Lombard Bank Malta and its subsidiary registered a record pre-tax profit of Lm1.66 million for the six months ended June 30, an improvement of six per cent on the Lm1.56 million recorded for the same period in 2005.

The bank's unaudited accounts were approved by the board of directors yesterday.

The bank said that profit after tax attributable to shareholders reached Lm1.07 million, an increase of six per cent over the Lm1.01 million earned during the corresponding 2005 period.

Net interest income grew by 16 per cent over the same period last year and contributed Lm2.43 million to the total operating income, which increased by 15 per cent over the previous year, to reach Lm2.84 million.

The cost to income ratio, the bank said, improved to 38.4 per cent from last year's 42.7 per cent. Administrative expenses were up by three per cent to Lm1.04 million from last year's Lm1.01 million.

Credit risk continued to be assessed consistent with a prudent policy resulting in a net increase of Lm96,000 to the impairment provisions.

Customer deposits were at Lm161.04 million last June, down from Lm165.75 million in December 2005, while total assets stood at Lm185.37 million, down from Lm188.03 million.

The bank said that loans and advances to customers at Lm86.09 million were up by nine per cent over last December 31.

Shareholders' funds rose by Lm1.06 million to Lm17.68 million during the period while earnings per share rose from 12c2 in 2005 to 12c7 - when accounting for the two-for-one share split held in April.

The record profit, the bank said, was in line with expectations and underlined improved operating profits and efficient cost-to-income ratios.

The selective business approach adopted by the bank increased shareholder value and provided opportunities for further business expansion.