Technical Analysis of Sana Kisan Bikas Bank

 Sana Kisan Bikas bank, as an apex microfinance bank emerged in July 2001 has been  incorporated under the Company Act and licensed under the Bank and Financial Institutions Act (BAFIA) 2006 as a “D” class bank.

Sana kisan Bank aims to provide wholesale credit along with the technical support services mainly to the Small Farmers Agriculture Cooperatives Ltd. (SFACLs) and similar types. Currently, this bank has started providing wholesale credit to other cooperatives and Microfinance institutions (MFIs) too in order to expedite access to microfinance services for the low income people especially living in hills and mountains of the country.

Bank has the vision to be a leading, financially viable, microfinance wholesale bank, owned by SFACLs and similar rural MFIs, to substantially improve the quality of life of the rural poor.

Bank has the values ofbusiness and financial viability, political neutrality, committed to serve the rural poor, quality services to the customer and transparency in policies and operations

Bank has taken objectives to provide wholesale credit to small farmers agriculture cooperative ltd (sfacls) and micro-finance institutions (MFIS) for lending to low income households, monitor and supervise client MFIS′ activities to ascertain adherence to prudential and non-prudential regulations, provide technical assistance for institutional strengthening and capacity building, pool resources from the government and donors for social mobilization and community development activities through client MFIS, undertake replication program to expand microfinance services to the underserved and unserved areas, especially in the hills and mountains; targeting women, dalits, madhesis, janjatis, indigenous groups and other backward communities, provide technical and financial support to client MFIS to expand their business to potential microfinance clients.

Mr. Khem Bahadur Pathak is leading the bank as a chairman of the Board of Directors whereas Mr. Jalan Kumar Sharma is serving as chief executive officer.

In the total of 34 Micro finance Development Bank till 2070/71; Sana Kisan Bikas Bank has been awarded 'NEWBIZ BUSINESS CONCLAVE AND AWARD 2014' as the best managed Microfinance Company.

Capital Structure and Reserve fund: In the FY 2070/71, bank had paid up capital of Rs. 260.6 million which has been continued in the FY 2071/72 also because in the FY 2070/71, bank didn't distribute dividend. Likewise, in the current year 2072/73, paid up capital of Rs. 260.6 million is standstill.

Similarly, Reserve fund of the bank had been amounted to Rs. 615.9 million in the FY 2070/71 which increased by 27.37% to Rs. 784.5 million in the FY 2071/72. In the current FY, reserve of the bank has increased to Rs. 816.4 million.

Investment and loan advancement: In the FY 2070/71 and FY 2071/72, bank has invested Rs. 201 million. Bank invested Rs. 5 billion 305.8 million in loan advances in FY 2070/71 which increased by 52.60% to Rs. 8 billion 96.7 million in the FY 2071/72.

 Similarly, in the current FY 2072/73, investment amount has totaled up to Rs. 201 million while loan advance has amounted to Rs. 8 billion 221.6 million.

Net interest income and operating profit:  Bank had earned net interest income of Rs. 230.8 million in the FY 2070/71 which grew by 55.65% to Rs. 359.2 million in the FY 2071/72. Similarly, bank earned operating profit of Rs. 164 million in FY 2070/71 which boosted by 46% to Rs. 239.4 million in the FY 2071/72.

In the first quarter of current FY 2072/73, net interest income has decreased to Rs. 107 million and operating profit has decreased to Rs. 76.4 million.

Net profit: in the FY 2070/71, net profit of bank was Rs. 114 million whereas in the FY 2071/72, it increased by 34.93% to Rs. 153.9 million. In the first quarter of current FY 2072/73, net profit of the bank is amounted to Rs. 48.8 million.

Earning per share and P/E ratio:  Earning per share shows the earning of a unit of share in a year. If we look at EPS of the bank for last five years, EPS in the FYA 2071/72 is highest with Rs. 66.73. In the first quarter of current FY 2072/73, earning per share has heightened to Rs. 84.73.

Similarly, P/E ratio in the FY 2070/71 was recorded 27.58 times which decreased to 23.11 times in the FY 2071/72. Similarly, in the current FY 2072/73, it has further diminished to 22.13 times.

Following table shows the financial position of the bank in last five years.