tel : +94 11 246 3500

Chartered Accountants Fax (Gen) : +94 11 269 7369
201, De Saram Place Fax (Tax) : +94 11 557 8180
P.O. Box 101 Email : [email protected]
Colombo 10, Sri Lanka ey.com
INDEPENDENT ASSURANCE Our engagement provides limited assumption of responsibility for

REPORT TO THE BOARD OF assurance as well as reasonable any reliance on this Report to any
DIRECTORS OF PEOPLE’S assurance. A limited assurance person other than the Bank or for any
engagement is substantially less in purpose other than that for which
BANK
scope than a reasonable assurance it was prepared. In conducting our
engagement conducted in accordance engagement, we have complied with
Introduction and scope of the
with and consequently does not enable the independence requirements of
engagement
to obtain assurance that we would the Code of Ethics for Professional
The Management of People’s Bank become aware of all significant matters Accountants issued by CA Sri Lanka,
(“the Bank”) engaged us to provide that might be identified in a reasonable
an independent assurance on the assurance engagement. EY also applies International Standard
following elements of its Integrated on Quality Control 1, Quality Control
Annual Report for the year ended for Firms that Perform Audits and
Management of the Bank’s
31 December 2022 (“the Report”). Reviews of Financial Statements, and
responsibility for the Report Other Assurance and Related Services
z Reasonable assurance on the
information on financial performance The Management of the Bank Engagements, and accordingly
as specified on page 123 of the is responsible for selecting the maintains a comprehensive system of
Report. criteria, and for the preparation and quality control including documented
presentation and self-declaration of the policies and procedures regarding
z Limited assurance on other
information contained in the Report in compliance with ethical requirements,
information presented in the Report,
accordance with the given criteria, in professional standards, and applicable
prepared in accordance with the
all material respects. This responsibility legal and regulatory requirements.
GRI Standards.
includes establishing and maintaining
internal controls, maintaining adequate
Key assurance procedures
Basis of our work and level of records and making estimates that
assurance are relevant to the preparation of the We planned and performed our
information, such that it is free from procedures to obtain the information
We perform our procedures to
material misstatement, whether due to and explanations considered necessary
provide reasonable and limited
fraud or error. to provide sufficient evidence to
assurance in accordance with Sri Lanka
support our assurance conclusions.
Standard on Assurance Engagements
We performed such other procedures
(SLSAE 3000) (Revised): “Assurance Ernst & Young’s as we considered necessary in
Engagements Other than Audits responsibilities the circumstances. Key assurance
or Reviews of Historical Financial
Our responsibility is to express a procedures included:
Information”.
conclusion as to whether we have z Agreed the information on financial
become aware of any matter that performance as disclosed on
The criteria applied for this assurance
causes us to believe that the Report page 123 of the Report to audited
engagement:
is not prepared in accordance with financial statements
z The Global Reporting Initiative’s the given criteria. This Report is made
(GRI) Sustainability Reporting
z Validated the information presented
solely to the Bank in accordance and checked the calculations
Guidelines, publicly available with our engagement letter dated
at GRI’s global website performed by the organisation
1 March 2023. We disclaim any through recalculation
www.globalreporting.org.
Partners: H M A Jayesinghe FCA FCMA, R N de Saram ACA FCMA, Ms. N A De Silva FCA, W R H De Silva FCA ACMA, Ms. Y A De Silva FCA, Ms. K R M Fernando FCA ACMA, N Y R L Fernando ACA,
W K B S P Fernando FCA FCMA, Ms. L K H L Fonseka FCA, D N Gamage ACA ACMA, A P A Gunasekera FCA FCMA, A Herath FCA, D K Hulangamuwa FCA FCMA LLB (London),
Ms. G G S Manatunga FCA, A A J R Perera ACA ACMA, Ms. P V K N Sajeewani FCA, N M Sulaiman ACA ACMA, B E Wijesuriya FCA FCMA, C A Yalagala ACA ACMA
Principals: W S J De Silva BSc (Hons)-MIS MSc-IT, G B Goudian ACMA, D L B Karunathilaka ACMA, Ms. P S Paranavitane ACA ACMA LLB (Colombo), T P M Ruberu FCMA FCCA
A member firm of Ernst & Young Global Limited
External Assurance on Sustainability Report
PEOPLE’S BANK
ABOUT
FROM THE TOP
REFLECTIONS
z Performed a comparison of the Limitations and considerations
content given in the Report against
the criteria given in the selected Social, Natural and, Intellectual capital
sustainability standards/frameworks management data/information are
subject to inherent limitations given
z Conducted interviews with their nature and the methods used for
relevant organisation’s personnel determining, calculating and estimating
to understand the process for
VALUE CREATION
DRIVING
such data.
collection, analysis, aggregation
and presentation of data. Interviews We also do not provide any assurance
included selected Key Management on the assumptions and achievability
Personnel and relevant staff of prospective information presented
z Read the content presented in in the Report.
the Report for consistency with
our overall knowledge obtained
during the course of our assurance
Conclusion
AND ANALYSIS
engagement and requested changes Based on our procedures and the
wherever required. evidence obtained, we conclude that:
z Provided guidance, z The information on financial
recommendations and feedback performance as specified on
on the improvement of the page 123 of the Report are properly
sustainability reporting indicators to derived from the audited financial
improve the presentation standard. statements for the year ended
31 December 2022.
Although we considered the z Nothing has come to our attention
effectiveness of Management’s that causes us to believe that
internal controls when determining the the information presented in the
nature and extent of our procedures,
REPORTS
GOVERNANCE
Report are not fairly presented, in
our assurance engagement was not all material respects, in accordance
designed to provide assurance on with the relevant criteria.
internal controls. Our procedures
did not include testing controls or
performing procedures relating to
checking aggregation or calculation
of data within IT systems.
STATEMENTS
FINANCIAL
9 March 2023
Colombo
INFORMATION
SUPPLEMENTARY
GRI CONTENT INDEX
STATEMENT OF USE
People’s Bank has reported in accordance with the GRI Standards for the period 1 January 2022 to 31 December 2022.
GRI 1 USED
GRI 1: Foundation 2021
GRI standard/ Disclosure Location Omission Remarks

other source
Require-
ment (s)
omitted Reason Explanation
General disclosures
GRI 2: 2-1 Organisational details 218, 368
General
Disclosures 2-2 Entities included in the organisation’s 3
2021 sustainability reporting
2-3 Reporting period, frequency and 3, 6
contact point
2-4 Restatements of information 3
2-5 External assurance 5, 346-347
2-6 Activities, value chain and other 60-61, 110-111,
business relationships 117, 218
2-7 Employees 96-99
2-8 Workers who are not employees 98
2-9 Governance structure and 24-27, 62,
composition 169, 171
2-10 Nomination and selection of 175, 198
the highest governance body
2-11 Chair of the highest 172-174
governance body
2-12 Role of the highest governance body 174
in overseeing the management of impacts
2-13 Delegation of responsibility for 62, 176 ,
managing impacts 194-201
2-14 Role of the highest governance body 16-19, 62
in sustainability reporting
2-15 Conflicts of interest 180, 190-192
2-16 Communication of critical concerns 106
2-17 Collective knowledge of the highest 24-27, 169,
governance body 173
2-18 Evaluation of the performance of the 175
highest governance body
2-19 Remuneration policies 175, 188
2-20 Process to determine remuneration 175, 188
2-21 Annual total compensation ratio – 2-21 Confidentiality Bank does not
constraints disclose this due to
confidentiality reasons
2-22 Statement on sustainable 16-19, 168
development strategy
2-23 Policy commitments 107
2-24 Embedding policy commitments 107
2-25 Processes to remediate 106-107
negative impacts
2-26 Mechanisms for seeking advice and 106-107
raising concerns
GRI content index
PEOPLE’S BANK
ABOUT
other source
Require-
ment (s)
2-27 Compliance with laws and 90

regulations
FROM THE TOP

REFLECTIONS
2-28 Membership associations 118
2-29 Approach to stakeholder 47 – 49

engagement
2-30 Collective bargaining agreements 106
Material topics
GRI 3: 3-1 Process to determine material topics 50, 54
Material
3-2 List of material topics 51-53
VALUE CREATION
DRIVING
Topics 2021
3-3 Management of material topics 51-53
Economic performance
GRI 201: 201-1 Direct economic value generated 123
Economic and distributed
Performance
2016 201-2 Financial implications and other risks 136
and opportunities due to climate change
201-3 Defined benefit plan obligations and 227-228

other retirement plans
AND ANALYSIS
201-4 Financial assistance received – No exceptional
from government relief received
during the year
Market presence
GRI 202: 202-1 Ratios of standard entry level wage 104
Market by gender compared to local minimum
Presence 2016 wage
202-2 Proportion of senior management 99

hired from the local community
Indirect economic impacts
REPORTS
GOVERNANCE
GRI 203: 203-1 Infrastructure investments and 127
Indirect services supported
Economic
Impacts 2016 203-2 Significant indirect economic 127-128
impacts
Procurement practices
GRI 204: 204-1 Proportion of spending on local 116
Procurement suppliers
Practices 2016
STATEMENTS
FINANCIAL
Anti-corruption
GRI 205: Anti- 205-1 Operations assessed for risks – The Bank evaluates
corruption related to corruption the potential impact
2016 of operational risk
on all product,
processes and
activities on an
ongoing basis.
INFORMATION
SUPPLEMENTARY
205-2 Communication and training about 106-107

anti-corruption policies and procedures
205-3 Confirmed incidents of corruption 106-107

and actions taken
GRI content index

other source
Require-
ment (s)
Anti-competitive behavior
GRI 206: Anti- 206-1 Legal actions for anti-competitive 111

competitive behavior, anti-trust, and monopoly
Behavior 2016 practices
Tax
GRI 207: 207-1 Approach to tax 70, 229-230

Tax 2019
207-2 Tax governance, control, and 70, 229-230
risk management
207-3 Stakeholder engagement and 70, 229-230
management of concerns related to tax
207-4 Country-by-country reporting – 207-4 Not PB does not operate
applicable in other countries
Energy
GRI 302: 302-1 Energy consumption within 135
Energy 2016 the organisation
302-2 Energy consumption outside – 302-2 Not Not applicable to the
of the organisation applicable Banks operations
302-3 Energy intensity 135
302-4 Reduction of energy consumption 135
302-5 Reductions in energy requirements – 302-5 Not Not applicable to the
of products and services applicable Banks operations
Water and effluents
GRI 303: Water 303-1 Interactions with water 134
and Effluents as a shared resource
2018
303-2 Management of water – 303-2 Information Bank does not track
discharge-related impacts unavailable/ these
incomplete
303-3 Water withdrawal – 303-3 Information Bank does not track
unavailable/ these
incomplete
303-4 Water discharge – 303-4 Information Bank does not track
unavailable/ these
incomplete
303-5 Water consumption 134
Emissions
GRI 305: 305-1 Direct (Scope 1) GHG emissions 134
Emissions 2016
305-2 Energy indirect (Scope 2) 134
GHG emissions
305-3 Other indirect (Scope 3) 134
GHG emissions
305-4 GHG emissions intensity 134
305-5 Reduction of GHG emissions 134
305-6 Emissions of ozone-depleting – 305-6 Not applicable Not applicable to the
substances (ODS) Banks operations
305-7 Nitrogen oxides (NOx), – 305-7 Not applicable Not applicable to the
sulfur oxides (SOx), and other Banks operations
significant air emissions
GRI content index
PEOPLE’S BANK
ABOUT
other source
Require-
ment (s)
Supplier environmental assessment

GRI 308: 308-1 New suppliers that were screened 117-118
FROM THE TOP

REFLECTIONS
Supplier using environmental criteria
Environmental
Assessment 308-2 Negative environmental impacts in – There were no
2016 the supply chain and actions taken incidents reported
for the year
Employment
GRI 401: 401-1 New employee hires and 100, 105

Employment employee turnover
2016
VALUE CREATION
DRIVING
401-2 Benefits provided to full-time 104
employees that are not provided to
temporary or part-time employees
401-3 Parental leave 103
Labour/management relations
GRI 402: 402-1 Minimum notice periods regarding 106
Labour/ operational changes
Management
Relations 2016
AND ANALYSIS
Occupational health and safety
GRI 403: 403-1 Occupational health and safety – 403-1 Not applicable Bank does not have
Occupational management system a Management
Health and system for
Safety 2018 Occupational
health and safety
403-2 Hazard identification, risk 103-104

assessment,
and incident investigation
403-3 Occupational health services 103-104
403-4 Worker participation, consultation, 103-104

and communication on occupational
REPORTS
GOVERNANCE
health and safety
403-5 Worker training on occupational 103-104

health and safety
403-6 Promotion of worker health 103-104
403-7 Prevention and mitigation of 103-104

occupational health and safety impacts
directly linked by business relationships
STATEMENTS
FINANCIAL
403-8 Workers covered by an – 403-8 Not applicable Bank does not have
occupational health and safety a Management
management system system for
Occupational
health and safety
403-9 Work-related injuries 104
403-10 Work-related ill health 104

INFORMATION
SUPPLEMENTARY
GRI content index

other source
Require-
ment (s)
Training and education

GRI 404: 404-1 Average hours of training per year 101
Training and per employee
Education
2016 404-2 Programs for upgrading employee 100-102
skills and transition assistance programs
404-3 Percentage of employees 102
receiving regular performance and career
development reviews
Diversity and equal opportunity
GRI 405: 405-1 Diversity of governance bodies 98-99, 169
Diversity and employees
and Equal
Opportunity 405-2 Ratio of basic salary and 103
2016 remuneration of women to men
Non-discrimination
GRI 406: Non- 406-1 Incidents of discrimination and – No discriminations
discrimination corrective actions taken reported for
2016 the year
Local communities
GRI 413: 413-1 Operations with local community 126 - 128
Local engagement, impact assessments, and
Communities development programs
2016
413-2 Operations with significant actual – No instances were
and potential negative impacts on local reported for
communities the year
Supplier social assessment
GRI 414: 414-1 New suppliers that were screened 117
Supplier using social criteria
Social
Assessment 414-2 Negative social impacts in the – No instance were
2016 supply chain and actions taken reported for
the year
Customer health and safety
GRI 416: 416-1 Assessment of the health and safety 113
Customer impacts of product and service categories
Health and
Safety 2016 416-2 Incidents of non-compliance – No instances were
concerning the health and safety impacts reported for
of products and services the year
Marketing and labeling
GRI 417: 417-1 Requirements for product and 113
Marketing and service information and labeling
Labeling 2016
417-2 Incidents of non-compliance 113
concerning product and service
information and labeling
417-3 Incidents of non-compliance 113
concerning marketing communications
Customer privacy
GRI 418: 418-1 Substantiated complaints concerning 113
Customer breaches of customer privacy and losses
Privacy 2016 of customer data
SENIOR MANAGERS
PEOPLE’S BANK
ABOUT
1. Ms W J A Fernando 17. Ms P N Kahangamage 33. Ms K T S Perera
Senior Manager Senior Manager Senior Manager
Supplies & Stores Department Develpmnt & Micro Finance Overseas Customer Services
Department
2. Ms S A D H Wimalasena 34. Ms W U M Gamage
Senior Manager 18. Ms M G C K Siriweera Assistant Regional Manager
Investigation & Inquiries Department Senior Manager Kurunegala R.H.O.
Information Technology Department
FROM THE TOP

REFLECTIONS
3. Mr T B Liyanage 35. Mr R M Gamini
Senior Manager 19. Mr D H N Wijemanna Assistant Regional Manager
Internal Audit Department Senior Manager Galle R.H.O.
Internal Audit Department
4. Ms D Athulathmudali 36. Ms U A L Srimathie
Senior Manager 20. Ms D M T S Dissanayaka Assistant Regional Manager
Human Resources Department Senior Manager Gampaha R.H.O.
Corporate & INST. Banking Division
5. Ms W G P Damayanthi 37. Ms H W S Hathnagoda
VALUE CREATION
DRIVING
Senior Manager 21. Ms W M A Sanjeewani Assistant Regional Manager
Internal Audit Department Senior Manager Nuwara-Eliya R.H.O.
Personal Banking Department
6. Mr A A S Seneviratne 38. Ms T S Nammuniarachchi
Senior Manager 22. Ms R H Samarawickrema Assistant Regional Manager
Internal Audit Department Senior Manager Matara R.H.O.
Corporate & INST. Banking Division
7. Ms S W Dewanarayana 39. Ms S Sivananthawerl
Senior Manager 23. Ms U I Rodrigo Assistant Regional Manager
Corporate & INST. Banking Division Senior Manager Kandy R.H.O.
Internal Audit Department
AND ANALYSIS
8. Ms D R M Disanayaka 40. Ms N S Rambodagedara
Senior Manager 24. Ms M A N N Preethikumari Assistant Regional Manager
Finance & MGMT. Accounting Senior Manager Kegalle R.H.O.
Department Internal Audit Department
41. Ms W A P M J Wickramaarachchi
9. Mr W M U Wijekoon 25. Ms S S Jumat Assistant Regional Manager
Senior Manager Senior Manager Gampaha R.H.O.
Badulla Personal Banking Department
42. Mr W Muthugala
10. Ms D L S Wanigarathna 26. Ms W M D Ganga Assistant Regional Manager
Senior Manager Senior Manager Ampara R.H.O.
Credit Review Department Salaries & Pensions Department
43. Ms K S C Rohini
REPORTS
GOVERNANCE
11. Ms L L Namalie 27. Mr W G I P C Kosgollawaththa Assistant Regional Manager
Senior Manager Senior Manager Kalutara R.H.O.
Credit Review Department Treasury Unit
44. Mr P M J J Jayasinghe
12. Mr S A Weerasinghe 28. Mr W A L P Jayarathne Assistant Regional Manager
Senior Manager Senior Manager Kandy R.H.O.
Corporate & INST. Banking Division Treasury Unit
45. Ms S P K Ekanayaka
13. Ms S M D Nandanie 29. Ms B N S Bollegala Assistant Regional Manager
STATEMENTS
FINANCIAL
Senior Manager Senior Manager Anuradhapura R.H.O.

Internal Audit Department Supplies & Stores Department
46. Ms A K Alahakoon
14. Ms M P W Kodippili 30. Ms K C S Perera Assistant Regional Manager
Senior Manager Senior Manager Kandy R.H.O.
Credit Recoveries Department Small & Medium Enterprises
Department 47. Ms K S S Subhashini
15. Ms G D K Perera Assistant Regional Manager
Senior Manager 31. Mr G K R R Perera Galle R.H.O.
INFORMATION
SUPPLEMENTARY
Internal Audit Department Senior Manager

Personal Banking Department 48. Mr K P Vithana
16. Mr M M A P Ratnayake Assistant Regional Manager
Senior Manager 32. Mr D M S R Alwis Kalutara R.H.O.
Staff Welfare & STF. Loans Senior Manager
Department Risk Management & Credit Control
Senior Managers
49. Mr W M T Weerasinghe 66. Ms S A M L Sirimanna 83. Ms L P W M Damayanthi

Assistant Regional Manager Assistant Regional Manager Assistant Regional Manager
Ampara R.H.O. Puttalam R.H.O. Puttalam R.H.O.
50. Mr W K S Kumarasinghe 67. Mr K M P P Kulathunga 84. Ms H Abayawickrama

Matara R.H.O. Polonnaruwa R.H.O. Colombo Outer R.H.O.
51. Ms U A R P Amarasinghe 68. Ms S A M A Sooriyapperuma 85. Ms H M Karuna Herath

Galle R.H.O. Colombo Outer R.H.O. Kurunegala R.H.O.
52. Mr S P Sooriyakumaran 69. Ms K V I K Dayananda 86. Ms A H S Perera

Ampara R.H.O. Kegalle R.H.O. Kalutara R.H.O.
53. Ms I S Kirindegedara 70. Ms N H N Thushari 87. Mr S M A P K Samarakoon

Anuradhapura R.H.O. Galle R.H.O. Badulla R.H.O.
54. Ms K D Jayathissa 71. Ms W A P S Rathnasiri 88. Mr K A S I Kumarapeli

Gampaha R.H.O. Ratnapura R.H.O. Kandy R.H.O.
55. Ms D D K Hettiarachchi 72. Mr A L C P Abesinghe 89. Ms P G C Chandramali

Colombo North R.H.O. Hambanthota R.H.O. Colombo Outer R.H.O.
56. Ms K A U I Dharmasiri 73. Mr U G T S B Thennakoon 90. Ms M A K L Menik Arachchi

Colombo South R.H.O. Matale R.H.O. Matale R.H.O.
57. Ms D S Atigala 74. Ms S D W Rajapaksha 91. Ms L A S Sajeewani

Colombo South R.H.O. Colombo North R.H.O. Kegalle R.H.O.
58. Mr T Sudagar 75. Mr J D R Gnanathilaka 92. Ms N Y Fernando

Assistant Regional Manager Assistant Regional Manager Senior Internal Audit Officer
Colombo South R.H.O. Gampaha R.H.O. Internal Audit Department
59. Ms R P S Dangalla 76. Ms K A M N Perera 93. Ms T N Vijayakumar

Assistant Regional Manager Assistant Regional Manager Law Officer
Gampaha R.H.O. Badulla R.H.O. Batticaloa R.H.O.
60. Mr N Arudselvan 77. Mr K Chandrakumar 94. Ms B M D Kumudini

Batticaloa R.H.O. Badulla R.H.O. Hambanthota R.H.O.
61. Ms S G T Udayani 78. Mr M Mathiyalagan 95. Ms P M K A Priyadharshanie

Hambanthota R.H.O. Jaffna R.H.O. Matara R.H.O
62. Ms W N D Priyanath 79. Ms N S W Pathirana 96. Ms L M Narangoda

Colombo Outer R.H.O. Matara R.H.O. Colombo Outer R.H.O.
63. Mr S B S K Priyadarshana 80. Ms Y Sureshkumar 97. Ms P P K Attanayaka

Nuwara-Eliya R.H.O. Jaffna R.H.O. Kurunegala R.H.O.
64. Ms R M P Rathnayaka 81. Ms J A D T A Uduwawala 98. Ms D C Induruwa

Moneragala R.H.O. Kurunegala R.H.O. Legal Department
65. Mr U P A D R Karunanayaka 82. Mr D M V K Dissanayake 99. Ms D G S G Dayarathna

Colombo North R.H.O. Kurunegala R.H.O. Kandy R.H.O.
Senior Managers
PEOPLE’S BANK
ABOUT
100. Ms R A S Dassanayake 116. Ms D D N A Aluthge 132. Ms M A O V Dias
Law Officer Law Officer Senior Finance Officer
Puttalam R.H.O. Colombo Outer R.H.O. Finance & MGMT. Accounting
Department
101. Ms W T I Ambepitiya 117. Mr R A S R Ranasinghe
Law Officer Law Officer 133. Mr K W R R C Siriwardena
Colombo South R.H.O. Legal Department Senior Manager Technical Services
Gampaha R.H.O.
102. Ms M G C Aroshini 118. Ms M D S K Dasanayaka
FROM THE TOP

REFLECTIONS
Law Officer Law Officer 134. Mr D M G M Dasanayaka
Galle R.H.O. Ratnapura R.H.O. Senior Manager Technical Services
Kandy R.H.O.
103. Miss I B Illangasinghe 119. Ms L C Shiromi
Law Officer Law Officer 135. Mr U M De Silva
Matale R.H.O. Kalutara R.H.O. Senior Manager IT
104. Ms M S W R Wimalagunarathna 120. Ms W R D D Ranathunga
Law Officer Law Officer 136. Mr T K Hinguralaarchchi
VALUE CREATION
DRIVING
Colombo Outer R.H.O. Kegalle R.H.O. Senior Manager IT
105. Mr P H L Jayathilaka 121. Ms W O K A W K Wijesinghe
Law Officer Law Officer 137. Mr A D R Priyantha
Kandy R.H.O. Legal Department Senior Manager IT
106. Ms S A W Samaraweera 122. Ms W M D S Nisansala
Law Officer Law Officer 138. Mr E A V Warnakula
Legal Department Legal Department Senior Manager IT
107. Ms A S D De S Sirisena 123. Ms D S Mahawatta
AND ANALYSIS
Law Officer Law Officer 139. Ms S E Wickramaratna
Kalutara R.H.O. Corporate & INST. Banking Division Senior Manager IT
108. Ms H Raguraman 124. Ms R G S A Randeniya
Law Officer Law Officer 140. Mr J M G I C Jayasundara
Ampara R.H.O. Legal Department Senior Manager IT
109. Ms H G N Pragathi 125. Ms T M T K K Abeynayake
Law Officer Law Officer 141. Mr K S J Kodippili
Gampaha R.H.O. Kurunegala R.H.O. Senior Manager IT
110. Ms K M A Wijesinghe 126. Ms P D S R Joseph
Law Officer Law Officer 142. Mr S Kariyawasam
REPORTS
GOVERNANCE
Badulla R.H.O. Puttalam R.H.O. Senior Manager IT
111. Ms W G G I Gunaratne 127. Ms M D Dharmaratne
Law Officer Law Officer 143. Mr L R De Silva
Galle R.H.O. Colombo North R.H.O. Senior Manager IT
112. Ms M D M I Saparamadu 128. Ms K S A Arachchige
Law Officer Law Officer 144. Ms H P K S Gunawardhana
Gampaha R.H.O. Hambanthota R.H.O. Deputy Board Secretary
STATEMENTS
FINANCIAL
Chairman’s OFF. & SCR’S Department

113. Ms R A C Kumarasiri 129. Ms E M Lohanathan
Law Officer Law Officer 145. Mr D H M T L Karunaratne
Corporate & INST. Banking Division Batticaloa R.H.O. Senior Dealer II
Treasury Unit
114. Ms W M N H Weerakoon 130. Ms T D M Shanthikumara
Law Officer Senior Finance Officer 146. Ms A W Jayasooriya
Kurunegala R.H.O. Kegalle R.H.O. Senior Dealer II
Treasury Unit
INFORMATION
SUPPLEMENTARY
115. Ms E K G I Gajadeera 131. Mr S D Jayasinghe

Law Officer Senior Finance Officer 147. Mr K N W P Perera
Legal Department Finance & MGMT. Accounting Senior Dealer II
Department Treasury Unit
BRANCH MANAGERS
001. Mr W K Weerasinghe 017. Mr K A D S Kuruppuarachchi 032. Ms C K Madawan Arachchi

Manager Manager Manager
Duke Street Balangoda Matara – Uyanwatte
002. Mr N G D B K Jayathissa 018. Mr K M I S Dissanayake 034. Mr M A D N Prasanna

Matale Gampola Negombo
003. Mr M G T P Karunarathna 019. Ms C Matharage 035. Mr H G S Diluksha

Kandy Dehiwala Ambalangoda
005. Mr P H C Peiris 020. Mr S Gobikrishna 036. Mr W D N Kumara

Polonnaruwa Mullatiivu Ragala
006. Ms V J K Botheju 021. Ms A T Nishanthi 037. Mr B L Pushpa Kumara

Hingurakgoda Minuwangoda Bandarawela
007. Ms M A S Sanura 022. Ms I M I P K Ilanganthilake 038. Mr H A A S Hettiarachchi

Manager Manager Deputy Manager
Hambantota Hanguranketha Talawakelle
008. Mr E A C Edirisinghe 023. Mr V Saravanabavan 039. Mr G A D Rasajeewa

Anuradhapura Kalmunai Kalutara
009. Ms W M S K Wanninayake 024. Mr P L S R Fernando 040. Mr M Kalistus

Puttalam Chilaw Vavuniya
010. Mr W M U Wijekoon 025. Ms Y C Edirisooriya 041. Ms W K P Wickrama

Senior Manager Manager Manager
Badulla Hyde Park Corner Horana
011. Ms H M A Chulangani 026. Mr N R A L K Ranathunga 042. Mr A B Gunawardena

Bibile Gampaha Kekirawa
012. Mr G M U S Abayakoon 027. Ms C I Gamage 043. Mr S P U Karunananda

Kurunegala Kegalle Padaviya
013. Mr H Vidanapathirana 028. Mr U K D M Priyantha 044. Mr A Harikesan

Galle – Fort Kuliyapitiya Mannar
014. Ms E A A I K Bogamuwa 029. Ms M I L Mendis 045. Mr R T Nishantha

Union Place – Colombo Avissawella Embilipitiya
015. Mr R K S P Rajapaksha 030. Mr P Partheepan 046. Ms D M B P Jayaweera

Ampara Jaffna – Stanley Road First City
016. Mr D M U P Dissanayaka 031. Ms K Pushpanayagam 047. Ms L P G N Amarasooriya

Welimada Kankasanthurai Yatiyantota
Branch Managers
PEOPLE’S BANK
ABOUT
048. Mr K Pratheep 064. Mr M I M Hilmi 079. Ms G M K Jayaweera
Kilinochchi Samanthurai Veyangoda
049. Mr K S Kalubowila 065. Mr R M Vishnuvarthanan 080. Ms H D S Perera

Manager Deputy Manager Manager
Homagama Kattankudy Ratmalana
FROM THE TOP

REFLECTIONS
051. Mr S L Algewatta 066. Mr T Bharathramana 081. Ms A Samarasinghe
Deputy Manager Manager Manager
Kahatagasdigiliya Trincomalee Ruwanwella
052. Mr S M C Wijayarathne 067. Mr H S Keembiye Hettige 082. Ms A M T Abeysinghe

Maho Tangalle Narammala
VALUE CREATION
DRIVING
053. Ms G A Suhood 068. Mr J K Kalubowila 083. Ms M M S Perera
Nawalapitiya Monaragala Nattandiya
054. Ms S S K Mallawarachchi 069. Ms K A U Seneviratna 084. Mr W S S Rupasiri

Warakapola Mawanella Alutgama
055. Mr E P A P De Silva 070. Ms M D Ranasinghe 085. Mr D H Nawagamuwa

AND ANALYSIS
Kelaniya Matugama Eheliyagoda
056. Ms J C Palathanthri 071. Ms D R T Janaki Kumari 086. Ms W I P D Perera

Sri Sangaraja Mawatha – Col Dematagoda Thimbirigasyaya
057. Ms N S Kulasekara 072. Mr I R Thenabadu 087. Mr W J Weerakkody

Peradeniya Ambalantota Baddegama
058. Mr W M M I B Weerapana 073. Ms M K C Jeewanthi 088. Mr B A L Jayatissa

REPORTS
GOVERNANCE
Mahiyangana Elpitiya Ratnapura
059. Ms H M M H Seneviratna 074. Ms W A G N H Jayathilake 089. Mr P W B Tennakoon

Polgahawela Wattegama Katugastota
060. Ms G Chandrika 075. Mr N M Santhan 090. Mr S A Farook

STATEMENTS
FINANCIAL
Morawaka Batticaloa Kantalai
061. Ms S H W Rohini 076. Mr M P W Kurera 091. Ms A C Konara

Tissamaharama Wennappuwa Moratuwa
062. Mr W P M Ruwanpathirana 077. Ms T A R Chandrika 092. Mr K K S P Deshapriya

INFORMATION
SUPPLEMENTARY
Wellawaya Weligama Giriulla
063. Mr M A C M Shafeek 078. Ms W A N Udayangani 093. Ms D G G K Dahanayaka

Akkaraipattu Borella Pugoda
Branch Managers
094. Mr K M Ameerdeen 110. Ms K Beeshman 125. Mr M A D Chinthaka

Kinniya Chavakachcheri Kalpitiya
095. Mr K Mathyvathanan 111. Mr A Francis 126. Mr A V D Thushan

Muttur Paranthan Grandpass
096. Mr S M N Samarakoon 112. Ms H G R Suranji 127. Ms L Y N Sandamali

Medawachchiya Theldeniya Nildandahinna
097. Mr K K D Kossinna 113. Mr N Thineskumar 128. Ms A M U N D K Amarakoon

Gangodawila Batticaloa – Town Rattota
098. Ms W A I Nimali 114. Mr I M P Ilankoon 129. Mr P D S K Pathirana

Kotikawatta Galagedara Rakwana
100. Mr D M J Dissanayaka 115. Mr L W M G De Silva 130. Mr W W M Nawaratne

Marandagahamula Galewela Hakmana
101. Mr K A U K Devapriya 116. Mr C D Senanayaka 131. Mr A U W Weerarathne

Rambukkana Passara Udugama
102. Mr E G P Pragash 117. Mr C Kodisinghe 132. Mr A P Mahesha

Valaichenai Akuressa Deniyaya
103. Ms W B L D Fernando 118. Ms G K P D Alahakoon 133. Mr R D Pathma

Piliyandala Delgoda Kamburupitiya
104. Ms N Sathiyaseelan 119. Ms W A N Piyasili 134. Mr K L P Kithsiri

Jaffna – Main Street Narahenpita Nuwara – Eliya
105. Mr K Rameshnesan 120. Ms S H C A N Senevirathna 135. Ms E B C M Bandara

Kayts Walasmulla Dikwella
106. Ms G Pirathakshi 121. Mr P A C J Palihawadana 136. Ms K H Hemamala

Nelliady Bandaragama Hikkaduwa
107. Ms K Sasikala 122. Mr R R M S B Bambaradeniya 137. Ms T A D Jayathilaka

Atchuvely Wilgamuwa Makandura
108. Mr N Thanesh 123. Ms R C Suthaharan 138. Mr K M P Pushpakumara

Chankanai Eravur Dambulla
109. Mr S Mohanachselvan 124. Mr W H M T S Wijekoon 139. Mr A J C S Perera

Chunnakam Nikaweratiya Pettah
Branch Managers
PEOPLE’S BANK
ABOUT
140. Mr A B Kulasekara 155. Mr A B M Rizwan 170. Mr S A A I R Suraweera
Deputy Manager Manager Deputy Manager
Hasalaka Kahawatta Eppawela
141. Mr A S Antonippillai 156. Ms A S Kaluarachchi 171. Mr S T Dissanayake

Valvetiturai Uva – Paranagama Nochchiyagama
FROM THE TOP

REFLECTIONS
142. Ms H H A S Jayasekara 157. Ms W M I E M Balasooriya 172. Mr K A C Kasthuri
Kochchikade Menikhinna Bingiriya
143. Ms M M N S Gunasekara 158. Mr E O Udayapriya 173. Ms V N Gunasekara

Suduwella Senkadagala Pundaluoya
VALUE CREATION
DRIVING
144. Mr R M S P Rathnayaka 159. Ms I D Pandithaarachchi 174. Ms H P K Samanmali
Hettipola Kadugannawa Nugegoda
145. Mr S Manimaran 160. Ms B P C Basnayaka 175. Ms S K Nawagamuwa

Wellawatte Pelmadulla Kandana
146. Mr K P C S Kularathne 161. Ms B G Ruwani 176. Ms Y A Senevirathne

AND ANALYSIS
Naula Bulathsinhala Mid City
147. Ms P H I P Siriwardhana 162. Ms R Jeyachandra 177. Ms H M D Herath

Buttala Jaffna – University Galenbindunuwewa
148. Ms M D S Fernando 163. Mr K R S B Kulasuriya 178. Mr M Jegadeesen

Panadura Wariyapola Maskeliya
149. Mr A M T T Amarapathy 164. Mr M A Ilyas 179. Mr H M N M Dissanayaka

Manager Dpty.mgr. Manager
REPORTS
GOVERNANCE
Alawwa Pottuvil Galnewa
150. Mr S D N J Cristopher 165. Mr B Seeralan 180. Mr G B E M K R Ekanayake

Kebitigollewa Mankulam Deraniyagala
151. Mr T B A G Silva 166. Mr K Venkadesh 181. Mr K M A N Bandara

STATEMENTS
FINANCIAL
Diyatalawa Murunkan Maha-Oya
152. Mr K Y R Manawansa 167. Mr M T Pradeep 183. Ms T K Ekanayake

Matara – Dharmapala Mawatha Town Hall – Colombo Ankumbura
153. Ms P M Wijesundara 168. Mr Y L C Dhanawardana 184. Ms M M C Rathnayaka

INFORMATION
SUPPLEMENTARY
Akurana Kataragama Galgamuwa
154. Ms I D Nilushika 169. Ms P M S Sri Wimukthi 185. Ms M H M P A Weerasinghe

Balapitiya Galle Bazaar Kg/Galigamuwa
Branch Managers
186. Mr S M U Asanga 202. Ms W R D Kumudini 219. Mr V M B Senanayake

Hatton Kirindiwela Thambuttegama
188. Ms N S B Yapa 203. Ms S H H Sikurajapathi 220. Ms A M M U Adhikari

Ahangama Habarana Anuradhapura – Nuwara Wewa
189. Mr A G Anusha 204. Mr L D T P Mihiraj 221. Ms S Wickramasooriya

Uhana Head Quarters Branch Hemmathagama
190. Mr D Thanashakaran 205. Mr A P D J Pushpakumara 222. Mr W G W B Wedagedara

Kaluwanchikudy Angunakolapelessa Wattala
191. Ms K K D R T Karunathilaka 206. Ms B J Dissanayaka 223. Mr T Karikalan

Malwana Davulagala Karativu
192. Ms K M P P Rathnayake 207. Ms S N C W M I S K Hulugalla 224. Mr T Umaashankaran

Manager Manager Dpty.mgr.
Nivithigala Ibbagamuwa Thirukovil
193. Mr W D S K Chandratilake 208. Mr V T R Wasantha Kumara 225. Ms D P Wijayarathna

Ridigama Battaramulla Hali-Ela
194. Ms K D T Dilrukshi 209. Ms H M N W K Herath 226. Mr H D A Srilal

Kolonnawa Boralanda Kurunegala – Maliyadeva St.
195. Ms D M M Gunarathna 210. Ms N R Ramanayaka 227. Ms N Rajanayagam

Haldummulla Kollupitiya - Co-Op. Bldg, Chengalady
196. Ms S Raddella 211. Ms Y M C K Yapa 228. Mr A L Abdussalam

Kaduwela Panwila Addalachchenai
197. Ms L N G De Silva 214. Ms S P N Ramar 229. Ms R Illanperuma

Uragasmanhandiya Mutwal Hanwella
198. Mr M A P N Mallawaarachchi 215. Ms D M S D Dissanayaka 230. Mr W P K Gunawardana

Mirigama Madampe Thanamalwila
199. Ms U V S M Premathunga 216. Ms B D T M De Silva 231. Mr U D S N Ranasinghe

Mawatagama Haputale Medirigiriya
200. Ms D M N P Gunaratne 217. Ms E K K Udumullage 232. Mr R M P S Ranasinghe

Majestic City Mahara Polonnaruwa – Town
201. Ms P A P Dayananda 218. Mr K N Jayatissa 233. Mr M Premkumar

Ukuwela Horowupathana Serunuwara
Branch Managers
PEOPLE’S BANK
ABOUT
234. Ms W L Ranaweera 249. Mr M P Chandana 264. Mr K H A G Pamuditha
Batapola Neboda Suriyawewa
235. Mr A A D S Amarakoon 250. Ms W N Kumari 265. Mr H K Thilakarathna

Kalawana Kandeketiya Middeniya
FROM THE TOP

REFLECTIONS
236. Ms E P M Rajakaruna 251. Ms S D Umadevi 266. Mr C Malalasekara
Maradana Lunugala Kiriella
237. Ms C S Gamage 252. Ms E D A P Hettiarachchi 267. Mr T D W Ekanayake

Kiribathgoda Bulathkohupitiya Anamaduwa
VALUE CREATION
DRIVING
238. Ms H G C N Kumari 253. Mr K T A R Wickramarathne 268. Mr H Y W W M C K Wijesekara
Manager Deputy Manager Deputy Manager
Gonagaldeniya Aralaganwila Girandurukotte
239. Mr R N Jeewamal 254. Ms M V K Imbuldeniya 269. Ms A I Suriyapperuma

Ja-Ela Welikanda Badulla – Muthiyangana
240. Ms M H P S De Silva 255. Mr M M M Niyas 270. Ms M M C A Badullewa

AND ANALYSIS
Keppetipola Trincomalee – Town Thulhiriya
241. Mr G H Malwaththage 256. Ms M G R M Madakumbura 271. Ms N H Weerasingha

Pallepola Pilimathalawa Urubokka
242. Mr R A A C Ranasinghe 257. Ms J M D L Peiris 272. Mr G D S Gamage

Bakamuna Deltota Thalgaswala
243. Ms P M K G Jinadasa 258. Ms B M N D K Balasooriya 273. Ms A K P A Attanagoda

REPORTS
GOVERNANCE
Devinuwara Medagama Kadawatha
244. Ms W B M R Weeraratna 259. Ms J M N T Sandareka 274. Ms D S Hettiarachchi

Beliatta Kehelwatta Pussellewa
245. Mr P Dencil 260. Mr A R Amarasiri 275. Ms K Velrane

STATEMENTS
FINANCIAL
Godakawela Koslanda Olcott Mawatha – Colombo
246. Mr W W P M D Weerasooriya 261. Mr P R Silva 276. Mr J W K K N Jayasunadara

Meegalewa Pelawatta Katunayake
247. Ms W H D S Wimalajeewa 262. Ms H D T R Siriwardena 277. Ms S Satkkuneswaran

INFORMATION
SUPPLEMENTARY
Imaduwa Wadduwa Sea Street – Colombo
248. Ms H P A D Rathnakumara 263. Mr M A Raban 278. Mr R D R S Kumara

Aranayake Kuruwita Nittambuwa
Branch Managers
279. Ms M N P Perera 296. Mr N L F Rifai 312. Ms N K Munasinghe

Pitakotte Nintavur Malwatta Road
280. Ms N L Wanigasekara 297. Mr B G Dewadasa 313. Ms W G K M Wickremasinghe

Pothuhera Dam Street – Colombo Katubedda
281. Ms G P G M E Palliyaguru 298. Mr P H J Tilakaratne 315. Mr R M D M Rajaguru

Kobeigane Central Road Thalawa
282. Ms H D S Fernando 299. Ms S A B Jaffeer 316. Mr A S Athulasiri

Maggona Kegalle Bazaar Ragama
283. Ms M A C A Premadasa 300. Ms L C Gorokgoda 317. Mr H S M De Silva

Baduraliya Ingiriya Ratnapura – Town
284. Ms R Paramthaman 301. Mr J A P Jayasinghe 318. Ms T N Peiris

Kannathidy Galkiriyagama Pamunugama
285. Mr S Sarvananthan 302. Ms K A S W Amarathilake 319. Ms M A S Himali

Point Pedro Ginigathhena Kirulapone
288. Ms G Wijesinghe 303. Mr M Ranjith 320. Ms D Kalatuwawa

Kudawella Mahawewa Golden Jubilee Branch
289. Mr H G I P H Gamage 304. Ms T P Karunasena 321. Ms D C Jayasinghe

Deputy Manager Deputy Manager Manager
Kaltota Walasgala Panadura – Town
290. Ms N C Dahanayake 306. Ms R M P S Rathnayake 322. Mr H J P A Jayasinghe

Moratumulla Maharagama Marawila
291. Mr H A M Perera 307. Ms D C Mallikarachchi 324. Ms S W G C Swarnamali

Dankotuwa Gandara Seeduwa
292. Mr M P Wijekoon 308. Ms R P C N Rajapaksha 325. Ms W A P Chandranganie

Udupussellawa Kotahena Wanduramba
293. Mr W A V E Kulathunga 309. Mr U B D A Danapala 327. Ms I N K Jayawardena

Dehiowita Kollupitiya – Liberty Plaza Kesbewa
294. Ms M M I D Manthilake 310. Ms C J Gunawardena 328. Ms P G U Sandamali

Alawathugoda Bambalapitiya Kottawa
295. Ms M K Liynarachchi 311. Mr O D N L Vithanage 329. Ms V M Erandani

Deputy Manager Manager Deputy Manager
Udawalawa Beruwala Koggala
Branch Managers
PEOPLE’S BANK
ABOUT
330. Mr J S Chandradasa 345. Mr H G S L Sumanadasa 360. Mr W G M Tikiribanda
Dehiattakandiya Ranna Polpithigama
331. Ms T H J Hettiarachchi 346. Mr P Nasurudeen 361. Ms P Visakan

Lucky Plaza Maruthmunai Kodikamam
FROM THE TOP

REFLECTIONS
332. Mr S Nimal 347. Ms G H W W M M N Samanmali 362. Ms W N V Botheju
Ganemulla Badalkumbura People’s Elegance
333. Ms G K D P S Gunarathna 348. Ms M D M Pushpakumari 363. Mr R M R M Rathnayaka

Yakkala Boralesgamuwa Gelioya
VALUE CREATION
DRIVING
334. Ms I L T N Ihalagedara 349. Mr W R E I B Ekiriyagala 364. Ms R I Jayaweera
Ethugalpura Pallebedda Athurugiriya
335. Ms W A U S Samaranayaka 350. Mr K H S Chandralal 365. Ms R M A D Rathnayake

Manager Deputy Manager Deputy Manager
Nugegoda – City Weeraketiya Siyambalanduwa
336. Ms A T N Perera 351. Ms H P R Srimalee

Manager Deputy Manager
AND ANALYSIS
Mount Lavinia Thambala
337. Ms M D Samaradivakera 352. Mr M B Jawfer

Manager Manager
Dehiwala (Galle Road) Pulmudai
338. Mr M I Yahiya 353. Ms B M N T Bandara

Deputy Manager Manager
Sainthamaruthu Rikillagaskada
339. Mr S Pavanantharajah 354. Ms V N Kodieswary

REPORTS
GOVERNANCE
Kallar Bagawanthalawa
340. Mr P S Christy 355. Ms K M K Pushpa Kumari

Oddamavadi Kotiyakumbura
341. Ms S P Jayawardena 356. Mr M C M Fahmy

Manager Manager
STATEMENTS
FINANCIAL
Hatharaliyadda Chettikulam
342. Mr P Vigneswararajah 357. Ms F N Zuhair

Kokkaddichcholai Kandy City Center
343. Ms M H De Silva 358. Ms S Siriwardana

Manager Manager
INFORMATION
SUPPLEMENTARY
Karapitiya Poojapitiya
344. Ms K M I K P Kuruppu 359. Mr R M R Lakmal

Manager Manager Scan to view our
Melsiripura Piliyandala City Branch Branch Network
GLOSSARY OF FINANCIAL/BANKING TERMS
Bill of exchange Contingencies

A
A signed, written, unconditional order A condition or situation, the ultimate
Accounting policies addressed by one person (the drawer) outcome of which, gain or loss, will
directing another person (the drawee) be confirmed only on the occurrence
Principles, rules and procedures selected
to pay a specified sum of money to the or non-occurrence of one or more
and consistently followed by the
order of a third person (the payee). The uncertain future events.
management of an entity in preparing
terms bill of exchange and draft are
and reporting the Financial Statements. Corporate governance
often used interchangeably.
Accrual basis The process by which corporate entities
are governed. It is concerned with the
Recognition of the effects of
way in which power is exercised over
transactions and other events when C the management and direction of entity,
they occur without waiting for receipt or
the supervision of executive actions and
payment of cash or its equivalents. Call deposits or call money accountability to owners and others.
Amortisation Deposits or funds lent out which are
repayable on demand. Correspondent banks
Systematic allocation of the depreciable
A bank that acts as an agent for
amount of an intangible asset over its Capital adequacy another bank. The correspondent Bank
useful life. Depreciation and amortisation
The ability of a Bank to meet the needs will generally provide a wide variety
both have the same meaning.
of their depositors and other creditors of banking services on behalf of the
Actuarial valuation in terms of available funds. As per other banks in the region in which the
Fund value determined by computing requirement of Bank for International correspondent bank is located.
its normal cost, actuarial accrued Settlements (SIBS) and Central Bank of
Sri Lanka, local banks should maintain a Cost income ratio
liability, actuarial value of its assets and
stipulated minimum capital. Operating expenses as a percentage
other relevant costs and values.
of net income.
Amortised cost Capital adequacy ratio
The percentage of the risk-adjusted Counterparty
The amount at which the financial
assets supported by capital, as defined The other party (including a bank)
asset or financial liability is measured
under the framework of risk based with whom a deal is made or closed.
at initial recognition minus principal
repayments, plus or minus the capital standards developed by the Country risk
cumulative amortisation using the Bank for International Settlements
The credit risk associated with lending
effective interest method of any (BIS) and as modified to suit local
to borrowers within a particular country,
difference between that initial amount requirements by the Central Bank of Sri
sometimes taken to include sovereign
and the maturity amount and minus any Lanka.
risk.
reduction (directly or through the use of Credit risk
an allowance account) for impairment Cross rate
The risk that one party to a financial
or uncollectability. The calculated foreign exchange rate
instrument will cause a financial loss for
from two separate quotations involving
Associate company the other party by failing to discharge
the same currency.
A company other than a subsidiary an obligation.
in which a holding company has a Currency swap
Cash equivalents
participating interest and exercise a A current exchange of principal
Short-term highly liquid investments
significant influence over its operating amounts in two currencies combined
that are readily convertible to known
and financial policies. with an agreement to re-exchange the
amounts of cash and which are subject
currencies at a later date and to make
Available-for-sale financial asset to an insignificant risk of changes in
interest payments, until the re-exchange,
Those financial assets that are value.
on the currency is received.
designated as available-for-sale or Certificate of deposit (CD)
are not classified as (a) loans and
A certificate issued by a Bank against
receivables, (b) held-to-maturity
funds deposited with it that specifies D
investments, or (c) financial assets at
the rate of interest payable and the date
fair value through profit and loss.
when the deposit will be repaid to the Deferred tax
bearer. CDs are often negotiable. Sum set aside in the Financial
Commercial paper Statements for taxation that may
B become payable in a financial year other
Unsecured short-term Promissory
Notes issued by banks and creditworthy than the current financial year.
Bill discounted
A Promissory Note or Bill of Exchange corporate borrowed. Depreciation
that has been purchased for less than Commitments The systematic allocations of the
face value, the difference representing Credit facilities approved but not yet depreciable amount of the assets over
interest on the unexpired term of the utilised by the clients as at the balance its useful life.
bill. At maturity, the holder collects the sheet date.
face value of the bill for its own account.
Glossary of Financial/Banking Terms
PEOPLE’S BANK
ABOUT
Derivative Equity instrument Forward rate
A financial instrument with all three Any contract that evidences a residual The price of currency with a maturity
of the following characteristics: (a) interest in the assets of an entity after beyond the spot date. Forward rates
Its value changes in response to the deducting all of its liabilities. may be either the same in price as spot
change in a specified interest rate, rates or different. In the first case, the
Expected credit loss
security price, commodity price, foreign forward rate is flat. In the second case,
exchange rate, index of prices or The weighted average of credit losses the price is either higher, at a premium,
rates, a credit rating or credit index, or with the respective risks of a default or lower, at a discount.
FROM THE TOP

REFLECTIONS
other variable (sometimes called the occurring as the weights.
Forward rate agreement (FRA)
“underlying”). (b) It requires no initial net
investment that is smaller than would be An agreement to exchange payments
at a specified future date based on the
required for other types. F
(c) It is settled at a future date. difference between a particular interest
Fair value rate index (e.g. LIBOR) and an agreed
Dealing securities fixed rate.
The amount for which an asset could be
Securities acquired and held with
exchanged or a liability settled, between
the intention of reselling them in
VALUE CREATION
DRIVING
knowledgeable, willing parties in an
the short-term.
arm’s length transaction. G
Defined benefit plan
Fixed charge Group
Retirement benefit plans under which
A charge on specific property, usually A group is a parent and all its
amounts to be paid as retirement
freehold or leasehold property or plant subsidiaries.
benefits are determined by reference to
and machinery, given under a legal
a formula usually based on employees’ Guarantees
mortgage.
remuneration and/or years of service.
Primarily represent irrevocable
Financial instrument
Disintermediation assurances that a bank will make
Any contract that gives rise to a payments in the event that its customer
AND ANALYSIS
The term often used to describe
financial asset of one entity and a is unable to perform its financial
borrowers raising funds directly from
financial liability or equity instrument of obligations to third parties. Certain
the capital markets rather than from
another entity. other guarantees represent non-
the banking sector. This is usually only
undertaken by borrowers with the Floating charge financial undertakings such as bid and
strongest credit ratings. performance bonds.
A charge, taken by a lender to secure
Documentary bill an advance upon property, such as
stock, debtors, or cash, that permits
A Bill of Exchange that is accompanied
by various documents, such as a Bill
the Company to continue using and H
disposing of those assets in connection
of Lading, an invoice and an insurance
with its ordinary business. Such a charge Hedging
policy.
becomes fixed in the event of the A methodology used to cover against
Documentary credit Company’s default. risk of unfavourable price movements
REPORTS
GOVERNANCE
A letter of credit that stipulates the (interest rates, prices, commodities, etc).
Foreclosed properties
documents that must be produced
Properties acquired in full or partial Held-to-maturity investments
in order for payment to be made.
settlement of debts, which will be A financial asset with fixed or
Draft held with the intention of resale at the determinable payments and fixed
A term generally synonymous with earliest opportunity. maturity that an entity has the positive
Bill of Exchange but sometimes used intent and ability to hold to maturity,
Foreign exchange income
specifically in the context of interbank other than those that the entity on
The realised gain recorded when assets initial recognition elects to designate as
bills. A banker’s draft, payable on
STATEMENTS
FINANCIAL
or liabilities denominated in foreign held-for-trading or available-for-sale,

demand, drawn by or on behalf
currencies are translated into Sri Lankan or that meet the definition of loans and
of a Bank.
rupees on the balance sheet date at receivables.
prevailing rates which differ from those
rates in force at inception or on the
E previous balance sheet date. Foreign
exchange income also arises from I
Effective interest method trading in foreign currencies.
The method of calculating the amortised Impairment
INFORMATION
SUPPLEMENTARY
Forward contract This arises due to decline in recoverable

cost of a financial asset or a financial
liability and of allocating the interest A contract that commits two parties amount below carrying amount.
income or interest expense over the to an exchange at a specific future
relevant period. date under terms set out at the
contract date.
Indemnity Liquidity risk Non-performing loan

An agreement whereby a person agrees The risk that an entity will encounter A loan where principal or interest
to bear any loss that is suffered by a difficulty in meeting obligations payments are not being made on the
party to a contract to which he himself associated with financial liabilities that due dates or where the borrower is
is not a party. The person giving the are settled by delivering cash or another failing to meet some other term or
indemnity assumes primarily liability, financial asset. condition of the loan. Non-performing
unlike a guarantor who assumes loans are frequently allocated non-
Liquid assets ratio
secondary liability. accrual status.
Liquid assets expressed as a
Intangible assets percentage of total liabilities other than Nostro account
An identifiable non-monetary asset shareholders’ funds. A foreign currency current account
without a physical substance. maintained with another Bank,
Loss allowance
usually but not necessarily a foreign
Interest rate risk The allowance for expected credit correspondent Bank. At the other Bank,
The risk that the fair value of future losses on financial assets measured the deposit is called a nostro account.
cash flows of a financial instrument will at amortised cost, financial assets
fluctuate because of changes in market measured at fair value through other
interest rates. comprehensive income and the
O
provision for expected credit losses
Interest in suspense
on loan commitments and financial Objective evidence
The interest due on non-performing guarantee contracts.
assets. Information based on facts that can be
proved through analysis, measurement,
Interest margin observation and other such means of
Net interest income as a percentage of M research.
average interest-earning assets.
Mark to market Off-balance sheet transactions
Investment property Transactions not recognised as assets
The policy to periodically revaluing
A property (land or a building) held to positions up or down to their current or liabilities in the balance sheet but
earn rentals or for capital appreciation market or fair value. which give rise to contingencies and
or both, rather than for: (a) use in the commitments.
supply of goods or services or for Market risk
administrative purposes; or (b) sale in The risk that the fair value or future
the Ordinary course of business. cash flows of a financial instrument will P
fluctuate because of changes in market
prices. Market risk comprises three Position
K types of risks: currency risk, interest The netted total commitments in a given
rate risk, and other price risk. currency or interest rate. A position can
Key management personnel be either flat or square (no exposure),
Minority interest
Those persons who have the authority long (more currency bought than sold
The proportion of the profit or loss and
and responsibility for planning, directing overbought) or short (more currency
net assets of a subsidiary attributable
and controlling the activities of the sold than bought oversold).
to equity interest that are not
entity.
owned, directly or indirectly through Prime rate
Key Performance Indicators (KPIs) subsidiaries, by the Parent. The interest rate which a bank charges
KPIs are quantifiable measurements, its most creditworthy corporate
Mortgage
agreed beforehand that reflects the customers.
A lien on real property used to secure a
critical success factors of a company.
borrowing. Promissory note
An unconditional promise in writing
L made by one person to another, signed
N by the promisor, engaging to pay on
Lease demand or at a fixed or determinable
Negotiable instrument future time a fixed sum to or to the
A contract, or part of contract that
A security or other financial instrument order of, a specified person or to bearer.
conveys the right to use as asset (the
underline asset) for a period of time in which can be freely sold to a third party
exchange for consideration. (i.e. negotiated). Bank notes, bearer
bonds, Bills of Exchange and cheques R
Letter of credit (LC) are normally negotiable instruments.
A document issued by a bank, Related parties
requesting another bank or banks to Net interest margin Parties where one party has the ability
advance money to a third person, up to Interest income as a percentage of to control the other party or exercise
a certain amount, in accordance with Average Interest Earning Assets. significant influence over the other
the terms and conditions set out in the party in making financial and operating
document. decisions.
PEOPLE’S BANK
ABOUT
Repo Subsidiary company or repurchasing it in the near term; (b)
Jargon for sale and repurchase A subsidiary is an enterprise that is Part of a portfolio of identified financial
agreement. controlled by another enterprise (known instruments that are managed together
as the parent). for which there is evidence of a recent
Reserve assets actual pattern of short-term profit
Assets of a financial institution which Suspense account taking; or (c) A derivative (except for
form part of its reserve requirements An account used to record items a derivative that is designated and
with the Central Bank. temporarily which are held subject effective hedging instrument).
FROM THE TOP

REFLECTIONS
to clarification and transfer to the
Reverse repo Transaction costs
appropriate account.
The opposite of a repo, i.e. a purchase Incremental costs that are directly
and resale agreement. Syndication loan attributable to the acquisition, issue or
A loan arrangement in which a number disposal of a financial asset or financial
Revolving credit
of banks, in a form of joint venture, liability.
A line credit that has terms permitting provides funds which they would
successive drawings and payments individually be unwilling or unable to Treasury bonds (T-Bond)
at the borrower’s discretion. The provide. Syndications are used for A long-dated security issued by the
funds available to the borrower are
VALUE CREATION
DRIVING
customers whose scale of financing Central Bank of Sri Lanka. T-Bonds carry
replenished by any repayments of is too great for any single Bank to a coupon rate of interest.
principal. accommodate without distorting its
Right of use asset loan portfolio.
An asset that represents a lessee`s V
right to use an underline asset for
the lease term T Value added
Value added is the wealth created by
Risk-weighted assets Time deposit providing banking services less the
On-balance sheet assets and the An interest bearing deposit account cost of providing such services. The
AND ANALYSIS
credit equivalent of off-balance sheet which is subject to withdrawal only after value added is allocated among the
assets multiplied by the relevant risk a fixed term. employees, the providers of capital
weighting factors. to Government by way of taxes and
Tier 1 capital retained for expression and growth.
(Common Equity Tier 1 – CET I
Common Equity Tier 1 (CET I) is a Value at risk (VAR)
S
component of Tier 1 Capital that A risk management methodology that
consists mostly of stated capital. It is a estimates the potential loss arising from
Securitisation
capital measure that was introduced as adverse movement in market interest or
This involves the transfer of a block of
precautionary measure to protect the exchange rates over a defined holding
income producing assets to a vehicle
economy from a financial crisis. period.
company that finances the purchase
through the issue of debt (usually notes Tier 1 capital Vostro account
REPORTS
GOVERNANCE
of commercial paper). (Additional Tier 1 Capital – AT I) A local currency current account
Additional Tier 1 Capital (AT I) maintained with a bank by another
Segmental analysis
is a component of Tier 1 Capital bank (compare with Nostro account).
Analysis of financial information by
that comprises securities that are
segments of an enterprise specifically,
subordinated to most subordinated
the different geographical areas in
debt, which have no maturity, and their Y
which it operates. Segment reporting
dividends can be cancelled at any time.
indicates the contribution to the revenue
derived from business segments such as Tier 2 capital Yield curve
STATEMENTS
FINANCIAL
banking operations, leasing operations, Capital representing revaluation A graph showing market interest rates
stock broking and securities dealings, reserves, general provisions and other as a function of maturity. Normally, the
property and insurance. capital instruments, which combine yield curve is upward sloping: interest
certain characteristics of equity and rates increase with the term of the
Settlement date instrument.
debt such as hybrid capital instruments
The date on which a securities
and subordinated term debts.
transaction is completed by actual
exchange of securities for cash. Total capital
The sum of Tier 1 capital and Tier 2
INFORMATION
SUPPLEMENTARY
Short position
capital. Trading Financial Assets and
An excess of liabilities (and/or forward
Liabilities A financial asset or financial
sale contracts) over assets (and/or
liability is classified as held-for-trading
forward purchase contracts). A dealer’s
is it is: (a) Acquired or incurred
position when the net of purchases
principally for the purpose of selling
and sales leaves a net sold or oversold
position.
CORPORATE INFORMATION
Name of the Bank International Banking Division Subsubsidiaries of People’s Bank

People’s Bank ACHC Building, No. 91, (Subsidiaries of People’s Leasing &
Sir Chittampalam A Gardiner Mawatha, Finance PLC)
Legal Status Sri Lanka.
A licensed commercial bank under Tel: +94 11 243 7239-41, People’s Insurance PLC
the Banking Act No. 30 of 1988 +94 11 232 0651-6 No. 7, Havelock Road, Colombo 5.
incorporated as a commercial bank by Fax: +94 11 243 3127 Tel.: +94 11 212 6126
People’s Bank Act No. 29 of 1961. Email: [email protected] Fax: +94 11 212 6109
SWIFT: PSBKLKLX Email: [email protected]
Head Office (Registered Office)
Overseas Customer Services People’s Leasing Property
No. 75,
No. 59, D R Wijewardena Mawatha, Development Ltd.
Sir Chittampalam A Gardiner Mawatha,
Colombo 2, Sri Lanka. Colombo 10, Sri Lanka. No. 1161, Maradana Road, Borella,
Call Centre: 1961 Tel.: +94 11 233 2746, +94 11 233 4278, Colombo 8, Sri Lanka.
Tel.: +94 11 232 7841-6, +94 11 243 7621 Tel: +9411 263 1631
+94 11 244 6316-19, +94 11 248 1481 +94 11 244 6409 Fax: +9411 263 1596
Email: [email protected] Email: [email protected],
Web: www.peoplesbank.lk [email protected], People’s Leasing Fleet
SWIFT: PSBKLKLX [email protected], Management Ltd.
VAT Registration No. 409000037-7000 [email protected] No. 1161, Maradana Road, Borella,
SWIFT: PSBKLKLX Colombo 8, Sri Lanka.
Auditors Tel: +94 11 230 4464/5, +94 11 230 4466
People’s Card Centre Fax: +94 11 230 4467
Auditor General
2nd Floor, No. 1161, Maradana Road, PLC Email: [email protected]
Auditor General’s Department,
National Audit Office, Building, Colombo 8, Sri Lanka.
Tel: +94 11 249 0490/+94 11 249 0400 People’s Micro-Commerce Ltd.
No. 306/72, Polduwa Road,
Battaramulla, Sri Lanka. Fax: +94 11 216 9023 No. 1161, Maradana Road, Borella,
Email: [email protected] Colombo 8, Sri Lanka.
Board Secretary Tel: +94 11 281 7654/5, +94 11 289 0990
Subsidiaries of People’s Bank Fax: +94 11 281 7653
Ms Shyama Wijekoon,
People’s Travels (Pvt) Ltd. Email: [email protected]
Attorney-at-Law PGEDBM (IBSL)
Email: [email protected] No. 59, D R Wijewardena Mawatha,
People’s Leasing Havelock
Colombo 10, Sri Lanka.
Properties Ltd.
Corporate Banking Division Tel.: +94 11 247 0190, +94 11 239 6296
Fax: +94 11 243 4530 No. 1161, Maradana Road, Borella,
People’s Bank, 11th Floor, Colombo 8, Sri Lanka.
Email: [email protected]
Head Office Building, No. 75, Tel: +94 11 263 1631
Web: www.peoplestravels.com
Sir Chittampalam A Gardiner Mawatha, Fax: +94 11 263 1596
Tel: +9411 248 1662, +9411 471 3460, Lankan Alliance Finance Limited
+94 11 471 3427 No. 1161, Maradana Road, Borella,
Colombo 8, Sri Lanka. Level 10, Laila Tower,
+94 11 248 1481 (ext. 1181)
Tel: +94 11 263 1631 No. 8, South Gulshan Avenue,
Fax: +94 11 244 6410
Fax: +94 11 263 1000 Dhaka, 1212, Bangladesh
Email: [email protected],
Email: [email protected] Tel: +8802 984 0411-12
[email protected]
Web: www.plc.lk
Off-shore Banking Unit
People’s Bank, 11th Floor, Head Office
Building, No. 75,
Sir Chittampalam A Gardiner Mawatha,
Tel: +94 11 220 6745-7, +94 11 220 6731
Fax: +94 11 232 9575/+94 11 247 3340
Email: [email protected]
SWIFT: PSBKLKLX

Peoples Bank Annual Report 2022 1

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Peoples Bank Annual Report 2022 1

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CREATING A LEGACY OF CARING FOR

3 About our Integrated Report

75 Corporate Banking 210 Statement of Comprehensive

36 Executive Management 115 Business Partner Capital

38 Chief Managers 120 Investor Capital

199 Board Investment Banking 364 Glossary of Financial/

ABOUT OUR INTEGRATED REPORT

We have the pleasure of presenting SCOPE AND BOUNDARY VALUE CREATION

Financial Reporting Non-Financial

The following six capitals are

Social and relationship Capital

People’s Bank Investor Capital

About our integrated Report

CLASSIFICATION OF OUR REPORT

Transparency Accountability Governance Sustainability

About our integrated Report

Aspect Internal assurance External assurance

THE EVOLUTION OF OUR INTEGRATED ANNUAL REPORT

KEY AWARDS AND RECOGNITIONS FOR THE 2021 ANNUAL REPORT

About our integrated Report

You can access the video from

ABOUT REFLECTIONS DRIVING MANAGEMENT DISCUSSION GOVERNANCE FINANCIAL SUPPLEMENTARY

12 / Highlights of the Year

People’s Bank is the largest financial

FROM THE TOP

Number of Branches Staff Strength

Ownership 75% 99%

Leasing and Hire Purchases Inbound Travel

Profit after tax Profit after tax

Number of Branches 111 2

Staff Strength 3,062 15

1961 to 1969 1980 to 1989 2000 to 2009

FROM THE TOP

funding facility secured by any

HIGHLIGHTS OF THE YEAR

2022 2021 Change 2022 2021 Change

Operating performance (LKR Bn.)

Net interest income 75.8 82.5 -8.1 91.0 96.9 -6.0

Gross income 357.2 207.2 72.4 391.2 236.8 65.2

Profit before tax 21.3 30.4 -29.8 26.7 37.2 -28.3

Income tax 4.1 6.7 -37.8 6.2 9.2 -32.7

Profit after tax 17.2 23.7 -27.5 20.5 28.1 -26.9

Retained profit 16.5 21.5 -23.2 19.7 25.7 -23.6

Financial position (LKR Bn.)

Total deposits 2,371.5 2,071.5 14.5 2,450.1 2,168.7 13.0

Shareholders’ funds 145.3 136.1 6.8 189.3 177.6 6.6

Performance ratios (%)

Return on equity (after tax) 12.2 19.9 11.2 17.7

Interest margin 2.7 3.4 3.1 3.7

Cost to income ratio 50.4 51.1 53.1 53.3

Loans to deposits ratio 80.8 93.5 84.1 97.0

Assets quality ratios (%)

Impairment (Stage 3) to Stage 3 loans ratio 29.9 50.2 30.5 46.9

Statutory liquid assets ratio (%)

Off-shore banking unit 20.1 25.9

Liquidity coverage ratio (%)

Liquidity coverage ratio – all currency 119.5 105.7

Regulatory capital ratios (%)

Shareholder ratios (LKR)

Highlights of the year

FROM THE TOP

NON-FUNDED INCOME PROFIT BEFORE TAX

COST TO INCOME RATIO TOTAL CAPITAL RATIO