First Business News Portal in English from Nepal
KATHMANDU: Despite prolonged liquidity crisis and the slowdown in economic activities in the country, the profits of commercial banks have increased notably in the last fiscal year. Although business of banks was affected in the fourth quarter of last year, business expansion of banks in the first, second and third quarter of the last fiscal year had a positive impact on the profits of the banks.
The unaudited financial statements published by commercial banks shows that their profits have increased by 23.14 percent in the fourth quarter of the last fiscal year. In the last fiscal year 2021-22, commercial banks recorded a net profit of Rs 74.80 billion whereas, in the previous fiscal year 2020-21, commercial banks had recorded a net profit of Rs 60.74 billion.
Though financial statements of some banks are negative, the overall profit of commercial bank is however positive. “Due to the practice of paying installments and interest amount at the end of the fiscal year in order to improve the relationship with the banks, the financial statements of the banks are seeing better,” said a banker.
Similarly, in the fourth quarter of last fiscal year, it was easy to keep the financial statement positive as banks stopped investment and focused on recovery. The banker further said that interest income, return of funds for risk management, etc. also contributed to increase the profit.
Last year, Rastriya Banijya Bank earned the highest profit of Rs 5.21 billion. Similarly, Global IME Bank made a profit of Rs 5.2 billion, Nabil Bank Rs 4.97 billion rupees, NIC Asia 4.52 billion rupees and Nepal Investment Bank 4.8 billion rupees.
Century Commercial Bank recorded the lowest profit worth Rs 1.35 billion in the last fiscal year. Similarly, Civil Bank has booked a profit of Rs 1.38 billion, Laxmi Bank Rs 1.6 billion, Nepal SBI Bank Rs 1.63 billion and Bank of Kathmandu Rs 1.81 billion.
However, the profit growth rate of Century Bank and Civil Bank is the highest. Compared to the previous fiscal year, the profit of Century Bank has increased by 162 percent and that of Civil Bank by 115 percent.
Last year, the profit of Agriculture Development Bank, Himalayan Bnak and Sanima Bank has decreased. While the profit of Agriculture Development Bank has decreased by 26 percent, Himalayan Bank by 17 percent and Sanima Bank by 1 percent.
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