Total net profits of commercial banks up by around 14 percent

KATHMANDU, AUGUST 5: All 20 commercial banks have published their unaudited financial statements for the last fiscal year by Monday. Their total net profits in 2023/24 stood at NPR 64.15 billion. This amount is more by NPR 7.8 billion i.e. 13.40 percent compared to 2022/23.

As per the statistics, the net profits of 10 have increased while that of 10 have decreased. 

Among the banks seeing a rise in their net profits last year, Prabhu Bank stands at the top. The bank had made a net profit of NPR 280.2 million in the previous year, but it jumped by 1,499 percent to NPR 4.48 billion last year.

This colossal increase is attributed to the rise in net interest income and the reduction in impairment charges. The bank's net interest income, which had stood at NPR 10.06 billion the previous year,  was NPR 12.02 billion last year. The impairment charge had been NPR 5.21 billion the previous year, but it declined to NPR 556.8 million last year.

The other nine banks posting a rise in their respective net profits are Kumari, Prime Commercial, Agriculture Development, Himalayan, Nepal Investment Mega, Laxmi Sunrise, Nabil, Everest, and Nepal SBI.

Kumari's net profit increased by 345.67% to NPR 2.3 billion, Prime Commercial's by 267.19% to NPR 3.77 billion, Agriculture Development's by 176.23% to NPR 3.65 billion, Himalayan Bank's by 81.60% to NPR 2.83 billion, and Nepal Investment Mega Bank's by 39.71% to NPR 5.19 billion

Likewise, Laxmi Sunrise Bank's net profit went up by 32.79% to NPR 3.03 percent, Nabil Bank's by 10.23% to NPR 7.06 billion, Everest Bank's by 10.07% to NRR 3.7 billion, and Nepal SBI Bank's by 2.35% to Rs 2.01 billion

When it comes to the 10 banks witnessing a decline in their net profit, NIC Asia Bank tops the chart. Its net profit plummeted by 68.91 percent to NPR 1.38 billion last year compared to the previous year.

The significant plunge in net profit of the bank last year was due to the reduction in net interest income and the increase in impairment charges. It had NPR 12.25 billion in net interest income in 2022/23 but earned only NPR 10.61 billion in 2023/24. The impairment charge had been recorded at NPR 721.9 million the previous year, but it increased to NPR 2.84 billion last year.

Similarly, Nepal Bank's net profit decreased by 51.80% to NPR 1.65 billion, Citizens Bank's by 27.97% to NPR 1.34 billion, NMB Bank's by 27.49% to NPR 2.33 billion, Machhapuchchhre Bank's by 23.09% to NPR 1.25 billion, and Global IME Bank's by 10.13% to NPR 6.01 billion.

Similarly, Sanima Bank's net profit decreased by 8.59% to NPR 2.38 billion, Rastriya Banijya Bank's by 5.48% to NPR 3.39 billion, Siddhartha Bank's by 4.78% to NPR 3.01 billion, and Standard Chartered Bank's by 4.51% to NPR 3.3 billion.

The primary reasons for the fluctuations in net profit appear to be related to impairment charges and net interest income.