Net profit of 30 commercial banks grew by 9.37 per cent in the fourth quarter of last fiscal ended mid-July, as against 40 per cent in the same period the previous year, shows the latest unaudited financial reports of commercial banks.
Profit growth rate plunged in the final quarter of last fiscal, as Grand Bank incurred a net loss of Rs 1.61 billion in the last fiscal and Kist Bank booked a net loss of Rs 240.61 million. Also, Agricultural Development Bank, Janata Bank, Bank of Kathmandu and Sunrise Bank could not meet profit registered in fiscal 2012-13.
Overall, net profit of commercial banks stood at Rs 20.79 billion in the last fiscal as against Rs 19.01 billion in the previous fiscal.
Nabil Bank, one of the oldest private sector-led commercial banks, led the pack of highest profit earners in the last fiscal, with its net profit standing at Rs 2.32 billion, up 4.55 per cent than in the previous fiscal. Close on the heels was Nepal Investment Bank Ltd (NIBL), which booked a net profit of Rs 1.95 billion, marking an increment of 1.87 per cent from the same period of 2012-13.
While Nabil’s earning went up on the back of higher interest income, NIBL saw moderate increment in its profit due to lower allocation of funds for loan loss provision and reduction in extraordinary expenses, unaudited balance sheets of the two institutions show.
Among others in the league table of top profit earners were: state-owned Rastriya Banijya Bank, which booked a net profit of Rs 1.73 billion, up 32.30 per cent than in the same period the previous fiscal year; Everest Bank, which recorded net earnings of Rs 1.55 billion — a rise of 5.34 per cent than in the same period the previous fiscal; and Agricultural Development Bank, which earned a net profit of Rs 1.51 billion, down 34.06 per cent than in the same period a year ago.
Although profit of most of the major players in the banking sector went up moderately, few institutions, whose health had started faltering in the past, appear to have consolidated their financial position.
Among such institutions is Machhapuchchhre Bank, whose net profit soared by 203.31 per cent to Rs 450.71 million in last fiscal. Its earnings jumped due to higher interest income and lower allocation of funds for possible losses, meaning not many loans extended by it turned sour in the last fiscal. The level of bad debt at the bank stood at 1.78 per cent of the credit portfolio in mid-July, as against 2.84 per cent recorded in the same period a year ago.
Global IME Bank was another class ‘A’ institution which saw massive growth in its profit. The profit of the bank, which successfully merged with Commerz and Trust Bank, surged by 124.27 per cent to Rs 1.01 billion in the last fiscal.
source: the himalayan times,20 august 2014
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