Softlogic Finance PLC Charts ‘Pathway to Progress’ with Strong FY 2025/26 Annual Report
Colombo, Sri Lanka – August 31, 2026 – Softlogic Finance PLC, a prominent player in Sri Lanka’s Non-Bank Financial Institutions (NBFI) sector, today announced the release of its Annual Report for the financial year ended March 31, 2026. Titled “Pathway to Progress,” the report underscores a period of significant transformation, resilience, and strategic repositioning, positioning the company for sustained long-term growth and enhanced stakeholder value.
The report highlights the company’s successful navigation through a volatile economic landscape and internal recalibrations, emerging “stronger, sharper and leaner.” It signals a confident shift towards consolidating strengths, expanding its vision, and aggressively capturing market opportunities to generate sustainable value for all stakeholders, including shareholders, customers, partners, and communities.
Financial Resilience and Growth Drivers
Softlogic Finance PLC recorded a net profit after tax of Rs. 150 Million for FY 2025/26, reflecting a 3.7% increase from the previous year, despite operational and lending restrictions being in effect for the first half of the financial year. A significant driver of this performance was a remarkable 34.1% year-on-year growth in Net Interest Income, reaching Rs. 402 Million, propelled by lower funding costs and high-margin gold loan disbursements.
The company’s Gold Loan portfolio demonstrated exceptional momentum, growing by 75.5% to Rs. 3.2 Billion. This strategic focus on asset-backed, high-yield, small-ticket-size lending proved instrumental in maintaining income generation during the period of regulatory limitations.
Fortified Balance Sheet and Capital Adequacy
A hallmark of the reported period is the significant strengthening of the company’s balance sheet and capital position. The strategic transfer of a distressed loan portfolio to a Special Purpose Vehicle (SPV), totaling approximately Rs. 1.8 Billion across multiple tranches, drastically improved asset quality. Consequently, the Gross Non-Performing Loan (NPL) ratio saw a substantial reduction from 61.6% to 37.6%.
Furthermore, the company successfully restored its regulatory capital position through a meticulously executed capital enhancement initiative. As of March 31, 2026, both the Tier I Core Capital Ratio and the Total Capital Adequacy Ratio stood impressively at 61.0%, significantly exceeding regulatory minimum thresholds of 8.5% and 12.5% respectively. This robust capital base provides Softlogic Finance PLC with the financial strength and flexibility to pursue future expansion.
The company also undertook a strategic reduction of its stated capital in December 2025, from Rs. 9.9 Billion to Rs. 2.3 Billion, by offsetting accumulated retained losses. This structural cleanup has established a healthier equity structure, enhancing financial transparency and restoring the capacity for future dividend distribution.
Regulatory Restrictions Lifted, Full Operations Resume
A pivotal moment occurred on September 19, 2025, when the Central Bank of Sri Lanka (CBSL) officially lifted all regulatory restrictions previously imposed on Softlogic Finance PLC. This followed the company’s full compliance with CBSL’s regulatory minimum core capital requirements, enabling the immediate resumption of new customer deposits and full-scale leasing operations across its island-wide branch network.
Operational Excellence and Digital Transformation
Softlogic Finance PLC continues to drive operational efficiency and customer engagement through a multi-pronged approach. The company is refining its operations to harness internal efficiencies, deploying enhanced risk control frameworks, and strengthening collections and recoveries processes. Investments in digital transformation are actively underway, with a focus on technology-enabled financial solutions, seamless customer interactions, and improved accessibility.
ESG Integration and Human Capital Development
The company’s commitment to Environmental, Social, and Governance (ESG) principles was evident through initiatives like its investment in a Wildlife Rehabilitation Project. Substantial investments were also made in human capital development, with over 6,500 training hours delivered, fostering a meritocratic culture and offering opportunities for professional growth across its 253-strong workforce.
Pathway to Progress: The Future Outlook
Looking ahead, Softlogic Finance PLC’s strategic trajectory is firmly set on disciplined growth, operational efficiency, and risk governance. Key pillars include accelerating asset-backed lending, diversifying funding, optimizing liquidity management, driving digital transformation, and deepening ESG integration. The company aims to further strengthen its market position, expand its branch network strategically, and continue investing in its human capital to sustain long-term growth and value creation for all stakeholders.
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