Twenty-eight commercial banks have reported a 13.99 percent rise in cumulative net profit to Rs 3.37 billion in the first quarter of the current fiscal year.
The banks had registered a net profit of Rs 3.31 billion during the same period last fiscal. Out of 28 banks, 25 registered profit while three banks incurred losses. A total of 19 banks witnessed rise in profit while the rest either had decline or loss in their profit.
According to quarterly figures, Nepal Investment Bank (NIBL) topped the chart with a net profit of Rs 462.61 million. The bank’s profit, however, fell 3.08 percent compared to the corresponding period last year when it logged a profit of Rs 477.36 million.
Nabil Bank, the second highest grosser, also witnessed a comedown on its profit which fell 22.25 percent to Rs 457.89 million as compared to the same period last year. Everest Bank with a profit of Rs 351.09 million, Standard Chartered
(Rs 334.20 million) and Agriculture Development Bank (Rs 259.27 million) complete the top five.
Himayalan Bank CEO Ashoke Rana lamented the bank’s failure to lend adequately despite huge liquidity as a reason for its decline in profit. “The investors stayed in wait-and-watch mode until Tuesday’s election,” he said. “Limited lending resulted in reduced interest income hitting the bank’s profit.”
However with adequate liquidity in the market, he said that there is a room for the new government to spearhead the economy.
Three commercial banks—Kist Bank and Janata Bank and Commerz and Trust Bank have reported a loss in the first quarter. While Kist Bank has incurred a loss of Rs 27.44 million, Janata posted a loss of 59.82 million, followed by Commerz and Trust which posted Rs 12.66 million in loss.
“We were in uncertainty for a long time after the bank’s managing director stepped down. It was reflected on the balance sheet,” said BN Gharti, acting CEO of Kist Bank.
He said that the bank had failed to collect interest as expected because of the major festivals—Dashain and Tihar. However, Gharti sounded optimistic of a turnaround in the bank’s fortunes.
“We are in the positive direction as the bank has already posted a profit of 12.5 million if we take into account the date until mid-November. We’re confident that the bank’s second quarter result will be much better,” he said, dismissing suggestions that the loss was due to the bank’s exposure to the real estate loans. “We have already cut down our the exposure to the sector to just 12 percent,” he claimed.
During the first quarter, banks’ deposits rose modesty but their lending remained meagre. Amid lower demand of loans, lending grew by just 1.88 percent to Rs 573.1 billion while the growth in deposits remained at 22.48 percent to Rs 934.3 billion.
However, the central bank has defended the gap in deposit and credit growth as a normal phenomenon. “Usually banks increase deposits first and increase credit after mid-December,” said Bhaskar Mani Gnawali, spokesperson for Nepal Rastra Bank. “The second quarters report will show growth in lending.”
Source: ekantipur, 19 Nov 2013
The banks had registered a net profit of Rs 3.31 billion during the same period last fiscal. Out of 28 banks, 25 registered profit while three banks incurred losses. A total of 19 banks witnessed rise in profit while the rest either had decline or loss in their profit.
According to quarterly figures, Nepal Investment Bank (NIBL) topped the chart with a net profit of Rs 462.61 million. The bank’s profit, however, fell 3.08 percent compared to the corresponding period last year when it logged a profit of Rs 477.36 million.
Nabil Bank, the second highest grosser, also witnessed a comedown on its profit which fell 22.25 percent to Rs 457.89 million as compared to the same period last year. Everest Bank with a profit of Rs 351.09 million, Standard Chartered
(Rs 334.20 million) and Agriculture Development Bank (Rs 259.27 million) complete the top five.
Himayalan Bank CEO Ashoke Rana lamented the bank’s failure to lend adequately despite huge liquidity as a reason for its decline in profit. “The investors stayed in wait-and-watch mode until Tuesday’s election,” he said. “Limited lending resulted in reduced interest income hitting the bank’s profit.”
However with adequate liquidity in the market, he said that there is a room for the new government to spearhead the economy.
Three commercial banks—Kist Bank and Janata Bank and Commerz and Trust Bank have reported a loss in the first quarter. While Kist Bank has incurred a loss of Rs 27.44 million, Janata posted a loss of 59.82 million, followed by Commerz and Trust which posted Rs 12.66 million in loss.
“We were in uncertainty for a long time after the bank’s managing director stepped down. It was reflected on the balance sheet,” said BN Gharti, acting CEO of Kist Bank.
He said that the bank had failed to collect interest as expected because of the major festivals—Dashain and Tihar. However, Gharti sounded optimistic of a turnaround in the bank’s fortunes.
“We are in the positive direction as the bank has already posted a profit of 12.5 million if we take into account the date until mid-November. We’re confident that the bank’s second quarter result will be much better,” he said, dismissing suggestions that the loss was due to the bank’s exposure to the real estate loans. “We have already cut down our the exposure to the sector to just 12 percent,” he claimed.
During the first quarter, banks’ deposits rose modesty but their lending remained meagre. Amid lower demand of loans, lending grew by just 1.88 percent to Rs 573.1 billion while the growth in deposits remained at 22.48 percent to Rs 934.3 billion.
However, the central bank has defended the gap in deposit and credit growth as a normal phenomenon. “Usually banks increase deposits first and increase credit after mid-December,” said Bhaskar Mani Gnawali, spokesperson for Nepal Rastra Bank. “The second quarters report will show growth in lending.”
Source: ekantipur, 19 Nov 2013
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